Document:

Exhibit 10.1

 

January 1, 2022

 

Maureen Hewitt

mhewitt@myinnovage.com

 

Re:     Separation
Letter Agreement

 

Dear Maureen:

 

This letter agreement (this
 “Letter Agreement”) confirms our understanding regarding your resignation from employment with InnovAge Holding Corp.
(“InnovAge”) and its subsidiaries and affiliates (together with InnovAge, the “Company”). Except
as otherwise provided herein, initially capitalized terms used but not otherwise defined herein shall have the meanings ascribed to such
terms in that certain Employment Agreement, by and between you and TCO Acquisition Corporation, dated October 30, 2015 (the “Employment
Agreement”).

 

1.          Separation
Overview. This Letter Agreement confirms that your last day of employment with the Company and
your employment separation date will be January 1, 2022 (the “Separation Date”). Effective as of the Separation
Date, you will be deemed to have resigned from all of your positions at the Company, without any further action required therefor (collectively,
the “Resignations”). InnovAge, on its own behalf and on behalf of its subsidiaries and affiliates, hereby accepts the
Resignations as of the Separation Date, and you agree to execute any additional documentation as the Company may reasonably request to
effectuate the foregoing. The Separation Date will be the termination date of your employment for purposes of active participation in
and coverage under all benefit plans and programs sponsored by or through the Company. The Company shall pay any accrued but unpaid wages
and an amount in respect of any accrued but unused paid time off, in each case, in a lump sum, less all applicable deductions and withholdings,
on the Separation Date.

 

2.            Separation
Benefits. In consideration for your compliance with paragraphs 4 and 5 hereof, and subject to
your compliance therewith, the Company will pay to you (i) an amount equal to Two Million Six Hundred Seventy-Seven Thousand One
Hundred Forty-Seven Dollars and Twenty Cents ($2,677,147.20), which represents the sum of (x) twenty-four (24) months of your Base
Salary and (y) an amount equal to one and one-half (1.5) times your Annual Bonus at the target amount, in substantially equal installments
over the twenty-four (24)-month period immediately following the Separation Date, in accordance with the Company’s regular payroll
practices; (ii) a pro-rata portion of your Annual Bonus (if any) earned for the year in which termination occurs, based on your actual
performance through the date of such termination and determined in accordance with Section 4(b) of the Employment Agreement,
to be paid at the time that annual bonuses for the 2022 fiscal year are paid by the Company generally; and (iii) the reimbursement
of your reasonable legal fees incurred in connection with the review and negotiation of this Agreement and any other agreement ancillary
to your separation from the Company, up to $20,000 in the aggregate. In addition, as further consideration for your compliance with paragraphs
4 and 5 hereof, and subject to your compliance therewith, the Company also will pay your monthly health insurance premiums, subject to
your timely electing to continue your coverage (and, if applicable, the coverage of your eligible dependents) in the Company’s group
health plans under the federal law commonly known as “COBRA” or similar state law, until the earliest to occur of (a) twenty-four
(24) months following the Separation Date, (b) the date on which you cease to be eligible for such COBRA coverage under applicable
law or plan terms and (c) the date you become eligible for health insurance coverage through a subsequent employer or otherwise (the
 “COBRA Premiums”). The payments set forth in this paragraph 2 are hereinafter referred to as the “Separation
Benefits” and are in full consideration of any payments or benefits due to you under the Employment Agreement. Payment of the
Separation Benefits shall commence on the first payroll date immediately following the expiration of sixty (60) calendar days from the
Separation Date, with the first payment to include all amounts that otherwise would have been payable prior thereto absent the delay.
Notwithstanding the foregoing, in the event that the Company’s payment of the COBRA Premiums would subject the Company to any tax
or penalty under Section 105(h) of the Internal Revenue Code of 1986, as amended, the Patient Protection and Affordable Care
Act, as amended, any regulations or guidance issued thereunder, or any other applicable law, in each case, as determined by the Company,
then you and the Company agree to work together in good faith to restructure such benefit.

 

    	 	 	 

     

    

 

3.          No
Other Compensation or Benefits. You acknowledge that, except (a) as expressly provided in
this Letter Agreement, (b) as otherwise specifically provided under any employee benefit plan of the Company, or (c) as otherwise
required by applicable law, you will not receive any additional compensation, bonus, severance or other benefits of any kind or of any
amount following the Separation Date.

 

4.            Release.
The Separation Benefits contemplated by paragraph 2 hereof will only be due and payable, and the 496,536.78 vested Class B Units
of TCO Group Holdings, L.P. (“Holdings”) that you hold pursuant to that certain Class B Unit Award Agreement (the
 “Award Agreement”) evidencing an award granted to you on September 22, 2020 (the “Vested Class B
Units”) will only remain outstanding following the Separation Date, if, within sixty (60) days following the Separation Date,
you deliver to InnovAge the executed general release of claims in the form attached on Exhibit A hereto (the “Release”),
and the Release becomes effective and non-revocable in accordance with its terms during such sixty (60)-day period. The Release creates
legally binding obligations, and the Company hereby advises you to consult an attorney before you sign the Release.

 

5.            Restrictive
Covenants; Survival.

 

(a)            You
hereby (i) reaffirm your obligations under the following arrangements (collectively, the “Restrictive Covenants”):
(A) Sections 7, 8 and 9 of the Employment Agreement and (B) Section 4 of the Award Agreement, and (ii) understand,
acknowledge and agree that the Restrictive Covenants will survive your termination of employment with the Company and remain in full force
and effect in accordance with all of the terms and conditions thereof. If, during such time that you are receiving the Separation Benefits
or while your Vested Class B Units remain outstanding, you breach any of the Restrictive Covenants, your right to receive any Separation
Benefits shall immediately cease and be forfeited, and you shall immediately repay to the Company any Separation Benefits previously paid
to you.

 

    	 	2	 

     

    

 

(b)           18
U.S.C. § 1833(b) provides: “An individual shall not be held criminally or civilly liable under any Federal or State trade
secret law for the disclosure of a trade secret that—(A) is made—(i) in confidence to a Federal, State, or local
government official, either directly or indirectly, or to an attorney; and (ii) solely for the purpose of reporting or investigating
a suspected violation of law; or (B) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing
is made under seal.” Nothing in this Letter Agreement is intended to conflict with 18 U.S.C. § 1833(b) or create liability
for disclosures of trade secrets that are expressly allowed by 18 U.S.C. § 1833(b). Accordingly, the parties to this Letter Agreement
have the right to disclose in confidence trade secrets to federal, state and local government officials, or to an attorney, for the sole
purpose of reporting or investigating a suspected violation of law. The parties also have the right to disclose trade secrets in a document
filed in a lawsuit or other proceeding, but only if the filing is made under seal and protected from public disclosure.

 

(c)            Notwithstanding
anything to the contrary contained herein, no provision of this Letter Agreement shall be interpreted so as to impede you (or any other
individual) from reporting possible violations of federal law or regulation to any governmental agency or entity, including, but not limited
to, the Department of Justice, the Securities and Exchange Commission, the Congress and any agency Inspector General, or making other
disclosures under the whistleblower provisions of federal law or regulation. You do not need the prior authorization of the Company to
make any such reports or disclosures and you shall not be required to notify the Company that such reports or disclosures have been made.

 

6.            Cooperation.
You agree that you will assist and cooperate with the Company in connection with the defense or prosecution of any claim that may be made
against or by the Company, or in connection with any ongoing or future investigation or dispute or claim of any kind involving the Company,
including any proceeding before any arbitral, administrative, judicial, legislative, or other body or agency (each, a “Claim”),
including testifying truthfully in any proceeding to the extent such claims, investigations or proceedings relate to services performed
or required to be performed by you, pertinent knowledge possessed by you, or any act or omission by you. You further agree to perform
all acts upon reasonable notice and at reasonable times and to execute and deliver any documents that may be reasonably necessary to carry
out the provisions of this paragraph . You understand and agree that to the maximum extent permitted by law and applicable evidentiary
rules and privileges, you will treat your communications with the Company’s legal counsel pursuant to this cooperation obligation
as strictly confidential and privileged from disclosure. Similarly, to the maximum extent permitted by law and applicable evidentiary
rules and privileges, the Company shall treat all of its communications with your legal counsel pursuant to this cooperation obligation
as strictly confidential and privileged from disclosure. The Company will (a) reimburse you for reasonable and documented expenses
incurred in connection with such cooperation and assistance (including the payment and advancement of your reasonable legal fees), subject
to and in accordance with Section 13 of the Employment Agreement; and (b) use best efforts to minimize any disruption to your
activities, including work for any future employer(s). It is expressly understood that the reimbursement of expenses pursuant to this
paragraph is meant to minimize any inconvenience and out of pocket losses you would otherwise incur, and is in no way intended to influence
any testimony and/or other assistance you may provide. At all times, the Company expects and requires that your cooperation and assistance,
including any testimony, be completely truthful and honest. For the avoidance of doubt, nothing in this Letter Agreement shall (i) be
deemed a waiver, limitation, revocation or retraction of any right you may have under applicable statutory or common law, Company by-law,
certificate of incorporation or other governing documents or insurance policy to indemnification or advancement, including but not limited
to any right you have to indemnification and/or advancement for legal fees and costs, or any other losses or expenses or (ii) affect
your rights to indemnification and/or the reimbursement of any expenses incurred by you (including reasonable attorneys’ fees) as
set forth in Section 13 of the Employment Agreement, which shall remain in full force and effect in accordance with their respective
terms.

 

    	 	3	 

     

    

 

7.            Return
of Company Property. On or as soon as reasonably practicable following the Separation Date,
you shall promptly return, to the Company, originals or copies of any and all materials, documents, notes, manuals or lists containing
or embodying confidential information, or relating directly or indirectly to the business of the Company, and all other property of the
Company, then in your possession or control.

 

8.           Non-Disparagement.
Subject to paragraph 5 of the Release, you agree that you will never disparage or criticize the
Company, or its business, management, products or services, and that you will not otherwise do or say anything that could disrupt the
good morale of employees of the Company or harm the interests or reputation of the Company. InnovAge will direct its senior officers and
directors as of the Separation Date not to make or cause to be made any statements that disparage or criticize you or your reputation.
Notwithstanding the foregoing, nothing herein shall prevent either you or any of InnovAge’s senior officers or directors from testifying
truthfully in any legal or administrative proceeding where such testimony is compelled or requested, or from otherwise complying with
applicable legal requirements.

 

In connection with your resignation, InnovAge
will issue a press release in the form attached as Exhibit B and an internal communication in the form of Exhibit C.
Any communication by you or InnovAge, either internally or externally, shall be materially consistent with those Exhibits.

 

9.            Governing
Law & Forum. This Letter Agreement, the rights and obligations of the parties hereto,
and any claims or disputes relating thereto shall be governed by and construed in accordance with Section 23 of the Employment Agreement
and you hereby submit to the exclusive jurisdiction of the courts in and of the State of Colorado in connection with any such claim or
dispute; provided, that, for the avoidance of doubt, any disputes with regard to the Award Agreement will be determined in accordance
with the governing provisions of the Award Agreement.

 

10.            Tax
Matters. The Company may withhold from any and all amounts payable under this Letter Agreement
such federal, state, local or foreign taxes as may be required to be withheld pursuant to any applicable law or regulation. The intent
of the parties is that the payments contemplated under this Letter Agreement be either compliant with, or exempt from, Section 409A
of the Internal Revenue Code of 1986, as amended, and the regulations and guidance promulgated thereunder (“Code Section 409A”),
and accordingly, to the maximum extent permitted, this Letter Agreement will be interpreted to be in compliance therewith or exempt therefrom.
You and the Company hereby agree that your termination of employment and the Separation Date will constitute a “separation from
service” within the meaning of Code Section 409A. Additionally, Section 5(g) of the Employment Agreement will apply
mutatis mutandis to this Letter Agreement.

 

    	 	4	 

     

    

 

11.          Entire
Agreement. Except as otherwise expressly provided herein, this Letter Agreement (inclusive of
Exhibit A attached hereto) constitutes the entire agreement between you and the Company with respect to the subject matter
hereof and supersedes any and all prior agreements or understandings between you and the Company with respect to your employment or termination
of employment, whether written or oral (including, without limitation, the Employment Agreement; provided, that, (a) Sections
5(g) and 6 through 23 of the Employment Agreement and (b) the Holdings’ Equity Incentive Plan, the Award Agreement and
Holdings’ Amended and Restated Agreement of Limited Partnership, dated as of July 27, 2021 will survive the Separation Date
and remain in full force and effect in accordance with their terms (and Section 5(g) of the Employment Agreement shall apply
mutatis mutandis to this Letter Agreement). This Letter Agreement will bind the heirs, personal representatives, successors and
assigns of you and the Company and inure to the benefit of you and the Company, and your and their respective heirs, successors and assigns;
provided, that, you may not assign your rights or obligations hereunder. This Letter Agreement may be amended or modified only
by a written instrument executed by you and the Company.

 

12.        Counterparts &
Signatures. This Letter Agreement may be executed in counterparts, each of which shall be deemed
an original, and together any counterparts shall constitute one and the same instrument. Additionally, the parties agree that electronic
reproductions of signatures (i.e., scanned PDF versions of original signatures, facsimile transmissions, and the like) shall be
treated as original signatures for purposes of execution of this Letter Agreement.

 

[SIGNATURES ON FOLLOWING PAGE]

 

    	 	5	 

     

    

 

If this Letter Agreement accurately
reflects your understanding as to the terms and conditions of your separation from employment with the Company, please sign one copy of
this Letter Agreement in the space provided below and return the same for the Company’s records.

 

	 	Very truly yours,
	 	 
	 	INNOVAGE HOLDING CORP.
	 	 
	 	By:	/s/ Andrew Cavanna
	 	 
	 	Name:	Andrew Cavanna
	 	 
	 	Title:	Chairman

 

EXECUTIVE ACKNOWLEDGMENT

 

The above terms and conditions
accurately reflect our understanding regarding the terms and conditions of my separation from employment with the Company, and I hereby
confirm my agreement to the same.

 

	Dated:
    January 2, 2022	/s/ Maureen Hewitt
	 	Maureen
    Hewitt

 

Separation Letter Agreement Signature Page

 

    	 	 	 

     

    

 

EXHIBIT A

 

GENERAL RELEASE

 

I,
Maureen Hewitt, in consideration of and subject to the performance by InnovAge Holding Corp. (“InnovAge”)
and its subsidiaries and affiliates (together with InnovAge, the “Company”), of their obligations under the Separation
Letter Agreement, dated as of January 1, 2022 (the “Letter Agreement”), do hereby release and forever discharge
as of the date hereof the Company and all present and former managers, directors, officers, agents, representatives, employees, successors
and assigns of the Company and its direct and indirect owners (collectively, the “Released Parties”) to the extent
provided below.

 

		1.	I understand that any payments or benefits paid or granted to me under paragraph 2 of the Letter Agreement
represent, in part, consideration for signing this General Release and are not salary, wages or benefits to which I was already entitled.
I understand and agree that I will not receive the payments and benefits specified in paragraph 2 of the Letter Agreement (i) unless
I execute this Release of Claims (the “General Release”) and do not revoke this General Release within the time period
permitted hereafter or (ii) if I breach this General Release. For the avoidance of doubt, I acknowledge and agree that, if,
during such time that I am receiving the Separation Benefits (as defined in the Letter Agreement) or while my Vested Class B Units
(as defined in the Letter Agreement) remain outstanding, I breach any of the Restrictive Covenants (as defined in the Letter Agreement),
my right to receive any Separation Benefits shall immediately cease and be forfeited, and I shall immediately repay to the Company any
Separation Benefits previously paid to me. Such payments and benefits will not be considered compensation for purposes of any employee
benefit plan, program, policy or arrangement maintained or hereafter established by the Company. In signing this General Release, I
also acknowledge and represent that I have received all payments and benefits that I am otherwise entitled to receive (as of the date
hereof) by virtue of my employment with the Company, including pay for all work I have performed for the Company through the date
hereof (to the extent not previously paid) and pay, at my final base rate of pay, for any vacation time I earned but have not used as
of the date hereof.

 

		2.	Except as provided in paragraphs 4,
and 8 below and except for the provisions of the Letter Agreement and the Employment Agreement (as defined in the Agreement)
which expressly survive the termination of my employment with the Company as specified in the Letter Agreement, I knowingly and voluntarily
(for myself, my heirs, executors, administrators, beneficiaries, representatives, successors and assigns, and all others connected with
or claiming through me) release and forever discharge the Released Parties from any and all claims, suits, controversies, actions,
causes of action, rights and claims, cross-claims, counter-claims, demands, debts, compensatory damages, liquidated damages, punitive
or exemplary damages, other damages and compensation, claims for costs and attorneys’ fees, or liabilities of any kind and nature
whatsoever, whether in law or in equity, both past and present, (through the date I sign this General Release) and whether now known
or unknown, suspected or unsuspected, contingent, claimed or otherwise, which I now have or ever have had against any of the Released
Parties in any way related to, arising out of or connected with my employment and/or other relationship with, or my separation or termination
from, the Company, or pursuant to the Letter Agreement or Employment Agreement or Title VII of the Civil Rights Act of 1964, as amended;
the Civil Rights Act of 1991; the Age Discrimination in Employment Act of 1967, as amended (including the Older Workers Benefit
Protection Act); the Equal Pay Act of 1963, as amended; the Americans with Disabilities Act of 1990; the Family and Medical
Leave Act of 1993; the Worker Adjustment Retraining and Notification Act; the Employee Retirement Income Security Act of 1974;
the Fair Labor Standards Act; or their state or local counterparts; the wage and hour and fair employment practices law of the state or
states in which I have provided services to the Company (each as amended from time to time) or under any other federal, state or local
civil or human rights law, or under any other local, state, or federal law, regulation or ordinance; or under any public policy, contract
or tort, or under common law; or arising under any policies, practices or procedures of the Company; or any claim for wrongful discharge,
breach of contract, infliction of emotional distress, defamation; or any claim for costs, fees, or other expenses, including attorneys’
fees incurred in these matters (all of the foregoing are collectively referred to herein as “Claims”), and
I hereby waive all such Claims. I understand that nothing contained in this General Release shall be construed to limit, restrict or in
any other way affect my communicating with any governmental agency or entity, or communicating with any official or staff person of a
governmental agency or entity, concerning non-privileged matters relevant to the governmental agency or entity.

 

    	 	A-1	 

     

    

 

		3.	I represent that I have made no assignment or transfer of any right, claim, demand, cause of action or
other matter covered by paragraph 2 above.

 

		4.	I agree that this General Release does not waive or release any rights or claims that I may have under
the Age Discrimination in Employment Act of 1967 which arise after the date I execute this General Release. This General Release
also does not waive any Claims for any vested pension benefits (if any), or for indemnification under the Employment Agreement or the
Company’s D&O Policy, by-laws, certificate of incorporation or other governing documents, or rights arising after the date hereof
as an equity holder or under any equity based award.

 

		5.	Except as provided in paragraphs 4 and 8, I agree that I am waiving
all rights to sue or obtain equitable, remedial or punitive relief from any or all Released Parties of any kind whatsoever, including,
without limitation, reinstatement, back pay, front pay, attorneys’ fees and any form of injunctive relief. Notwithstanding the above, I
further acknowledge that I am not waiving and am not being required to waive any right (i) as set forth in paragraphs 4 and 8 or
(ii) that cannot be waived under law, including the right to file an administrative charge or participate in an administrative investigation
or proceeding conducted by the federal Equal Employment Opportunity Commission or a comparable state or local agency; provided,
however that I disclaim and waive any right to share or participate in any monetary award resulting from the prosecution of such
charge or investigation or proceeding, filed by me or by anyone else on my behalf.

 

		6.	I expressly consent that this General Release shall be given full force and effect according to each and
all of its express terms and provisions, including those relating to unknown and unsuspected Claims (notwithstanding any state statute
that expressly limits the effectiveness of a general release of unknown, unsuspected and unanticipated Claims), if any, as well as those
relating to any other Claims hereinabove mentioned or implied. Without limiting the foregoing, I expressly waive and relinquish all
rights and benefits provided by Section 1542 of the Civil Code of the State of California, and do so understanding and acknowledging
the significance of such specific waiver of Section 1542, which section states as follows:

 

A general release does not extend to
claims that the creditor or releasing party does not know or suspect to exist in his or her favor at the time of executing the release
and that, if known by him or her, would have materially affected his or her settlement with the debtor or released party.

 

    	 	A-2	 

     

    

 

Thus, notwithstanding the provisions
of Section 1542, and for the purpose of implementing a full and complete release and discharge of the Released Parties, I expressly
acknowledge that the general release and waiver of claims set forth in this General Release is intended to include in its effect, without
limitation, all Claims which I do not know or suspect to exist in my favor at the time I sign it, and that this General Release. contemplates
the extinguishment of any and all such Claims. I acknowledge and agree that this waiver is an essential and material term of this General
Release and that without such waiver the Company would not have agreed to the terms of the Letter Agreement. I further agree that in the
event I should bring a Claim seeking damages against the Company and/or any other Released Party, or in the event I should seek to recover
against the Company and/or any other Released Party in any Claim brought by a governmental agency on my behalf, this General Release shall
serve as a complete defense to such Claims.  I further agree that I am not aware of any pending charge or complaint of the type described
in paragraph 2 above as of the execution of this General Release.

 

		7.	I agree that neither this General Release, nor the furnishing of the consideration for this General Release,
shall be deemed or construed at any time to be an admission by the Company, any Released Party or myself of any improper or unlawful conduct.
Rather, this General Release expresses the intention of the parties to resolve all issues and other claims related to or arising out of
my employment by and termination from the Company.

 

		8.	Notwithstanding anything in this General Release to the contrary, this General Release shall not relinquish,
diminish, or in any way affect (i) any rights or claims arising out of any breach by the Company or by any Released Party of the
Letter Agreement after the date hereof or (ii) any rights or claims that cannot be waived by law.

 

		9.	Whenever possible, each provision of this General Release shall be interpreted in such manner as to be
effective and valid under applicable law, but if any provision of this General Release is held to be invalid, illegal or unenforceable
in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability shall not affect
any other provision or its validity and enforceability in any other jurisdiction, but this General Release shall be reformed, construed
and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision had never been contained herein.

 

    	 	A-3	 

     

    

 

BY SIGNING THIS GENERAL RELEASE, I
REPRESENT AND AGREE THAT:

 

		1.	I HAVE READ IT CAREFULLY;

 

		2.	I UNDERSTAND ALL OF ITS TERMS AND KNOW THAT I AM GIVING UP IMPORTANT RIGHTS, INCLUDING BUT NOT LIMITED
TO, RIGHTS UNDER THE AGE DISCRIMINATION IN EMPLOYMENT ACT OF 1967, AS AMENDED, TITLE VII OF THE CIVIL RIGHTS ACT OF 1964, AS
AMENDED; THE EQUAL PAY ACT OF 1963, THE AMERICANS WITH DISABILITIES ACT OF 1990; AND THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974, AS AMENDED;

 

		3.	I VOLUNTARILY CONSENT TO EVERYTHING IN IT;

 

		4.	I HAVE BEEN ADVISED TO CONSULT WITH AN ATTORNEY BEFORE EXECUTING IT AND I HAVE DONE SO OR, AFTER CAREFUL
READING AND CONSIDERATION, I HAVE CHOSEN NOT TO DO SO OF MY OWN VOLITION;

 

		5.	I ACKNOWLEDGE I MAY NOT SIGN THIS GENERAL RELEASE BEFORE THE DATE MY EMPLOYMENT WITH THE COMPANY
TERMINATES;

 

		6.	I HAVE BEEN GIVEN ALL TIME PERIODS REQUIRED BY LAW TO CONSIDER THIS GENERAL RELEASE (INCLUDING, BUT NOT
LIMITED TO, THE TIME PERIODS REQUIRED UNDER THE AGE DISCRIMINATION AND EMPLOYMENT ACT, AS AMENDED) ;

 

		7.	I HAVE HAD AT LEAST TWENTY-ONE (21) DAYS FROM THE DATE OF MY RECEIPT OF THIS GENERAL RELEASE TO CONSIDER
IT;

 

		8.	I UNDERSTAND THAT I HAVE SEVEN (7) DAYS AFTER THE EXECUTION OF THIS RELEASE TO REVOKE IT (AND IF
I INTEND TO REVOKE MY SIGNATURE I MUST DO SO IN WRITING ADDRESSED AND DELIVERED TO THE CHIEF LEGAL OFFICER AT THE COMPANY PRIOR TO THE
END OF THE SEVEN (7)-DAY REVOCATION PERIOD) AND THAT THIS RELEASE SHALL NOT BECOME EFFECTIVE OR ENFORCEABLE UNTIL THE REVOCATION PERIOD
HAS EXPIRED, PROVIDED I HAVE NOT REVOKED MY ACCEPTANCE;

 

		9.	I HAVE SIGNED THIS GENERAL RELEASE KNOWINGLY AND VOLUNTARILY, WITH A FULL UNDERSTANDING OF ITS TERMS AND
WITH THE ADVICE OF ANY COUNSEL RETAINED TO ADVISE ME WITH RESPECT TO IT;

 

		10.	I HAVE NOT RELIED ON ANY PROMISES OR REPRESENTATIVES, EXPRESS OR IMPLIED, THAT ARE NOT SET FORTH EXPRESSLY
IN THIS GENERAL RELEASE; AND

 

		11.	I AGREE THAT THE PROVISIONS OF THIS GENERAL RELEASE MAY NOT BE AMENDED, WAIVED, CHANGED OR MODIFIED
EXCEPT BY AN INSTRUMENT IN WRITING SIGNED BY AN AUTHORIZED REPRESENTATIVE OF THE COMPANY AND BY ME.

 

[DO NOT SIGN BEFORE THE SEPARATION DATE.]

 

    	 	A-4	 

     

    

 

	DATE:
    January 2, 2022	/s/ Maureen Hewitt
	 	Maureen
    Hewitt

 

    	 	A-5EX-4.1

 Exhibit 4.1 

Final 
 ABRAXAS PETROLEUM
CORPORATION 
 CERTIFICATE OF DESIGNATION 

OF 
 SERIES A PREFERRED
STOCK 
 (Par Value $0.01 Per Share) 

Abraxas Petroleum Corporation, a Nevada corporation (the “Corporation”), hereby certifies that, pursuant to the
authority expressly granted to and vested in the Board (as defined below) by the Articles of Incorporation of the Corporation (as heretofore amended and as further amended from time to time, the “Articles of Incorporation”),
which authorizes the Board, by resolution, to set forth the designation, powers, preferences and relative, participating, optional and other special rights, if any, and the qualifications, limitations and restrictions thereof, in one or more series
of up to 1,000,000 shares of preferred stock, par value $0.01 per share (the “Preferred Stock”), and in accordance with the provisions of Nevada Revised Statutes (“NRS”) 78.1955, the Board has duly
adopted the following resolution, which resolution remains in full force and effect on the date hereof: 
 RESOLVED, that pursuant to
the authority granted to and vested in it, the Board hereby creates a new series consisting of 685,505 shares of Preferred Stock, designated as Series A Preferred Stock, and hereby fixes the powers, preferences and relative, participating, optional
and other special rights, if any, and the qualifications, limitations and restrictions thereof, of such series of Preferred Stock as set forth in this certificate of designation (this “Certificate of Designation”): 

1. General. 
 (a) There shall be
created from the 1,000,000 shares of Preferred Stock of the Corporation authorized to be issued pursuant to the Articles of Incorporation, a series of Preferred Stock designated as “Series A Preferred Stock” par value $0.01 per share (the
“Series A Preferred Stock”), and the authorized number of shares of Series A Preferred Stock shall be 685,505. Shares of Series A Preferred Stock that are converted, purchased or otherwise acquired by the Corporation shall be
automatically cancelled and shall revert to authorized but unissued shares of Series A Preferred Stock, without any action of the Board required, and shall be available for future designation and re-issuance.

 (b) The Series A Preferred Stock, with respect to dividend and distribution rights and rights upon the liquidation, winding-up or dissolution or any other Insolvency or Liquidation Proceeding of the Corporation, ranks: (i) senior to all Junior Stock; (ii) on a parity with all Parity Stock; (iii) junior to all
Senior Stock; and (iv) junior to existing and future indebtedness and liabilities of the Corporation. 
 2. Definitions. As used herein,
the following terms shall have the following meanings: 
 (a) “Accreted Preference Amount” shall mean, with respect to each
share of Series A Preferred Stock, an amount equal to the sum of (a) the Initial Preference Amount with respect to such share of Series A Preferred Stock plus (b) an amount equal to a 6.0% per annum return on such Initial Preference
Amount, compounding quarterly on March 31, June 30, September 30 and December 31 of each year, commencing on March 31, 2022, which amount shall accumulate and accrue on a day-to-day basis from the Initial Issue Date until the applicable date of distribution pursuant to Section 3(a)(ii). 

 

 (b) “Articles of Incorporation” shall have the meaning specified in the
preamble. 
 (c) “Bankruptcy Code” means Title 11 of the United States Code, as amended or any similar federal or state law
for the relief of debtors. 
 (d) “Bankruptcy Law” means the Bankruptcy Code and any other federal, state or foreign law for
the relief of debtors, or any arrangement, reorganization, insolvency, moratorium, assignment for the benefit of creditors, any other marshalling of the assets or liabilities of the Corporation, or similar law affecting creditors’ rights
generally. 
 (e) “Board” shall mean the Board of Directors of the Corporation or, with respect to any action to be taken by
the Board of Directors, any committee of the Board of Directors duly authorized to take such action. 
 (f) “Business Day”
shall mean any day other than Saturday, Sunday or a day on which the Federal Reserve Bank of New York or banks in the State of Nevada are authorized or required by law or executive order to close or be closed. 

(g) “Capital Stock” shall mean, for any entity, any and all shares, equity interests, rights to purchase, warrants, options,
equity participations or other equity equivalents of or equity interests in (however designated) capital stock issued by that entity. 
 (h)
“Certificate of Designation” shall have the meaning specified in the preamble. 
 (i) “Common Stock” means
the Common Stock, par value $0.01 per share, of the Corporation. 
 (j) “Corporation” shall have the meaning specified in
the preamble. 
 (k) “Deemed Liquidation Event” means: 

(i) a merger or consolidation in which (x) the Corporation is a constituent party or (y) a subsidiary of the Corporation is a
constituent party and the Corporation issues shares of its capital stock pursuant to such merger or consolidation; or 
 (ii) the sale,
lease, transfer, exclusive license or other disposition, in a single transaction or series of related transactions, by the Corporation or any subsidiary of the Corporation of all or substantially all the assets of the Corporation and its
subsidiaries taken as a whole or (2) the sale or disposition (whether by merger, consolidation or otherwise, and whether in a single transaction or a series of related transactions) of one (1) or more subsidiaries of the Corporation if
substantially all of the assets of the Corporation and its subsidiaries taken as a whole are held by such subsidiary or subsidiaries, except where such sale, lease, transfer, exclusive license or other disposition is to a wholly owned subsidiary of
the Corporation. 
 (l) “Holder” shall mean a holder of shares of Series A Preferred Stock. 

  
 2 

 (m) “Initial Holder” means AG Energy Funding, LLC, a Delaware limited
liability company. 
 (n) “Initial Issue Date” shall mean the first date of original issuance of a particular share of the
Series A Preferred Stock. 
 (o) “Initial Preference Amount” shall mean, with respect to each share of Series A Preferred
Stock, $200. 
 (p) “Insolvency or Liquidation Proceeding” shall mean: (a) any case commenced by or against the
Corporation under any Bankruptcy Law, any other proceeding for the reorganization, recapitalization or adjustment or marshalling of the assets or liabilities of the Corporation, any receivership or assignment for the benefit of creditors relating to
the Corporation or any similar case or proceeding relative to the Corporation, its creditors or its equity holders, as such, in each case whether or not voluntary; (b) any liquidation, dissolution, marshalling of assets or liabilities or other
winding up of or relating to the Corporation, in each case whether or not voluntary and whether or not involving bankruptcy or insolvency; or (c) any other proceeding of any type or nature in which substantially all claims of creditors of or
equity interests in the Corporation are determined and any payment or distribution is or may be made on account of such claims or interests. 

(q) “Junior Stock” shall mean (i) the Common Stock and (ii) each other class or series of the Corporation’s
Capital Stock established after the Initial Issue Date, the terms of which do not expressly provide that such class or series ranks senior to or on a parity with the Series A Preferred Stock as to dividend rights, redemption rights or distribution
rights upon the liquidation, winding-up or dissolution or other Insolvency or Liquidation Proceeding of the Corporation. 

(r) “Ownership Notice” shall mean the notice of ownership of Capital Stock of the Corporation containing the information
required to be set forth or stated on certificates pursuant to the NRS or other applicable law and, in the case of an issuance of Capital Stock by the Corporation (including the Series A Preferred Stock), in substantially the form attached hereto as
Exhibit A. 
 (s) “Parity Stock” shall mean any class or series of the Corporation’s Capital Stock established
after the Initial Issue Date, the terms of which expressly provide that such class or series will rank on parity with the Series A Preferred Stock as to dividend rights, redemption rights or distribution rights upon the liquidation, winding up or
dissolution or other Insolvency or Liquidation Proceeding of the Corporation. 
 (t) “Preferred Stock” shall have the
meaning specified in the preamble. 
 (u) “SEC” shall mean the Securities and Exchange Commission. 

(v) “Securities Act” shall mean the Securities Act of 1933, as amended. 

(w) “Exchange Agreement” shall mean that certain Exchange Agreement dated as of January 3, 2022 by and among the Initial
Holder and the Corporation. 

  
 3 

 (x) “Senior Stock” shall mean any class or series of the Corporation’s
Capital Stock established after the Initial Issue Date, the terms of which expressly provide that such class or series will rank senior to the Series A Preferred Stock as to dividend rights, redemption rights or distribution rights upon the
liquidation, winding up or dissolution of the Corporation. 
 (y) “Series A Preferred Stock” shall have the meaning
specified in Section 1(a). 
 (z) “Tier One Preference Amount” means, for each share of Series A
Preferred Stock, (i) $145.88, plus (ii) an amount equal to (A) (1) the aggregate amount of all capital contributions made by the Initial Holder following the Initial Issue Date pursuant to Section 1.1(b) of the Exchange
Agreement (2) multiplied by 1.5, divided by (B) the number of outstanding shares of Series A Preferred Stock. 
 (aa)
“Transfer Agent” shall mean American Stock Transfer & Trust Company, LLC, acting as the Corporation’s duly appointed transfer agent, registrar, redemption, conversion and dividend disbursing agent for the Series A
Preferred Stock. The Corporation may, in its sole discretion, remove the Transfer Agent with 10 days’ prior notice to the Transfer Agent and Holders; provided that the Corporation shall appoint a successor Transfer Agent who shall accept
such appointment prior to the effectiveness of such removal. 
 3. Distribution Priority; Liquidation, Dissolution or Winding Up; Deemed
Liquidation Events. 
 (a) From and after the Initial Issue Date, all dividends or distributions of any kind or character to the
Corporation’s stockholders (including in the event of any voluntary or involuntary liquidation, dissolution or winding up or other Insolvency or Liquidation Proceeding of the Corporation or Deemed Liquidation Event), shall be made in the
following manner: 
 (i) First, the holder of each share of Series A Preferred Stock then outstanding shall be entitled to be paid out
of the assets of the Corporation available for distribution to its stockholders (or any distribution in any Insolvency or Liquidation Proceeding) before any payment shall be made to the holders of any Junior Stock by reason of their ownership
thereof, an amount per share equal to the Tier One Preference Amount; 
 (ii) Second, (A) 95% to the holders of shares of Series A
Preferred Stock pro rata in proportion to the number of shares of Series A Preferred Stock held by them and (B) 5% to the holders of Junior Stock in accordance with the respective rights, preferences and privileges of such Junior Stock and pro rata
in proportion to the number of shares of Junior Stock held by each of them, until each share of Series A Preferred Stock has received an amount equal to its Accreted Preference Amount as of the applicable date of determination; and 

(iii) Thereafter, (A) 75% to the holders of shares of Series A Preferred Stock pro rata in proportion to the number of shares of Series
A Preferred Stock held by each of them and (B) 25% to the holders of Junior Stock in accordance with the respective rights, preferences and privileges of such Junior Stock and pro rata in proportion to the number of shares of Junior Stock held by
each of them. 

  
 4 

 (b) The Corporation shall not have the power to effect a Deemed Liquidation Event referred
to in clause (a) of the definition thereof unless the agreement or plan of merger or consolidation for such transaction (the “Merger Agreement”) provides that the consideration payable to the stockholders of the
Corporation in such Deemed Liquidation Event shall be allocated to the holders of capital stock of the Corporation in accordance with Section 3(a). The amount deemed paid or distributed to the holders of capital stock of
the Corporation in any such Deemed Liquidation Event shall be the cash or the value of the property, rights or securities to be paid or distributed to such holders pursuant to such Deemed Liquidation Event. 

(c) The value of any property, rights or securities (other than cash) that are distributed or deemed distributed to the holders of shares of
Series A Preferred Stock shall be determined in good faith by the Board of Directors of the Corporation, which determination shall be conclusive for all purposes under this Certificate of Designation. 

(d) In the event the assets of the Corporation available for distribution to the Holders upon any liquidation, winding up or dissolution or
other Insolvency or Liquidation Proceeding of the Corporation or in connection with any Deemed Liquidation Event, whether voluntary or involuntary, shall be insufficient to pay in full the Tier One Preference Amount of each share of Series A
Preferred Stock then outstanding, such Holders shall share, equally and ratably in proportion to the number of shares of Series A Preferred Stock held by them, in any such distribution of the assets of the Corporation. 

4. Dividends. The Corporation shall not declare, pay or set aside any dividends or distributions on shares of any class or series of capital
stock of the Corporation (other than dividends on shares of Common Stock payable in shares of Common Stock) other than in the order of priority for distributions to the holders of shares of capital stock of the Corporation set forth in
Section 3. 
 5. Voting; Other Rights. 

(a) Voting. 

(i) On any matter presented to the stockholders of the Corporation for their action or consideration at any meeting of
stockholders of the Corporation (or by written consent of stockholders in lieu of meeting), each holder of outstanding shares of Series A Preferred Stock shall be entitled to cast 69 votes for each share of Series A Preferred Stock held by such
holder as of the record date for determining stockholders entitled to vote on such matter. Except as provided by law (including the Bankruptcy Code) or by the other provisions of this Certificate of Designation, holders of Series A Preferred Stock
shall vote together with the holders of Common Stock as a single class. If the Corporation shall at any time or from time to time after the Initial Issue Date effect a subdivision or combination of the outstanding Common Stock or declare or dividend
on the Common Stock in shares of Common Stock, then the number of votes that may be exercised by each share of Series A Preferred Stock shall be proportionately adjusted such that any such subdivision, combination or Common Stock dividend does not
result in a change in the relative voting power of the Series A Preferred Stock as compared to the Common Stock. If the Corporation shall at any time or from time to time after the Initial Issue Date effect a

  
 5 

 
subdivision or combination of the outstanding Series A Preferred Stock, then the number of votes that may be exercised by each share of Series A Preferred Stock shall be proportionately adjusted
such that any such subdivision or combination does not result in a change in the relative voting power of the Series A Preferred Stock as compared to the Common Stock. 

(b) So long as any shares of Series A Preferred Stock remain outstanding, the Corporation shall not, and shall cause its subsidiaries not to,
without the affirmative vote or consent of the Holders of at least a majority in voting power of the shares of Series A Preferred Stock outstanding at the time, voting together as a separate class, given in person or by proxy, either in writing or
at a meeting (provided, however, that so long as the Initial Holder holds a majority of the issued and outstanding shares of Series A Preferred Stock, the Initial Holder may waive by written notice to the Corporation the requirement that the
Corporation seek consent of the holders of the Series A Preferred Stock pursuant to this Section 5(b) in respect of any matter set forth herein): 

(i) authorize or create, or increase the authorized amount of, or issue any class or series of Senior Stock or Parity Stock
(including the Series A Preferred Stock) or reclassify any of the authorized capital stock of the Corporation into shares of Senior Stock or Parity Stock (including the Series A Preferred Stock), or create, authorize or issue any obligation or
security convertible into or evidencing the right to purchase any shares of Senior Stock or Parity Stock (including the Series A Preferred Stock); 

(ii) amend, alter or repeal the provisions of the Articles of Incorporation or this Certificate of Designation, whether by
merger, consolidation or otherwise; 
 (iii) effect any Deemed Liquidation Event; 

(iv) take any action to commence any Insolvency or Liquidation Proceeding, or otherwise liquidate or dissolve the Corporation
or authorize, declare or initiate general assignments to creditors, file a voluntary bankruptcy petition, petition for liquidation or dissolution or consent to the appointment or appoint a trustee, receiver or liquidator of the Corporation or any of
its subsidiaries or consent to the commencement of any Insolvency or Liquidation Proceeding; or 
 (v) agree or commit to
take any of the foregoing actions. 
 6. Certificates; Transfers. 

(a) Uncertificated Shares. 

(i) Form. The shares of Series A Preferred Stock shall be in uncertificated, book entry form as permitted by the bylaws
of the Corporation and the NRS. Within a reasonable time after the issuance or transfer of uncertificated shares, the Corporation shall, or shall cause the Transfer Agent to, send to the registered owner thereof an Ownership Notice. 

  
 6 

 (ii) Transfer. Transfers of Series A Preferred Stock held in
uncertificated, book-entry form shall be made only upon the transfer books of the Corporation kept at an office of the Transfer Agent upon receipt of proper transfer instructions from the registered owner of such uncertificated shares, or from a
duly authorized attorney or from an individual presenting proper evidence of succession, assignment or authority to transfer the stock. The Corporation may refuse any requested transfer until furnished evidence reasonably satisfactory to it that
such transfer is made in accordance with the terms of this Certificate of Designation. 
 7. Waiver of Corporate Opportunity. 

(a) To the fullest extent permitted by applicable law (including, without limitation, Section 78.070(8) of the Nevada Revised Statutes),
and except as may be otherwise expressly agreed in writing by the Corporation and AG Energy Funding, LLC (together with its affiliates, “AG”): (i) the Corporation, on behalf of itself and its subsidiaries, hereby renounces any
interest or expectancy of the Corporation and its subsidiaries in, or in being offered an opportunity to participate in, business opportunities, which are from time to time presented to AG, any of its affiliates or subsidiaries, any directors or
officers of the Corporation that are employees or affiliates of AG or any affiliate of AG, or any of AG’s or any of its affiliate’s managers, officers, directors, agents, stockholders, members, partners, affiliates and subsidiaries (other
than the Corporation and its subsidiaries), even if the opportunity is one that the Corporation or its subsidiaries might reasonably be deemed to have pursued or had the ability or desire to pursue if granted the opportunity to do so; and
(ii) no such person or entity shall be liable to the Corporation or any of its subsidiaries for breach of any fiduciary or other duty, as a stockholder, director or officer or otherwise, by reason of the fact that such person or entity pursues
or acquires such business opportunity, directs such business opportunity to another person or entity or fails to present such business opportunity, or information regarding such business opportunity, to the Corporation or its subsidiaries. 

8. Other Provisions. 
 (a) With
respect to any notice to a Holder required to be provided hereunder, neither failure to send such notice, nor any defect therein or in the sending thereof, to any particular Holder shall affect the sufficiency of the notice or the validity of the
proceedings referred to in such notice with respect to the other Holders or affect the legality or validity of any distribution, rights, warrant, reclassification, consolidation, merger, conveyance, transfer, dissolution, liquidation or winding-up, or the vote upon any such action. Any notice which was mailed in the manner herein provided shall be conclusively presumed to have been duly given whether or not the Holder receives the notice.

 (b) All notice periods referred to herein shall commence: (i) when made, if made by hand delivery, and upon confirmation of receipt,
if made by electronic mail or facsimile; (ii) one Business Day after being deposited with a nationally recognized next-day courier, postage prepaid; or (iii) three Business Days after being by
first-class mail, postage prepaid. Notice to any Holder shall be given to the registered address set forth in the Corporation’s records for such Holder. Any payment required to be made hereunder on any day that is not a Business Day shall be
made on the next succeeding Business Day. 
 [The Remainder of this Page Intentionally Left Blank] 

  
 7 

 EXHIBIT A 

Ownership Notice 
 THE SECURITIES
IDENTIFIED HEREIN HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), 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 FOREGOING LEGEND WILL BE REMOVED AND A NEW OWNERSHIP NOTICE PROVIDED WITH RESPECT TO THE SECURITIES IDENTIFIED HEREIN UPON THE REQUEST OF THE HOLDER AFTER
THE EXPIRATION OF THE APPLICABLE HOLDING PERIOD WITH RESPECT TO RESTRICTED SECURITIES SET FORTH IN RULE 144 UNDER THE SECURITIES ACT. 
 SUBJECT TO THE
TERMS AND CONDITIONS SET FORTH IN THE ARTICLES OF INCORPORATION OF ABRAXAS PETROLEUM CORPORATION (THE “CORPORATION”), INCLUDING ANY CERTIFICATES OF DESIGNATION (AS FURTHER AMENDED AND/OR RESTATED FROM TIME TO TIME, THE
“CHARTER”), THE CORPORATION IS AUTHORIZED TO ISSUE MORE THAN ONE CLASS OF STOCK OR MORE THAN ONE SERIES OF ANY CLASS AND THE CORPORATION WILL FURNISH WITHOUT CHARGE TO EACH STOCKHOLDER WHO SO REQUESTS THE POWERS, DESIGNATIONS,
PREFERENCES AND RELATIVE PARTICIPATING, OPTIONAL OR OTHER SPECIAL RIGHTS OF EACH CLASS OF STOCK OR SERIES THEREOF AND THE QUALIFICATIONS, LIMITATIONS OR RESTRICTIONS OF SUCH PREFERENCES AND/OR RIGHTS. THE SHARES EVIDENCED BY THIS NOTICE ARE SUBJECT
TO THE OBLIGATIONS AND RESTRICTIONS STATED IN, AND ARE TRANSFERABLE ONLY IN ACCORDANCE WITH, THE PROVISIONS OF THE CHARTER, A COPY OF WHICH IS ON FILE WITH THE SECRETARY OF THE CORPORATION AND WILL BE PROVIDED, WITHOUT COST, UPON WRITTEN REQUEST TO
THE SECRETARY. THE TERMS OF THE CHARTER ARE HEREBY INCORPORATED INTO THIS NOTICE BY REFERENCE. 
 IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER
TO THE TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH TRANSFER AGENT MAY REASONABLY REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING RESTRICTIONS. 

This letter confirms and acknowledges that you are the record owner of the number and the class or series of shares of capital stock of the Corporation listed
on Schedule A to this letter. 
 Dated: 

[                       
                                     ] 

  
 A-1 

 
			
	By:	 	
                     

		 	Name:
		 	Title:

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