Document:

EX-10.74

 Exhibit 10.74 

Execution Version 

AMENDMENT TO THE COMMON TERMS AGREEMENT 

This Amendment to the Common Terms Agreement (this “Amendment”), dated as of January 20, 2017 amends the
Second Amended and Restated Common Terms Agreement, dated as of June 30, 2015 (as it may be further amended, restated, supplemented or otherwise modified from time to time, the “Common Terms Agreement”), by and among
Sabine Pass Liquefaction, LLC, a Delaware limited liability company (the “Borrower”), Société Générale as the Secured Debt Holder Group Representative for the Commercial Banks Facility, as the
Common Security Trustee (in such capacity, the “Common Security Trustee”) and as the Intercreditor Agent (in such capacity, the “Intercreditor Agent”), Shinhan Bank New York Branch, as the Secured Debt
Holder Group Representative for the KEXIM Direct Facility and the KEXIM Covered Facility, The Korea Development Bank New York Branch, as the Secured Debt Holder Group Representative for the KSURE Covered Facility, The Bank of Nova Scotia, as the
Secured Debt Holder Group Representative for the Working Capital Debt and other Secured Debt Holder Group Representatives party thereto from time to time, the Secured Hedge Representatives and the Secured Gas Hedge Representatives party thereto from
time to time. All capitalized terms used herein and not otherwise defined shall have the meanings ascribed to such terms in the Common Terms Agreement. 

WHEREAS, the Borrower has requested that the Secured Debt Holder Group Representatives for the Commercial Banks Facility, the KEXIM Direct
Facility, the KEXIM Covered Facility, the KSURE Covered Facility and the Working Capital Debt, the Common Security Trustee, the Intercreditor Agent, and each of the Facility Lenders and the Working Capital Lenders (collectively, the
“Lenders” and each individually, a “Lender”) agree to amend the Common Terms Agreement as set forth in Section 1 herein; 

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

Section 1.    Amendment to Schedule 1. Pursuant to Section 10.1 of the Common Terms Agreement and Section
4.1(i) of the Intercreditor Agreement, the Borrower, the Secured Debt Holder Group Representatives for the Commercial Banks Facility, the KEXIM Direct Facility, the KEXIM Covered Facility, the KSURE Covered Facility and the Working Capital Debt, the
Common Security Trustee, the Intercreditor Agent, and each Lender agrees that: 
 1.1    Schedule 1 to the Common Terms
Agreement is hereby amended by adding the following definitions (inserted in proper alphabetical sequence): 
 “‘Basis
Swap’ means a commodity derivative contract that is cash-settled based on the difference between: (1) the price of natural gas at one particular pricing point and (2) the price of natural gas at a different delivery location or
pricing point. 
 ‘First of Month Index’ means a price which represents the most commonly traded fixed price at a major
trading point and as published by 

 
Inside FERC Gas Market Report (“IFERC” or any successor publication widely used to establish index pricing in the U.S. natural gas trading market). 

‘Fixed-Float Futures Swap’ means a contract which entitles the buyer of the contract to pay a fixed price for natural gas and
the seller to pay a floating price equal to the final settlement price of the Futures Contract settlement prices. The Fixed-Float Futures Swap shall be settled financially, via exchange of cash payment at the expiration of the underlying Futures
Contract, rather than physically. 
 ‘Futures Contract’ means a contract which entitles the buyer of the contract to claim
physical delivery of natural gas from the seller at a specified contract delivery point at a specified date in the future and entitles the seller to deliver the physical commodity to the buyer under the same conditions. The price between the buyer
and the seller shall be transacted at the price of final settlement on a monthly basis. 
 ‘Index Swap’ means a contract
which entitles the buyer of the contract to pay one index price (e.g. First of Month Index) and entitles the seller to pay a different index price (e.g. the daily average). The index swap is settled financially via exchange of cash payment at the
expiration of the underlying Futures Contract. 
 ‘NYMEX’ means the New York Mercantile Exchange, a wholly owned subsidiary
of the Chicago Mercantile Exchange. 
 ‘NYMEX Natural Gas Futures Contract’ means the Futures Contract for natural gas on
NYMEX, which is used for the physical receipt and/or delivery of gas at the Henry Hub located in Erath, Louisiana. 
 ‘Swing
Swap’ means a contract which entitles the buyer of the contract to pay a fixed price for natural gas and the seller to pay the gas daily average at a defined location for a defined period of time. The Swing Swap is settled financially, via
exchange of cash payment each day as the gas daily average is settled, rather than physically.” 
 1.2    Schedule
1 to the Common Terms Agreement is hereby amended by replacing the definition of “Permitted Hedging Agreement” in its entirety with the following: 

“‘Permitted Hedging Agreement’ means any: 

(a)     Interest Rate Protection Agreements; 

(b)     the following gas hedging contracts: 

(i)    Futures Contracts, Fixed-Float Futures Swaps, NYMEX Natural Gas Futures Contracts and Swing Swaps
for gas hedging purposes for up to a maximum 

  
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of 55 TBtu (or 78 TBtu, if Train 6 Debt is incurred in connection with Section 2.7 of the Common Terms Agreement or otherwise approved in accordance with the Financing Documents) of gas
utilizing intra-month and up to three prompt month contracts; 
 (ii)    Index Swaps for gas hedging
purposes for up to a maximum of 62 TBtu per month (or 74.4 TBtu per month, if Train 6 Debt is incurred in connection with Section 2.7 of the Common Terms Agreement or otherwise approved in accordance with the Financing Documents) of gas
utilizing up to three prompt month contracts; and 
 (iii)    Basis Swaps for gas hedging purposes for
up to a maximum of 62 TBtu per month (or 74.4 TBtu per month, if Train 6 Debt is incurred in connection with Section 2.7 of the Common Terms Agreement or otherwise approved in accordance with the Financing Documents) of gas utilizing up to
three prompt month contracts.” 
 Section 2.    Effectiveness. This Amendment shall become effective as
of the date hereof only upon the execution of this Amendment by the Common Security Trustee and receipt by the Common Security Trustee of executed counterparts of this Amendment by each of the Borrower, the Intercreditor Agent, the Secured Debt
Holder Group Representatives for the Commercial Banks Facility, the KEXIM Direct Facility, the KEXIM Covered Facility, the KSURE Covered Facility and the Working Capital Debt, and the Required Secured Parties constituting the Majority Aggregate
Secured Credit Facilities Debt Participants (as defined in the Intercreditor Agreement). 

Section 3.    Representations and Warranties. The Borrower hereby represents and warrants to the Lenders that:

 3.1    no Default or Event of Default has occurred and is continuing as of the date hereof or will result from the
consummation of the transactions contemplated by the Amendment; and 
 3.2    each of the representations and warranties
of the Borrower in the Common Terms Agreement and the other Financing Documents is true and correct in all material respects except for (A) those representations and warranties that are qualified by materiality, which shall be true and correct
in all respects, on and as of the date hereof (or, if stated to have been made solely as of an earlier date, as of such earlier date) and (B) the representations and warranties that, pursuant to Section 4.1(b) (General) of the Common
Terms Agreement, are not deemed repeated. 
 Section 4.    Financing Document. This Amendment constitutes a
Financing Document as such term is defined in, and for purposes of, the Common Terms Agreement. 

Section 5.    Governing Law. THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEW YORK, UNITED STATES OF AMERICA, WITHOUT ANY REFERENCE TO THE CONFLICT OF LAW PRINCIPLES THEREOF (OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW). 

  
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 Section 6.    Headings. All headings in this Amendment are
included only for convenience and ease of reference and shall not be considered in the construction and interpretation of any provision hereof. 

Section 7.    Binding Nature and Benefit. This Amendment shall be binding upon and inure to the benefit of
each party hereto and their respective successors and permitted assigns. 
 Section 8.    Counterparts. This
Amendment may be executed in multiple counterparts, each of which shall be deemed an original for all purposes, but all of which together shall constitute one and the same instrument. Delivery of an executed counterpart of a signature page of this
Amendment by facsimile or portable document format (“pdf’) shall be effective as delivery of a manually executed counterpart of this Amendment. 

Section 9.    No Modifications; No Other Matters. Except as expressly provided for herein, the terms and
conditions of the Common Terms Agreement shall continue unchanged and shall remain in full force and effect. Each amendment granted herein shall apply solely to the matters set forth herein and such amendment shall not be deemed or construed as an
amendment of any other matters, nor shall such amendment apply to any other matters. 
 Section 10.    Direction
to Secured Credit Facilities Debt Holder Group Representatives, Intercreditor Agent and Common Security Trustee. 
  

	 	a.	[With respect to the Term Loan A Credit Agreement, by their signature below, each of the undersigned Commercial Bank Lenders instructs the Commercial Banks Facility Agent to (i) execute this Amendment and
(ii) direct the Intercreditor Agent to execute this Amendment;] 

  

	 	b.	[with respect to the KEXIM Direct Facility, by its signature below, KEXIM instructs the KEXIM Facility Agent to (i) execute this Amendment and (ii) direct the Intercreditor Agent to execute this Amendment; ]

  

	 	c.	[with respect to the KEXIM Covered Facility, by its signature below, in accordance with Section 9.13 of the KEXIM Covered Facility Agreement, KEXIM instructs the KEXIM Facility Agent, on behalf of all KEXIM Covered
Facility Lenders, to (i) execute this Amendment and (ii) direct the Intercreditor Agent to execute this Amendment;] 

  

	 	d.	[with respect to the KSURE Covered Facility, in accordance with Section 9.13 of the KSURE Covered Facility Agreement, KSURE instructs the KSURE Covered Facility Agent, on behalf of all KSURE Covered Facility
Lenders, to (i) execute this Amendment and (ii) direct the Intercreditor Agent to execute this Amendment;] 

  

	 	e.	[with respect to the Working Capital Facility, by their signature below, each of the undersigned Working Capital Facility Lenders instructs the Working Capital Facility Agent to (i) execute this Amendment and
(ii) direct the Intercreditor Agent to execute this Amendment;] 

  
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	 	f.	based on the instructions above, each of the [Commercial Banks Facility Agent,] [the KSURE Covered Facility Agent,] [the KEXIM Facility Agent] and the [Working Capital Facility Agent,] constituting the Majority
Aggregate Secured Credit Facilities Debt Participants (as defined in the Intercreditor Agreement), hereby directs the Intercreditor Agent to (i) execute this Amendment and (ii) direct the Common Security Trustee to execute this Amendment;
and 

  

	 	g.	by its signature below, the Intercreditor Agent, in such capacity, hereby directs the Common Security Trustee to execute this Amendment. 

[Remainder of the page left intentionally blank.] 

  
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 IN WITNESS WHEREOF, the Parties have caused this Amendment to be duly executed by
their officers thereunto duly authorized as of the day and year first above written. 
  

			
	 SABINE PASS LIQUEFACTION, LLC, 

as the Borrower

		
	By:	 	 /s/ Lisa C. Cohen

	Name:	 	Lisa C. Cohen
	Title:	 	Treasurer

  
 SIGNATURE
PAGE TO AMENDMENT TO THE COMMON TERMS AGREEMENT 

 Acknowledged and agreed as of the first date set forth above. 

 

			
	 SOCIÉTÉ GÉNÉRALE,

as Common Security Trustee and Secured
 Debt Holder
Group Representative for the Commercial Banks Facility

		
	By:	 	 /s/ Ellen Turkel

	Name:	 	Ellen Turkel
	Title:	 	Director
	
	 SOCIÉTÉ GÉNÉRALE,

as the Intercreditor Agent

		
	By:	 	 /s/ Ellen Turkel

	Name:	 	Ellen Turkel
	Title:	 	Director
	
	 SOCIÉTÉ GÉNÉRALE,

as Commercial Bank Lender, Swing Line Lender
 and Working Capital
Lender

		
	By:	 	 /s/ Ellen Turkel

	Name:	 	Ellen Turkel
	Title:	 	Director

  
 SIGNATURE
PAGE TO AMENDMENT TO THE COMMON TERMS AGREEMENT 

 Acknowledged and agreed as of the first date set forth above. 

 

			
	 THE EXPORT-IMPORT BANK OF KOREA

		
	By:	 	 /s/ Tae-Hyung Lee

	Name:	 	Tae-Hyung Lee
	Title:	 	Director General

  
 SIGNATURE
PAGE TO AMENDMENT TO THE COMMON TERMS AGREEMENT 

 Acknowledged and agreed as of the first date set forth above. 

SHINHAN BANK NEW YORK BRANCH, 
 as the Secured Debt Holder
Group Representative for the KEXIM Direct Facility, the Secured Debt Holder Group Representative for the KEXIM Covered Facility and the KEXIM Facility Agent 

			
		
	By:	 	 /s/ Jinsoo Bae

	Name:	 	Jinsoo Bae
	Title:	 	Genera Manager Shinhan Bank New York Branch

  
 SIGNATURE
PAGE TO AMENDMENT TO THE COMMON TERMS AGREEMENT 

 Acknowledged and agreed as of the first date set forth above. 

THE KOREA DEVELOPMENT BANK NEW YORK BRANCH, 
 as the
Secured Debt Holder Group Representative for the KSURE Covered Facility and the KSURE Covered Facility Agent 

			
		
	 By:
	 	 /s/ Nakjoo Seong

	Name:	 	 Nakjoo Seong

	Title:	 	General Manager

  
 SIGNATURE
PAGE TO AMENDMENT TO THE COMMON TERMS AGREEMENT 

 Acknowledged and agreed as of the first date set forth above. 

THE BANK OF NOVA SCOTIA, 
 as the Secured Debt Holder
Group Representative for the Working Capital Facility 

			
		
	By:	 	 /s/ Alfredo Brahim

	Name:	 	 Alfredo Brahim

	Title:	 	Director
	
	 THE BANK OF NOVA SCOTIA,
 as
Commercial Bank Lender, Senior
 Issuing Bank and Working Capital Lender

		
	By:	 	 /s/ Alfredo Brahim

	Name:	 	 Alfredo Brahim

	Title:	 	Director

  
 SIGNATURE
PAGE TO AMENDMENT TO THE COMMON TERMS AGREEMENT 

 Acknowledged and agreed as of the first date set forth above. 

 

			
	 ABN AMRO CAPITAL USA LLC,

as Commercial Bank Lender, Senior
 Issuing Bank and Working
Capital Lender

		
	By:	 	 /s/ Darrell Holley

	Name:	 	Darrell Holley
	Title:	 	Managing Director
		
	By:	 	 /s/ Casey Lowary

	Name:	 	Casey Lowary
	Title:	 	Executive Director

  
 SIGNATURE
PAGE TO AMENDMENT TO THE COMMON TERMS AGREEMENT 

 Acknowledged and agreed as of the first date set forth above. 

 

			
	 BANCO SANTANDER BANK, S.A.,

as Commercial Bank Lender

		
	By:	 	 /s/ Helena González

	Name:	 	Helena González
	Title:	 	

  
 SIGNATURE
PAGE TO AMENDMENT TO THE COMMON TERMS AGREEMENT 

 Acknowledged and agreed as of the first date set forth above. 

 

			
	 SANTANDER BANK, N.A.,
 as
Commercial Bank Lender

		
	By:	 	 /s/ Manuel Garcia

	Name:	 	Manuel Garcia
	Title:	 	V.P.

  
 SIGNATURE
PAGE TO AMENDMENT TO THE COMMON TERMS AGREEMENT 

 Acknowledged and agreed as of the first date set forth above. 

 

			
	 BANK OF AMERICA, N.A.,
 as
Commercial Bank Lender

		
	By:	 	 /s/ Ronald E. McKaig

	Name:	 	Ronald E. McKaig
	Title:	 	Managing Director

  
 SIGNATURE
PAGE TO AMENDMENT TO THE COMMON TERMS AGREEMENT 

 Acknowledged and agreed as of the first date set forth above. 

 

			
	 THE BANK OF TOKYO-MITSUBISHI UFJ, LTD.,

as Commercial Bank Lender and Working
 Capital
Lender

		
	By:	 	 /s/ Billy Tracy

	Name:	 	Billy Tracy
	Title:	 	Managing Director

  
 SIGNATURE
PAGE TO AMENDMENT TO THE COMMON TERMS AGREEMENT 

 Acknowledged and agreed as of the first date set forth above. 

 

			
	 CRÉDIT AGRICOLE CORPORATE AND INVESTMENT BANK, 

as Commercial Bank Lender

		
	By:	 	 /s/ Frederic Petit

		 	Name: Frederic Petit
		 	Title: Director
		
	By:	 	 /s/ Kenneth Ricciardi

		 	Name: Kenneth Ricciardi
		 	Title: Director

  
 SIGNATURE
PAGE TO AMENDMENT TO THE COMMON TERMS AGREEMENT 

 Acknowledged and agreed as of the first date set forth above. 

 

			
	 CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH,

as Commercial Bank Lender

		
	By:	 	 /s/ Nupur Kumar

	Name:	 	Nupur Kumar
	Title:	 	Authorized Signatory
		
	By:	 	 /s/ Warren Van Heyst

	Name:	 	Warren Van Heyst
	Title:	 	Authorized Signatory

  
 SIGNATURE
PAGE TO AMENDMENT TO THE COMMON TERMS AGREEMENT 

 Acknowledged and agreed as of the first date set forth above. 

 

			
	 GOLDMAN SACHS BANK USA,

as Commercial Bank Lender

		
	By:	 	 /s/ Eddie Ashagba

	Name:	 	Eddie Ashagba
	Title:	 	Vice President

  
 SIGNATURE
PAGE TO AMENDMENT TO THE COMMON TERMS AGREEMENT 

 Acknowledged and agreed as of the first date set forth above. 

 

			
	 HSBC BANK USA, NATIONAL ASSOCIATION,

as Commercial Bank Lender, Senior Issuing Bank
 and Working
Capital Lender

		
	By:	 	 /s/ James Kaiser

	Name:	 	James Kaiser
	Title:	 	Managing Director

  
 SIGNATURE
PAGE TO AMENDMENT TO THE COMMON TERMS AGREEMENT 

 Acknowledged and agreed as of the first date set forth above. 

 

			
	 INDUSTRIAL AND COMMERCIAL BANK OF CHINA LIMITED, NEW YORK BANK,

as Commercial Bank Lender and Working Capital Lender

		
	 By:
	 	 /s/ Guoshell Sien

	Name:	 	Guoshell Sien
	Title:	 	DGM

  
 SIGNATURE
PAGE TO AMENDMENT TO THE COMMON TERMS AGREEMENT 

 Acknowledged and agreed as of the first date set forth above. 

 

			
	 ING CAPITAL LLC,
 as
Commercial Bank Lender, Senior Issuing Bank and Working Capital Lender

		
	By:	 	 /s/ Subha Pasumarti

	Name:	 	Subha Pasumarti
	Title:	 	Managing Director
		
	By:	 	 /s/ Cheryl LaBelle

	Name:	 	Cheryl LaBelle
	Title:	 	Managing Director

  
 SIGNATURE
PAGE TO AMENDMENT TO THE COMMON TERMS AGREEMENT 

 Acknowledged and agreed as of the first date set forth above. 

 

			
	 INTESA SANPAOLA S.P.A., NEW YORK BRANCH,

as Commercial Bank Lender

		
	By:	 	 /s/ Francesco DiMario

	Name:	 	Francesco DiMario
	Title:	 	First Vice President
		
	By:	 	 /s/ Nicholas A. Matacchieri

	Name:	 	Nicholas A. Matacchieri
	Title:	 	Vice President

  
 SIGNATURE
PAGE TO AMENDMENT TO THE COMMON TERMS AGREEMENT 

 Acknowledged and agreed as of the first date set forth above. 

 

			
	 JP MORGAN CHASE BANK, N.A.,

as Commercial Bank Lender

		
	By:	 	 /s/ Jeffrey C. Miller

	Name:	 	Jeffrey C. Miller
	Title:	 	Vice President

  
 SIGNATURE
PAGE TO AMENDMENT TO THE COMMON TERMS AGREEMENT 

 Acknowledged and agreed as of the first date set forth above. 

 

			
	 LANDESBANK BADEN-WÜRTTEMBERG, NEW YORK BRANCH,

as Commercial Bank Lender and Working Capital Lender

		
	By:	 	 /s/ A. Bruns

	Name:	 	A. Bruns
	Title:	 	VP

  
 SIGNATURE
PAGE TO AMENDMENT TO THE COMMON TERMS AGREEMENT 

 Acknowledged and agreed as of the first date set forth above. 

 

			
	 LLOYDS BANK PLC,
 as
Commercial Bank Lender and Working Capital Lender

		
	By:	 	 /s/ Daven Popat

	Name:	 	Daven Popat
	Title:	 	Senior Vice President
		
	By:	 	 /s/ Joel Siomko

	Name:	 	Joel Siomko
	Title:	 	Assistant Vice President

  
 SIGNATURE
PAGE TO AMENDMENT TO THE COMMON TERMS AGREEMENT 

 Acknowledged and agreed as of the first date set forth above. 

 

			
	 MIZUHO BANK, LTD.,
 as
Commercial Bank Lender

		
	By:	 	 /s/ Brian Caldwell

	Name:	 	Brian Caldwell
	Title:	 	Managing Director

  
 SIGNATURE
PAGE TO AMENDMENT TO THE COMMON TERMS AGREEMENT 

 Acknowledged and agreed as of the first date set forth above. 

 

			
	 MORGAN STANLEY BANK, N.A.,

as Commercial Bank Lender and Working Capital Lender

		
	By:	 	 /s/ Pat Layton

	Name:	 	Pat Layton
	Title:	 	Authorized Signatory

  
 SIGNATURE
PAGE TO AMENDMENT TO THE COMMON TERMS AGREEMENT 

 Acknowledged and agreed as of the first date set forth above. 

 

			
	 ROYAL BANK OF CANADA,
 as
Commercial Bank Lender

		
	By:	 	 /s/ Matthias Wong

	Name:	 	Mattias Wong
	Title:	 	Mattias Wong

  
 SIGNATURE
PAGE TO AMENDMENT TO THE COMMON TERMS AGREEMENT 

 Acknowledged and agreed as of the first date set forth above. 

 

			
	 SUMITOMO MITSUI BANKING

CORPORATION,
 as Commercial Bank Lender and Working Capital
Lender

		
	By:	 	 /s/ Toshitake Funaki

	Name:	 	Toshitake Funaki
	Title:	 	Managing Director

  
 SIGNATURE
PAGE TO AMENDMENT TO THE COMMON TERMS AGREEMENT 

 Acknowledged and agreed as of the first date set forth above. 

 

			
	 COMMONWEALTH BANK OF AUSTRALIA,

as Working Capital Lender

	
	By its attorney under Power of Attorney dated 24 June 2013:
		
	Signature of Attorney:	 	 /s/ David Sparling

	Name of Attorney: David Sparling
	
	 Signed by its duly constituted attorney in the presence of:

		
	Signature of Witness:	 	 /s/ Axelle Anterion

	Name of Witness: Axelle Anterion

  
 SIGNATURE
PAGE TO AMENDMENT TO THE COMMON TERMS AGREEMENTExhibit 10.1

 

EMPLOYMENT AGREEMENT

 (As Amended and Restated, Effective February 1, 2017)

 

THIS EMPLOYMENT AGREEMENT (the “Agreement”) between UCP, Inc., a Delaware corporation (the “Company”), and Dustin L. Bogue (the “Executive”) is entered into as of February 1, 2017 (the “Effective Date”), and is an amendment and restatement of the Employment Agreement between the Company and the Executive dated July 23, 2013, and as thereafter amended on April 1, 2016.  In consideration of the covenants contained herein, the parties agree as follows:

 

1.            Employment.  The term of Executive’s employment by the Company under this Agreement, as amended and restated as set forth herein, will begin on the Effective Date, and will continue until February 1, 2020, unless earlier terminated pursuant to Section 4 hereof; provided, however, that on each monthly anniversary of the Effective Date, the Agreement shall automatically be extended for one additional month unless either the Company or Executive shall have terminated this automatic extension provision by written notice to the other party at least 60 days prior to the automatic extension date.  The term of employment in effect from time to time hereunder is hereinafter called the “Employment Period.”  Subject to the terms of this Agreement, Executive’s employment is at will, which means that either Executive or the Company may terminate this relationship with or without Cause or notice.

 

2.            Position and Duties.

 

		(a)	
Position.  During the Employment Period, Executive shall serve as the President and Chief Executive Officer of the Company and shall report to the Board of Directors of the Company (the “Board”) and have the normal duties, responsibilities and authority of an executive serving in such positions, subject to the direction of the Board.  Executive shall be appointed to serve as a member of the Board. At each annual meeting of the Company’s stockholders during the Employment Period, the Company shall nominate Executive to serve as a member of the Board, with such service as a member of the Board subject to any required stockholder approval.  Upon the termination of Executive’s service as President and Chief Executive Officer for any reason, unless otherwise determined by the Board, Executive shall be deemed to have resigned from the Board (and any boards of subsidiaries) and any other positions held at the Company or any of its subsidiaries or affiliates voluntarily, without any further required action by Executive, as of the cessation of Executive’s services, and Executive, at the Board’s request, shall execute any documents deemed in the discretion of the Company to be reasonably necessary to reflect his resignation(s).

 

		(b)	
Obligations.  During the Employment Period, Executive shall devote his full business time and efforts to the business and affairs of the Company and its subsidiaries.  Notwithstanding the foregoing, during his employment, Executive may devote reasonable time to the supervision of his personal investments and activities involving professional, charitable, community, educational, religious and similar types of organizations, speaking engagements, membership on the boards of directors of other organizations, and other types of activities, to the 

 

 

 

extent that such other activities are not competitive with the Company or otherwise conflict with the business of the Company or Executive’s duties hereunder; provided, however, that before Executive agrees to serve on the board of directors of any for-profit company (whether publicly or privately held), Executive will obtain the approval of the Audit Committee of the Board (or such other committee to which the Board may subsequently delegate this responsibility).

 

3.            Compensation and Benefits.

 

		(a)	
Base Salary.  As compensation for Executive’s performance of Executive’s duties hereunder, Company shall pay to Executive an initial Base Salary of $530,000 per year, payable in accordance with the normal payroll practices of the Company, less required deductions for state and federal withholding tax, social security and all other employment taxes and payroll deductions. The Base Salary shall be reviewed for increases by the Board in good faith, based upon Executive’s performance, not less often than annually.  The term “Base Salary” shall refer to the Base Salary as so increased by the Board.

 

		(b)	
Annual Incentive Compensation.  During the Employment Period, Executive shall be eligible to receive an annual cash incentive bonus determined by the Compensation Committee of the Board (the “Committee”) in its sole discretion, as a percentage of Executive’s Base Salary, with a target bonus of not less than 50% of Executive’s Base Salary, and based upon Executive’s and/or the Company’s achievement of annual performance goals or objectives established by the Committee, in its sole discretion. Payment of any annual cash incentive bonus earned shall be made on or before March 15th of each calendar year immediately following the year in which such compensation is earned.

 

		(c)	
Equity-Based Compensation.  Subject to approval by the Committee, Executive shall be eligible to be granted equity-based compensation awards based upon Executive’s and/or the Company’s achievement of annual performance goals or objectives established by the Committee, in its sole discretion; provided that the target grant date value of such awards granted each year during the Employment Period shall be not less than 125% of Executive’s Base Salary.

 

		(d)	
Other Benefits.

 

(i)            Savings and Retirement Plans.  Executive shall be entitled to participate in all qualified and non-qualified savings and retirement plans applicable generally to other senior executives of the Company, in accordance with the terms of the plans, as may be amended from time to time.

 

(ii)           Welfare Benefit Plans.  Executive and/or his eligible dependents shall be eligible to participate in and shall receive all benefits under the Company’s welfare benefit plans and programs applicable generally to other senior executives 

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of the Company, in accordance with the terms of the plans, as may be amended from time to time.

 

(iii)          Fringe Benefits.  During the Employment Period, Executive shall be entitled to such fringe benefits as may be available generally to other senior executives of the Company.

 

(iv)          Vacation.  Executive shall be entitled to accrue paid vacation time consistent with the applicable policies of the Company as in effect from time to time, but in no event shall Executive be eligible to accrue less than five weeks of such vacation per year.

 

(v)            Business Expenses.  Subject to Section 17 and compliance with applicable Company policies (including any requirements for acceptable documentation), Executive shall be reimbursed for all reasonable travel and other expenses incurred in the performance of Executive’s duties on behalf of the Company.

 

4.            Termination of Employment.

 

		(a)	
The Employment Period shall end upon the first to occur of: (i) the expiration of the term of this Agreement pursuant to Section 1 hereof; (ii) termination of Executive’s employment by the Company on account of Executive’s inability to perform the essential functions of Executive’s position, with or without reasonable accommodation, due to a physical or mental disability (as determined by the Board in good faith), for a period of more than six consecutive months (“Termination for Disability”); (iii) termination of Executive’s employment by the Company for Cause (as defined in Exhibit A attached hereto) (“Termination for Cause”); (iv) termination of  Executive’s employment by the Company other than a Termination for Disability or a Termination for Cause (“Termination Without Cause”); (v) Executive’s death; (vi) termination of Executive’s employment by Executive for Good Reason (as defined in Exhibit A attached hereto) (“Termination for Good Reason”); or (vii) termination of Executive’s employment by Executive for any reason other than Good Reason.

 

		(b)	
If the Employment Period ends for any reason set forth in Section 4(a), except as otherwise provided in this Section 4, Executive shall cease to have any rights to salary, bonus (if any) or benefits hereunder, other than (i) payment of unpaid Base Salary through and including the date of termination or resignation (which in the case of a termination by the Company shall be paid on the final day of employment, and in the case of a resignation shall be paid out on the final day of employment or within seventy-two hours after the resignation, whichever occurs later), (ii) Executive’s business expenses that are reimbursable pursuant to Section 3(d) but have not been reimbursed by the Company as of the date of termination, (iii) Executive’s annual bonus for the fiscal year immediately preceding the fiscal year in which the date of termination occurs, if such bonus has been earned, but has not been paid as of the date of termination, (iv) any accrued vacation pay to the extent not theretofore paid, and (v) any other amounts or benefits required to 

 

 

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be paid or provided by law or under any plan, program, policy or practice of the Company (“Accrued Compensation and Benefits”).

 

		(c)	
If the Employment Period ends on account of Termination Without Cause or Termination for Good Reason, Executive shall receive a severance payment (the “Severance Payment”) in an amount equal to two times the sum of (A) Executive’s Base Salary at the time of termination (or, in the event of a Termination for Good Reason, the Base Salary prior to the event constituting Good Reason if such Base Salary is higher than the Base Salary at the time of termination) plus (B) Executive’s target annual bonus for the year in which Executive’s employment terminates.  In addition, if the Employment Period ends on account of death, Termination Without Cause, Termination for Good Reason or Termination for Disability, the Company shall pay Executive after such termination of employment (or to Executive’s family in the event of his death), on a monthly basis, an amount equal to the monthly amount of the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”) continuation coverage premium for such month, at the same level and cost to Executive (or Executive’s family in the event of his death) as immediately preceding the date of termination, under the Company group medical plan in which Executive participated immediately preceding the date of termination, less the amount of Executive’s portion of such monthly premium as in effect immediately preceding the date of termination, until the earlier of (A) 24 months after the date of termination; and (B) the date on which Executive and his family have obtained other substantially similar healthcare coverage or become entitled to Medicare coverage.  Subject to Section 17, the Severance Payment shall be paid in a lump sum payment on the sixtieth day following the termination date.  As a condition to Executive’s receipt of the post-employment payments and benefits set forth in this Section 4(c), Executive must execute, return, not rescind and comply with a commercially reasonable written release agreement in a form prescribed by the Company (the “Release”).

 

		(d)	
If, during the two year period following a Change in Control (as defined in Exhibit A attached hereto), Executive’s employment is terminated due to a Termination Without Cause or a Termination for Good Reason, Executive shall receive the benefits set forth in Section 4(c), except that (1) in lieu of the Severance Payment described in Section 4(c), Executive shall receive three times the sum of (A) Executive’s Base Salary at the time of such termination or Change in Control, whichever Base Salary level is greater, plus (B) the average of Executive’s annual bonuses for the three most recently completed years prior to Executive’s termination of employment or Change in Control, whichever average is greater or, if Executive has not been employed for at least three full years, the average of Executive’s annual bonuses for all completed years prior to Executive’s termination of employment or Change in Control, whichever is greater (the “CIC Severance Payment”).  Subject to Section 17, the CIC Severance Payment shall be paid in a lump sum payment on the sixtieth day following the termination date.    As a condition to Executive’s receipt of the post-

 

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employment payments and benefits set forth in this Section 4(d), Executive must execute, return, not rescind and comply with a Release.

 

		(e)	
Notwithstanding the foregoing, if the payment required to be paid under Section 4(d), when considered either alone or with other payments paid or imputed to Executive (the “Total Payments”) from the Company that would be deemed “excess parachute payments” under Section 280G(b)(1) of the Internal Revenue Code of 1986, as amended (the “Code”), is determined by the Company, with the assistance of a nationally recognized accounting firm acceptable to Executive, to be a “parachute payment” under Section 280G(b)(2) of the Code, then the Total Payments shall be automatically reduced to an amount equal to $1.00 less than three times (3x) the “base amount” (as defined in Section 280G(3) of the Code) (the “Reduced Amount”); provided, however, such reduction shall not apply if the sum of (A) the Total Payments  less (B) the amount of excise tax payable by the Executive under Section 4999 of the Code with respect to the Total Payments, is greater than the Reduced Amount.  Any such reduction shall occur in the following order:  (i)  by eliminating the acceleration of vesting of any stock options for which the exercise price exceeds the fair market value (and if there is more than one option award so outstanding, then the acceleration of the vesting of the most “under water” option shall be reduced first, and so-on); (ii)  by reducing the CIC Severance Payment and any other cash payments not subject to Section 409A of the Code;  (iii) by reducing any benefit continuation payments (and if there be more than one such payment, by reducing the payments in reverse order, with the payments made the earliest being reduced first); (iv), by reducing any cash payments that are subject to Section 409A of the Code (and if there be more than one such payment, by reducing the payments in reverse order, with the payments made the earliest being reduced first); (v) by reducing the payments of any restricted stock, restricted stock units, performance awards or similar equity-based awards that have been awarded to Executive by the Company that are subject to performance-based vesting (and if there be more than one such award held by Executive, by reducing the awards in the reverse order of the date of their award, with the most-recently awarded reduced first and the oldest award reduced last); (vi) by reducing the payments of any restricted stock, restricted stock units, performance awards or similar equity-based awards that have been awarded to Executive by the Company that are subject to time-based vesting (and if there be more than one such award held by Executive, by reducing the awards in the reverse order of the date of their award, with the most-recently awarded reduced first and the oldest award reduced last); and (vii) by reducing the acceleration of vesting of any stock options that are not described in (i), above.

 

5.            Confidential Information.  Executive acknowledges that the information, observations and data obtained by him while employed by the Company pursuant to this Agreement, as well as those obtained by him while employed by the Company or any of its subsidiaries prior to the date of this Agreement, concerning the business or affairs of the Company or any of its subsidiaries (“Confidential Information”) are the property of the Company or such subsidiary. Therefore, Executive agrees that during the Employment Period and for three years thereafter that he shall not disclose to any unauthorized person or use for his own account any Confidential 

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Information without the prior written consent of the Board unless and except to the extent that such Confidential Information becomes generally known to and available for use by the public other than as a result of Executive’s acts or omissions to act. Executive shall deliver to the Company at the termination of the Employment Period, or at any other time the Company may request, all memoranda, notes, plans, records, reports, computer tapes and software and other documents and data (and copies thereof) relating to the Confidential Information or the business of the Company or any of its subsidiaries or affiliates which he may then possess or have under his control.

 

6.            Enforcement.  Because the services of Executive are unique and Executive has access to confidential information of the Company, the parties hereto agree that the Company would be damaged irreparably in the event the provisions of Section 5 hereof were not performed in accordance with its terms or were otherwise breached and that money damages would be an inadequate remedy for any such nonperformance or breach. Therefore, the Company or its successors or assigns shall be entitled, in addition to other rights and remedies existing in their favor, to an injunction or injunctions to prevent any breach or threatened breach of any of such provisions and to enforce such provisions specifically (without posting a bond or other security).

 

7.            Indemnification and Insurance.  The Company shall indemnify Executive to the full extent provided for in its corporate Bylaws and to the maximum extent that the Company indemnifies any of its other directors and senior executive officers, and he will be entitled to the protection of any insurance policies the Company may elect to maintain generally for the benefit of its directors and senior executive officers against all costs, charges, liabilities and expenses incurred or sustained by him in connection with any action, suit or proceeding to which he may be made a party by reason of his being or having been a director, officer or employee of the Company or any of its affiliates or his serving or having served any other enterprise, plan or trust as a director, officer, employee or fiduciary at the request of the Company or any of its affiliates (other than any dispute, claim or controversy arising under or relating to this Agreement (except for this Section 7)).  The Company will enter into an indemnification agreement with the Executive in the standard form that it has or will adopt for the benefit of its other directors and senior executive officers.

 

8.            Reimbursement of Expenses.  If any contest or dispute shall arise under this Agreement involving termination of the Executive’s employment with the Company or involving the failure or refusal of the Company to perform fully in accordance with the terms hereof, the Company shall reimburse the Executive, on a current basis and in accordance with Section 17, for all legal fees and expenses, if any, incurred by the Executive in connection with such contest or dispute, together with interest in an amount equal to the U.S. Prime Rate as published in the “Money Rates” section of The Wall Street Journal, but in no event higher than the maximum legal rate permissible under applicable law, such interest to accrue from the date the Company receives the Executive’s statement for such fees and expenses through the date of payment thereof; provided, however, that in the event the resolution of any such contest or dispute includes a finding denying, in total, the Executive’s claims in such contest or dispute, the Executive shall be required to reimburse the Company, over a period of 12 months from the date of such resolution, for all sums advanced to the Executive pursuant to this Section 8.

 

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9.            Survival.  Sections 5, 6, 7, 8 and 17 hereof shall survive and continue in full force and effect in accordance with their respective terms, notwithstanding any termination of the Employment Period.

 

10.         Notices.  Any notice provided for in this Agreement shall be in writing and shall be either personally delivered, or sent by certified mail, return receipt requested, postage prepaid, addressed (a) if to Executive, to his last known address shown on the payroll records of the Company, and if to the Company, to UCP, Inc., 99 Almaden, Fourth floor, San Jose, CA 95113 attention:  Chairman of the Compensation Committee of the Board of Directors, with a copy to the General Counsel of the Company at the same address, or (b) to such other address as either party shall have furnished to the other in accordance with this Section 10.

 

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

 

12.         Entire Agreement. This Agreement constitutes the entire agreement and understanding between the parties with respect to the subject matter hereof and supersedes and preempts any prior understandings, agreements or representations by or between the parties, written or oral, which may have related in any manner to the subject matter hereof.

 

13.         Successors and Assigns. This Agreement shall inure to the benefit of and be enforceable by Executive and his heirs, executors and personal representatives, and the Company and its successors and assigns. Any successor or assignee of the Company shall assume the liabilities of the Company hereunder.

 

14.         Governing Law.  This Agreement shall be governed by the internal laws (as opposed to the conflicts of law provisions) of the State of California.

 

15.         Amendment and Waiver.  The provisions of this Agreement may be amended or waived only with the prior written consent of the Company and Executive, and no course of conduct or failure or delay in enforcing the provisions of this Agreement shall affect the validity, binding effect or enforceability of this Agreement.

 

16.         Withholding.  All payments and benefits under this Agreement are subject to withholding of all applicable taxes.

 

17.         Code Section 409A.  This Agreement is intended to comply with the requirements of Section 409A of the Code, and shall be interpreted and construed consistently with such intent.  The payments to Executive pursuant to this Agreement are also intended to be exempt from Section 409A of the Code to the maximum extent possible, under either the separation pay exemption pursuant to Treasury regulation §1.409A-1(b)(9)(iii) or as short-term deferrals pursuant to Treasury regulation §1.409A-1(b)(4), and for such purposes, each payment to Executive under this Agreement shall be considered a separate payment.    In the event the terms 

7

of this Agreement would subject Executive to taxes or penalties under Section 409A of the Code (“409A Penalties”), the Company and Executive shall cooperate diligently to amend the terms of the Agreement to avoid such 409A Penalties, to the extent possible; provided that in no event shall the Company be responsible for any 409A Penalties that arise in connection with any amounts payable under this Agreement.  To the extent any amounts under this Agreement are payable by reference to Executive’s “termination of employment” such term and similar terms shall be deemed to refer to Executive’s “separation from service,” within the meaning of Section 409A of the Code.  Notwithstanding any other provision in this Agreement, to the extent any  payments hereunder constitutes nonqualified deferred compensation, within the meaning of Section 409A, and Executive is a specified employee (within the meaning of Section 409A of the Code) as of the date of Executive’s separation from service, each such payment that is payable upon Executive’s separation from service and would have been paid prior to the six-month anniversary of  Executive’s separation from service, shall be delayed until the earlier to occur of (i) the first day of the seventh month following Executive’s separation from service or (ii) the date of Executive’s death.  Any reimbursement payable to Executive pursuant to this Agreement shall be conditioned on the submission by Executive of all expense reports reasonably required by Employer under any applicable expense reimbursement policy, and shall be paid to Executive within 30 days following receipt of such expense reports, but in no event later than the last day of the calendar year following the calendar year in which Executive incurred the reimbursable expense.  Any amount of expenses eligible for reimbursement, or in-kind benefit provided, during a calendar year shall not affect the amount of expenses eligible for reimbursement, or in-kind benefit to be provided, during any other calendar year.  The right to any reimbursement or in-kind benefit pursuant to this Agreement shall not be subject to liquidation or exchange for any other benefit.

 

8

 

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

 

	 	
UCP, INC.

	 
	 	 	 	 
	
 

	
By: 

	/s/ James M. Pirrello	 
	 	 	Name: James M. Pirrello	 
	 	 	Title:   Chief Financial Officer	 
	 	 	 	 

 

	 	
EXECUTIVE:

	 
	 	 	 	 
	
 

	
 

	/s/ Dustin L. Bogue	 
	 	 	Dustin L. Bogue	 

 

 

 

 

 

 

 

 

 

 

[Signature Page to the Employment Agreement for Dustin L. Bogue]

EXHIBIT A

 

DEFINITIONS

 

“Cause” shall mean the occurrence of any of the following conditions:

 

(i)            any act or omission that constitutes a material breach by Executive of any of his material obligations under this Agreement, after a written demand for substantial performance is delivered to Executive by the Board that specifically identifies the manner in which the Board believes that Executive has materially breached such obligations and Executive’s failure to cure such alleged breach not later than 30 days following his receipt of such notice;

 

(ii)           conviction or plea of guilty to a charge of commission of a felony;

 

(iii)          the commission of dishonest, fraudulent or deceptive acts or practices in connection with Executive’s employment that are materially injurious to the Company, monetarily or otherwise; or

 

(iv)          Executive's ongoing willful refusal to follow the proper and lawful directions of the Board after a written demand for substantial performance is delivered to Executive by the Board that specifically identifies the manner in which the Board believes that Executive has refused to follow its instructions and Executive’s failure to cure such refusal not later than 30 days following his receipt of such notice.

 

For purposes of this definition, no act, or failure to act, on the part of Executive shall be considered “willful” unless it is done, or omitted to be done, by Executive in bad faith or without reasonable belief that Executive’s action or omission was in the best interests of the Company.  Any act, or failure to act, based upon (A) authority given pursuant to a resolution duly adopted by the Board or (B) the advice of counsel for the Company shall be conclusively presumed to be done, or omitted to be done, by Executive in good faith and in the best interests of the Company.  The cessation of employment of Executive shall not be deemed to be for Cause unless and until there shall have been delivered to Executive a copy of a resolution duly adopted by the affirmative vote of not less than three-quarters of the entire membership of the Board (excluding Executive, if Executive is a member of the Board) at a meeting of the Board called and held for such purpose (after reasonable notice is provided to Executive and Executive is given an opportunity, together with counsel for Executive, to be heard before the Board), finding that, in the good faith opinion of the Board, the conditions set forth in clauses (i), (ii), (iii) or (iv) above have been satisfied, and specifying the particulars thereof in detail.

 

“Change in Control”  shall mean, except as otherwise provided below, the occurrence of a “change in the ownership,” a “change in the effective control” or a “change in the ownership of a substantial portion of the assets” of the Company.  In determining whether an event shall be considered a “change in the ownership,” a “change in the effective control” or a “change in the ownership of a substantial portion of the assets” of the Company, the following provisions shall apply:

A-1

 

(i)            A “change in the ownership” of the Company shall occur on the date on which any one person, or more than one person acting as a group, acquires ownership of stock of the Company that, together with stock held by such person or group, constitutes more than 50% of the total fair market value or total voting power of the stock of the Company, as determined in accordance with Treasury Regulation § 1.409A-3(i)(5)(v).  If a person or group is considered either to own more than 50% of the total fair market value or total voting power of the stock of the Company, or to have effective control of the Company within the meaning of clause (ii) of this definition, and such person or group acquires additional stock of the Company, the acquisition of additional stock by such person or group shall not be considered to cause a “change in the ownership” of the Company.

 

(ii)            A “change in the effective control” of the Company shall occur on either of the following dates:

 

(A)  The date on which any one person, or more than one person acting as a group, acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or persons) ownership of stock of the Company possessing 30% or more of the total voting power of the stock of the Company, as determined in accordance with Treasury Regulation § 1.409A-3(i)(5)(vi).  If a person or group is considered to possess 30% or more of the total voting power of the stock of the Company, and such person or group acquires additional stock of the Company, the acquisition of additional stock by such person or group shall not be considered to cause a “change in the effective control” of the Company; or

 

(B)  The date on which a majority of the members of the Board is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the Board before the date of the appointment or election, as determined in accordance with Treasury Regulation § 1.409A-3(i)(5)(vi).

 

(iii)            A “change in the ownership of a substantial portion of the assets” of the Company shall occur on the date on which any one person, or more than one person acting as a group, acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or persons) assets from the Company that have a total gross fair market value equal to or more than 40% of the total gross fair market value of all of the assets of the Company immediately before such acquisition or acquisitions, as determined in accordance with Treasury Regulation § 1.409A-3(i)(5)(vii).  A transfer of assets shall not be treated as a “change in the ownership of a substantial portion of the assets” when such transfer is made to an entity that is controlled by the shareholders of the Company, as determined in accordance with Treasury Regulation § 1.409A-3(i)(5)(vii)(B).

 

Notwithstanding the occurrence of any of the foregoing events, an initial public offering or any bona fide primary or secondary public offering following the occurrence of an initial public offering shall not constitute a Change in Control.  Additionally, the ownership of stock by 

A-2

Pico Holdings, Inc., or its affiliates, as of and following the initial public offering shall not constitute a Change of Control.

 

“Good Reason” shall mean any of the following actions, if taken without the express written consent of Executive:   (i) a material diminution in Executive’s Base Salary, short-term incentive opportunity, long-term incentive opportunity or employee benefits; (ii) a material diminution in Executive’s authority, duties or responsibilities; (iii) requiring Executive to move his place of employment more than 50 miles from his place of employment prior to such move; or (iv) a material breach by the Company of this Agreement.  Executive’s employment with the Company may be terminated for Good Reason if (A) Executive provides written notice to Company of the occurrence of the Good Reason event (as described above) within 90 days after Executive has knowledge of the circumstances constituting Good Reason, which notice shall specifically identify the circumstances which Executive believes constitute Good Reason, (B)  Company fails to correct the circumstances constituting “Good Reason” within 30 days after such notice; and (C) Executive resigns within six months after the initial existence of such circumstances.

 

 

 

 

 

 

 

 

 

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