Document:

hrtg-ex1016_337.htm

Exhibit 10.16

 

Heritage Insurance Holdings, Inc.

Restricted Stock Award Agreement

This Restricted Stock Award Agreement (the “Agreement”) is entered into as of February 12, 2018 (the “Award Date”) between Heritage Insurance Holdings, Inc. (the “Company”) and Timothy Moura (the “Participant”). Any term capitalized but not defined in the Agreement shall have the meaning set forth in the Heritage Insurance Holdings, Inc. Omnibus Incentive Plan, as may be amended from time to time (the “Plan”).

The Plan provides that the Administrator may grant restricted stock to employees, directors, and independent contractors of the Company or its Affiliates.  In the Administrator’s exercise of discretion under the Plan, the Administrator has determined that the Participant should receive a restricted stock award under the Plan and, accordingly, the Company and the Participant hereby agree as follows:

Grant

.  The Company hereby grants to the Participant a restricted stock award (the “RS Award”) of 50,000 shares of Stock (the “Award Shares’).  The RS Award shall be subject to the terms and conditions of the Plan and the Agreement.

Stock Certificates

.  The Company may, but shall not be required to, issue certificates for the Award Shares in the Participant’s name, in which event the Company (or its designee) shall hold the certificates until the Award Shares either are forfeited or become vested.

Rights as Shareholder

.  On and after the Award Date, and except to the extent provided in Section 9, the Participant may exercise full voting rights with respect to the Award Shares and the Participant will be entitled to receive dividends on Award Shares if and when dividends are payable on Stock to shareholders of record after the Award Date.  If the Participant forfeits any rights he/she may have under the RS Award in accordance with Section 4, the Participant shall, on the day following the event of forfeiture:  (i) cease to have any rights as a shareholder with respect to the Award Shares or any interest therein and, including rights to any dividends on such stock and (ii) Participant shall repay to the Company any dividends that were paid on any forfeited Award Shares.  Neither unvested shares of Award Shares, nor the right to vote such shares and receive dividends thereon, may be sold, assigned, transferred, exchanged, pledged, hypothecated or otherwise encumbered; provided, however, that the Participant may grant to another person a revocable proxy to vote unvested shares of Award Shares at a Company stockholder meeting.

Vesting; Effect of Termination of Employment

.  The Participant’s Award Shares shall vest:

	
 
	
•
	
January 1, 2019 - 20%,

	
 
	
•
	
January 1, 2020 - 20%,

	
 
	
•
	
January 1, 2021 - 20%,

	
 
	
•
	
January 1, 2022 - 20%, and

	
 
	
•
	
January 1, 2023 - 20%,

 

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Exhibit 10.16

 

provided the Participant remains continuously employed by, or in service as an employee of, the Company or its Affiliates until each such respective date.  If the application of this Section would result in the Participant vesting in a fraction of a share, such fractional share shall be rounded up to the next whole share.

If Participant ceases to be continuously employed as an employee for any reason and before all of his/her Award Shares have become vested under the Agreement, the Participant’s Award Shares that have not become vested as of the effective date of the termination shall be immediately forfeited, in which case neither the Company nor any Affiliate shall have any further obligations under this Agreement with respect to such forfeited shares.  Notwithstanding the previous sentence, if the Participant’s employment is terminated by the Company without cause, the Participant’s Award Shares that have not become vested as of the effective date of the termination shall become immediately vested on that date.  If the Company undergoes a change in control and the Participant remains employed by the successor entity, the dollar value of the Participant’s unvested Award Shares as of the date of such change in control shall be held in escrow and distributed to the Participant according to the vesting schedule outlined under this section of the Agreement.  If the Participant’s employment is terminated as a result of the change in control, the Participant’s Award Shares that have not become vested as of the effective date of termination shall become immediately vested on that date.

Terms and Conditions of Distribution

.  The Company shall distribute certificates for Award Shares as soon as practicable after they become vested.  If the Participant dies before the Company has distributed all vested Award Shares, the Company shall distribute certificates for the vested Award Shares to the beneficiary or beneficiaries the Participant designated, in the proportions the Participant specified.  If the Participant failed to designate a beneficiary or beneficiaries, the Company shall distribute certificates for the vested Award Shares to the Participant’s estate.  The Company shall distribute certificates for the vested Award Shares no later than six months after the Participant’s death.

Notwithstanding the foregoing, the Company shall not distribute the certificates for the Award Shares until the Participant has paid to the Company or an Affiliate the amount required to be withheld for federal, state or local taxes.  The Participant may satisfy the required withholding amount by directing that the Company use for this purpose a portion of the Award Shares that would otherwise be distributed to him/her.

Legend on Stock Certificates

.  The Company may require that certificates for Award Shares distributed to the Participant pursuant to the Agreement bear any legend that counsel to the Company believes is necessary or desirable to facilitate compliance with applicable securities laws.

Delivery of Certificates

.  Notwithstanding the provisions of Sections 4 and 5, the Company is not required to issue or deliver any certificates for Award Shares before completing the steps necessary to comply with applicable federal and state securities laws (including any registration requirements) and applicable stock exchange rules and practices.  The Company shall use commercially reasonable efforts to cause compliance with those laws, rules and practices.

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Exhibit 10.16

 

The Company shall not make any distribution of certificates before the first date the Award Shares may be distributed to the Participant without penalty or forfeiture under federal or state laws or regulations governing short swing trading of securities.  In determining whether a distribution would result in such a penalty or forfeiture, the Administrator may rely upon information reasonably available to them or upon representations of the Participant’s legal or personal representative.

No Right to Employment

.  Nothing in the Plan or the Agreement shall be construed as creating any right in the Participant to continued employment or service, or as altering or amending the existing terms and conditions of the Participant’s employment or service.

Nontransferability

.  No interest of the Participant or any beneficiary in or under the Agreement shall be assignable or transferable by voluntary or involuntary act or by operation of law, other than by shall or by the laws of descent and distribution, or pursuant to a domestic relations order (as defined in section 414(p)) of the Code).  Distribution of Award Shares shall be made only to the Participant; or, if the Administrator has been provided with evidence acceptable to it that the Participant is legally incompetent, the Participant’s guardian or legal representative; or, if the Participant is deceased, to the beneficiaries that the Participant has designated in the manner required by the Administrator or, in the absence of a designated beneficiary, to the Participant’s estate.  The Administrator may, in its discretion, require a Participant’s guardian or legal representative to supply it with evidence the Administrator deems necessary to establish the authority of the guardian or legal representative to act on behalf of the Participant.  Any effort to assign or transfer the rights under the Agreement shall be wholly ineffective, and shall be grounds for termination by the Administrator of all rights of the Participant and his/her beneficiary in and under the Agreement.

Administration

.  The Administrator administers the Plan.  The Participant’s rights under the Agreement are expressly subject to the terms and conditions of the Plan, including required shareholder approval thereof, and to any guidelines the Administrator adopts from time to time.  The Participant hereby acknowledges receipt of a copy of the Plan.

Dispute Resolution and Arbitration

.  In the event of any dispute or claim relating to or arising out of the terms and conditions of the Plan and the Agreement (including, without limitation, any claims of breach of contract, wrongful termination or age, sex, race or other discrimination), Participant and the Company agree that all such disputes shall be fully and finally resolved by binding arbitration conducted by the American Arbitration Association in Pinellas County, Florida in accordance with its National Employment Dispute Resolution rules, as those rules are currently in effect (and not as they may be modified in the future).  Participant acknowledges that by accepting this arbitration provision he is waiving any right to a jury trial in the event of such dispute.  Notwithstanding the foregoing, this arbitration provision shall not apply to any disputes or claims relating to or arising out of the misuse or misappropriation of trade secrets or proprietary information.

Choice of Law

.  The Agreement shall be governed by and construed in accordance with the laws of the State of Delaware, without regard to any choice of law or conflict of laws rules, provisions or principles (whether of the State of Delaware or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Delaware.

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Exhibit 10.16

 

Sole Agreement

.  The RS Award is in all respects subject to the provisions set forth in the Plan to the same extent and with the same effect as if set forth fully herein.  In the event that the terms of the RS Award conflict with the terms of the Plan, the Plan shall control.  The Agreement is the entire agreement between the parties to it, and any and all prior oral and written representations are merged in the Agreement.  The Agreement may be amended only by written agreement between the Participant and the Company.

Counterparts

.  The parties may execute the Agreement in one or more counterparts, all of which together shall constitute but one Agreement.

[signature page follows]

 

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Exhibit 10.16

 

IN WITNESS WHEREOF, the Company and the Participant have duly executed the Agreement as of the day and year first above written.

		
	
 
	
COMPANY:

Heritage Insurance Holdings, Inc.

By:/s/ Bruce Lucas

Bruce Lucas

Board Chairman and Chief Executive Officer

PARTICIPANT:

/s/ Timothy Moura

Timothy Moura

 

Page 5 of 5hrtg-ex1017_653.htm

Exhibit 10.17

FIRST AMENDMENT TO CREDIT AGREEMENT

 

This FIRST AMENDMENT TO CREDIT AGREEMENT, dated as of May 17, 2019 (this “Amendment”), to the Credit Agreement referenced below is entered into by and among HERITAGE INSURANCE HOLDINGS, INC., a Delaware corporation (the “Borrower”), the Guarantors, the Lenders party hereto, and Regions Bank, in its capacity as Administrative Agent (the “Administrative Agent”). All capitalized terms used herein and not otherwise defined herein shall have the meanings ascribed to such terms in the Credit Agreement (as defined below).

RECITALS

WHEREAS, the Borrower, the Guarantors, the Lenders and Regions Bank, as Administrative Agent and Collateral Agent, entered into that certain Credit Agreement, dated as of December 14, 2018 (as amended, modified, supplemented, increased, extended, restated, refinanced and/or replaced from time to time, the “Credit Agreement”); and

WHEREAS, the Credit Parties and the Administrative Agent desire to correct the technical omission in the Credit Agreement identified in Section 3 below;

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

1.Introductory Paragraph; Recitals. The above introductory paragraph and recitals (including any terms defined therein) of this Amendment are incorporated herein by reference as if fully set forth in the body of this Amendment.

2.Definitions. All capitalized terms used herein and not otherwise defined herein shall have the meanings ascribed to such terms in the Credit Agreement.

3.Technical Amendment to Credit Agreement. Pursuant to sub-clause (C) of Section 11.4(c) of the Credit Agreement, Section 2.6(c) of the Credit Agreement is hereby amended to correct a technical omission by inserting the text “, and ending with the close of the Fiscal Quarter ending September 30, 2023, with the outstanding principal balance of the Term Loan A payable in full on the Term Loan A Maturity Date” immediately after the text “unless accelerated sooner pursuant to Section 9” and prior to the period at the end of such sub-clause.

4.Condition Precedent. This Amendment shall be effective upon receipt by the Administrative Agent of counterparts of this Amendment duly executed by the Borrower, the Administrative Agent and the Collateral Agent.

5.Miscellaneous.

(a)This Amendment shall be deemed to be, and is, a Credit Document.

(b)The Borrower (on behalf of itself and the other Credit Parties) (i) acknowledges and consents to all of the terms and conditions of this Amendment, (ii) agrees that, except as expressly set forth herein, this Amendment, and all documents executed in connection herewith, do not operate to reduce or discharge its obligations under the Credit Agreement or the other Credit Documents, or any certificates, documents, agreements and instruments executed in connection therewith, (iii) affirms all of its obligations under the Credit Documents, (iv) agrees that this Amendment shall in no manner impair or otherwise adversely affect any of the Liens granted in, or pursuant to, the Credit Documents, and (v) affirms that each of the Liens granted in or pursuant to the Credit Documents are valid and subsisting.

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(c)The Borrower (on behalf of itself and the other Credit Parties) hereby represents and warrants to the Administrative Agent and the Lenders as follows:

(i)the Borrower and each other Credit Party has taken all necessary action to authorize the execution, delivery and performance of this Amendment;

(ii)this Amendment has been duly executed and delivered by the Borrower and each other Credit Party and constitutes each such Credit Party’s legal, valid and binding obligations, enforceable in accordance with its terms, except as such enforceability may be subject to (A) bankruptcy, insolvency, reorganization, fraudulent conveyance or transfer, moratorium or similar Laws affecting creditors’ rights generally, and (B) general principles of equity (regardless of whether such enforceability is considered in a proceeding at law or in equity); and

(iii)no consent, approval, authorization or order of, or filing, registration or qualification with, any court or governmental authority or third party is required in connection with the execution, delivery or performance by the Borrower of this Amendment.

(d)This Amendment may be executed in counterparts (and by different parties hereto in different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. Delivery of an executed counterpart of a signature page of this Amendment by telecopy or other electronic imaging means (e.g., “pdf” or “tif” format) shall be effective as delivery of a manually executed counterpart of this Amendment.

(e)THIS AMENDMENT AND ANY CLAIMS, CONTROVERSY, DISPUTE OR CAUSE OF ACTION (WHETHER IN CONTRACT OR TORT OR OTHERWISE) BASED UPON, ARISING OUT OF, OR RELATING TO THIS AMENDMENT SHALL BE CONSTRUED IN ACCORDANCE WITH, AND BE GOVERNED BY, THE LAW OF THE STATE OF NEW YORK.

[Signature Pages Follow]

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

	
BORROWER:
	
HERITAGE INSURANCE HOLDINGS, INC.,

a Delaware corporation

	
 
	
By:  /s/ Kirk Lusk
	

Name:Kirk Lusk

Title:Chief Financial Officer

	
Guarantors: 
	
CONTRACTORS ALLIANCE NETWORK, LLC,

a Florida limited liability company

	
 
	
By:  /s/ Kirk Lusk
	

Name:Kirk Lusk

Title:Chief Financial Officer

FIRST ACCESS INSURANCE GROUP, LLC,

a Florida limited liability company

	
 
	
By:  /s/ Kirk Lusk
	

Name:Kirk Lusk

Title:Chief Financial Officer

HERITAGE INSURANCE CLAIMS, LLC,

a Florida limited liability company

	
 
	
By:  /s/ Kirk Lusk
	

Name:Kirk Lusk

Title:Chief Financial Officer

HERITAGE MGA, LLC,

a Florida limited liability company

	
 
	
By:  /s/ Kirk Lusk
	

Name:Kirk Lusk

Title:Chief Financial Officer

[Signature Pages Continue]

Signature Page to First Amendment to Credit Agreement (Heritage Insurance Holdings, Inc.)

 

NBIC FINANCIAL HOLDINGS, INC.,

a Delaware corporation

	
 
	
By:  /s/ Kirk Lusk
	

Name:Kirk Lusk

Title:Chief Financial Officer

NBIC HOLDINGS, INC.,

a Delaware corporation

	
 
	
By:  /s/ Kirk Lusk
	

Name:Kirk Lusk

Title:Chief Financial Officer

NBIC SERVICE COMPANY, INC.,

a Rhode Island corporation

	
 
	
By:  /s/ Kirk Lusk
	

Name:Kirk Lusk

Title:Chief Financial Officer

SKYE LANE PROPERTIES, LLC,

a Florida limited liability company

	
 
	
By:  /s/ Kirk Lusk
	

Name:Kirk Lusk

Title:Chief Financial Officer

ZEPHYR ACQUISITION COMPANY,

a Delaware corporation

	
 
	
By:  /s/ Kirk Lusk
	

Name:Kirk Lusk

Title:Chief Financial Officer

[Signature Pages Continue]

 

Signature Page to First Amendment to Credit Agreement (Heritage Insurance Holdings, Inc.)

 

HI Holdings, INc.,

a Hawaii corporation

	
 
	
By:  /s/ Bruce Lucas
	

Name:Bruce Lucas

Title:Chief Executive Officer

[Signature Pages Continue]

Signature Page to First Amendment to Credit Agreement (Heritage Insurance Holdings, Inc.)

 

ADMINISTRATIVEREGIONS BANK,

	
AGENT:
	
as Administrative Agent and Collateral Agent

By: /s/ Andrew Staszesky

Name:Andrew Staszesky

Title:Vice President

Signature Page to First Amendment to Credit Agreement (Heritage Insurance Holdings, Inc.)

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