Document:

Exhibit 10.5

    

    South Mountain Merger Corp.

    767 Fifth Avenue, 9th Floor

    New York, NY 10153

    

    

    April 19, 2019

    

    

    South Mountain LLC

    767 Fifth Avenue, 9th Floor

    New York, NY 10153

    

    

    RE: Securities Subscription Agreement

    

    

    Ladies and Gentlemen:

    

    

    We are pleased to accept the offer South Mountain LLC (the “Subscriber” or “you”) has made to purchase 5,750,000 shares of Class B common stock (the “Shares”), $0.0001 par value per share (the “Class B Common Stock” together with all other classes of Company (as defined below) common stock, the “Common Stock”), up to 750,000 Shares of which are subject to
        complete or partial forfeiture by you if the underwriters of the initial public offering (“IPO”) of South Mountain Merger Corp, a Delaware corporation (the “Company”), do not fully exercise
        their over-allotment option (the “Over-allotment Option”). The terms (this “Agreement”) on which the Company is willing to sell the Shares to the Subscriber, and the Company and the Subscriber’s agreements regarding such Shares, are as follows:

    

    

    1. Purchase of Shares. For the
        sum of $25,000 (the “Purchase Price”), which the Company acknowledges receiving in cash, the Company hereby sells and issues the Shares to the Subscriber, and the Subscriber hereby purchases the Shares from the Company,
        subject to the forfeiture provisions of Section 3 below, on the terms and subject to the conditions set forth in this Agreement. Concurrently with the Subscriber’s
        execution of this Agreement, the Company is delivering to the Subscriber a certificate registered in the Subscriber’s name representing the Shares (the “Original Certificate”), receipt of which the Subscriber hereby acknowledges.

    

    

    2. Representations, Warranties and
            Agreements.

    

    

    2.1 Subscriber’s Representations,
            Warranties and Agreements. To induce the Company to issue the Shares to the Subscriber, the Subscriber hereby represents and warrants to the Company and agrees with the Company as follows:

    

    

    2.1.1. No Government Recommendation or
            Approval. The Subscriber understands that no federal or state agency has passed upon or made any recommendation or endorsement of the offering of the Shares.

    

    

    2.1.2. No Conflicts. The
        execution, delivery and performance of this Agreement and the consummation by the Subscriber of the transactions contemplated hereby do not violate, conflict with or constitute a default under (i) the formation and governing documents of the
        Subscriber, (ii) any agreement, indenture or instrument to which the Subscriber is a party, (iii) any law, statute, rule or regulation to which the Subscriber is subject, or (iv) any agreement, order, judgment or decree to which the Subscriber is
        subject.

    

    

    2.1.3. Organization and Authority.
        The Subscriber is a Delaware limited liability company, validly existing and in good standing under the laws of Delaware and possesses all requisite power and authority necessary to carry out the transactions contemplated by this Agreement. Upon
        execution and delivery by you, this Agreement will be a legal, valid and binding agreement of Subscriber, enforceable against Subscriber in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy,
        insolvency, fraudulent conveyance or similar laws affecting the enforcement of creditors’ rights generally and subject to general principles of equity (regardless
        of whether enforcement is sought in a proceeding at law or in equity).

    

    

    2.1.4. Experience, Financial Capability
            and Suitability. Subscriber is: (i) sophisticated in financial matters and is able to evaluate the risks and benefits of the investment in the Shares and (ii) able to bear the economic risk of its investment in the Shares for an
        indefinite period of time because the Shares have not been registered under the Securities Act (as defined below) and therefore cannot be resold unless subsequently registered under the Securities Act or an exemption from such registration is
        available. Subscriber is capable of evaluating the merits and risks of its investment in the Company and has the capacity to protect its own interests. Subscriber must bear the economic risk of this investment until the Shares are sold pursuant to:
        (x) an effective registration statement under the Securities Act or (y) an exemption from registration available with respect to such sale. Subscriber is able to bear the economic risks of an investment in the Shares and to afford a complete loss
        of Subscriber’s investment in the Shares.

    

    

    2.1.5. Access to Information; Independent
            Investigation. Prior to the execution of this Agreement, the Subscriber has had the opportunity to ask questions of and receive answers from representatives of the Company concerning an investment in the Company, as well as the
        finances, operations, business and prospects of the Company, and the opportunity to obtain additional information to verify the accuracy of all information so obtained. In determining whether to make this investment, Subscriber has relied solely on
        Subscriber’s own knowledge and understanding of the Company and its business based upon Subscriber’s own due diligence investigation and the information furnished pursuant to this paragraph. Subscriber understands that no person has been authorized to give any information or to make any representations which were not
        furnished pursuant to this Section 2 and Subscriber has not relied on any other representations or information in making its investment decision, whether written or oral, relating to the Company, its operations or its prospects.

    

    

    
      
        

    

    2.1.6. Accredited Investor. The
        Subscriber represents that it is an “accredited investor” as such term is
        defined in Rule 501(a) of Regulation D under the Securities Act of 1933, as amended (the “Securities Act”) and acknowledges the sale contemplated hereby is being made in reliance on a private placement exemption under
        federal and state law.

    

    

    2.1.7. Investment Purposes. The
        Subscriber is purchasing the Shares solely for investment purposes, for the Subscriber’s own account and not for the account or benefit of any other person, and not
        with a view towards the distribution or dissemination thereof that would result in a violation of the Securities Act. The Subscriber did not enter into this Agreement as a result of any general solicitation or general advertising within the meaning
        of Rule 502 of Regulation D under the Securities Act.

    

    

    2.1.8. Restrictions on Transfer; Shell
            Company. The Subscriber understands the Shares are being offered in a transaction not involving a public offering within the meaning of the Securities Act. Subscriber understands the Shares will be “restricted securities” as defined in Rule 144(a)(3) under the Securities Act and Subscriber understands
        that the certificate representing the Shares will contain a legend in respect of such restrictions. If in the future the Subscriber decides to offer, resell, pledge or otherwise transfer the Shares, such Shares may be offered, resold, pledged or
        otherwise transferred only in accordance with the provisions of Section 5 hereof. Subscriber agrees that if any transfer of its Shares or any interest therein is proposed to be made, as a condition precedent to any such transfer, Subscriber may be
        required to deliver to the Company an opinion of counsel satisfactory to the Company. Absent registration or an exemption, the Subscriber agrees not to offer, resell, pledge or otherwise transfer the Shares. Subscriber further acknowledges that
        because the Company is a shell company, Rule 144 may not be available to the Subscriber for the resale of the Shares until one year following consummation of the initial business combination of the Company, despite technical compliance with the
        certain requirements of Rule 144 and the release or waiver of any contractual transfer restrictions.

    

    

    2.1.9. No Governmental Consents.
        No governmental, administrative or other third party consents or approvals are required, necessary or appropriate on the part of Subscriber in connection with the transactions contemplated by this Agreement.

    

    

    2.2 Company’s Representations, Warranties
            and Agreements. To induce the Subscriber to purchase the Shares, the Company hereby represents and warrants to the Subscriber and agrees with the Subscriber as follows:

    

    

    2.2.1. Organization and Corporate Power.
        The Company is a Delaware corporation and is qualified to do business in every jurisdiction in which the failure to so qualify would reasonably be expected to have a material adverse effect on the financial condition, operating results or assets of
        the Company. The Company possesses all requisite corporate power and authority necessary to carry out the transactions contemplated by this Agreement.

    

    

    2.2.2. No Conflicts. The
        execution, delivery and performance of this Agreement and the consummation by the Company of the transactions contemplated hereby do not violate, conflict with or constitute a default under (i) the Certificate of Incorporation or Bylaws of the
        Company, (ii) any agreement, indenture or instrument to which the Company is a party, (iii) any law, statute, rule or regulation to which the Company is subject, or (iv) any agreement, order, judgment or decree to which the Company is subject.

    

    

    2.2.3. Title to Securities.
        Upon issuance in accordance with, and payment pursuant to, the terms hereof, the Shares will be duly and validly issued, fully paid and nonassessable. Upon issuance in accordance with, and payment pursuant to, the terms hereof the Subscriber will
        have or receive good title to the Shares, free and clear of all liens, claims and encumbrances of any kind, other than (a) transfer restrictions hereunder and other agreements to which the Shares may be subject which have been notified to the
        Subscriber in writing, (b) transfer restrictions under federal and state securities laws, and (c) liens, claims or encumbrances imposed due to the actions of the Subscriber.

    

    

    2.2.4. No Adverse Actions.
        There are no actions, suits, investigations or proceedings pending, threatened against or affecting the Company which: (i) seek to restrain, enjoin, prevent the consummation of or otherwise affect the transactions contemplated by this Agreement or
        (ii) question the validity or legality of any transactions or seek to recover damages or to obtain other relief in connection with any transactions.

    

    

    
      
        

    

    3. Forfeiture of Shares.

    

    

    3.1. Partial or No Exercise of the
            Over-allotment Option. In the event the Over-allotment Option granted to the representative of the underwriters of the IPO is not exercised in full, the Subscriber acknowledges and agrees that it (and, if applicable, any transferee
        of Shares) shall forfeit any and all rights to such number of Shares (up to an aggregate of 750,000 Shares and pro rata based upon the percentage of the Over-allotment Option exercised) such that immediately following such forfeiture, the
        Subscriber (and any such transferees) will own an aggregate number of Shares (not including Shares issuable upon exercise of any warrants or any Common Stock purchased by Subscriber in the IPO or in the aftermarket) equal to 20% of the issued and
        outstanding Common Stock immediately following the IPO.

    

    

    3.2. Termination of Rights as Stockholder.
        If any of the Shares are forfeited in accordance with this Section 3, then after such time the Subscriber (or successor in interest), shall no longer have any rights as a holder of such Shares, and the Company shall take such action as is
        appropriate to cancel such Shares.

    

    

    3.3. Share Certificates. In the
        event an adjustment to the Original Certificate is required pursuant to this Section 3, then the Subscriber shall return such Original Certificate to the Company or its designated agent as soon as practicable upon its receipt of notice from the
        Company advising Subscriber of such adjustment, following which a new certificate (the “New Certificate”) shall be issued in such amount representing the adjusted number of Shares held by the Subscriber. The New Certificate
        shall be returned to the Subscriber as soon as practicable.

    

    

    4. Waiver of Liquidation Distributions;
            Redemption Rights. In connection with the Shares purchased pursuant to this Agreement, the Subscriber hereby waives any and all right, title, interest or claim of any kind in or to any distributions by the Company from the trust
        account which will be established for the benefit of the Company’s public stockholders and into which substantially all of the proceeds of the IPO will be deposited
        (the “Trust Account”), in the event of a liquidation of the Company upon the Company’s failure to timely complete an initial
        business combination. For purposes of clarity, in the event the Subscriber purchases Common Stock in the IPO or in the aftermarket, any additional Common Stock so purchased shall be eligible to receive any liquidating distributions by the Company.
        However, in no event will the Subscriber have the right to redeem any Shares into funds held in the Trust Account upon the successful completion of an initial business combination.

    

    

    5. Restrictions on Transfer.

    

    

    5.1. Securities Law Restrictions.
        In addition to any restrictions to be contained in that certain letter agreement (commonly known as an “Insider Letter”) to be dated as of the closing of the IPO by and between Subscriber and the Company, Subscriber
        agrees not to sell, transfer, pledge, hypothecate or otherwise dispose of all or any part of the Shares unless, prior thereto (a) a registration statement on the appropriate form under the Securities Act and applicable state securities laws with
        respect to the Shares proposed to be transferred shall then be effective or (b) the Company has received an opinion from counsel reasonably satisfactory to the Company, that such registration is not required because such transaction is exempt from
        registration under the Securities Act and the rules promulgated by the Securities and Exchange Commission thereunder and with all applicable state securities laws.

    

    

    5.2. Lock-up. Subscriber
        acknowledges that the Shares will be subject to lock-up provisions contained in the Insider Letter.

    

    

    5.3. Restrictive Legends. All
        certificates representing the Shares shall have endorsed thereon legends substantially as follows:

    

    

    “THE SECURITIES REPRESENTED HEREBY HAVE
        NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS AND NEITHER THE SECURITIES NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE
        REGISTRATION STATEMENT UNDER SUCH ACT OR SUCH LAWS OR AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT AND SUCH LAWS WHICH, IN THE OPINION OF COUNSEL, IS AVAILABLE.”

    

    

    “THE SECURITIES REPRESENTED BY THIS
        CERTIFICATE ARE SUBJECT TO LOCKUP PROVISIONS AND MAY NOT BE OFFERED, SOLD, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED DURING THE TERM OF THE LOCKUP PERIOD.”

    

    

    5.4. Additional Shares or Substituted
            Securities. In the event of the declaration of a stock dividend, the declaration of a special dividend payable in a form other than Common Stock, a spin-off, a stock split, an adjustment in conversion ratio, a recapitalization or a
        similar transaction affecting the Company’s outstanding Common Stock without receipt of consideration, any new, substituted or additional securities or other
        property which are by reason of such transaction distributed with respect to any Shares subject to this Section 5 or into which such Shares thereby become convertible shall immediately be subject to this Section 5 and Section 3. Appropriate
        adjustments to reflect the distribution of such securities or property shall be made to the number or class of Shares subject to this Section 5 and Section 3.

    

    

    5.5. Registration Rights. The
        Subscriber acknowledges that the Shares are being purchased pursuant to an exemption from the registration requirements of the Securities Act and will become freely tradable only after certain conditions are met or they are registered pursuant to a
        Registration Rights Agreement to be entered into with the Company prior to the closing of the IPO.

    

    

    
      
        

    

    6. Other Agreements.

    

    

    6.1. Further Assurances. The
        Subscriber agrees to execute such further instruments and to take such further action as may reasonably be necessary to carry out the intent of this Agreement.

    

    

    6.2. Notices. All notices,
        statements or other documents which are required or contemplated by this Agreement shall be in writing and delivered: (i) personally or sent by first class registered or certified mail, overnight courier service or facsimile or electronic
        transmission to the address designated in writing, (ii) by facsimile to the number most recently provided to such party or such other address or fax number as may be designated in writing by such party and (iii) by electronic mail, to the
        electronic mail address most recently provided to such party or such other electronic mail address as may be designated in writing by such party. Any notice or other communication so transmitted shall be deemed to have been given on the day of
        delivery, if delivered personally, on the business day following receipt of written confirmation, if sent by facsimile or electronic transmission, one (1) business day after delivery to an overnight courier service or five (5) days after mailing if
        sent by mail.

    

    

    6.3. Entire Agreement. This
        Agreement, together with that certain Insider Letter to be entered into between Subscriber and the Company, substantially in the form to be filed as an exhibit to the Registration Statement, embodies the entire agreement and understanding between
        the Subscriber and the Company with respect to the subject matter hereof and supersedes all prior oral or written agreements and understandings relating to the subject matter hereof. No statement, representation, warranty, covenant or agreement of
        any kind not expressly set forth in this Agreement shall affect, or be used to interpret, change or restrict, the express terms and provisions of this Agreement.

    

    

    6.4. Modifications and Amendments.
        The terms and provisions of this Agreement may be modified or amended only by written agreement executed by all parties hereto.

    

    

    6.5. Waivers and Consents. The
        terms and provisions of this Agreement may be waived, or consent for the departure therefrom granted, only by written document executed by the party entitled to the benefits of such terms or provisions. No such waiver or consent shall be deemed to
        be or shall constitute a waiver or consent with respect to any other terms or provisions of this Agreement, whether or not similar. Each such waiver or consent shall be effective only in the specific instance and for the purpose for which it was
        given, and shall not constitute a continuing waiver or consent.

    

    

    6.6. Assignment. The rights and
        obligations under this Agreement may not be assigned by either party hereto without the prior written consent of the other party.

    

    

    6.7. Benefit. All statements,
        representations, warranties, covenants and agreements in this Agreement shall be binding on the parties hereto and shall inure to the benefit of the respective successors and permitted assigns of each party hereto. Nothing in this Agreement shall
        be construed to create any rights or obligations except among the parties hereto, and no person or entity shall be regarded as a third-party beneficiary of this Agreement.

    

    

    6.8. Governing Law. This
        Agreement and the rights and obligations of the parties hereunder shall be construed in accordance with and governed by the laws of New York applicable to contracts wholly performed within the borders of such state, without giving effect to the
        conflict of law principles thereof. The parties hereto irrevocably submit to the exclusive jurisdiction of any federal court sitting in the Southern District of New York or any state court located in New York County, State of New York, over any
        suit, action or proceeding arising out of or relating to this Agreement. To the fullest extent they may effectively do so under applicable law, the parties hereto irrevocably waive and agree not to assert, by way of motion, as a defense or
        otherwise, any claim that they are not subject to the jurisdiction of any such court, any objection that they may now or hereafter have to the laying of the venue of any such suit, action or proceeding brought in any such court and any claim that
        any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum.

    

    

    6.9. Severability. In the event
        that any court of competent jurisdiction shall determine that any provision, or any portion thereof, contained in this Agreement shall be unreasonable or unenforceable in any respect, then such provision shall be deemed limited to the extent that
        such court deems it reasonable and enforceable, and as so limited shall remain in full force and effect. In the event that such court shall deem any such provision, or portion thereof, wholly unenforceable, the remaining provisions of this
        Agreement shall nevertheless remain in full force and effect.

    

    

    6.10. No Waiver of Rights, Powers and
            Remedies. No failure or delay by a party hereto in exercising any right, power or remedy under this Agreement, and no course of dealing between the parties hereto, shall operate as a waiver of any such right, power or remedy of such
        party. No single or partial exercise of any right, power or remedy under this Agreement by a party hereto, nor any abandonment or discontinuance of steps to enforce any such right, power or remedy, shall preclude such party from any other or
        further exercise thereof or the exercise of any other right, power or remedy hereunder. The election of any remedy by a party hereto shall not constitute a waiver of the right of such party to pursue other available remedies. No notice to or demand
        on a party not expressly required under this Agreement shall entitle the party receiving such notice or demand to any other or further notice or demand in similar or other circumstances or constitute a waiver of the rights of the party giving such
        notice or demand to any other or further action in any circumstances without such notice or demand.

    

    

    
      
        

    

    6.11. Survival of Representations and
            Warranties. All representations and warranties made by the parties hereto in this Agreement or in any other agreement, certificate or instrument provided for or contemplated hereby, shall survive the execution and delivery hereof and
        any investigations made by or on behalf of the parties.

    

    

    6.12. No Broker or Finder. Each
        of the parties hereto represents and warrants to the other that no broker, finder or other financial consultant has acted on its behalf in connection with this Agreement or the transactions contemplated hereby in such a way as to create any
        liability on the other. Each of the parties hereto agrees to indemnify and hold the other harmless from any claim or demand for commission or other compensation by any broker, finder, financial consultant or similar agent claiming to have been
        employed by or on behalf of such party and to bear the cost of legal expenses incurred in defending against any such claim.

    

    

    6.13. Headings and Captions.
        The headings and captions of the various sections of this Agreement are for convenience of reference only and shall in no way modify or affect the meaning or construction of any of the terms or provisions hereof.

    

    

    6.14. Counterparts. This
        Agreement may be executed in one or more counterparts, all of which when taken together shall be considered one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other party, it
        being understood that both parties need not sign the same counterpart. In the event that any signature is delivered by facsimile transmission or any other form of electronic delivery, such signature shall create a valid and binding obligation of
        the party executing (or on whose behalf such signature is executed) with the same force and effect as if such signature page were an original thereof.

    

    

    6.15. Construction. The words “include,” “includes,” and “including” will be deemed to be followed by “without limitation.” Pronouns in masculine, feminine, and neuter
        genders will be construed to include any other gender, and words in the singular form will be construed to include the plural and vice versa, unless the context otherwise requires. The words “this Agreement,” “herein,” “hereof,” “hereby,” “hereunder,” and words of similar import refer to this Agreement as a whole and not to
        any particular section unless expressly so limited. The parties hereto intend that each representation, warranty, and covenant contained herein will have independent significance. If any party hereto has breached any representation, warranty, or
        covenant contained herein in any respect, the fact that there exists another representation, warranty or covenant relating to the same subject matter (regardless of the relative levels of specificity) which such party hereto has not breached will
        not detract from or mitigate the fact that such party hereto is in breach of the first representation, warranty, or covenant.

    

    

    6.16. Mutual Drafting. This
        Agreement is the joint product of the Subscriber and the Company and each provision hereof has been subject to the mutual consultation, negotiation and agreement of such parties and shall not be construed for or against any party hereto.

    

    

    7. Voting and Redemption of Shares.
        The Subscriber agrees to vote the Shares in favor of an initial business combination that the Company negotiates and submits for approval to the Company’s
        stockholders and shall not seek redemption with respect to such Shares. Additionally, the Subscriber agrees not to redeem any Shares in connection with a redemption or tender offer presented to the Company’s stockholders in connection with an initial business combination negotiated by the Company.

    

    

    8. Indemnification. Each party
        shall indemnify (such party, the “Indemnifying Party”) the other party (such party, the “Indemnified Party”) and its respective officers, employees, and controlling persons to the fullest
        extent permitted by law from and against any and all losses, damages, expenses (including reasonable attorneys’ fees and expenses) or other liabilities resulting
        from or arising out of such party’s breach of any representation, warranty, covenant or agreement in this Agreement. The foregoing indemnification rights apply so
        long as the action or failure to act by the Indemnified Party does not constitute fraud, bad faith, willful misconduct or gross negligence. Notwithstanding any of the foregoing to the contrary, indemnification protections will not be construed so
        as to relieve (or attempt to relieve) any Indemnified Party of any liability (including liability under federal securities laws which, under certain circumstances, impose liability even on persons that act in good faith), to the extent (but only to
        the extent) that such liability may not be waived, modified or limited under applicable law, but will only be construed so as to effectuate the indemnification protections to the fullest extent permitted by law.

    

    

    [Signature Page Follows]

    

    

    
      
        

    

    If the foregoing accurately sets forth our understanding and agreement, please sign the enclosed copy of this Agreement and
        return it to us.

    

    

    

    

    	 	
            Very truly yours,

          
	 	 	 
	 	
            South Mountain Merger Corp.

          
	 	 	 
	 	
            By:

          	
            /s/ Charles Bernicker

          
	 	
            Name:

          	
            Charles Bernicker

          
	 	
            Title:

          	
            Director and CEO

          

    

    

    

    

    Accepted and agreed this 19th day of April, 2019

    

    

    

    

    	
            South Mountain LLC

          	 	 
	 	 	 	 	 	 
	 	
            By:

          	
            Harbour Reach Holdings LLC, its managing member

          	 
	 	 	 	 	 	 
	 	 	
            By:

          	
            Netherton Investments Limited, its managing member

          	 
	 	 	 	 	 	 
	 	 	

          	
            By:

          	 /s/ Robert Heaselgrave	 
	 	 	

          	
            Name:

          	 Robert Heaselgrave	 
	 	 	

          	
            Title:

          	
            Director

          	 

    

    

    

    

    
      [Signature Page to Subscription
          Agreement]Exhibit 10.1

 

 

May 30, 2019

 

VIA HAND DELIVERY

 

Mr. Dennis P. Kelleher

57 East Elm Street
 Chicago, IL 60611

 

RE:                           Transition and Separation Agreement

 

Dear Dennis:

 

This transition and separation agreement (this “Agreement”) sets forth the entire agreement between CF Industries Holdings, Inc. (the “Company”) and you regarding your separation from the Company.  By countersigning and delivering this Agreement to the Company, you and the Company (each a “Party” and collectively, the “Parties”), intending to be legally bound, and for good and valuable consideration, hereby agree as follows:

 

1.             Resignation.  Effective as of September 1, 2019 (the “Resignation Date”), you hereby irrevocably resign from your role as an employee and from your role as Chief Financial Officer (“CFO”) and from all other director, officer, benefit plan trustee, and similar positions you hold with the Company and its affiliates.  The Company agrees to continue employing you through the Resignation Date, subject to the terms and conditions of this Agreement and your compliance with the Company’s policies.

 

2.             Payments.

 

(a)           Whether or not you sign this Agreement, the Company shall pay you (i) your current monthly base pay, less all applicable withholdings and deductions, through the Resignation Date in accordance with the Company’s usual payroll practices, (ii) accrued but unpaid vacation pay in one lump-sum included in your final paycheck and (iii) reimbursement of any business expenses incurred prior to the Resignation Date in compliance with the policies and procedures of the Company.  Provided that you timely and validly elect continued coverage under the Consolidated Omnibus Budget Reconciliation Act of 1986 (“COBRA”), you and your eligible dependents’ participation in the group health and dental insurance plans of the Company will continue after the date of this Agreement in accordance with the provisions of COBRA for such period as is required pursuant to applicable law.

 

(b)           Provided that (i) you execute the release attached hereto as Appendix B, Section 1 (the “Supplemental Release”) on or within twenty-one (21) calendar days following the Resignation Date and the Supplemental Release becomes effective pursuant to its terms; and (ii) you remain in compliance with this Agreement at all times, you will be entitled to the following:

 

(i)            Continued payment to you of your current base salary through December 31, 2020, payable on each regularly scheduled payroll date of the Company in

 

 

accordance with the Company’s payroll procedures and subject to any applicable deductions or withholdings;

 

(ii)           Payment to you of your 2019 annual bonus under the Company’s Annual Incentive Plan, pro-rated to reflect the partial year of service in 2019 ending with the Resignation Date but with no other change in the current terms on which you participate in the Plan, payable based on actual performance for 2019 at the same time and pursuant to the same terms as 2019 annual bonuses are paid to senior executives of the Company, subject to any applicable deductions or withholdings;

 

(iii)          Payment to you of your current target annual bonus under the Company’s Annual Incentive Plan for 2020, payable at the same time as 2020 annual bonuses are paid to senior executives of the Company, subject to any applicable deductions or withholdings;

 

(iv)          Reimbursement to you by the Company for COBRA premium payments for you and your eligible dependents through the end of 2020; and

 

(c)           Continued vesting of your equity awards that are outstanding as of the Resignation Date, as set forth on Appendix A hereto (“Outstanding Company Equity Awards”) following the Resignation Date in accordance with the vesting schedule and terms applicable to such equity awards, and any such Outstanding Company Equity Awards that are stock options will remain exercisable until the earlier of (A) the fourth anniversary of the Resignation Date and (B) expiration of the term applicable to the stock option.

 

3.             Effect of Death.  In the event of your death following the date the Supplemental Release becomes effective (or in the event of your death on or before September 30, 2019 and before the Supplemental Release becomes effective), your estate shall be provided with any remaining unpaid payments described in Sections 2(b)(i)-(iv) and to the continued vesting and exercisability of Outstanding Company Equity Awards described in Section 2(c) to the same extent to which you were entitled to such payments and continued vesting and exercisability in accordance with the terms of the Outstanding Company Equity Awards and this Agreement.

 

4.             No Other Payments or Benefits.  You acknowledge and agree that, other than the payments and benefits set forth in Section 2 of this Agreement, you have received all payments and benefits to which you are entitled from the Company and are not entitled to any other compensation, benefits, or payments from the Company or any other Company Parties (as defined below).

 

5.             Return of Property.  You agree that within five (5) business days of the Resignation Date, you will deliver, without retaining any copies, all documents and other material in your possession relating, directly or indirectly, to any Confidential Information (as defined in Section 6 below) or other information of the Company, or Confidential Information or other information regarding third parties, learned as an employee of the Company, including, but not limited to, any and all documents, contracts, agreements, plans, books, notes, including electronically stored data and any copies of the foregoing, as well as all materials or equipment supplied by the Company, such as credit cards, laptop or other computer equipment.

 

2

 

6.             Confidentiality and Confidential Information.

 

(a)           You represent that you have held, and you agree that you will at all times hold, in the strictest confidence and have not and will not make any unauthorized disclosure, directly or indirectly, of any Confidential Information of the Company, or third parties, or make any use thereof, directly or indirectly, except in working for the Company.  You assign to the Company any rights you may have or acquire in such Confidential Information and recognize that all such information shall be the sole property of the Company and its successors or assigns.

 

(b)           “Confidential Information” means and includes the Company’s confidential and/or proprietary information and/or trade secrets, including those that have been and/or will be developed or used and that cannot be obtained readily by third parties from outside sources.  Confidential Information includes, but is not limited to, the following:  information regarding past, current and prospective customers and investors and business affiliates, employees, contractors, and the industry not generally known to the public; strategies, methods, books, records, and documents; technical information concerning products, equipment, services and processes; procurement procedures, pricing, and pricing techniques, including contact names, services provided, pricing, type and amount of services used; financial and sales data; trading methodologies and terms; communications information; evaluations, opinions and interpretations of information and data; marketing and merchandising techniques; electronic databases; models; specifications; computer programs; contracts; bids or proposals; technologies and methods; training methods and processes; organizational structure; personnel information; payments or rates paid to consultants or other service providers; and other such confidential or proprietary information.  You acknowledge that the Company’s business is highly competitive, that this Confidential Information constitutes a valuable, special and unique asset used by the Company in its business, and that protection of such Confidential Information against unauthorized disclosure and use is of critical importance to the Company.  Confidential Information shall not include information that (i) was already in your possession prior to disclosure by the Company but not developed by you; (ii) was independently developed by you without reference to the Company’s Confidential Information; (iii) is obtained from a third party who is not prohibited from transmitting the information to you by a contractual, legal or fiduciary obligation to the Company; or (iv) is or becomes generally available to the public other than as a result of disclosure by you.

 

(c)           You agree to keep the existence and terms of this Agreement, and all discussions relating thereto, completely confidential, except to members of your immediate family or as may be required (i) in the course of obtaining legal or financial advice with respect to the rights and obligations created hereby, (ii) in the preparation of federal, state or local tax returns or (iii) as required by law.

 

7.             Transition Assistance and Non-Disparagement.  During the period beginning on the date you sign this Agreement through December 31, 2020, you agree to make yourself available to provide limited transition assistance to the Company from time to time.  The assistance that you will provide shall be as requested by the Chief Executive Officer or the new Chief Financial Officer of the Company (or their delegates), for the purpose of assisting the new Chief Financial Officer with any questions or issues that may arise during the transition, subject to your availability to provide such services in each instance in light of your then-existing responsibilities.  You agree not to take any action, or make any statement, whether orally or in

 

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writing, which in any manner disparages or impugns the reputation or goodwill of the Company (including its directors and executive officers) and that to do so will constitute a material breach of this Agreement.  The Company agrees that it shall not, and shall instruct its directors and executive officers to not, take any action or make any statement, whether orally or in writing, which in any manner disparages or impugns your reputation or goodwill and that for the Company to do so or fail to so instruct its directors and executive officers will constitute a material breach of this Agreement.  The foregoing restrictions shall not apply with regard to any statements that are made truthfully in response to a subpoena or other legal process.

 

8.             Non-Competition and Non-Solicitation.  During the period beginning on the date you sign this Agreement through December 31, 2020, you agree and covenant that, without the express prior written consent of the Company, you will not, directly or indirectly:

 

(a)                                 anywhere in the United States or in any other country in which the Company engages, or is preparing to engage in, the business of manufacturing and distributing agricultural fertilizers (the “Business”), as an owner, part owner, partner, principal, manager, member, director, officer, management-level or executive-level employee, senior-level consultant or an agent, engage or prepare to engage in, or assist others to engage or prepare to engage in, the Business;

 

(b)                                 solicit business of the same or of a similar nature to the business of the Company or its affiliates from any customer or client who is doing business with the Company or its affiliates at the time of such solicitation or was doing business with the Company or its affiliates as of the termination of your employment with the Company; or

 

(c)                                  solicit for employment or engagement, or otherwise induce to leave the employment or service of the Company, any person employed or engaged by the Company.

 

It is expressly understood and agreed that although you and the Company consider the restrictions contained in this Section 8 to be reasonable, if a final judicial determination is made by a court of competent jurisdiction that any restriction contained in this Agreement is an unenforceable restriction against you, the provisions of this Agreement shall not be rendered void but shall be deemed amended to apply as to such maximum time and to such maximum extent as such court may judicially determine or indicate to be enforceable.  Alternatively, if any court of competent jurisdiction finds that any restriction contained in this Agreement is unenforceable, and such restriction cannot be amended so as to make it enforceable, such finding shall not affect the enforceability of any of the other restrictions contained in this Agreement.

 

9.             Permitted Disclosures.  Notwithstanding anything to the contrary in this Agreement or any other agreement between you and the Company, pursuant to 18 U.S.C. § 1833(b), you will not be held criminally or civilly liable under any Federal or State trade secret law for the disclosure of a trade secret of the Company that (i) is made (A) in confidence to a Federal, State, or local government official, either directly or indirectly, or to your attorney and (B) solely for the purpose of reporting or investigating a suspected violation of law; or (ii) is made in a complaint or other document that is filed under seal in a lawsuit or other proceeding.  If you

 

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file a lawsuit for retaliation by the Company for reporting a suspected violation of law, you may disclose the trade secret to your attorney and use the trade secret information in the court proceeding, if you (i) file any document containing the trade secret under seal, and (ii) do not disclose the trade secret, except pursuant to court order.  Nothing in this 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 such section.  Further, nothing in this Agreement or any other agreement that you have with the Company shall prohibit or restrict you from making any voluntary disclosure of information or documents concerning possible violations of law to, or seek a whistleblower award from, any governmental agency or legislative body, or any self-regulatory organization, in each case, without advance notice to the Company.

 

10.          Release.

 

(a)           You hereby release, discharge and forever acquit the Company, and its affiliates and subsidiaries and the past, present and future stockholders, members, partners, directors, managers, employees, agents, attorneys, heirs, legal representatives, successors and assigns of the foregoing, in their personal and representative capacities (individually, “Company Party,” and collectively, the “Company Parties”), from liability for, and hereby waive, any and all claims, charges, liabilities, causes of action, rights, complaints, sums of money, suits, debts, covenants, contracts, agreements, promises, benefits, obligations, damages, demands or liabilities of every nature, kind and description, in law, equity or otherwise, whether known or unknown, suspected or unsuspected (collectively, “Claims”) which you or your heirs, executors, administrators, spouse, relatives, successors or assigns ever had, now has or may hereafter claim to have by reason of any matter, cause or thing whatsoever: (i) arising from the beginning of time through the date upon which you sign this Agreement including, but not limited to (A) any such Claims relating in any way to your employment relationship with the Company or any other Company Parties, and (B) any such Claims arising under any federal, state, local or foreign statute or regulation, including, without limitation, Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act of 1990, the Employee Retirement Income Security Act of 1974 and any other federal, state, local or foreign law (statutory, regulatory or otherwise) that may be legally waived and released; (ii) relating to wrongful employment termination; or (iii) arising under or relating to any policy, agreement, understanding or promise, written or oral, formal or informal, between the Company or any of the other Company Parties and you, including, without limitation, the Change in Control Severance Agreement between the Parties, effective as of August 22, 2011, amended as of April 27, 2012, and amended further and restated as of February 17, 2014 (the “Change in Control Severance Agreement”) and any incentive compensation plan or stock option plan with any Company Party; provided, however, that nothing in this Release shall release or impair any rights (1) that cannot be waived under applicable law, (2) to enforce this Agreement, (3) to indemnification pursuant to the terms of any agreement between you and the Company (including without limitation that certain Indemnification Agreement between you and the Company dated as of August 22, 2011, which remains in effect in accordance with its terms), or any policy under which you were covered during your employment with the Company or (4) to receive vested benefits under the Company’s qualified and non-qualified pension and 401(k) plans, if any, accrued prior to the Resignation Date (the “Excluded Claims”).

 

(b)           You represent that you have not brought or joined any lawsuit or filed any charge or claim against any Company Party in any court or before any government agency

 

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and have made no assignment of any rights you have asserted or may have against any of the Company Parties to any person or entity, in each case, with respect to any released Claims.

 

(c)           You further acknowledge and agree that, except with respect to the Excluded Claims, the Company Parties have fully satisfied any and all obligations whatsoever owed to you arising out of your employment with the Company or any other Company Party, and that no further payments or benefits are owed to you by the Company or any other Company Party.

 

11.          No Admission.  Nothing herein shall be deemed to constitute an admission of wrongdoing by you or any of the Company Parties.  Neither this Agreement nor any of its terms may be used as an admission or introduced as evidence as to any issue of law or fact in any proceeding, suit or action, other than an action to enforce this Agreement.

 

12.          Remedies.  Should you breach any provision of this Agreement, then on the recommendation of management approved by the Company’s board of directors, the Company may immediately cease any payments and benefits pursuant to this Agreement and you will be required to pay the Company an amount equal to all payments and benefits previously provided to you under this Agreement.  Nothing in this section shall be construed as limiting the Company from pursuing any remedies available to it for breach of this Agreement, including injunctive relief and the recovery of any damages it is able to prove.  By your signature below, you represent that, as of the date you sign this Agreement, you have not breached any obligations or covenants contained in this Agreement.

 

13.          Section 409A.  The intent of the Parties is that payments and benefits under this Agreement comply with or be exempt from the requirements of Section 409A of the Internal Revenue Code of 1986, as amended (“Section 409A”), and accordingly, to the maximum extent permitted, this Agreement shall be interpreted and administered in accordance with such intention. Without limiting the foregoing, each amount to be paid or benefit to be provided to you pursuant to this Agreement which constitutes deferred compensation subject to Section 409A, shall be construed as a separate identified payment for the purposes of Section 409A. All payments to be made upon a termination of employment under this Agreement may only be made upon a “separation from service” under Section 409A to the extent necessary in order to avoid the imposition of penalty taxes on you pursuant to Section 409A.  In no event may you, directly or indirectly, designate the calendar year of any payment under this Agreement, and to the extent required to comply with, and avoid the imposition of penalty taxes under, Section 409A, any payment that may be paid in more than one taxable year (depending on the time that you execute the release in Section 10 hereof or the Supplemental Release) shall be paid in the later taxable year. Notwithstanding anything to the contrary in this Agreement, all reimbursements and in-kind benefits provided under this Agreement that are subject to Section 409A shall be made in accordance with the requirements of Section 409A, including, where applicable, the requirement that (a) any reimbursement is for expenses incurred during your lifetime (or during a shorter period of time specified in this Agreement); (b) the amount of expenses eligible for reimbursement, or in-kind benefits provided, during a calendar year may not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other calendar year; (C) the reimbursement of an eligible expense will be made no later than the last day of the calendar year following the year in which the expense is incurred; and (D) the right to reimbursement or in-kind benefits is not subject to liquidation or exchange for another benefit.

 

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14.          Counterparts.  This Agreement may be executed in counterparts, and each counterpart, when so executed and delivered, shall be deemed to be an original and both counterparts, taken together, shall constitute one and the same Agreement.  A faxed or .pdf-ed signature shall operate the same as an original signature.

 

15.          Successors and Assigns.  This Agreement shall inure to the benefit of and be binding upon the Company and any successor organization which shall succeed to the Company by acquisition, merger, consolidation or operation of law, or by acquisition of assets of the Company and any assigns.  You may not assign this Agreement, except with respect to the rights provided under Section 2 of this Agreement, which shall inure to the benefit of your heirs, executors and administrators.

 

16.          Severability; Blue-Penciling.  The provisions of this Agreement are severable and the invalidity of any one or more provisions shall not affect the validity of any other provision.  In the event that a court of competent jurisdiction shall determine that any provision of this Agreement or the application thereof is unenforceable in whole or in part because of the scope thereof, the Parties hereto agree that said court in making such determination shall have the power to reduce the scope of such provision to the extent necessary to make it enforceable, and that this Agreement in its reduced form shall be valid and enforceable to the full extent permitted by law.

 

17.          Governing Law.  This Agreement will be governed by and construed in accordance with the laws of the State of Illinois, without regard to any conflict of law principles thereof that would give rise to the application of the laws of any other jurisdiction.

 

18.          Entire Agreement/No Oral Modifications.  This Agreement, including the Supplemental Release, the Employee Confidentiality Agreement between you and the Company dated as of September 2, 2011, and the Company’s Code of Corporate Conduct, constitute the entire agreement between you and any of the Company Parties with respect to the subject matter hereof and supersedes all prior negotiations, representations, arrangements or agreements relating thereto, whether written or oral, including the Change in Control Severance Agreement.  You represent that in executing this Agreement, you have not relied on any representation or statement not set forth herein.  No amendment or modification of this Agreement shall be valid or binding on the Parties unless in writing and signed by both Parties.

 

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*        *        *

 

	
 
    	
 
    	
Very truly yours,
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
CF Industries Holdings, Inc.
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
/s/ Susan L. Menzel
    
	
 
    	
 
    	
 
    	
Susan L. Menzel
    
	
 
    	
 
    	
 
    	
Senior Vice President, Human Resources
    
	
 
    	
 
    	
 
    	
 
    
	
ACKNOWLEDGED   AND AGREED
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
/s/ Dennis P. Kelleher
    	
 
    	
May 30, 2019
    
	
Dennis P. Kelleher
    	
 
    	
Dated
    

 

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APPENDIX A: OUTSTANDING COMPANY EQUITY AWARDS

 

Non-qualified Stock Option Award Agreements dated on or about August 22, 2011, August 10, 2012, August 12, 2013, March 3, 2014, March 3, 2015, March 3, 2016, and March 3, 2017, each as amended prior to the date of this Agreement (if applicable)

 

Performance Restricted Stock Unit Agreements dated on or about March 3, 2017, January 2, 2018, and January 2, 2019, each as amended prior to the date of this Agreement (if applicable)

 

Restricted Stock Unit Agreements dated on or about March 3, 2017, January 2, 2018, and January 2, 2019, each as amended prior to the date of this Agreement (if applicable)

 

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APPENDIX B: SUPPLEMENTAL RELEASE

 

This Supplemental Release is entered into by Dennis P. Kelleher (“you”) in connection with the transition, separation and consulting letter agreement between you and CF Industries Holdings, Inc. (the “Company”), dated May 30, 2019 (the “Separation Agreement”).  Capitalized terms not otherwise defined herein shall have the meanings ascribed to them in the Separation Agreement.

 

1.                                      Release.

 

(a)                                 You hereby release, discharge and forever acquit the Company, and its affiliates and subsidiaries and the past, present and future stockholders, members, partners, directors, managers, employees, agents, attorneys, heirs, legal representatives, successors and assigns of the foregoing, in their personal and representative capacities (individually, “Company Party,” and collectively, the “Company Parties”), from liability for, and hereby waive, any and all claims, charges, liabilities, causes of action, rights, complaints, sums of money, suits, debts, covenants, contracts, agreements, promises, benefits, obligations, damages, demands or liabilities of every nature, kind and description, in law, equity or otherwise, whether known or unknown, suspected or unsuspected (collectively, “Claims”) which you or your heirs, executors, administrators, spouse, relatives, successors or assigns ever had, now has or may hereafter claim to have by reason of any matter, cause or thing whatsoever: (i) arising from the beginning of time through the date upon which you sign this Supplemental Release including, but not limited to (A) any such Claims relating in any way to your employment relationship with the Company or any other Company Parties, and (B) any such Claims arising under any federal, state, local or foreign statute or regulation, including, without limitation, the Age Discrimination in Employment Act of 1967, as amended by the Older Workers Benefit Protection Act (“ADEA”), Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act of 1990, the Employee Retirement Income Security Act of 1974 and any other federal, state, local or foreign law (statutory, regulatory or otherwise) that may be legally waived and released; (ii) relating to wrongful employment termination; or (iii) arising under or relating to any policy, agreement, understanding or promise, written or oral, formal or informal, between the Company or any of the other Company Parties and you, including, without limitation, the Change in Control Severance Agreement and any incentive compensation plan or stock option plan with any Company Party; provided, however, that nothing in this Supplemental Release shall release or impair any rights (1) that cannot be waived under applicable law, (2) to enforce the Separation Agreement, (3) to indemnification pursuant to the terms of any agreement between you and the Company, or any policy under which you were covered during your employment with the Company or (4) to receive vested benefits under the Company’s qualified and non-qualified pension and 401(k) plans, if any, accrued prior to the Termination Date (the “Excluded Claims”).

 

(b)                                 You represent that you have not brought or joined any lawsuit or filed any charge or claim against any Company Party in any court or before any government agency and have made no assignment of any rights you have asserted or may have against any of the Company Parties to any person or entity, in each case, with respect to any released Claims.

 

(c)                                  You further acknowledge and agree that, except with respect to the Excluded Claims, the Company Parties have fully satisfied any and all obligations whatsoever

 

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owed to you arising out of your engagement with the Company or any other Company Party, and that no further payments or benefits are owed to you by the Company or any other Company Party.

 

2.                                      Review and Revocation Period.

 

(a)                                 By executing and delivering this Supplemental Release, you acknowledge that you have carefully read this Supplemental Release; you have had at least twenty-one (21) days to consider this Supplemental Release before execution and delivery hereof to the Company, though you may sign it sooner; and you have been and hereby are advised in writing that you may, at your option, discuss this Supplemental Release with an attorney of your choice and that you have had adequate opportunity to do so.  You fully understand the final and binding effect of this Supplemental Release; the only promises made to you to sign this Supplemental Release are those stated herein; and you are signing this Supplemental Release voluntarily and of your own free will in exchange for good and valuable consideration to which you are not otherwise entitled, including the payment and benefits set forth in Section 2 of the Separation Agreement.

 

(b)                                 Notwithstanding the initial effectiveness of this Supplemental Release, you may revoke the execution and delivery (and therefore the effectiveness) of this Supplemental Release within the seven (7) day period beginning on the date you deliver the re-execution to the Company (such seven (7) day period being referred to herein as the “Release Revocation Period”). To be effective, such revocation must be in writing signed by you and must be delivered to the Company before 11:59 p.m., Eastern Standard time, on the last day of the Release Revocation Period.

 

(c)                                  In the event of such revocation by you, this Supplemental Release shall be of no force or effect, and you shall not have any rights and the Company shall not have any obligations under Section 2 of the Separation Agreement.  Provided that you do not revoke your consent to this Supplemental Release within the Release Revocation Period, this Supplemental Release shall become effective on the eighth (8th) calendar day after the date upon which you execute this Supplemental Release (the “Supplemental Release Effective Date”).

 

	
ACKNOWLEDGED AND AGREED ON OR AFTER SEPTEMBER 1,   2019
    
	
 
    	
 
    
	
 
    	
 
    
	
Dennis P.   Kelleher
    	
 
    
	
 
    	
 
    
	
Date:
    	
 
    	
 
    
			

 

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