Document:

Exhibit 4.2

 

REGISTRATION RIGHTS AGREEMENT

 

This Registration Rights Agreement (this “Agreement”) is made and entered into as of [·], 2018, by and among YETI Holdings, Inc., a Delaware corporation (the “Company”), Cortec Group Fund V, L.P., a Delaware limited partnership (including any permitted Transferees, the “Fund”), Cortec Co-Investment Fund V, LLC, a Delaware limited liability company (including any permitted Transferees, “Cortec Co-Invest”), and the other parties listed on the signature pages hereto.

 

In consideration of the mutual covenants and agreements set forth herein and for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged by each party hereto, the parties hereto agree as follows:

 

1.                                      Definitions.  In addition to those capitalized terms otherwise defined in this Agreement (which shall have the definitions set forth therein), the following additional capitalized terms have the corresponding meanings:

 

“Affiliate” means, with respect to any Person, any other Person directly or indirectly controlling, controlled by, or under common control with, such Person (including any investment fund the primary investment advisor to which is such Person or an Affiliate thereof); provided, that for purposes of this Agreement, no Holder shall be deemed an Affiliate of the Company or any of its Subsidiaries.  For purposes of this definition, the term “control” (including the correlative meanings of the terms “controlled by” and “under common control with”), as used with respect to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management policies of such Person, whether through the ownership of voting securities, by contract or otherwise.

 

“Alternative Transaction” means the sale of Registrable Securities to one or more purchasers in a registered transaction without a prior marketing process by means of (a) a bought deal, (b) a block trade, (c) a direct sale or (d) any other transaction that is registered pursuant to a Shelf Registration Statement that is not a firm commitment underwritten offering.

 

“Automatic Shelf Registration Statement” means an “automatic shelf registration statement” as defined in Rule 405.

 

“Business Day” means any day that is not a Saturday, a Sunday or other day on which banks are required or authorized by law to be closed in New York, New York.

 

“Certificate of Incorporation” means the Amended and Restated Certificate of Incorporation of the Company as amended from time to time.

 

“Commission” means the Securities and Exchange Commission or any other federal agency then administering the Securities Act or Exchange Act.

 

“Common Stock Equivalents” means all options, warrants and other securities that at such time are convertible into, or exchangeable or exercisable for, shares of Company Common Stock (including, without limitation, any note or debt security convertible into or exchangeable for shares of Company Common Stock).

 

 

“Company Common Stock” means the shares of common stock, par value $0.01 per share, of the Company.

 

“Demand Registration Holder(s)” means the Fund, Cortec Co-Invest, Ryan Roger Seiders, RRS Ice 2, LP, Roy Joseph Seiders, and RRS Ice 2, LP.

 

“Exchange Act” means the Securities Exchange Act of 1934.

 

“Family Member” shall mean, with respect to any natural Person, such Person’s parents, spouse (but not including a former spouse or a spouse from whom such Person is legally separated) and descendants (whether or not adopted) and any trust, family limited partnership or limited liability company that is and remains solely for the benefit of such Person’s parents, spouse (but not including a former spouse or a spouse from whom such Person is legally separated) and/or descendants (whether or not adopted).

 

“FINRA” means the Financial Industry Regulatory Authority.

 

“Holder” means (i) any Person who is signatory to this Agreement or (ii) any Permitted Transferee. A Person shall cease to be a Holder hereunder at such time as it ceases to hold any Registrable Securities.

 

“IPO” means an underwritten initial public offering.

 

“Issuer Free Writing Prospectus” means an issuer free writing prospectus, as defined in Rule 433, relating to an offer of the Registrable Securities.

 

“Parties” means the Holders and the Company.

 

“Permitted Transferee” means a transferee to whom a Holder transfers shares of Company Common Stock and related rights under this Agreement in accordance with Section 6.

 

“Person” means any individual, partnership, corporation, company, association, trust, joint venture, limited liability company, unincorporated organization, entity or division, or any government, governmental department or agency or political subdivision thereof.

 

“Proceeding” means any action, claim, suit, proceeding or investigation (including a preliminary investigation or partial proceeding, such as a deposition) pending or known to the Company to be threatened.

 

“Prospectus” means the prospectus included in a Registration Statement (including a prospectus that includes any information previously omitted from a prospectus filed as part of an effective Registration Statement in reliance upon Rule 430A promulgated under the Securities Act), all amendments and supplements to the Prospectus, including post-effective amendments, all material incorporated by reference or deemed to be incorporated by reference in such Prospectus and any Issuer Free Writing Prospectus.

 

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“Public Offering” means any sale of shares of Company Common Stock to the public pursuant to a public offering registered (other than a registration effected solely to implement an employee benefit plan or a transaction to which Rule 145 is applicable) under the Securities Act.

 

“Registrable Securities” means (a) any shares of Company Common Stock (including those held as a result of, or issuable upon, the conversion or exercise of Common Stock Equivalents), (b) any securities issued or issuable, directly or indirectly, with respect to, on account of or in exchange for Company Common Stock, whether by stock split, stock dividend, recapitalization, merger, consolidation or other reorganization, charter amendment or otherwise and (c) any options, warrants or other rights to acquire, and any securities received as a dividend or distribution in respect of, any of the securities described in clauses (a) and (b) above, in each case that are held by the Holders and their Affiliates or any Permitted Transferee, all of which securities are subject to the rights provided herein until such rights terminate pursuant to the provisions of this Agreement.  As to any particular Registrable Securities, such securities shall not be Registrable Securities when (i) a Registration Statement registering such Registrable Securities under the Securities Act has been declared effective and such Registrable Securities have been sold, transferred or otherwise disposed of by the Holder thereof pursuant to such effective Registration Statement, (ii) such Registrable Securities are sold, transferred or otherwise disposed of pursuant to Rule 144, or (iii) such securities cease to be outstanding.

 

“Registration Statement” means a registration statement of the Company filed with or to be filed with the Commission under the Securities Act and other applicable law, including an Automatic Shelf Registration Statement, and including any Prospectus, amendments and supplements to each such registration statement or Prospectus, including pre- and post-effective amendments, all exhibits thereto, and all material incorporated by reference or deemed to be incorporated by reference in such registration statement.

 

“Rule 144” means Rule 144 promulgated by the Commission pursuant to the Securities Act, or any similar rule or regulation hereafter adopted by the Commission having substantially the same effect as such Rule.

 

“Rule 145” means Rule 145 promulgated by the Commission pursuant to the Securities Act, or any similar rule or regulation hereafter adopted by the Commission having substantially the same effect as such Rule.

 

“Rule 158” means Rule 158 promulgated by the Commission pursuant to the Securities Act, or any similar rule or regulation hereafter adopted by the Commission having substantially the same effect as such Rule.

 

“Rule 405” means Rule 405 promulgated by the Commission pursuant to the Securities Act, or any similar rule or regulation hereafter adopted by the Commission having substantially the same effect as such Rule.

 

“Rule 424” means Rule 424 promulgated by the Commission pursuant to the Securities Act, or any similar rule or regulation hereafter adopted by the Commission having substantially the same effect as such Rule.

 

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“Rule 433” means Rule 433 promulgated by the Commission pursuant to the Securities Act, or any similar rule or regulation hereafter adopted by the Commission having substantially the same effect as such Rule.

 

“Seasoned Issuer” means an issuer eligible to use a registration statement on Form S-3 under the Securities Act and who is not an “ineligible issuer” as defined in Rule 405.

 

“Securities Act” means the Securities Act of 1933.

 

“Selling Expenses” means all underwriting fees, discounts, selling commissions and stock transfer taxes applicable to the sale of Registrable Securities and related legal and other fees of a Holder not included within the definition of Registration Expenses.

 

“Shelf Registration Statement” means a shelf registration statement under Rule 415 of the Securities Act.

 

“Subsidiary” means, when used with respect to any Person, any corporation or other entity, whether incorporated or unincorporated, (a) of which such Person or any other Subsidiary of such Person is a general partner (excluding partnerships, the general partnership interests of which held by such Person or any Subsidiary of such Person do not have a majority of the voting interests in such partnership) or (b) at least a majority of the securities or other interests of which having by their terms ordinary voting power to elect a majority of the board of directors or others performing similar functions with respect to such corporation or other entity is directly or indirectly owned or controlled by such Person or by any one or more of its Subsidiaries, or by such Person and one or more of its Subsidiaries.

 

“Trading Market” means the principal national securities exchange in the United States on which Registrable Securities are listed.

 

“WKSI” means a “well known seasoned issuer” as defined under Rule 405 and which (i) is a “well-known seasoned issuer” under paragraph (1)(i)(A) of such definition or (ii) is a “well-known seasoned issuer” under paragraph (1)(i)(B) of such definition and is also a Seasoned Issuer.

 

Unless the context requires otherwise: (a) any pronoun used in this Agreement shall include the corresponding masculine, feminine or neuter forms; (b) references to Sections, paragraphs and clauses refer to Sections, paragraphs and clauses of this Agreement; (c) the terms “include,” “includes,” “including” or words of like import shall be deemed to be followed by the words “without limitation”; (d) the terms “hereof,” “herein” or “hereunder” refer to this Agreement as a whole and not to any particular provision of this Agreement; (e) unless the context otherwise requires, the term “or” is not exclusive and shall have the inclusive meaning of “and/or”; (f) defined terms herein will apply equally to both the singular and plural forms and derivative forms of defined terms will have correlative meanings; (g) references to any law or statute shall be deemed to refer to such law or statute as amended or supplemented from time to time and shall include all rules and regulations and forms promulgated thereunder, and references to any law, rule, form or statute shall be construed as including any legal and statutory provisions, rules or forms consolidating, amending, succeeding or replacing the applicable law, rule, form or statute; (h) references to any Person include such Person’s successors and permitted

 

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assigns; and (i) references to “days” are to calendar days unless otherwise indicated.  Each of the parties hereto acknowledges that each party was actively involved in the negotiation and drafting of this Agreement and that no law or rule of construction shall be raised or used in which the provisions of this Agreement shall be construed in favor or against any party hereto because one is deemed to be the author thereof.

 

2.                                      Registration.

 

(a)                                 Demand Registration.

 

(i)                                     Subject to the terms and conditions of this Agreement, including Section 2(a)(ii) below, at any time and from time to time after the expiration or earlier termination of the lock-up period applicable to the Company’s IPO, one or more Demand Registration Holder(s) (any such requesting Demand Registration Holder(s), the “Initiating Holder(s)”) shall have the right to require the Company to file one or more registration statements under the Securities Act (other than pursuant to a registration statement on Form S-4 or Form S-8 or any similar or successor forms under the Securities Act) covering all or any part of their Registrable Securities upon written notice to the Company (a “Demand Notice”).  The registration so requested is referred to herein as a “Demand Registration.”  The Company shall promptly (but in any event, not later than five Business Days following the Company’s receipt of a Demand Notice) give written notice (“Demand Eligible Holder Notice”) of the receipt of such Demand Notice to all Holders (other than the Initiating Holder(s)) that, to its knowledge, hold Registrable Securities (each a “Demand Eligible Holder”).  The Company shall promptly file the appropriate Registration Statement (the “Demand Registration Statement”) and use its commercially reasonable efforts to effect, at the earliest practicable date, the registration under the Securities Act and under applicable state securities laws of (A) the Registrable Securities which the Company has been so requested to register by the Initiating Holder(s) in the Demand Notice, (B) all other Registrable Securities of the same class or series as those requested to be registered in the Demand Notice which the Company has been requested to register by the Demand Eligible Holders by written request (the “Demand Eligible Holder Request”) given to the Company within five Business Days after the giving of the Demand Eligible Holder Notice, and (C) any shares of Company Common Stock to be offered and sold by the Company, in each case subject to Section 2(a)(ii), all to the extent required to permit the disposition (in accordance with the intended methods of disposition) of the Registrable Securities to be so registered. The Company shall effect any requested Demand Registration using a registration statement on Form S-3 whenever the Company is a Seasoned Issuer or a WKSI, and shall use an Automatic Shelf Registration Statement if it is a WKSI.

 

(ii)                                  Limitations on Demand Registration. The Demand Registration rights granted in Section 2(a)(i) are subject to the following limitations: (A) the Company shall not be required to effect more than four Demand Registrations pursuant to Section 2(a)(i) in any twelve month period; and (B) each registration in respect of a Demand Notice must include, in the aggregate (based solely on the Company Common Stock requested to be included in such registration by all Holders participating in such registration), shares of Company Common Stock having an aggregate market value of at least $250 million (measured based on the closing sale price of the Company Common Stock on the date that the Demand Eligible Holder Request is due, as set forth above).

 

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(iii)                               Effectiveness of Demand Registration Statement.  The Company shall use its commercially reasonable efforts to have the Demand Registration Statement declared effective by the Commission and keep the Demand Registration Statement continuously effective under the Securities Act for the period of time necessary for the underwriters or Holders to sell all the Registrable Securities covered by such Demand Registration Statement or such shorter period which will terminate when all Registrable Securities covered by such Demand Registration Statement have been sold pursuant thereto (including, if necessary, by filing with the Commission a post-effective amendment or a supplement to the Demand Registration Statement or the related Prospectus or any document incorporated therein by reference or by filing any other required document or otherwise supplementing or amending the Demand Registration Statement, if required by the rules, regulations or instructions applicable to the registration form used by the Company for such Demand Registration Statement or by the Securities Act, any state securities or “blue sky” laws, or any other rules and regulations thereunder) (the “Effectiveness Period”). A Demand Registration requested pursuant to this Section 2(a) shall not be deemed to have been effected (A) if the Registration Statement is withdrawn without becoming effective, (B) if the Registration Statement does not remain effective in compliance with the provisions of the Securities Act and the laws of any state or other jurisdiction applicable to the disposition of the Registrable Securities covered by such Registration Statement for the Effectiveness Period, (C) if, after it has become effective, such Registration Statement is subject to any stop order, injunction or other order or requirement of the Commission or other governmental or regulatory agency or court for any reason other than a violation of applicable law solely by any selling Holder and has not thereafter become effective, (D) in the event of an underwritten offering, if the conditions to closing specified in the underwriting agreement entered into in connection with such registration (other than such conditions which are the sole obligation of any of the Holders) are not satisfied or waived, or (E) if the Company does not include in the applicable Registration Statement any Registrable Securities held by a Holder that are required by the terms hereof to be included in such Registration Statement.

 

(iv)                              Priority of Registration.  Notwithstanding any other provision of this Section 2(a), if (A) the Registrable Securities covered by a Demand Registration are intended to be distributed by means of an underwritten offering and (B) the managing underwriters advise the Company that, in their reasonable view, the number of Registrable Securities proposed to be included in such offering (including Registrable Securities requested by Holders to be included in such offering and any securities that the Company proposes to be included in such offering) exceeds the  number of Registrable Securities which can be sold in an orderly manner in such offering within a price range acceptable to the Holders of a majority of the Registrable Securities requested to be included in the underwritten offering (the “Maximum Offering Size”), then the Company shall so advise the Holders with Registrable Securities proposed to be included in such underwritten offering, and shall include in such offering the number of Registrable Securities which can be so sold in the following order of priority, up to the Maximum Offering Size:  (1) first, the Registrable Securities requested to be included in such underwritten offering by the Initiating Holder(s) and the Demand Eligible Holders who have submitted a timely Demand Eligible Holder Request, allocated, if necessary for the offering not to exceed the Maximum Offering Size, pro rata among the Initiating Holders and Demand Eligible Holders on the basis of the number of Registrable Securities requested to be included therein by each such Holder and (2) second, any securities proposed to be registered by the Company.  For any Demand Eligible

 

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Holder that is a partnership, limited liability company, corporation or other entity, the partners, members, stockholders, Subsidiaries, parents and Affiliates of such Demand Eligible Holder, or the estates and Family Members of any such partners/members and retired partners/members and any trusts for the benefit of any of the foregoing Persons, shall be deemed to be a single “Demand Eligible Holder,” and any pro rata reduction with respect to such “Demand Eligible Holder” shall be based upon the aggregate amount of securities carrying registration rights owned by all entities and individuals included in such “Demand Eligible Holder,” as defined in this sentence.

 

(v)                                 Underwritten Demand Registration.  The determination of whether any offering of Registrable Securities pursuant to a Demand Registration will be an underwritten offering shall be made in the sole discretion of the Holders of a majority of the Registrable Securities included in such underwritten offering.  The Holders of a majority of the Registrable Securities included in such underwritten offering shall also have the right to (A) determine the plan of distribution, including the price at which the Registrable Securities are to be sold and the underwriting commissions, discounts and fees, and (B) select the investment banker(s) and manager(s) to administer the offering (which shall consist of one (1) or more reputable nationally recognized investment banks, subject to the Company’s approval (which shall not be unreasonably withheld, conditioned or delayed)) and one firm of legal counsel to represent all of the Holders (along with any reasonably necessary local counsel), in connection with such Demand Registration.  Promptly (and in any event within one Business Day) following receipt of notification to the Company from the managing underwriter(s) of a range of prices at which such Registrable Securities are likely to be sold (the “Price Range”), the Company shall so advise each Holder requesting participation in such offering of such Price Range.

 

(vi)                              Withdrawal of Registrable Securities. In the event of an underwritten offering of Registrable Securities pursuant to a Demand Registration, any such Holder whose Registrable Securities were to be included in any such underwritten offering may elect to withdraw any or all of its Registrable Securities therefrom by written notice to the Company and the managing underwriter(s) delivered prior to the earlier of (A) noon Eastern Time on the Business Day following the date such Holder was advised of the Price Range, (B) execution of the underwriting agreement with respect to such underwritten offering, or (C) execution of the custody agreement with respect to such underwritten offering. If a Holder elects to withdraw any or all of its Registrable Securities based on the procedure set forth above prior to the effectiveness of the Demand Registration Statement, the Registrable Securities withdrawn from such underwritten offering shall be excluded and withdrawn from the registration.  Any Holder whose Registrable Securities were to be included in any such registration pursuant to Section 2(a), other than pursuant to an underwritten offering, may elect to withdraw any or all of its Registrable Securities therefrom, without prejudice to the rights of any such Holder to include Registrable Securities in any future registration (or registrations), by written notice to the Company delivered on or prior to the effective date of the relevant Demand Registration Statement.

 

(b)                                 Piggyback Registration.

 

(i)                                     Registration Statement on behalf of the Company.  If at any time following the consummation of the Company’s IPO the Company proposes to register any of its

 

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equity securities or Common Stock Equivalents for its own account or for the account of any other stockholder, other than pursuant to a Demand Registration under Section 2(a), under the Securities Act (excluding an offering relating solely to an employee benefit plan, an offering relating to a transaction on Form S-4, a rights offering or an offering on any form of Registration Statement that does not permit secondary sales) (a “Piggyback Registration Statement”), the Company shall give prompt written notice (the “Piggyback Notice”) to all Holders that, to its knowledge, hold Registrable Securities (collectively, the “Piggyback Eligible Holders”) of the Company’s intention to file a Piggyback Registration Statement reasonably in advance of (and in any event at least five Business Days before) the anticipated filing date of such Piggyback Registration Statement. The Piggyback Notice shall offer the Piggyback Eligible Holders the opportunity to include for registration in such Piggyback Registration Statement the number of Registrable Securities of the same class and series as those proposed to be registered as they may request, subject to Section 2(b)(ii) (a “Piggyback Registration”).  Subject to Section 2(b)(ii), the Company shall use its commercially reasonable efforts to include in each such Piggyback Registration such Registrable Securities for which the Company has received written requests (each, a “Piggyback Request”) from Piggyback Eligible Holders within four Business Days after giving the Piggyback Notice.  If a Piggyback Eligible Holder decides not to include all of its Registrable Securities in any Piggyback Registration Statement thereafter filed by the Company, such Piggyback Eligible Holder shall nevertheless continue to have the right to include any Registrable Securities in any subsequent Piggyback Registration Statements as may be filed by the Company, all upon the terms and conditions set forth herein.  The Company shall use its commercially reasonable efforts to effect the registration under the Securities Act of all Registrable Securities which the Company has been so requested to register pursuant to the Piggyback Requests, to the extent required to permit the disposition of the Registrable Securities so requested to be registered.

 

(ii)                                  Priority of Registration.  If the Piggyback Registration under which the Company gives notice pursuant to Section 2(b)(i) is an underwritten offering, and the managing underwriter or managing underwriters of such offering advise the Company and the Piggyback Eligible Holders that, in their reasonable view, the amount of securities requested to be included in such registration (including Registrable Securities requested by the Piggyback Eligible Holders to be included in such offering and any securities that the Company proposes to be included that are not Registrable Securities) exceeds the Maximum Offering Size (which, for the purposes of a Piggyback Registration shall be within a price range acceptable to the Company), then the Company shall so advise all Piggyback Eligible Holders with Registrable Securities proposed to be included in such Piggyback Registration, and shall include in such offering the number of securities which can be so sold in the following order of priority, up to the Maximum Offering Size: (A) first, the securities that the Company proposes to sell up to the Maximum Offering Size and (B) second, the Registrable Securities requested to be included in such Piggyback Registration, allocated, if necessary for the offering not to exceed the Maximum Offering Size, pro rata among the Piggyback Eligible Holders who have submitted a timely Piggyback Request on the basis of the number of Registrable Securities requested to be included therein by each such Piggyback Eligible Holder.  All Piggyback Eligible Holders requesting to be included in the Piggyback Registration must sell their Registrable Securities to the underwriters selected as provided in Section 2(b)(iv) on the same terms and conditions as apply to the Company.  Promptly (and in any event within one Business Day) following receipt of notification by the Company from the managing underwriter of the Price Range, the Company

 

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shall so advise each Piggyback Eligible Holder requesting registration in such offering of such Price Range.  If any Piggyback Eligible Holder disapproves of the terms of any such underwritten offering (including the Price Range), such Piggyback Eligible Holder may elect to withdraw any or all of its Registrable Securities therefrom by written notice to the Company and the managing underwriter(s) delivered prior to the earlier of (A) noon Eastern Time on the Business Day following the date such Holder was advised of the Price Range, (B) execution of the underwriting agreement with respect to such underwritten offering, or (C) execution of the custody agreement with respect to such underwritten offering. If a Piggyback Eligible Holder elects to withdraw any or all of its Registrable Securities based on the procedure set forth above prior to the effectiveness of the Piggyback Registration Statement, the Registrable Securities withdrawn from such underwritten offering shall be excluded and withdrawn from the registration.  For any Piggyback Eligible Holder that is a partnership, limited liability company, corporation or other entity, the partners, members, stockholders, Subsidiaries, parents and Affiliates of such Piggyback Eligible Holder, or the estates and Family Members of any such partners/members and retired partners/members and any trusts for the benefit of any of the foregoing Persons, shall be deemed to be a single “Piggyback Eligible Holder,” and any pro rata reduction with respect to such “Piggyback Eligible Holder” shall be based upon the aggregate amount of securities carrying registration rights owned by all entities and individuals included in such “Piggyback Eligible Holder,” as defined in this sentence.

 

(iii)                               Withdrawal from Registration.  The Company shall have the right to terminate or withdraw any registration initiated by it under this Section 2(b) prior to the effective date of such Registration Statement, whether or not any Piggyback Eligible Holder has elected to include Registrable Securities in such Registration Statement, without prejudice to the right of the Holders immediately to request that such registration be effected as a registration under Section 2(a) to the extent permitted thereunder and subject to the terms set forth therein.  The Registration Expenses of such withdrawn registration shall be borne by the Company in accordance with Section 4 hereof.

 

(iv)                              Selection of Bankers.  If a Piggyback Registration pursuant to this Section 2(b) involves an underwritten offering, the Company shall have the right, in consultation with the Holders of a majority of the Registrable Securities included in such underwritten offering, to (A) determine the plan of distribution, including the price at which the Registrable Securities are to be sold and the underwriting commissions, discounts and fees and (B) select the investment banker or bankers and managers to administer the offering, including the lead managing underwriter or underwriters.

 

(v)                                 Effect of Piggyback Registration.  No registration effected under this Section 2(b) shall relieve the Company of its obligations to effect any registration of the offer and sale of Registrable Securities upon request under Section 2(a) or Section 2(c) hereof and no registration effected pursuant to this Section 2(b) shall be deemed to have been effected pursuant to Section 2(a) or Section 2(c) hereof.

 

(c)                                  Underwritten Shelf Takedown.

 

(i)                                     At any time that a Shelf Registration Statement covering Registrable Securities pursuant to Section 2(a) or Section 2(b) is effective (subject to any Suspension Period)

 

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and the method of distribution set forth in the shelf registration allows for sales pursuant to an underwritten offering, the Holders of a majority of the Registrable Securities registered on an effective Shelf Registration Statement (such Holders, the “Shelf Public Offering Requesting Holders”) shall have the right to elect to sell pursuant to an underwritten offering Registrable Securities available for sale pursuant to such registration statement (each, an “Underwritten Shelf Takedown,” which term shall not include an Alternative Transaction).  The Shelf Public Offering Requesting Holders shall make such election by delivering a notice to the Company specifying the approximate number of Registrable Securities to be sold in the Underwritten Shelf Takedown and the expected price range (net of underwriting discounts and commissions) of such Underwritten Shelf Takedown (a “Shelf Takedown Notice”). Subject to Section 2(e) below, within three days after receipt of any Shelf Takedown Notice, the Company shall give written notice of such requested Underwritten Shelf Takedown (which notice shall state the material terms of such proposed Underwritten Shelf Takedown, to the extent known, as well as the identity of the Shelf Public Offering Requesting Holders) to all other Holders of Registrable Securities that have shares registered on such Shelf Registration Statement (the “Company Shelf Takedown Notice”) and, subject to the provisions of Section 2(e) below, shall include in such Underwritten Shelf Takedown all Registrable Securities of the same class or series as the Registrable Securities originally requested to be sold by the Shelf Public Offering Requesting Holders with respect to which the Company has received written requests for inclusion therein within five Business Days after giving the Company Shelf Takedown Notice (the “Shelf Inclusion Notice”); provided, that any such Registrable Securities shall be sold subject to the same terms as are applicable to the Registrable Securities the Shelf Public Offering Requesting Holders are requesting to sell. The Company shall, as expeditiously as possible use its reasonable best efforts to facilitate the Underwritten Shelf Takedown.

 

(ii)                                  Priority of Registrable Shares. If the managing underwriters for such Underwritten Shelf Takedown advise the Company and the Holders of Registrable Securities proposed to be included in such Underwritten Shelf Takedown that in their reasonable view the number of Registrable Securities proposed to be included in such Underwritten Shelf Takedown exceeds the Maximum Offering Size, then the Company shall so advise all Holders of Registrable Securities proposed to be included in such Underwritten Shelf Takedown, and shall include in such Underwritten Shelf Takedown the number of Registrable Securities which can be so sold in the following order of priority, up to the Maximum Offering Size: (A) first, pro rata among the Holders of such Registrable Securities on the basis of the number of Registrable Securities requested to be included therein by each such Holder, and (B) second, any securities requested to be included in such Underwritten Shelf Takedown by the Company.

 

(iii)                               Selection of Bankers and Counsel.  The Holders of a majority of the Registrable Securities requested to be included in an Underwritten Shelf Takedown shall have the right to select the investment banker or bankers and managers to administer the offering (which shall consist of one or more reputable nationally recognized investment banks, subject to the Company’s approval (which shall not be unreasonably withheld, conditioned or delayed)), including the lead managing underwriter or underwriters and one firm of counsel to represent all of the Holders (along with any reasonably necessary local counsel).

 

(iv)                              Limitations on Underwritten Shelf Takedowns.  The Underwritten Shelf Takedown rights granted in Section 2(c)(i) are subject to the following limitations: (A) the

 

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Company shall not be required to effect more than four Underwritten Shelf Takedowns pursuant to Section 2(c)(i) in any twelve month period; and (B) each Underwritten Shelf Takedown must include, in the aggregate (based solely on the Company Common Stock included in such Underwritten Shelf Takedown by all Holders participating in such Underwritten Shelf Takedown), shares of Company Common Stock having an aggregate market value of at least $250 million (measured based on the closing sale price of the Company’s Common Stock on the date that the Shelf Inclusion Notice is due, as set forth above).

 

(d)                                 Notice Requirements.  Any Demand Notice, Demand Eligible Holder Request, Piggyback Request or a Shelf Takedown Notice shall (i) specify the maximum number (which may be an approximation if a Shelf Takedown Notice) and class or series of Registrable Securities intended to be offered and sold by the Holder making the request, (ii) express such Holder’s bona fide intent to offer up to such number of Registrable Securities for distribution, (iii) describe the nature or method of the proposed offer and sale of Registrable Securities (to the extent applicable), and (iv) contain the undertaking of such Holder to provide all such information and materials and take all action as may reasonably be required in order to permit the Company to comply with all applicable requirements in connection with the registration of such Registrable Securities.

 

(e)                                  Suspension Period.  Notwithstanding any other provision of this Section 2, the Company shall have the right but not the obligation to defer the filing of (but not the preparation of), or suspend the use by the Holders of, any Registration Statement for a period of up to 45 days (i) if an event occurs as a result of which the Registration Statement and any related Prospectus as then supplemented would include any untrue statement of a material fact or omit to state any material fact necessary to make the statements therein in the light of the circumstances under which they were made at such time not misleading, or if it shall be necessary to amend the Registration Statement, file a new registration statement or supplement any related Prospectus to comply with the Securities Act or the Exchange Act or the respective rules thereunder; (ii) upon issuance by the Commission of a stop order suspending the effectiveness of any Registration Statement with respect to Registrable Securities or the initiation of Proceedings with respect to such Registration Statement under Section 9(d) or 8(e) of the Securities Act; (iii) if the Company believes that any such registration or offering (x) should not be undertaken because it would reasonably be expected to materially interfere with any material corporate development or plan or (y) would require the Company, under applicable securities laws and other laws, to make disclosure of material nonpublic information that would not otherwise be required to be disclosed at that time and the Company believes in good faith that such disclosures at that time would not be in the Company’s best interests; provided that this exception (y) shall continue to apply only during the time that such material nonpublic information has not been disclosed and remains material; (iv) if the Company elects at such time to offer Company Common Stock or other equity securities of the Company to (x) fund a merger, third-party tender offer or other business combination, acquisition of assets or similar transaction or (y) meet rating agency and other capital funding requirements; (v) if the Company is pursuing a primary underwritten offering of Company Common Stock pursuant to a registration statement; provided that the Holders shall have Piggyback Registration rights with respect to such primary underwritten offering in accordance with and subject to the restrictions set forth in Section 2(b); or (vi) if any other material development would materially and adversely interfere with the filing or use of any such Registration Statement (any such period, a “Suspension Period”); provided, however, that

 

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in such event, the Initiating Holder or the Shelf Public Offering Requesting Holder, as applicable, will be entitled to withdraw any request for a Demand Registration or any Underwritten Shelf Takedown and, if such request is withdrawn, such Demand Registration or any Underwritten Shelf Takedown will not count as a Demand Registration or an Underwritten Shelf Takedown, and the Company will pay all Registration Expenses in connection with such registration; and provided further, that in no event shall the Company declare a Suspension Period more than once in any 12-month period or for more than an aggregate of 45 days in any 12-month period. The Company shall give prompt written notice to the Holders of its declaration of a Suspension Period and of the expiration of the relevant Suspension Period.  If the filing of any Demand Registration is suspended pursuant to this Section 2(e), once the Suspension Period ends, the Initiating Holder may request a new Demand Registration and the Shelf Public Offering Requesting Holders may request a new Underwritten Shelf Takedown, as the case may be.

 

(f)                                   Required Information and Documents.

 

(i)                                     The Company may require each Holder of Registrable Securities as to which any Registration Statement is being filed or sale is being effected to furnish to the Company such information regarding the distribution of such securities and such other information relating to such Holder and its ownership of Registrable Securities as the Company may from time to time reasonably request in writing (provided that such information shall be used only in connection with such registration) and the Company may exclude from such registration or sale the Registrable Securities of any such Holder who fails to furnish such information within a reasonable time after receiving such request. Each Holder agrees to furnish such information to the Company and to cooperate with the Company as reasonably necessary to enable the Company to comply with the provisions of this Agreement.

 

(ii)                                  In connection with any Public Offering pursuant to Section 2(a), 2(b), or 2(c), each Holder of Registrable Securities as to which any Registration Statement is being filed or sale is being effected shall execute and deliver any agreements and instruments as are reasonably requested by the Company or the underwriters, as applicable, to effectuate such Public Offering, including, without limitation, customary lock-up agreements pursuant to which such Holder agrees not to sell or purchase any securities of the Company for a period of time following the Public Offering as is agreed to by the Company and the underwriters (not to exceed a period of 90 days) (such agreement, a “Lock-Up Agreement”), and each other Holder agrees to execute and deliver a Lock-Up Agreement pursuant to which such Holder agrees not to sell or purchase any securities of the Company for the same period of time following the Public Offering as is agreed to by the Company and the underwriters.

 

(g)                                  Other Registration Rights Agreements.  The Company has not entered into and, unless agreed in writing by Holders of a majority of the then-Registerable Securities on or after the date of this Agreement, will not enter into, any agreement that (i) is inconsistent with the rights granted to the Holders with respect to Registrable Securities in this Agreement or otherwise conflicts with the provisions hereof in any material respect or (ii) other than as set forth in this Agreement, would allow any holder of Company Common Stock to include Company Common Stock in any Registration Statement filed by the Company on a basis that is more favorable in any material respect to the rights granted to the Holders hereunder.

 

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(h)                                 Cessation of Registration Rights.  All registration rights granted under this Section 2 shall continue to be applicable with respect to any Holder until such Holder no longer holds any Registrable Securities.

 

3.                                      Registration Procedures.  The procedures to be followed by the Company and each participating Holder to register the sale of Registrable Securities pursuant to a Registration Statement in accordance with this Agreement, and the respective rights and obligations of the Company and such Holders with respect to the preparation, filing and effectiveness of such Registration Statement, are as follows:

 

(a)                                 The Company will (i) prepare and file a Registration Statement or a prospectus supplement, as applicable, with the Commission (within the time period specified in Section 2(a) or Section 2(c), as applicable, in the case of a Demand Registration or an Underwritten Shelf Takedown) which Registration Statement (A) subject to the requirements of Section 2(a)(i), shall be on a form selected by the Company for which the Company qualifies, (B) shall be available for the sale or exchange of the Registrable Securities in accordance with the intended method or methods of distribution, and (C) shall comply as to form in all material respects with the requirements of the applicable form and include and/or incorporate by reference all financial statements required by the Commission to be filed therewith, (ii) use its commercially reasonable efforts to cause such Registration Statement to become effective and remain effective for the periods provided under Section 2(a) in the case of a Demand Registration Statement, (iii) use its commercially reasonable efforts to prevent the occurrence of any event that would cause a Registration Statement to contain a material misstatement or omission or to be not effective and usable for resale of the Registrable Securities registered pursuant thereto (during the period that such Registration Statement is required to be effective as provided under Section 2(a)), and (iv) cause each Registration Statement and the related Prospectus and any amendment or supplement thereto, as of the effective date of such Registration Statement, amendment or supplement (x) to comply in all material respects with any requirements of the Securities Act and the rules and regulations of the Commission and (y) not to contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading. The Company will, (1) at least five Business Days prior to the anticipated filing of a Registration Statement or any related Prospectus or any amendment or supplement thereto (including any documents incorporated by reference therein), or before using any Issuer Free Writing Prospectus, furnish to such Holders, the Holders’ counsel and the managing underwriter or underwriters of an underwritten offering of Registrable Securities, if applicable, copies of all such documents proposed to be filed, (2) use its commercially reasonable efforts to address in each such document prior to being so filed with the Commission such comments as such Holder, its counsel or underwriter reasonably shall propose within three Business Days of receipt of such copies by the Holders and (3) not file any Registration Statement or any related Prospectus or any amendment or supplement thereto containing information regarding a participating Holder to which a participating Holder objects.

 

(b)                                 The Company will as promptly as reasonably practicable (i) prepare and file with the Commission such amendments, including post-effective amendments, and supplements to each Registration Statement and the Prospectus used in connection therewith as (A) may be reasonably requested by any Holder of Registrable Securities covered by such Registration Statement necessary to permit such Holder to sell in accordance with its intended method of

 

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distribution or (B) may be necessary under applicable law to keep such Registration Statement continuously effective with respect to the disposition of all Registrable Securities covered thereby for the periods provided under Section 2(a) in accordance with the intended method of distribution, (ii) cause the related Prospectus to be amended or supplemented by any required prospectus supplement, and as so supplemented or amended, to be filed pursuant to Rule 424, (iii) respond to any comments received from the Commission with respect to each Registration Statement or Prospectus or any amendment thereto, and (iv)  provide such Holders true and complete copies of all correspondence from and to the Commission relating to such Registration Statement or Prospectus other than any comments or Company responses that the Company determines in good faith would result in the disclosure to such Holders of material non-public information concerning the Company that is not already in the possession of such Holder.

 

(c)                                  The Company will comply in all material respects with the provisions of the Securities Act and the Exchange Act (including Regulation M under the Exchange Act) with respect to each Registration Statement and the disposition of all Registrable Securities covered by each Registration Statement.

 

(d)                                 The Company will notify participating Holders and the managing underwriter or underwriters of an underwritten offering of Registrable Securities, if applicable, as promptly as reasonably practicable: (i)(A) when a Registration Statement, any pre-effective amendment, any Prospectus or any prospectus supplement or post-effective amendment to a Registration Statement or any free writing prospectus is proposed to be filed; (B) when the Commission notifies the Company whether there will be a “review” of such Registration Statement and whenever the Commission comments on such Registration Statement (in which case the Company shall provide true and complete copies thereof and all written responses thereto to each participating Holder, its counsel and each underwriter, if applicable, other than information which the Company determines in good faith would constitute material non-public information that is not already in the possession of such Holder); and (C) with respect to each Registration Statement or any post-effective amendment thereto, when the same has been declared effective; (ii) of any request by the Commission or any other federal or state governmental or regulatory authority for amendments or supplements to a Registration Statement or Prospectus or for additional information (whether before or after the effective date of the Registration Statement) or any other correspondence with the Commission or any such authority relating to, or which may affect, the Registration Statement; (iii) of the issuance by the Commission or any other governmental or regulatory authority of any stop order, injunction or other order or requirement suspending the effectiveness of a Registration Statement covering any or all of the Registrable Securities or the initiation of any Proceedings for that purpose; (iv) of the receipt by the Company of any notification with respect to the suspension of the qualification or exemption from qualification of any of the Registrable Securities for sale in any jurisdiction, or the initiation or threatening of any Proceeding for such purpose; (v) if the representations and warranties of the Company in any applicable underwriting agreement or similar agreement cease to be true and correct in all material respects as of the date such representations and warranties are made; or (vi) of the occurrence of any event that makes any statement made in such Registration Statement or Prospectus or any document incorporated or deemed to be incorporated therein by reference untrue in any material respect or if, as a result of such event or the passage of time, such Registration Statement, Prospectus or other documents requires revisions so that, in the case of such Registration Statement or the Prospectus, as the case may be, it will not contain any

 

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untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein (in the case of the Prospectus, in light of the circumstances under which they were made) not misleading, or when any Issuer Free Writing Prospectus includes information that may conflict with the information contained in the Registration Statement or Prospectus, or if, for any other reason, it shall be necessary during such time period to amend or supplement such Registration Statement or Prospectus in order to comply with the Securities Act, which shall correct such misstatement or omission or effect such compliance.

 

(e)                                  The Company will use its commercially reasonable efforts to avoid the issuance or commencement, of, or, if issued or commenced, to obtain the withdrawal or dismissal, as soon as reasonably possible, of (i) any stop order or other order suspending the effectiveness of a Registration Statement or the use of any Prospectus, (ii) any suspension of the qualification (or exemption from qualification) of any of the Registrable Securities for sale in any jurisdiction, or (iii) Proceedings with respect to a Registration Statement under Section 9(d) or 8(c) of the Securities Act.

 

(f)                                   During the Effectiveness Period, the Company will furnish to each participating Holder and the managing underwriter or underwriters of an underwritten offering of Registrable Securities, if applicable, upon their request, without charge, at least one conformed copy of each Registration Statement and each amendment thereto and all exhibits to the extent requested by such participating Holder or underwriter (including those incorporated by reference) promptly after the filing of such documents with the Commission.

 

(g)                                  The Company will promptly deliver to each participating Holder and the managing underwriter or underwriters of an underwritten offering of Registrable Securities, if applicable, without charge, as many copies of each Prospectus or Prospectuses (including each form of prospectus) and each amendment or supplement thereto as such participating Holder or underwriter may reasonably request in order to facilitate the disposition of the Registrable Securities by such participating Holder or underwriter.  The Company consents to the use of such Prospectus and each amendment or supplement thereto by each of the participating Holders and any applicable underwriter in connection with the offering and sale of the Registrable Securities covered by such Prospectus and any amendment or supplement thereto.

 

(h)                                 The Company will use its commercially reasonable efforts to (i) register or qualify the Registrable Securities covered by a Registration Statement, no later than the time such Registration Statement is declared effective by the Commission, under all applicable securities laws (including the “blue sky” laws) of such jurisdictions each underwriter, if any, or any participating Holder shall reasonably request; (ii) keep each such registration or qualification effective during the period such Registration Statement is required to be kept effective under the terms of this Agreement and (iii) do any and all other acts and things which may be reasonably necessary or advisable to enable such underwriter, if any, and each participating Holder to consummate the disposition in each such jurisdiction of the Registrable Securities covered by such Registration Statement; provided, however, that the Company will not be required to (x) qualify generally to do business in any jurisdiction where it would not otherwise be required to qualify but for this subparagraph, (y) subject itself to taxation in any such jurisdiction or (z) consent to general service of process (other than service of process in connection with such

 

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registration or qualification or any sale of Registrable Securities in connection therewith) in any such jurisdiction.

 

(i)                                     The Company will cooperate with the participating Holders and the managing underwriter, if any, to facilitate the timely preparation and delivery of certificates or book-entry statements representing Registrable Securities to be sold, which certificates or book-entry statements shall be free, to the extent permitted by the underwriting agreement or purchase agreement, if applicable, and under law, of all restrictive legends, and to enable such Registrable Securities to be in such denominations and registered in such names as any such Holders or managing underwriter, as applicable, may reasonably request and instruct any transfer agent and registrar of Registrable Securities to release any stop transfer orders in respect thereof.  At the request of any participating Holder or the managing underwriter, if any, the Company will deliver or cause to be delivered an opinion or instructions to the transfer agent in order to allow the Registrable Securities to be sold from time to time free of all restrictive legends.

 

(j)                                    Upon the occurrence of any event contemplated by Sections 2(e) or 3(d)(ii) or (vi), as promptly as reasonably practicable, the Company will prepare a supplement or amendment, including a post-effective amendment, if required by applicable law, to the affected Registration Statement or a supplement to the related Prospectus or any document incorporated or deemed to be incorporated therein by reference or to the applicable Issuer Free Writing Prospectus, and file any other required document so that, as thereafter delivered, such documents comply with the Commission request and no Registration Statement nor any Prospectus will contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein (in the case of a Prospectus, in light of the circumstances under which they were made) not misleading and no Issuer Free Writing Prospectus will include information that conflicts with information contained in the Registration Statement or Prospectus, such that each participating Holder can resume disposition of such Registrable Securities covered by such Registration Statement or Prospectus.

 

(k)                                 Participating Holders may distribute the Registrable Securities by means of an underwritten offering; provided that (i) such Holders provide to the Company a Demand Notice or Shelf Takedown Notice of their intention to distribute Registrable Securities by means of an underwritten offering, (ii) the right of any Holder to include such Holder’s Registrable Securities in such registration shall be conditioned upon such Holder’s participation in such underwriting and the inclusion of such Holder’s Registrable Securities in the underwriting to the extent provided herein, (iii) each Holder participating in such underwritten offering agrees to enter into customary agreements, including an underwriting agreement in customary form, and sell such Holder’s Registrable Securities on the basis provided in any underwriting arrangements approved by the Holders entitled to select the managing underwriter or managing underwriters hereunder (provided that any such Holder shall not be required to make any representations or warranties to or agreements with the Company or the underwriters other than representations, warranties, agreements and indemnities regarding such Holder, such Holder’s title to the Registrable Securities, such Holder’s intended method of distribution, the accuracy of information concerning such Holder as provided by or on behalf of such Holder, and any other representations required to be made by the Holder under applicable law, and the aggregate amount of the liability of such Holder in connection with such offering shall not exceed such Holder’s net proceeds from the disposition of such Holder’s Registrable Securities in such

 

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offering) and (iv) each Holder participating in such underwritten offering completes and executes all questionnaires, powers of attorney, custody agreements and other documents reasonably required under the terms of such underwriting arrangements. The Company hereby agrees with each Holder that, in connection with any underwritten offering in accordance with the terms hereof, it will negotiate in good faith and execute all indemnities, underwriting agreements and other documents reasonably required under the terms of such underwriting arrangements, and will procure auditor “comfort” letters addressed to the underwriters in the offering from the Company’s independent certified public accountants or independent auditors (and, if necessary, any other independent certified public accountants or independent auditors of any Subsidiary of the Company or any business acquired by the Company for which financial statements and financial data are, or are required to be, included in the Registration Statement) in customary form and covering such matters of the type customarily covered by comfort letters as the underwriters reasonably request, dated the date of execution of the underwriting agreement and brought down to the closing under the underwriting agreement.

 

(l)                                     The Company will obtain for delivery to the underwriter or underwriters of an underwritten offering of Registrable Securities an opinion or opinions from counsel for the Company (including any local counsel reasonably requested by the underwriters) dated the most recent effective date of the Registration Statement or, in the event of an underwritten offering, the date of the closing under the underwriting agreement, in customary form, scope and substance, covering the matters customarily covered in opinions requested in sales of securities or underwritten offerings, which opinions shall be reasonably satisfactory to such underwriters and their counsel.

 

(m)                             For a reasonable period prior to the filing of any Registration Statement and throughout the Effectiveness Period, the Company will make available upon reasonable notice at the Company’s principal place of business or such other reasonable place for inspection by a representative appointed by the Holders of a majority of the Registrable Securities covered by the applicable Registration Statement, by any managing underwriter or managing underwriters selected in accordance with this Agreement and by any attorney, accountant or other agent retained by such Holders or underwriter, such financial and other information and books and records of the Company, and cause the officers, employees, counsel and independent certified public accountants of the Company to respond to such inquiries, as shall be reasonably necessary (and in the case of counsel, not violate an attorney-client privilege in such counsel’s reasonable belief) to conduct a reasonable investigation within the meaning of Section 11 of the Securities Act.

 

(n)                                 The Company will (i) provide and cause to be maintained a transfer agent and registrar for all Registrable Securities covered by the applicable Registration Statement from and after a date not later than the effective date of such Registration Statement and provide and enter into any reasonable agreements with a custodian for the Registrable Securities and (ii) not later than the effective date of the applicable Registration Statement, provide a CUSIP number for all Registrable Securities.

 

(o)                                 The Company will cooperate with each Holder of Registrable Securities and each underwriter or agent participating in the disposition of Registrable Securities and their respective

 

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counsel in connection with any filings required to be made with FINRA and in performance of any due diligence investigations by any underwriter.

 

(p)                                 The Company will use its commercially reasonable efforts to comply with all applicable rules and regulations of the Commission, the Trading Market, FINRA and any state securities authority, and make available to each Holder, as soon as reasonably practicable after the effective date of the Registration Statement, an earnings statement covering at least 12 months which shall satisfy the provisions of Section 11(a) of the Securities Act and Rule 158.

 

(q)                                 The Company will use its commercially reasonable efforts to ensure that any Issuer Free Writing Prospectus utilized in connection with any Prospectus complies in all material respects with the Securities Act, is filed in accordance with the Securities Act to the extent required thereby, is retained in accordance with the Securities Act to the extent required thereby and, when taken together with the related Prospectus, will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading.

 

(r)                                    In connection with any registration of Registrable Securities pursuant to this Agreement, the Company will take all commercially reasonable actions as are necessary or advisable in order to expedite or facilitate the disposition of Registrable Securities by such Holders, including using commercially reasonable efforts to cause appropriate officers and employees to be available, on a customary basis and upon reasonable advance notice, to meet with prospective investors in presentations, meetings and road shows; provided, however that the Company shall not be required to participate in any marketing effort that is longer than seven Business Days or requires face to face meetings with investors more than once every 90 days and no more than four times in a 12-month period.

 

(s)                                   The Company shall use its commercially reasonable efforts to cause all Registrable Securities being sold to be qualified for inclusion in or listed on any securities exchange on which shares of Company Common Stock are then so qualified or listed if so requested by the Holders, or if so requested by the managing underwriter(s) of an underwritten offering, if any.

 

(t)                                    The Company shall, if such registration for an underwritten offering is pursuant to a Registration Statement on Form S-3 or any similar short-form registration, include in such Registration Statement such additional information for marketing purposes as the managing underwriter(s) reasonably request(s).

 

(u)                                 The Company shall use its commercially reasonable efforts to cooperate in a timely manner with any reasonable and customary request of the Holders in respect of any Alternative Transaction, including entering into customary agreements with respect to such Alternative Transactions (and providing customary representations, warranties, covenants and indemnities in such agreements) as well as providing other reasonable assistance in respect of such Alternative Transactions of the type applicable to a Public Offering subject to this Section 3, to the extent customary for such transactions.

 

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4.                                      Registration Expenses.  The Company shall bear all reasonable Registration Expenses incident to the Parties’ performance of or compliance with their respective obligations under this Agreement or otherwise in connection with any Demand Registration, Piggyback Registration or Shelf Takedown Notice (excluding any Selling Expenses), whether or not any Registrable Securities are sold pursuant to a Registration Statement.

 

“Registration Expenses” shall include, without limitation, (i) all registration, qualification and filing fees and expenses (including fees and expenses (A) of the Commission or FINRA, (B) incurred in connection with the listing of the Registrable Securities on the Trading Market, and (C) incurred to comply with applicable state securities or “Blue Sky” laws (including reasonable fees and disbursements of counsel for the underwriters in connection with blue sky qualifications of the Registrable Securities)); (ii) printing expenses (including expenses of printing certificates for the Company’s shares and of printing prospectuses); (iii) analyst or investor presentation or road show expenses of the Company and the underwriters, if any; (iv) messenger, telephone and delivery expenses; (v) reasonable fees and disbursements of counsel (including any local counsel), auditors and accountants for the Company (including the expenses incurred in connection with “comfort letters” or legal opinions required by or incident to such performance and compliance); (vi) the reasonable fees and disbursements of underwriters to the extent customarily paid by issuers or sellers of securities (including, if applicable, the fees and expenses of any “qualified independent underwriter” (and its counsel) that is required to be retained in accordance with the rules and regulations of FINRA and the other reasonable fees and disbursements of underwriters (including reasonable fees and disbursements of counsel for the underwriters) in connection with any FINRA qualification, provided, that, other than in the limited capacities set forth in this clause (vi), the Company shall not be responsible for the fees and expenses of underwriters’ counsel; (vii) fees and expenses of any special experts retained by the Company; (viii) Securities Act liability insurance, if the Company so desires such insurance; (ix) reasonable fees and disbursements of one counsel (along with any reasonably necessary local counsel) representing all Holders mutually agreed by Holders of a majority of the Registrable Securities participating in the related registration; and (x) fees and expenses payable in connection with any ratings of the Registrable Securities, including expenses relating to any presentations to rating agencies.  In addition, the Company shall be responsible for all of its expenses incurred in connection with the consummation of the transactions contemplated by this Agreement (including expenses payable to third parties and including all salaries and expenses of the Company’s officers and employees performing legal or accounting duties), the expense of any annual audit and any underwriting fees, discounts, selling commissions and stock transfer taxes and related legal and other fees applicable to securities sold by the Company and in respect of which proceeds are received by the Company. Each Holder shall pay any Selling Expenses applicable to the sale or disposition of such Holder’s Registrable Securities pursuant to any Demand Registration Statement or Piggyback Registration Statement,  or pursuant to any Automatic Shelf Registration Statement or Shelf Registration Statement under which such selling Holder’s Registrable Securities were registered or sold, in proportion to the amount of such selling Holder’s shares of Registrable Securities registered or sold in any offering under such Demand Registration Statement, Piggyback Registration Statement, Automatic Shelf Registration Statement or Shelf Registration Statement.

 

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5.                                      Indemnification.

 

(a)                                 If requested by a participating Holder, the Company shall indemnify and hold harmless each underwriter, if any, engaged in connection with any registration referred to in Section 2 and provide representations, covenants, opinions and other assurances to such underwriter in form and substance reasonably satisfactory to such underwriter and the Company.  Further, the Company shall indemnify and hold harmless each Holder, its stockholders, equityholders, general partners, limited partners, managers, members, and Affiliates and each of their respective officers and directors and any Person who controls any such Holder (within the meaning of the Securities Act) and any employee, attorney or Representative thereof (collectively, “Indemnified Persons”), to the fullest extent permitted by applicable law, from and against any and all losses, claims, damages, liabilities, joint or several, costs (including reasonable costs of preparation and reasonable attorneys’, accountants’ and experts’ fees) and expenses, judgments, fines, penalties, interest, settlements or other amounts arising from any and all Proceedings, whether civil, criminal, administrative or investigative, in which any Indemnified Person may be involved, or is threatened to be involved, as a party or otherwise, under the Securities Act or otherwise (collectively, “Losses”), as incurred, arising out of, based upon, resulting from or relating to (i) any untrue or alleged untrue statement of a material fact contained in any Registration Statement under which any Registrable Securities were registered, Prospectus (including in any preliminary prospectus (if used prior to the effective date of such Registration Statement)), or in any summary or final prospectus or free writing prospectus or in any amendment or supplement thereto or in any documents incorporated by reference in any of the foregoing or (ii) the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements made therein not misleading, or (iii) any violation or alleged violation by the Company or any of its Subsidiaries of any federal, state or common law rule or regulation relating to action or inaction in connection with any Company provided information in such registration, disclosure document or related document or report, and the Company will reimburse such Indemnified Person for any legal or other expenses reasonably incurred by it in connection with investigating or defending any such Proceeding; provided, however, that the Company shall not be liable to any Indemnified Person to the extent that any such Losses arise out of, are based upon or results from an untrue or alleged untrue statement or omission or alleged omission made in such Registration Statement, such preliminary, summary or final prospectus or free writing prospectus or such amendment or supplement, in reliance upon and in conformity with written information furnished to the Company by or on behalf of such Indemnified Person specifically for use in the preparation thereof.

 

(b)                                 In connection with any Registration Statement filed by the Company pursuant to Section 2 hereof in which a Holder has registered for sale its Registrable Securities, each such selling Holder agrees (severally and not jointly) to indemnify and hold harmless, to the fullest extent permitted by law, the Company, its directors and officers, Affiliates, employees, agents and each Person who controls the Company (within the meaning of the Securities Act or the Exchange Act) from and against any Losses resulting from (i) any untrue statement of a material fact in any Registration Statement under which such Registrable Securities were registered or sold under the Securities Act (including any final, preliminary or summary Prospectus contained therein or any amendment thereof or supplement thereto or any documents incorporated by reference therein) or (ii) any omission to state therein a material fact required to be stated therein

 

20

 

or necessary to make the statements therein  not misleading, in each case to the extent, but only to the extent, that such untrue statement or omission is contained in any information furnished in writing by or on behalf of such selling Holder to the Company specifically for inclusion in such Registration Statement or Prospectus and has not been corrected in a subsequent writing prior to the sale of the Registrable Securities to the Indemnified Person asserting the claim. In no event shall the liability of any selling Holder hereunder be greater in amount than the dollar amount of the net proceeds received by such Holder under the sale of Registrable Securities giving rise to such indemnification obligation less any amounts paid by such Holder in connection with such sale.

 

(c)                                  Any indemnified person shall (i) give prompt written notice to the indemnifying party of any claim with respect to which it seeks indemnification (provided that any delay or failure to so notify the indemnifying party shall not relieve the indemnifying party of its obligations hereunder except to the extent, if at all, that it is actually and materially prejudiced by reason of such delay or failure) and (ii) permit such indemnifying party to assume the defense of such claim with counsel reasonably satisfactory to the indemnified party; provided, however, that any indemnified person shall have the right to select and employ separate counsel and to participate in the defense of such claim, but the fees and expenses of such counsel shall be at the expense of such indemnified person unless (A) the indemnifying party has agreed in writing to pay such fees or expenses, (B) the indemnifying party shall have failed to assume the defense of such claim within a reasonable time after receipt of notice of such claim from the indemnified person and employ counsel reasonably satisfactory to such indemnified person, (C) the indemnified party has reasonably concluded (based upon advice of its counsel) that there may be legal defenses available to it or other indemnified persons that are different from or in addition to those available to the indemnifying party, or (D) in the reasonable judgment of any such indemnified person (based upon advice of its counsel) a conflict of interest may exist between such indemnified person and the indemnifying party with respect to such claims (in which case, if the indemnified person notifies the indemnifying party in writing that such indemnified person elects to employ separate counsel at the expense of the indemnifying party, the indemnifying party shall not have the right to assume the defense of such claim on behalf of such indemnified person).  No action may be settled without the consent of the indemnifying party, provided that the consent of the indemnified party shall not be required if (A) such settlement includes an unconditional release of such indemnified party in form and substance satisfactory to such indemnified party from all liability on the claims that are the subject matter of such settlement; (B) such settlement provides for the payment by the indemnifying party of money as the sole relief for such action and (C) such settlement does not include any statement or any admission of fault, culpability or a failure to act by or on behalf of any indemnified party.  It is understood that the indemnifying party or parties shall not, except as specifically set forth in this Section 5(c), in connection with any Proceeding or related Proceedings in the same jurisdiction, be liable for the reasonable fees, disbursements or other charges of more than one separate firm admitted to practice in such jurisdiction at any one time.

 

(d)                                 If for any reason the foregoing indemnity is unavailable, unenforceable or is insufficient to hold harmless an indemnified party under Sections 5(a) or (b), then each applicable indemnifying party shall contribute to the amount paid or payable to such indemnified party as a result of any Losses in such proportion as is appropriate to reflect the relative fault of the indemnifying party, on the one hand, and the indemnified party, on the other hand, with

 

21

 

respect to such Loss. The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the indemnifying party or the indemnified party and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such untrue statement or omission. If, however, the allocation provided in the second preceding sentence is not permitted by applicable law, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party in such proportion as is appropriate to reflect not only such relative faults but also the relative benefits of the indemnifying party and the indemnified party as well as any other relevant equitable considerations. The parties hereto agree that it would not be just and equitable if any contribution pursuant to this Section 5(d) were to be determined by pro rata allocation or by any other method of allocation which does not take account of the equitable considerations referred to in the preceding sentences of this Section 5(d). The amount paid or payable in respect of any Losses shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such Losses. No Person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation. Notwithstanding anything in this Section 5(d) to the contrary, no indemnifying party (other than the Company) shall be required pursuant to this Section 5(d) to contribute any amount greater than the amount of the net proceeds received by such indemnifying party from the sale of Registrable Securities pursuant to the registration statement giving rise to such Losses, less the amount of any indemnification payment made by such indemnifying party pursuant to Section 5(b). In addition, no Holder or any Affiliate thereof shall be required to pay any amount under this Section 5(d) unless such Person or entity would have been required to pay an amount pursuant to Section 5(b) if it had been applicable in accordance with its terms.

 

(e)                                  The remedies provided for in this Section 5 are not exclusive and shall not limit any rights or remedies which may otherwise be available to any indemnified party at law or in equity.

 

6.                                      Other Agreements.

 

(a)                                 Transfer of Rights.

 

(i)                                     Each Holder acknowledges and agrees that it may not transfer any of its registration rights under this Agreement except (A) to its Affiliates, (B) to any trust or other entity formed by a Holder that is an individual for legitimate estate planning purposes (the beneficiary of which is one or more Family Members), or (C) with the prior written consent of the Company, and provided that, in each case, the requirements of Section 6(a)(ii) are complied with.

 

(ii)                                  In the case of a transfer of shares of Company Common Stock pursuant to Section 6(a), the registration rights of such Holder with respect to the transferred shares of Company Common Stock will be transferred to such transferee effective upon receipt by the Company of (A) written notice from such Holder stating the name and address of such transferee, identifying the number of shares of Company Common Stock with respect to which

 

22

 

rights under this Agreement are being transferred, the nature of the rights so transferred and the specific provision of Section 6(a)(i) that such transfer complies with, and (B) a written agreement from such transferee to be bound by the terms of this Agreement, substantially in the form of the Joinder Agreement attached hereto as Exhibit A. Following any such transfer, the Company will notify the other Holders as to who the transferees are and the nature of the rights so transferred.  Any proposed transfer of registration rights that the Company, in its reasonable discretion, determines not to be in compliance with Section 6(a)(i) above, shall be null and void.

 

(iii)                               In the event the Company engages in a merger, consolidation or sale of assets in which the Company Common Stock is converted into securities of another company, or the Company otherwise has a successor or assign, appropriate arrangements will be made so that the registration rights and other rights provided under this Agreement continue to be provided to Holders by the issuer of such securities, unless Holders then holding a majority of the Registrable Securities otherwise agree. To the extent such new issuer, or any company acquired by the Company in a merger or consolidation, was bound by registration rights obligations that would conflict with the provisions of this Agreement, the Company will, unless Holders then holding a majority of the Registrable Securities otherwise agree, use its best efforts to modify any such “inherited” registration rights obligations so as not to interfere in any material respects with the rights provided under this Agreement.

 

(b)                                 Facilitation of Sales Pursuant to Rule 144.  The Company shall use its commercially reasonable efforts to timely file the reports required to be filed by it under the Exchange Act or the Securities Act and the rules adopted by the Commission thereunder (including the reports under Sections 13 and 15(d) of the Exchange Act referred to in subparagraph (c)(1) of Rule 144), and shall take such further action as any Holder may reasonably request, all to the extent required from time to time to enable the Holders to sell Registrable Securities without registration under the Securities Act within the limitations of the exemption provided by Rule 144. Upon the written request of any Holder in connection with that Holder’s sale pursuant to Rule 144, the Company shall deliver to such Holder a written statement as to whether it has complied with such requirements, and the Company shall, at the request of any Holder, provide a legal opinion from its counsel as to whether such sale is exempt under Rule 144.

 

7.                                      Miscellaneous.

 

(a)                                 Remedies.  In the event of a breach by any party hereto of any of its obligations under this Agreement, the non-breaching parties, in addition to being entitled to exercise all rights granted by law and under this Agreement, including recovery of damages, will be entitled to specific performance of its rights under this Agreement.  Each party agrees that monetary damages would not provide adequate compensation for any losses incurred by reason of a breach by it of any of the provisions of this Agreement and further agrees that, in the event of any action for specific performance in respect of such breach, it shall have waived hereby the defense that a remedy at law would be adequate and shall have waived hereby any requirement for the posting of a bond.

 

(b)                                 Discontinued Disposition.  Each Holder agrees by its acquisition of Registrable Securities or execution of this Agreement and acquiring the rights and obligations hereunder,

 

23

 

that, upon receipt of a notice from the Company of the occurrence of any event of the kind described in clauses (ii) through (iv) and (vi) of Section 3(d) or the occurrence of a Suspension Period, such Holder will forthwith discontinue disposition of such Registrable Securities under the Registration Statement until such Holder’s receipt of the copies of the supplemental Prospectus or amended Registration Statement or until it is advised in writing by the Company that the use of the applicable Prospectus may be resumed, and, in either case, has received copies of any additional or supplemental filings that are incorporated or deemed to be incorporated by reference in such Prospectus or Registration Statement.  The Company may provide appropriate stop orders to enforce the provisions of this Section 7(b).  In the event the Company shall give any such notice, the period during which the applicable Registration Statement is required to be maintained effective shall be extended by the number of days during the period from and including the date of the giving of such notice to and including the date when each seller of Registrable Securities covered by such Registration Statement either receives the copies of the supplemented or amended Prospectus or is advised in writing by the Company that the use of the Prospectus may be resumed.

 

(c)                                  Amendments.  Except as otherwise provided herein, no modification, amendment or waiver of any provision of this Agreement shall be effective against the Company or any Holder unless such modification, amendment or waiver is approved in writing by the Company and the Holders holding a majority of the Registrable Securities then held by the Holders; provided that any amendment, modification, supplement or waiver of any of the provisions of this Agreement which disproportionately materially adversely affects any Holder or group of Holders shall not be effective without the written approval of such Holder or such Holders holding a majority of the Registrable Securities then held by all Holders of such group of Holders (it being understood that the proportionality and magnitude of such effect will be determined without regard to relative share ownership; and it being further acknowledged and agreed that the notice and other provisions of this Agreement may be waived with respect to any particular registration or transaction and such waiver shall not preclude any Holder from participating in such registration or transaction regardless of whether such Holder approved such waiver). Notwithstanding the foregoing, a waiver or consent to depart from the provisions hereof with respect to a matter that relates exclusively to the rights of Holders of Registrable Securities whose securities are being registered or sold pursuant to a Registration Statement and that does not affect the rights of other Holders of Registrable Securities may be given by holders of a majority of the Registrable Securities being registered or sold by such Holders pursuant to such Registration Statement.

 

(d)                                 Waivers.  No waiver of any default with respect to any provision, condition or requirement of this Agreement shall be deemed to be a continuing waiver in the future or a waiver of any subsequent default or a waiver of any other provision, condition or requirement hereof, nor shall any delay or omission of any Party to exercise any right hereunder in any manner impair the exercise of any such right.

 

(e)                                  Termination and Effect of Termination. This Agreement shall terminate with respect to each Holder when such Holder no longer holds any Registrable Securities and will terminate in full when no Holder holds any Registrable Securities, except for the provisions of Sections 5, 6(b) and 7, which shall survive any such termination. No termination under this Agreement shall relieve any Person of liability for breach or Registration Expenses incurred

 

24

 

prior to termination. In the event this Agreement is terminated, each Person entitled to indemnification rights pursuant to Section 5 shall retain such indemnification rights with respect to any matter that (i) may be an indemnified liability thereunder and (ii) occurred prior to such termination.

 

(f)                                   Notices.  Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall be in writing and shall be deemed given and effective on the earliest of (i) the date of transmission, if such notice or communication is delivered via  electronic mail in PDF or similar electronic or digital format (with confirmation of receipt) prior to 5:00 p.m. (New York time) on a Business Day in the place of receipt, (ii) the Business Day after the date of transmission, if such notice or communication is delivered via electronic mail in PDF or similar electronic or digital format (with confirmation of receipt) later than 5:00 p.m. (New York time) on any date and earlier than 11:59 p.m. (New York time) on such date, (iii) the Business Day following the date of mailing, if sent by nationally recognized overnight courier service or (iv) upon actual receipt by the Party to whom such notice is required to be given. The address for such notices and communications shall be as follows (or at such other address as shall be given in writing by any party to the others):

 

If to the Company:

 

YETI Holdings, Inc.

7601 Southwest Parkway

Austin, Texas  78735

Attention:  Bryan C. Barksdale

Email:

 

with a copy (which shall not constitute notice) to:

 

Jones Day

North Point

901 Lakeside Avenue

Cleveland, Ohio  44114

Attention:  Denise A. Carkhuff and Timothy R. Curry

Email:

 

If to the Fund or Cortec Co-Invest:

 

c/o Cortec Management V, LLC

140 East 45th Street, 43rd Floor

New York, New York  10117

Attn:  David L. Schnadig

Email:

 

If to any other Person who is then a Holder, to the address of such Holder set forth on the signature pages hereto, or which has been designated by notice in writing by such Person to the others in accordance with the provisions of this Section 7(f).

 

25

 

(g)                                  Successors and Assigns; New Issuances.  Except as otherwise provided herein, this Agreement shall be binding upon and inure to the benefit of and be enforceable by the parties hereto and the respective successors, Permitted Transferees, heirs and personal representatives of the parties hereto. Except as otherwise provided in Section 6(a)(iii), this Agreement may not be assigned by the Company without the prior written consent of the Holders of a majority of the Registrable Securities. Each Holder shall have the right to assign all or part of its or his rights and obligations under this Agreement only in accordance with transfers of Registrable Securities to such Holder’s Permitted Transferees. If any Holder shall acquire additional Registrable Securities, such Registrable Securities shall be subject to all of the terms, and entitled to all the benefits, of this Agreement.

 

(h)                                 Governing Law.  This Agreement and all claims arising out of or based upon this Agreement or relating to the subject matter hereof shall be governed by and construed in accordance with the domestic substantive laws of the State of Delaware without giving effect to any choice or conflict of laws provision or rule that would cause the application of the domestic substantive laws of any other jurisdiction.

 

(i)                                     Submission to Jurisdiction.  Each of the Parties, by its execution of this Agreement, (i) hereby irrevocably submits to the exclusive jurisdiction of the Court of Chancery of the State of Delaware for the purpose of any Proceeding arising out of or based upon this Agreement or relating to the subject matter hereof, (ii) hereby waives to the extent not prohibited by applicable law, and agrees not to assert, and agrees not to allow any of its Subsidiaries or Affiliates to assert, by way of motion, as a defense or otherwise, in any such action, any claim that it is not subject personally to the jurisdiction of the above-named courts, that its property is exempt or immune from attachment or execution, that any such Proceeding brought in one of the above-named courts is improper, or that this Agreement or the subject matter hereof or thereof may not be enforced in or by such court and (iii) hereby agrees not to commence or maintain any Proceeding arising out of or based upon this Agreement or relating to the subject matter hereof or thereof other than before one of the above-named courts nor to make any motion or take any other action seeking or intending to cause the transfer or removal of any Proceeding to any court other than one of the above-named courts whether on the grounds of inconvenient forum or otherwise.  Notwithstanding the foregoing, to the extent that any party hereto is or becomes a party in any litigation in connection with which it may assert indemnification rights set forth in this Agreement, the court in which such litigation is being heard shall be deemed to be included in clause (i) above.  Notwithstanding the foregoing, any party to this Agreement may commence and maintain an action to enforce a judgment of any of the above-named courts in any court of competent jurisdiction.  Each party hereto hereby consents to service of process in any such Proceeding in any manner permitted by Delaware law, and agrees that service of process by registered or certified mail, return receipt requested, at its address specified pursuant to Section 7(e) hereof is reasonably calculated to give actual notice.

 

(j)                                    Waiver of Venue.  The Parties irrevocably and unconditionally waive, to the fullest extent permitted by applicable law, (i) any objection that they may now or hereafter have to the laying of venue of any Proceeding arising out of or relating to this Agreement in any court referred to in Section 7(i) and (ii) the defense of an inconvenient forum to the maintenance of such Proceeding in any such court.

 

26

 

(k)                                 Cumulative Remedies.  The remedies provided herein are cumulative and not exclusive of any remedies provided by law.

 

(l)                                     Severability.  If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction to be invalid, illegal, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth herein shall remain in full force and effect and shall in no way be affected, impaired or invalidated, and the Parties shall use their commercially reasonable efforts to find and employ an alternative means to achieve the same or substantially the same result as that contemplated by such term, provision, covenant or restriction.  If the parties are unable to agree upon such an alternate means, such provision, covenant or restriction shall be replaced by the Court of Chancery of the State of Delaware with a valid, legal and enforceable provision that as much as possible reflects the business agreement by the Parties.  It is hereby stipulated and declared to be the intention of the Parties that they would have executed the remaining terms, provisions, covenants and restrictions without including any of such that may be hereafter declared invalid, illegal, void or unenforceable.

 

(m)                             Entire Agreement.  This Agreement constitutes the entire agreement among the Parties with respect to the subject matter hereof and supersedes all prior contracts or agreements with respect to the subject matter hereof and supersedes any and all prior or contemporaneous discussions, agreements and understandings, whether oral or written, that may have been made or entered into by or among any of the Parties or any of their respective Affiliates relating to the transactions contemplated hereby. For the avoidance of doubt, Section 2 of that certain Side Letter, dated [  ], 2018, by and among the Company, Ryan Roger Seiders, Roy Joseph Seiders, Andrew Scott Hollon and John David Bullock Jr. is hereby terminated and shall be of no further force or effect.

 

(n)                                 Execution of Agreement.  This Agreement may be executed and delivered (by facsimile, by electronic mail in portable document format (.pdf) or otherwise) in any number of counterparts, each of which, when executed and delivered, shall be deemed an original, and all of which together shall constitute the same agreement.

 

(o)                                 Determination of Ownership.  In determining ownership of Company Common Stock hereunder for any purpose, the Company may rely solely on the records of the transfer agent for the Company Common Stock from time to time, or, if no such transfer agent exists, the Company’s stock ledger.

 

(p)                                 Headings; Section References.  The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof.

 

(q)                                 No Recourse.  Notwithstanding anything that may be expressed or implied in this Agreement, and notwithstanding the fact that certain of the Holders may be partnerships or limited liability companies, each Holder covenants, agrees and acknowledges that no recourse under this Agreement or any documents or instruments delivered in connection with this Agreement shall be had against any of the Company’s or the Holder’s former, current or future direct or indirect equity holders, controlling persons, stockholders, directors, officers, employees, agents, Affiliates, members, financing sources, managers, general or limited partners or assignees (each, a “Related Party” and collectively, the “Related Parties”), in each case other

 

27

 

than the Company, the current or former Holders or any of their respective assignees under this Agreement, whether by the enforcement of any assessment or by any legal or equitable Proceeding, or by virtue of any applicable law, it being expressly agreed and acknowledged that no personal liability whatsoever shall attach to, be imposed on or otherwise be incurred by any of the Related Parties, as such, for any obligation or liability of the Company or the Holders under this Agreement or any documents or instruments delivered in connection herewith for any claim based on, in respect of or by reason of such obligations or liabilities or their creation; provided, however, nothing in this Section 7(q) shall relieve or otherwise limit the liability of the Company or any current or former Holder, as such, for any breach or violation of its obligations under this Agreement or such agreements, documents or instruments.

 

(r)                                    Recapitalizations, Exchanges, etc.  The provisions of this Agreement shall apply to the full extent set forth herein with respect to (a) the Company Common Stock, (b) any and all securities into which shares of Company Common Stock are converted, exchanged or substituted in any recapitalization or other capital reorganization by the Company and (c) any and all equity securities of the Company or any successor or assign of the Company (whether by merger, consolidation, sale of assets or otherwise) which may be issued in respect of, in conversion of, in exchange for or in substitution of, the Company Common Stock and shall be appropriately adjusted for any stock dividends, splits, reverse splits, combinations, recapitalizations and the like occurring after the date hereof.  The Company shall cause any successor or assign (whether by merger, consolidation, sale of assets or otherwise) to assume the obligations of the Company under this Agreement or enter into a new registration rights agreement with the Holders on terms substantially the same as this Agreement as a condition of any such transaction.

 

(s)                                   Governing Documents.  In the event of any conflict between the terms and provisions of Section 7 of this Agreement and those contained in the Certificate of Incorporation, Bylaws or other similar governing documents of the Company, the terms and provisions of Section 7 of this Agreement shall govern and control to the maximum extent permitted by the General Corporation Law of the State of Delaware.

 

[Signature Pages Follow]

 

28

 

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

 

	
 
    	
YETI HOLDINGS, INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    	
 
    
	
 
    	
Title:
    	
 
    

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK,
 SIGNATURE PAGES OF HOLDERS TO FOLLOW]

 

 

	
 
    	
CORTEC   GROUP FUND V, L.P.
    
	
 
    	
 
    
	
 
    	
By:
    	
CORTEC MANAGEMENT   V, LLC,
    
	
 
    	
 
    	
its general   partner
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name: David L.   Schnadig
    
	
 
    	
 
    	
Title: Member
    
	
 
    	
 
    
	
 
    	
CORTEC   CO-INVESTMENT FUND V, LLC
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name: David L.   Schnadig
    
	
 
    	
 
    	
Title: Member
    
	
 
    	
 
    
	
 
    	
CORTEC   GROUP FUND V (PARALLEL), L.P.
    
	
 
    	
 
    
	
 
    	
By:
    	
Cortec Management   V (Co-Invest), LLC,
    
	
 
    	
 
    	
its general   partner
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name: David L.   Schnadig
    
	
 
    	
 
    	
Title: Member
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
John T. Miner
    
	
 
    	
[ADDRESS]
    
	
 
    	
[EMAIL]
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Allison S. Klazkin
    
	
 
    	
[ADDRESS]
    
	
 
    	
[EMAIL]
    

 

 

	
 
    	
RJS   ICE 2, LP
    
	
 
    	
 
    
	
 
    	
By:
    	
RJS ICE   MANAGEMENT, LLC,
    
	
 
    	
 
    	
its general   partner
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name: Roy J.   Seiders
    
	
 
    	
 
    	
Title: Manager
    
	
 
    	
 
    	
P.O. Box   163325
    
	
 
    	
 
    	
Austin, TX 78716
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
RJS   ICE, LP
    
	
 
    	
 
    
	
 
    	
By:
    	
RJS ICE   MANAGEMENT, LLC,
    
	
 
    	
 
    	
its general   partner
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name: Roy J.   Seiders
    
	
 
    	
 
    	
Title: Manager
    
	
 
    	
 
    	
P.O. Box   163325
    
	
 
    	
 
    	
Austin, TX 78716
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Roy J. Seiders, in his   individual capacity
    
	
 
    	
P.O. Box   163325
    
	
 
    	
Austin, TX 78716
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
RRS   ICE 2, LP
    
	
 
    	
 
    
	
 
    	
By:
    	
RRS ICE   MANAGEMENT, LLC,
    
	
 
    	
 
    	
its general   partner
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name: Ryan R.   Seiders
    
	
 
    	
 
    	
Title: Manager
    
	
 
    	
 
    	
P.O. Box   163325
    
	
 
    	
 
    	
Austin, TX 78716
    

 

2

 

	
 
    	
OPTIONS   ICE, LP
    
	
 
    	
 
    
	
 
    	
By:
    	
OPTIONS ICE GP,   LLC,
    
	
 
    	
 
    	
its general   partner
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name: Ryan R.   Seiders
    
	
 
    	
 
    	
Title: Manager
    
	
 
    	
 
    	
P.O. Box   163325
    
	
 
    	
 
    	
Austin, TX 78716
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Ryan R. Seiders, in his   individual capacity
    
	
 
    	
PO Box 163325
    
	
 
    	
Austin, TX 78716
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
John D. Bullock Jr.
    
	
 
    	
[ADDRESS]
    
	
 
    	
[EMAIL]
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Andrew S. Hollon
    
	
 
    	
[ADDRESS]
    
	
 
    	
[EMAIL]
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
OAKTREE   SPECIALTY LENDING CORPORATION
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    

 

3

 

	
 
    	
YHI   CG GROUP INVESTORS, LLC
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    
	
 
    	
 
    
	
 
    	
HW   YETI, LLC
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Christopher S. Conroy
    
	
 
    	
[ADDRESS]
    
	
 
    	
[EMAIL]
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
CHRISTOPHER S. CONROY   IRREVOCABLE SPOUSAL TRUST
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Steve Hoogendoorn
    
	
 
    	
[ADDRESS]
    
	
 
    	
[EMAIL]
    

 

4

 

EXHIBIT A

 

Form of Joinder Agreement

 

The undersigned hereby agrees, effective as of the date set forth below, to become a party to that certain Registration Rights Agreement (as amended, restated and modified from time to time, the “Agreement”) dated as of [·], 2018, by and among YETI Holdings, Inc., a Delaware corporation (the “Company”), and the stockholders of the Company named therein, and for all purposes of the Agreement the undersigned will be included within the term “Holder” (as defined in the Agreement) (and become subject to all rights and obligations hereunder).  The address, facsimile number and email address to which notices may be sent to the undersigned are as follows:

 

	
Address:
    	
 
    
	
Facsimile No.:
    	
 
    
	
Email:
    	
 
    
	
Date:
    	
 
    

 

	
 
    	
[If entity]
    
	
 
    	
 
    
	
 
    	
[ENTITY NAME]
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    
	
 
    	
 
    
	
 
    	
[If individual]
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Individual Name:
    

 

5Exhibit 10.3

 

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

 

This AMENDED AND RESTATED EMPLOYMENT AGREEMENT (“Agreement”) is entered into as of October 9, 2018 between YETI Coolers, LLC, a Delaware limited liability company, on behalf of itself and its parent entities and subsidiaries as may employ Executive from time to time (collectively, the “Company”), and Matthew J. Reintjes (“Executive”), and supersedes and replaces in its entirety that certain employment agreement entered into between the Company and Executive, dated September 14, 2015, as amended December 31, 2015 by that certain Amendment No. 1 thereto (as amended, the “Prior Employment Agreement”).

 

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

 

1.                                      Certain Definitions.  Certain words or phrases used herein with initial capital letters shall have the meanings set forth in paragraph 8 hereof.

 

2.                                      Employment.  The Company shall continue to employ Executive, and Executive accepts such continued employment with the Company, upon the terms and conditions set forth in this Agreement for the period beginning on the Effective Date and ending as provided in paragraph 5 hereof (the “Employment Period”).  Notwithstanding anything in this Agreement to the contrary, Executive will be an at-will employee of the Company and Executive or the Company may terminate Executive’s employment with the Company for any reason or no reason at any time.

 

3.                                      Position and Duties.

 

(a)                                 During the Employment Period, Executive shall serve as the President and Chief Executive Officer of the Corporation and of the Company (“CEO”) and shall have the normal duties, responsibilities and authority of an executive serving in such position.  For so long as Executive holds the position of CEO, the Company shall use its good faith efforts to nominate Executive for re-election to the Board and procure his election to the Board at any applicable meeting of stockholders held for the purpose of electing directors, and Executive agrees to serve on the Board.  Executive agrees that in the event that his employment as CEO is terminated, at the request of the Board, he shall immediately resign from the Board.

 

(b)                                 During the Employment Period, Executive shall report solely to the Board.

 

(c)                                  During the Employment Period, Executive shall devote Executive’s reasonable best efforts and Executive’s full business time and attention (except for permitted paid time off periods and reasonable periods of illness or other incapacity) to the business and affairs of the Company, its subsidiaries and affiliates; provided, however, that Executive may (i) engage in charitable and civic activities, (ii) manage his personal and family finances and investments, and (iii) following the second anniversary of the Effective Date, subject to the consent of the Board which shall not be unreasonably withheld, serve on at least one board of directors for other public or private companies, so long as such activities do not compete with the Company’s Business or materially interfere, individually or in the aggregate, with the performance of his duties hereunder.

 

 

(d)                                 Executive shall perform Executive’s duties and responsibilities to the best of Executive’s abilities in a diligent, trustworthy, businesslike and efficient manner.

 

(e)                                  During the Employment Period, Executive shall perform Executive’s duties and responsibilities principally at the Company’s headquarters in the Austin, Texas area; provided, however, that Executive acknowledges that he may be required to engage in travel in connection with the performance of his duties hereunder.

 

4.                                      Compensation and Benefits.

 

(a)                                 Salary.  The Company agrees to pay Executive a salary during the Employment Period (the “Base Salary”) in installments based on the Company’s practices as may be in effect from time to time.  Executive’s initial salary shall be at the rate of $875,000 per year.  The Board shall review Executive’s salary annually commencing in 2020 and may, in its sole discretion, increase it.

 

(b)                                 Annual Incentive Compensation.  During the Employment Period, Executive will be eligible to receive an annual incentive compensation payment, based on the achievement of goals determined by the Board based on a number of factors, including Executive’s historical and anticipated future performance, the Company’s growth and profitability, and other relevant considerations.

 

(i)                                     2018 Incentive Compensation.  During the Employment Period, with respect to the 2018 calendar year, Executive’s target incentive compensation amount is equal to 75% of Executive’s Base Salary.

 

(ii)                                  Post-2018 Incentive Compensation.  During the Employment Period, with respect to the 2019 calendar year and each calendar year thereafter, Executive’s target incentive compensation amount is equal to 100% of Executive’s Base Salary (“Target Incentive Compensation Amount”).

 

(iii)                               Payment of Incentive Compensation.  Annual incentive compensation, including with respect to the 2018 calendar year, will be calculated on a sliding scale, with ranges above and below target, consistent with incentive compensation calculations prepared by the Company’s management, as approved by the Board, and provided to Executive during the applicable calendar year.  Except as otherwise set forth herein, Executive will be required to be employed by the Company on December 31st of the calendar year to which the incentive compensation relates in order to be eligible to receive the applicable incentive compensation under this subparagraph 4(b).  Any such incentive compensation will be paid by no later than March 15th of the year following the year to which it relates.

 

(c)                                  Paid Time Off.  During the Employment Period, Executive shall be entitled to twenty (20) days of paid time off during each calendar year. Any accrued paid time off that is not used in the calendar year in which it is earned will not be eligible to be carried forward to, or otherwise used in, any subsequent calendar year.

 

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(d)                                 Holidays.  During the Employment Period, Executive shall be entitled to holidays consistent with the Company’s current policy, which may be amended from time to time.

 

(e)                                  Standard Benefits Package.  Executive shall be eligible during the Employment Period to participate, on the same basis as other employees of the Company, in the Company’s Standard Benefits Package.  The Company’s “Standard Benefits Package” means those benefits (including insurance and other benefits, but excluding, except as hereinafter provided in subparagraphs 6(b), 6(c) or 6(d), as applicable, and subparagraph 6(e), if applicable, any severance pay program or policy of the Company) for which substantially all of the employees of the Company are from time to time generally eligible, as determined from time to time by the Board.

 

(f)                                   Long-Term Incentive Compensation.  With respect to each calendar year during the Employment Period commencing on or after January 1, 2019, Executive shall be eligible to participate in any long-term incentive compensation plan generally made available to senior executives of the Company at a level commensurate with his position in accordance with and subject to the terms of such plan.

 

5.                                      Employment Period.

 

(a)                                 Except as hereinafter provided, the Employment Period shall continue until, and shall end upon, the third anniversary of the Effective Date (the “Initial Term”).

 

(b)                                 On the third anniversary of the Effective Date and, after the Initial Term, on such third anniversary and each annual anniversary of such date thereafter, unless the Employment Period shall have ended pursuant to subparagraph 5(c) below or the Company or Executive shall have given the other party at least sixty (60) days’ written notice that the Employment Period will not be extended, the Employment Period shall be extended for an additional one-year period.

 

(c)                                  Notwithstanding (a) or (b) above, the Employment Period shall end early upon the first to occur of any of the following events:

 

(i)                                     Executive’s death;

 

(ii)                                  the Company’s termination of Executive’s employment due to Permanent Disability;

 

(iii)                               a Termination For Cause;

 

(iv)                              a Termination Without Cause;

 

(v)                                 a Termination With Good Reason; or

 

(vi)                              a Voluntary Termination.

 

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6.                                      Post-Employment Payments.

 

(a)                                 At the end of Executive’s employment for any reason, Executive shall cease to have any rights to salary, equity awards, expense reimbursements or other benefits, except that Executive shall be entitled to (i) any Base Salary which has accrued but is unpaid, (ii) any annual incentive compensation set forth in subparagraph 4(b) above that has been earned for a prior calendar year but is unpaid, (iii) any reimbursable expenses which have been incurred but are unpaid, (iv) and any paid time off days which have accrued pursuant to the Company’s paid time off policy, as in effect from time to time, but are unused, as of the end of the Employment Period, (v) any option or other equity-grant rights or plan benefits which by their terms extend beyond termination of Executive’s employment (but only to the extent provided in any option or equity grant theretofore granted to Executive or any other benefit plan in which Executive has participated as an employee of the Company and excluding, except as hereinafter provided in subparagraphs 6(b), 6(c) or 6(d), as applicable, and under subparagraph 6(e), if applicable, any severance pay program or policy of the Company) and (vi) any benefits to which Executive is entitled under Part 6 of Subtitle B of Title I of the Employee Retirement Income Security Act of 1974, as amended (“COBRA”).  In addition, Executive shall be entitled to the additional amounts described in subparagraphs 6(b), 6(c) or 6(d), as applicable, and under subparagraph 6(e), if applicable, in the circumstances described in such subparagraphs.

 

(b)                                 If the Employment Period ends pursuant to paragraph 5 on account of a Termination Without Cause or a Termination With Good Reason, and such termination occurs outside of the Change in Control Protection Period, the Company shall pay Executive (i) an amount equal to 150% of the sum of his Base Salary plus his Target Incentive Compensation Amount at the time of such termination (the “Base Severance Amount”), and (ii) a pro rata incentive compensation payment for the year in which such termination occurs based on the product of (x) the number of days Executive was employed by the Company during the then current calendar year, divided by 365 and (y) the annual incentive compensation payment Executive would have received had he continued employment through the end of the calendar year (assuming all non-formulaic goals were achieved at the average achievement for the formulaic goals for such calendar year).  The amounts payable under clause (i) of the preceding sentence shall be paid in equal installments over the eighteen (18) month period following Executive’s termination of employment in accordance with the Company’s normal payroll practices; provided, however, that any amounts due under this sentence during the 60-day period following such termination shall not be paid during such 60-day period but instead shall be paid on the first payroll date after such 60-day period.  The amount payable under clause (ii) of the second preceding sentence shall be paid in a lump sum at the later of (A) the time when annual incentive compensation payments are paid to the Company’s executive officers for the calendar year in which Executive’s employment terminates or (B) the 61st day after the date on which Executive’s employment terminates.

 

(c)                                  If the Employment Period ends pursuant to paragraph 5 on account of a Termination Without Cause or Termination With Good Reason, and such termination occurs during the Change in Control Protection Period but prior to the consummation of a Change in Control, the Company shall pay Executive (i) an amount equal to 200% of the sum of his Base Salary plus his Target Incentive Compensation Amount at the time of such termination (the “Enhanced Severance Amount”), and (ii) a pro rata incentive compensation payment for the year

 

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in which such termination occurs based on the product of (x) the number of days Executive was employed by the Company during the then current calendar year, divided by 365 and (y) the Target Incentive Compensation Amount.  The amounts payable under clause (i) of the preceding sentence shall be paid as follows: (x) the portion of the Base Severance Amount that is not subject to Section 409A (“Section 409A”) of the Internal Revenue Code of 1986, as amended (the “Code”), including all regulations and guidance promulgated thereunder, shall be paid in a single lump sum on the first payroll date following the 60-day period following such termination; (y) the portion of the Base Severance Amount that is subject to Section 409A shall be paid in equal installments over the eighteen (18) month period following such termination in accordance with the Company’s normal payroll practices; and (z) the difference between the Enhanced Severance Amount and the Base Severance Amount (i.e., 50% of the sum of Executive’s Base Salary plus his Target Incentive Compensation Amount) shall be paid in a single lump sum on the first payroll date following the 60-day period following such termination; provided, however, that any amounts due under this sentence during the 60-day period following such termination shall not be paid during such 60-day period but instead shall be paid on the first payroll date after such 60-day period.  The amount payable under clause (ii) of the second preceding sentence shall be paid in a lump sum at the later of (A) the time when annual incentive compensation payments are paid to the Company’s executive officers for the calendar year in which Executive’s employment terminates or (B) the 61st day after the date on which Executive’s employment terminates.

 

(d)                                 If the Employment Period ends pursuant to paragraph 5 on account of a Termination Without Cause or Termination With Good Reason, and such termination occurs during the Change in Control Protection Period and following the consummation of a Change in Control, the Company shall pay Executive (i) an amount equal to the Enhanced Severance Amount, and (ii) a pro rata incentive compensation payment for the year in which such termination occurs based on the product of (x) the number of days Executive was employed by the Company during the then current calendar year, divided by 365 and (y) the Target Incentive Compensation Amount.  The amounts payable under clause (i) of the preceding sentence shall be paid in a single lump sum on the first payroll date following the 60-day period following such termination; provided, however, that if the Change in Control does not qualify as a change in control under Section 409A, such amounts shall instead be paid as follows: (x) the portion of the Base Severance Amount that is not subject to Section 409A shall be paid in a single lump sum on the first payroll date following the 60-day period following such termination; (y) the portion of the Base Severance Amount that is subject to Section 409A shall be paid in equal installments over the eighteen (18) month period following such termination in accordance with the Company’s normal payroll practices; and (z) the difference between the Enhanced Severance Amount and the Base Severance Amount (i.e., 50% of the sum of Executive’s Base Salary plus his Target Incentive Compensation Amount) shall be paid in a single lump sum on the first payroll date following the 60-day period following such termination; provided, further, that any amounts due under this sentence during the 60-day period following such termination shall not be paid during such 60-day period but instead shall be paid on the first payroll date after such 60-day period.  The amount payable under clause (ii) of the second preceding sentence shall be paid in a lump sum at the later of (A) the time when annual incentive compensation payments are paid to the Company’s executive officers for the calendar year in which Executive’s employment terminates or (B) the 61st day after the date on which Executive’s employment terminates.

 

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(e)                                  If the Employment Period ends pursuant to paragraph 5 on account of a Termination Without Cause or Termination With Good Reason, regardless of whether such termination occurs during or outside of the Change in Control Protection Period, if Executive elects continuation coverage under the Company’s medical plan pursuant to COBRA, the Company shall reimburse Executive (provided such reimbursement does not result in taxes or penalties for the Company) for the full amount of Executive’s COBRA premium payments for such coverage and his eligible dependents until the earlier of (x) Executive’s eligibility for any such coverage under another employer’s or any other medical plan or (y) the date that is eighteen (18) months following the termination of Executive’s employment.  The Company shall make any such reimbursement within thirty (30) days following receipt of evidence from Executive of Executive’s payment of the COBRA premium.

 

(f)                                   It is expressly understood that the Company’s payment obligations under subparagraphs 6(b), 6(c) or 6(d), as applicable, and under subparagraph 6(e), if applicable, shall cease in the event Executive breaches in any material respect any of the agreements in paragraphs 7 or 9 hereof.  Each payment under subparagraphs 6(b), 6(c) or 6(d), as applicable, and under subparagraph 6(e), if applicable, shall be considered a separate payment and not one of a series of payments for purposes of Section 409A.

 

(g)                                  Executive shall not be required to mitigate the amount of any payment provided for in this Agreement by seeking other employment and such amounts shall not be reduced whether or not Executive obtains other employment, except as provided in subparagraph 6(e).  Subject to paragraph 23 of this Agreement, any severance payments payable under this Agreement shall not be reduced or offset by any claim the Company may have against Executive.

 

(h)                                 Release.  Notwithstanding anything herein to the contrary, the Company shall not be obligated to make any payment under subparagraphs 6(b), 6(c) or 6(d), as applicable, or under subparagraph 6(e), if applicable, unless (i) prior to the 60th day following the Termination Without Cause or Termination With Good Reason, Executive executes a release of all current or future claims, known or unknown, arising on or before the date of the release against the Company, the Corporation, and either of their subsidiaries and the directors, officers, employees and affiliates of any of them, in a form substantially similar to that attached as Exhibit A, with such changes as the Company deems in good faith are required or advisable as a result of changes in applicable law after the date hereof, and (ii) any applicable revocation period has expired during such 60-day period without Executive revoking such release.

 

7.                                      Competitive Activity; Confidentiality; Non-solicitation.

 

(a)                                 Acknowledgements and Agreements.  Executive hereby acknowledges and agrees that in the performance of Executive’s duties to the Company during the Employment Period, Executive will be brought into frequent contact with existing and potential customers of the Company throughout the world.  Executive also agrees that trade secrets and Confidential Information of the Company, more fully described in subparagraph 7(e)(i), gained by Executive during Executive’s association with the Company, have been developed by the Company through substantial expenditures of time, effort and money and constitute valuable and unique property of the Company.  Executive further understands and agrees that the foregoing makes it

 

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necessary for the protection of the Company’s Business that Executive not compete with the Company during his employment with the Company, and not compete with the Company for a reasonable period thereafter, as further provided in the following subparagraphs.  In consideration for Executive’s receipt of trade secrets and Confidential Information, Executive agrees to the following restrictive covenants:

 

(b)                                 Covenants.

 

(i)                                     Covenants During Employment.  While employed by the Company, Executive will not compete with the Company anywhere in the world.  In accordance with this restriction, but without limiting its terms, while employed by the Company, Executive will not:

 

(A)                               enter into or engage in any business which competes with the Company’s Business;

 

(B)                               solicit customers, business, patronage or orders for, or sell, any products or services in competition with, or for any business that competes with, the Company’s Business;

 

(C)                               divert, entice or otherwise take away any customers, business, patronage or orders of the Company or attempt to do so; or

 

(D)                               promote or assist, financially or otherwise, any person, firm, association, partnership, corporation or other entity engaged in any business which competes with the Company’s Business.

 

(ii)                                  Covenants Following Termination.  For a period of twelve (12) months following a termination of Executive’s employment during the Change in Control Protection Period, or for a period of eighteen (18) months following a termination of Executive’s employment outside of the Change in Control Protection Period, Executive shall not:

 

(A)                               enter into or engage in any business which competes with the Company’s Business within the Restricted Territory;

 

(B)                               solicit customers, business, patronage or orders for, or sell, any products and services in competition with, or for any business, wherever located, that competes with, the Company’s Business within the Restricted Territory;

 

(C)                               divert, entice or otherwise take away any customers, business, patronage or orders of the Company within the Restricted Territory, or attempt to do so; or

 

(D)                               promote or assist, financially or otherwise, any person, firm, association, partnership, corporation or other entity engaged in any business which competes with the Company’s Business within the Restricted Territory.

 

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Notwithstanding the foregoing, following a termination of Executive’s employment as a result of a Termination Without Cause or a Termination With Good Reason, Executive shall not be considered to have breached this subparagraph 7(b)(ii) if Executive provides services to a business unit, division or subsidiary of an entity that otherwise competes with the Company’s Business through another business unit, division or subsidiary, so long as Executive only provides services to the business unit, division or subsidiary that does not compete with the Company’s Business and Executive takes no actions that would compete with the Company’s Business or otherwise violate the provisions of this paragraph 7.

 

(iii)                               Indirect Competition.  For the purposes of subparagraphs 7(b)(i) and (ii), but without limiting such provisions, Executive will be in violation thereof if Executive engages in any or all of the activities set forth therein directly as an individual on Executive’s own account, or indirectly as a partner, joint venturer, employee, agent, salesperson, consultant, officer and/or director of any firm, association, partnership, corporation or other entity, or as a stockholder of any corporation (or owner of any other type of equity interest in any entity) in which Executive or Executive’s spouse (to the extent Executive and Executive’s spouse are not legally separated), minor child or parent sharing the same household as Executive owns, directly or indirectly, individually or in the aggregate, more than one percent (1%) of the outstanding stock or other equity interests.

 

(iv)                              If it is judicially determined that Executive has violated this subparagraph 7(b) and the Company obtains an injunction or other equitable relief, then the period applicable to each obligation that Executive has been determined to have violated will be automatically extended by a period of time equal in length to the period during which such violation occurred.

 

(c)                                  The Company.  For purposes of this paragraph 7, the Company shall include the Corporation and any and all direct and indirect subsidiary, parent, affiliated, or related companies of the Company for which Executive worked or had responsibility at the time of termination of his employment and at any time during the two (2) year period prior to such termination.

 

(d)                                 Non-Solicitation; Non-Association.  Executive will not directly or indirectly at any time during the period of Executive’s employment, or for a period of twelve (12) months following a termination of Executive’s employment during the Change in Control Protection Period, or for a period of eighteen (18) months following a termination of Executive’s employment outside of the Change in Control Protection Period, attempt to disrupt, damage, impair or interfere with the Company’s Business by raiding any of the Company’s employees, soliciting any of them to resign from their employment by the Company or associating with any of them for the express purpose of encouraging them to resign from their employment by the Company, or by disrupting the relationship between the Company and any of its consultants, agents or representatives; provided, however, that this subparagraph 7(d) shall not prohibit Executive from providing references for Company employees, when contacted by a prospective employer.  Executive acknowledges that this covenant is necessary to enable the Company to maintain a stable workforce and remain in business.

 

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(e)                                  Further Covenants.

 

(i)                                     Executive will keep in strict confidence, and will not, directly or indirectly, at any time, during or after Executive’s employment with the Company, disclose, furnish, disseminate, make available or, except in the course of performing Executive’s duties of employment, use any trade secrets or confidential business and technical information of the Company or its customers or vendors, without limitation as to when or how Executive may have acquired such information (“Confidential Information”), except (A) as required in the performance of his duties to the Company, (B) to the extent that Executive is required by law, or requested by subpoena, court order or governmental, regulatory or self-regulatory body with apparent authority to disclose any Confidential Information (provided that in such case, Executive shall (x) provide the Board, to the extent legally permitted, with notice as soon as practicable following such request that such disclosure has been requested or is or may be required, (y) reasonably cooperate with the Company, at the Company’s expense, in protecting, to the maximum extent legally permitted, the confidential or proprietary nature of such Confidential Information, and (z) disclose only that Confidential Information which he is legally required to disclose), (C) disclosing information that has been or is hereafter made public through no act or omission of Executive in violation of this Agreement or any other confidentiality obligation or duty owed to the Company, (D) disclosing information and documents to his attorney or tax adviser for the purpose of securing legal or tax advice (provided that such advisors agree to keep such information confidential), or (E) disclosing information and documents to the extent reasonably appropriate in connection with any litigation between Executive and the Company.  Such Confidential Information shall include, without limitation, the Company’s unique selling, manufacturing and servicing methods and business techniques, training, service and business manuals, promotional materials, training courses and other training and instructional materials, vendor and product information, customer and prospective customer lists, other customer and prospective customer information and other business information.  Executive specifically acknowledges that all such Confidential Information, whether reduced to writing, maintained on any form of electronic media, or maintained in the mind or memory of Executive and whether compiled by the Company, and/or Executive, derives independent economic value from not being readily known to or ascertainable by proper means by others who can obtain economic value from its disclosure or use, that reasonable efforts have been made by the Company to maintain the secrecy of such information, that such information is the sole property of the Company and that any retention and use of such information by Executive during Executive’s employment with the Company (except in the course of performing Executive’s duties and obligations to the Company) or after the termination of Executive’s employment shall constitute a misappropriation of the Company’s trade secrets.

 

(ii)                                  The U.S. Defend Trade Secrets Act of 2016 (“DTSA”) provides that an individual shall not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that (A) is made in confidence to a federal, state or local government official, either directly or indirectly, or to an attorney, and solely for the purpose of reporting or investigating a suspected violation of law; or (B) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal.  In addition, the DTSA provides that an individual who files a lawsuit for retaliation by an employer for reporting a suspected violation of law may disclose the trade secret to the attorney of the individual and use the trade secret information in the court proceeding, if the individual files any document containing the trade secret under seal and does not disclose the trade secret, except pursuant to court order.

 

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(iii)                               Executive agrees that upon termination of Executive’s employment with the Company, for any reason, Executive shall return to the Company, in good condition, all property of the Company, including without limitation, the originals and all copies of any materials which contain, reflect, summarize, describe, analyze or refer or relate to any items of information listed in subparagraph 7(e)(i) of this Agreement.  Notwithstanding the foregoing, Executive shall be permitted to retain or copy (A) his contacts, calendar and personal correspondence, and (B) any documents or information related to his compensation or reasonably needed for Executive’s tax purposes.

 

(iv)                              Nothing in this Agreement prevents Executive from providing, without prior notice to the Company, information to governmental authorities regarding possible legal violations or otherwise testifying or participating in any investigation or proceeding by any governmental authorities regarding possible legal violations, and for purpose of clarity Executive is not prohibited from providing information voluntarily to the United States Securities and Exchange Commission pursuant to Section 21F of the Exchange Act.

 

(f)                                   Discoveries and Inventions; Work Made for Hire.

 

(i)                                     Executive agrees that upon conception and/or development of any idea, discovery, invention, improvement, software, writing or other material or design that:  (A) relates to the business of the Company, or (B) relates to the Company’s actual or demonstrably anticipated research or development, or (C) results from any work performed by Executive for the Company, Executive will assign to the Company the entire right, title and interest in and to any such idea, discovery, invention, improvement, software, writing or other material or design.  Executive has no obligation to assign any idea, discovery, invention, improvement, software, writing or other material or design that Executive conceives and/or develops entirely on Executive’s own time without using the Company’s equipment, supplies, facilities, or trade secret information unless the idea, discovery, invention, improvement, software, writing or other material or design either:  (x) relates to the business of the Company, or (y) relates to the Company’s actual or demonstrably anticipated research or development, or (z) results from any work performed by Executive for the Company.  Executive agrees that any idea, discovery, invention, improvement, software, writing or other material or design that relates to the business of the Company or relates to the Company’s actual or demonstrably anticipated research or development which is conceived or suggested by Executive, either solely or jointly with others, within one (1) year following termination of Executive’s employment under this Agreement or any successor agreements shall be presumed to have been so made, conceived or suggested in the course of such employment with the use of the Company’s equipment, supplies, facilities, and/or trade secrets.

 

(ii)                                  In order to determine the rights of Executive and the Company in any idea, discovery, invention, improvement, software, writing or other material, and to insure the protection of the same, Executive agrees that during Executive’s employment, and, to the extent related to the Company’s Business, for one (1) year after termination of Executive’s employment under this Agreement or any successor agreement, Executive will disclose immediately and fully to the Company any idea, discovery, invention, improvement, software, writing or other material or design conceived, made or developed by Executive solely or jointly with others.  The Company agrees to keep any such disclosures confidential.  Executive also

 

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agrees during Executive’s employment, and, to the extent related to the Company’s Business, for one (1) year after termination of Executive’s employment under this Agreement or any successor agreement, to record descriptions of all work in the manner directed by the Company and agrees that all such records and copies, samples and experimental materials will be the exclusive property of the Company.  Executive agrees that at the request of and without charge to the Company, but at the Company’s expense, Executive will execute a written assignment of the idea, discovery, invention, improvement, software, writing or other material or design to the Company and will assign to the Company any application for letters patent or for trademark registration made thereon, and to any common-law or statutory copyright therein; and that Executive will do whatever may be necessary or desirable to enable the Company to secure any patent, trademark, copyright, or other property right therein in the United States and in any foreign country, and any division, renewal, continuation, or continuation in part thereof, or for any reissue of any patent issued thereon.  In the event the Company is unable, after reasonable effort, and in any event after ten business days, to secure Executive’s signature on a written assignment to the Company of any application for letters patent or to any common-law or statutory copyright or other property right therein, whether because of Executive’s physical or mental incapacity or for any other reason whatsoever, Executive irrevocably designates and appoints the Corporate Secretary of the Company as Executive’s attorney-in-fact to act on Executive’s behalf to execute and file any such application and to do all other lawfully permitted acts to further the prosecution and issuance of such letters patent, copyright or trademark.

 

(iii)                               Executive acknowledges that, to the extent permitted by law, all work papers, reports, documentation, drawings, photographs, negatives, tapes and masters therefor, prototypes and other materials (hereinafter, “items”), including without limitation, any and all such items generated and maintained on any form of electronic media, generated by Executive during Executive’s employment with the Company shall be considered a “work made for hire” and that ownership of any and all copyrights in any and all such items shall belong to the Company.  The item will recognize the Company as the copyright owner, will contain all proper copyright notices, e.g., “(creation date) YETI Coolers, LLC, All Rights Reserved,” and will be in condition to be registered or otherwise placed in compliance with registration or other statutory requirements throughout the world.

 

(g)                                  Confidentiality Agreements.  Executive agrees that Executive shall not disclose to the Company or induce the Company to use any secret or confidential information belonging to Executive’s former employers.  Except as indicated, Executive warrants that Executive is not bound by the terms of a confidentiality agreement or other agreement with a third party that would preclude or limit Executive’s right to work for the Company and/or to disclose to the Company any ideas, inventions, discoveries, improvements or designs or other information that may be conceived during employment with the Company.  Executive agrees to provide the Company with a copy of any and all agreements with a third party that preclude or limit Executive’s right to make disclosures or to engage in any other activities contemplated by Executive’s employment with the Company.

 

(h)                                 Relief.  Executive acknowledges and agrees that the remedy at law available to the Company for breach of any of Executive’s obligations under this Agreement would be inadequate.  Executive therefore agrees that, in addition to any other rights or remedies that the Company may have at law or in equity, temporary and permanent injunctive relief may

 

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be granted in any proceeding which may be brought to enforce any provision contained in subparagraphs 7(b), 7(d), 7(e), 7(f) and 7(g) of this Agreement, without the necessity of proof of actual damage.

 

(i)                                     Reasonableness.  Executive acknowledges that Executive’s obligations under this paragraph 7 are reasonable in the context of the nature of the Company’s Business and the competitive injuries likely to be sustained by the Company if Executive were to violate such obligations.  Executive further acknowledges that this Agreement is made in consideration of, and is adequately supported by the agreement of the Company to perform its obligations under this Agreement and by other consideration, which Executive acknowledges constitutes good, valuable and sufficient consideration.

 

8.                                      Definitions.

 

(a)                                 “Affiliate” means any Person that directly or indirectly controls, is controlled by, or is under common control with the Corporation.  The term “control” (including with the correlative meaning, the terms “controlled by” and “under common control with”), as applied to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting or other securities, by contract, or otherwise.

 

(b)                                 “Board” means the Board of Directors of the Corporation.  For purposes of this Agreement, references to the Board shall include references to the Compensation Committee of the Board, or any other committee or subcommittee authorized by the Board to discharge the Board’s responsibilities relating to the compensation of the Company’s executives and directors, to the extent that the Board has delegated authority to such committee.

 

(c)                                  “Change in Control” shall have the meaning set forth in the YETI Holdings, Inc. 2018 Equity and Incentive Compensation Plan (the “Equity Plan”) or any successor plan thereto, in any case as may be amended from time to time.

 

(d)                                 “Change in Control Protection Period” means: (i) in respect of subparagraph 12(c)(i) of the Equity Plan, the period beginning on the date of the filing by any Person with the United States Securities and Exchange Commission (the “SEC”) of one or more Schedule 13Ds (or any comparable form or report) relating to a single acquisition (or a series of acquisitions) by the Person of securities of the Corporation with the purpose of effecting a Change in Control described in subparagraph 12(c)(i) of the Equity Plan, and ending on either (A) the date that is twenty-four (24) months following the date on which such Change in Control occurs or (B) the date of the filing with the SEC by such Person or the Corporation evidencing that such Person no longer has the purpose of effecting such Change in Control or other action by such Person evidencing the abandonment of such purpose; (ii) in respect of subparagraph 12(c)(ii) of the Equity Plan, the period beginning on the date of the filing by any Person with the SEC of one or more Schedule 14As (or any comparable form or report) relating to the nomination by any Person of one or more Board nominees the election of whom to the Board would constitute a Change in Control, and ending on either (A) the date that is twenty-four (24) months following the date on which such Change in Control occurs or (B) (I) the date of the withdrawal of such nomination(s) or (II) the date of the stockholder meeting at which such

 

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nominees are not elected to the Board in a manner that would constitute a Change in Control; (iii) in respect of subparagraph 12(c)(iii) of the Equity Plan, the period beginning on the date of the execution of a definitive agreement (a “Transaction Agreement”) that provides for a transaction that, if consummated, would constitute a Change in Control, and ending on either (A) the date that is twenty-four (24) months following the date on which such Change in Control occurs or (B) the termination of the Transaction Agreement without such Change in Control having been consummated; or (iv) in respect of subparagraph 12(c)(iv) of the Equity Plan, the 24-month period beginning on the date of the approval by the stockholders of the Corporation of a complete liquidation or dissolution of the Corporation.

 

(e)                                  “Company’s Business” means the design, manufacture, distribution and sale of the products sold by the Company through retail and eCommerce channels during Executive’s employment with the Company and the products anticipated by the Company’s product roadmap, advertised on the Company’s website or described in any other marketing materials of the Company during Executive’s employment with the Company, including, without limitation, hard coolers (including water coolers), soft coolers, beverageware (including insulated drinkware such as cups, coozies, hydration bottles and jugs), bags (including duffel bags and backpacks), camp furniture, storage products and gear and accessories.

 

(f)                                   “Corporation” means YETI Holdings, Inc., a Delaware corporation, and its successors.

 

(g)                                  “Effective Date” means the date of the underwriting agreement between the Corporation and the underwriters managing the initial public offering of the Common Stock pursuant to which the Common Stock is priced for the initial public offering.

 

(h)                                 “Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder, as such laws, rules and regulations may be amended from time to time.

 

(i)                                     “Permanent Disability” means that Executive, because of accident, disability, or physical or mental illness, is incapable of performing Executive’s duties to the Company or any subsidiary, as determined by the Board.  Notwithstanding the foregoing, Executive will be deemed to have become incapable of performing Executive’s duties to the Company or any subsidiary, if Executive is incapable of so doing for (i) a continuous period of 120 days and remains so incapable at the end of such 120 day period or (ii) periods amounting in the aggregate to 180 days within any one period of 365 days and remains so incapable at the end of such aggregate period of 180 days.

 

(j)                                    “Person” means any individual, entity, or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act).

 

(k)                                 “Restricted Territory” means: (i) the United States and Canada; and/or (ii) all of the specific customer accounts, whether within or outside of the geographic area described in (i) above, with which Executive had any contact or for which Executive had any responsibility (either direct or supervisory) at the time of termination of Executive’s employment and at any time during the two (2) year period prior to such termination.

 

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(l)                                     “Termination For Cause” means the termination by the Company of Executive’s employment as a result of: (i) Executive’s indictment (or other criminal charge against Executive) for a felony, or Executive’s commission of fraud against the Company, (ii) willful misconduct by Executive that brings the Company or any subsidiary or affiliate of the Company into substantial public disgrace or disrepute, (iii) Executive’s gross negligence or gross misconduct with respect to the Company or any subsidiary or affiliate of the Company, (iv) Executive’s insubordination to, or failure to follow, the lawful directions of the Board, which, if curable, is not cured within ten (10) days after written notice thereof to Executive, (v) Executive’s material violation of paragraph 7 hereof, (vi) Executive’s breach of a material employment policy of the Company which, if curable, is not cured within ten (10) days after written notice thereof to Executive, or (vii) any other material breach by Executive of this Agreement or any other agreement with the Company or any subsidiary or affiliate, which, if curable, is not cured within thirty (30) days after written notice thereof to Executive.  Notwithstanding the foregoing, no termination by the Company shall constitute a “Termination For Cause” unless (A) the Company provides Executive reasonable written notice of its intent to terminate Executive by reason of a Termination For Cause, which such notice must include a statement that a majority of the Board has determined in good faith that an event described in clause (i), (ii), (iii), (iv), (v), (vi) or (vii) exists and (B) Executive is given reasonable opportunity during the thirty (30) day period after receiving the notice described in the preceding clause (A) to be heard by the Board with Executive’s legal counsel.

 

(m)                             “Termination With Good Reason” means a termination by Executive of Executive’s employment with the Company after: (i) (A) outside of the Change in Control Protection Period, a material reduction in either the Base Salary or the Target Incentive Compensation Amount, other than as part of an across-the-board reduction applicable to all Company executives of no greater than 10% or (B) during the Change in Control Protection Period, a reduction in either the Base Salary or the Target Incentive Compensation Amount, (ii) the material diminution in Executive’s position, duties, authority, reporting or responsibilities, (iii) any material breach of this Agreement or any equity agreement by the Company (including the failure of the Company to satisfy the last sentence of paragraph 16 or its obligations in the second to last sentence of subparagraph 3(a)), or (iv) the involuntary relocation of Executive’s principal place of employment to a location more than thirty-five (35) miles beyond Executive’s principal place of employment in Austin, Texas as of the Effective Date. Notwithstanding the foregoing, no termination of employment by Executive shall constitute a “Termination With Good Reason” unless (A) Executive gives the Company notice of the existence of an event described in clause (i), (ii), (iii) or (iv) above, within sixty (60) days following the occurrence thereof, (B) the Company does not remedy such event described in clause (i), (ii), (iii) or (iv) above, as applicable, within thirty (30) days of receiving the notice described in the preceding clause (A), and (C) Executive terminates employment within thirty (30) days of the end of the cure period specified in clause (B), above.

 

(n)                                 “Termination Without Cause” means the involuntary termination by the Company or any subsidiary of Executive’s employment with the Company or any subsidiary for any reason other than a termination by reason of Executive’s death, for Permanent Disability or a Termination For Cause, and shall include the Company’s giving notice prior to July 31, 2036, pursuant to subparagraph 5(b), that the Employment Period will not be extended, if Executive’s

 

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employment terminates within sixty (60) days following the conclusion of the Employment Period.

 

(o)                                 “Voluntary Termination” means Executive’s termination of Executive’s employment with the Company or any subsidiary for any reason, other than a Termination With Good Reason (it being understood that Executive may voluntarily resign his employment at any period after the Effective Date).

 

9.                                      Non-Disparagement.  Executive agrees not to disparage the Company, any of its products or practices, or any of its directors, officers, agents, representatives, partners, members, or affiliates, either orally or in writing, at any time, and the Company shall use its commercially reasonable best efforts to not disparage, and shall instruct its directors and executive officers not to disparage, Executive, either orally or in writing, at any time; provided, however, that Executive and the Company (and its directors and executive officers) may confer in confidence with their respective legal representatives and make truthful statements as required by law, or by governmental, regulatory or self-regulatory investigations or as truthful testimony in connection with any litigation involving Executive and the Company.  During the Employment Period, this paragraph 9 shall only apply to public statements or private statements that are reasonably likely to become public as a result of communication to any person or entity that is a member of, employed or engaged by, or directly connected to any broadcast or other media.

 

10.                               Survival.  Subject to any limits on applicability contained therein, paragraph 7 and paragraph 9 hereof shall survive and continue in full force in accordance with their terms notwithstanding any termination of the Employment Period.

 

11.                               Taxes.  The Company may withhold from any amounts payable under this Agreement all federal, state, city or other taxes as the Company is required to withhold pursuant to any applicable law, regulation or ruling.  Notwithstanding any other provision of this Agreement, the Company shall not be obligated to guarantee any particular tax result for Executive with respect to any payment provided to Executive hereunder, and Executive shall be responsible for any taxes imposed on Executive with respect to any such payment.

 

12.                               Notices.  Any notice provided for in this Agreement shall be in writing and shall be either personally delivered, sent by reputable overnight carrier or mailed by first class mail, return receipt requested, to the recipient at the address below indicated:

 

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Notices to Executive:

 

At the address contained in the Company’s payroll records

 

Notices to the Company:

 

YETI Coolers, LLC

7601 Southwest Parkway

Austin, TX 78735

Attention: General Counsel

 

or such other address or to the attention of such other person as the recipient party shall have specified by prior written notice to the sending party.  Any notice under this Agreement will be deemed to have been given when so delivered.

 

13.                               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 or unenforceable in any respect under any applicable law, such invalidity or unenforceability shall not affect any other provision, but this Agreement shall be reformed, construed and enforced as if such invalid or unenforceable provision had never been contained herein.

 

14.                               Complete Agreement.  This Agreement embodies the complete 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 to the subject matter hereof in any way, including without limitation the Prior Employment Agreement.

 

15.                               Counterparts.  This Agreement may be executed in separate counterparts, each of which shall be deemed to be an original and both of which taken together shall constitute one and the same agreement.

 

16.                               Successors and Assigns.  This Agreement shall bind and inure to the benefit of and be enforceable by Executive, the Company and their respective heirs, executors, personal representatives, successors and assigns, except that neither party may assign any rights or delegate any obligations hereunder without the prior written consent of the other party. Executive hereby consents to the assignment by the Company of all of its rights and obligations hereunder to any successor to the Company by merger or consolidation or purchase of all or substantially all of the Company’s assets, provided such transferee or successor assumes the liabilities of the Company hereunder. The Company shall require any successor to all or substantially all of its assets (whether direct or indirect, by purchase, merger, consolidation or otherwise) to assume expressly and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place.

 

17.                               Choice of Law/Dispute Resolution.  This Agreement shall be governed by, and construed in accordance with, the internal, substantive laws of the State of Texas.  Any dispute or controversy arising under, out of, or in connection with this Agreement (other than paragraph 7) shall, at the election and upon written demand of either party, be finally determined and

 

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settled by binding arbitration in the City of Austin, Texas, in accordance with the Labor Arbitration rules and procedures of the American Arbitration Association, and judgment upon the award may be entered in any court having jurisdiction thereof.  The Company and Executive shall share the costs of the arbitration and each party shall bear its own attorneys’ and accountants’ fees in connection therewith, including as incurred in any litigation to enforce any arbitration award.  Notwithstanding the foregoing, in respect of any termination of Executive’s employment during the Change in Control Protection Period, in the event of a dispute between the Company and Executive under this Agreement, the Company shall reimburse Executive for all reasonable legal fees and expenses incurred by Executive if Executive prevails on a majority of material claims (measured by value) in the dispute resolution process, and if Executive does not prevail on a majority of material claims (measured by value), Executive and the Company shall be responsible for their own respective legal fees and expenses.

 

18.                               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.

 

19.                               Section 409A Compliance.

 

(a)                                 The parties intend for this Agreement to either comply with, or be exempt from, Section 409A, and all provisions of this Agreement will be interpreted and applied accordingly.  If any compensation or benefits provided by this Agreement may result in the application of Section 409A, the Company shall, in consultation with the Executive, modify the Agreement in the least restrictive manner necessary in order to exclude such compensation from the definition of “deferral of compensation” within the meaning of such Section 409A or in order to comply with the provisions of Section 409A and without any diminution in the value of the payments or benefits to the Executive.  In no event, however, shall this paragraph 19 or any other provisions of this Agreement be construed to require the Company to provide any gross-up for the tax consequences of any provisions of, or payments under, this Agreement and the Company shall have no responsibility for tax consequences to Executive (or his beneficiary) resulting from the terms or operation of this Agreement.  Any payments or reimbursements of any expenses provided for under this Agreement shall be made in accordance with Treas. Reg. §1.409A-3(i)(1)(iv).

 

(b)                                 To the extent that any payment or benefit pursuant to this Agreement constitutes a “deferral of compensation” subject to Section 409A (after taking into account to the maximum extent possible any applicable exemptions) (a “409A Payment”) treated as payable upon Separation from Service, then, if on the date of the Executive’s Separation from Service, the Executive is a Specified Employee, then to the extent required for Executive not to incur additional taxes pursuant to Section 409A, no such 409A Payment shall be made to the Executive earlier than the earlier of (i) six (6) months after the Executive’s Separation from Service or (ii) the date of his death. Should this paragraph 19 result in payments or benefits to Executive at a later time than otherwise would have been made under this Agreement, on the first day any such payments or benefits may be made without incurring additional tax pursuant to Section 409A, the Company shall make such payments and provide such benefits as provided for

 

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in this Agreement.  For purposes of this paragraph 19, the terms “Specified Employee” and “Separation from Service” shall have the meanings ascribed to them in Section 409A.

 

20.                               Indemnification.  Executive shall be entitled to the protections (including insurance coverage) afforded in the Director and Officer Indemnification Agreement, dated as of September 26, 2018, between Executive and the Corporation.

 

21.                               Section 280G of the Code.  In the event that any payments, distributions, benefits or entitlements of any type payable to Executive, whether or not payable upon a termination of employment (“Payments”), (i) constitute “parachute payments” within the meaning of Section 280G of the Code, and (ii) but for this paragraph 21 would be subject to the excise tax imposed by Section 4999 of the Code (the “Excise Tax”), then the Payments shall be reduced to such lesser amount (the “Reduced Amount”) that would result in no portion of the Payments being subject to the Excise Tax; provided, however, that such Payments shall not be so reduced if a nationally recognized accounting firm selected by the Company in good faith (the “Accountants”) determines that without such reduction Executive would be entitled to receive and retain, on a net after-tax basis (including, without limitation, any excise taxes payable under Section 4999 of the Code, federal, state and local income taxes, social security and Medicare taxes and all other applicable taxes, determined by applying the highest marginal rate under Section 1 of the Code and under state and local tax laws which applied (or is likely to apply) to Executive’s taxable income for the tax year in which the transaction which causes the application of Section 280G of the Code occurs, or such other rate(s) as the Accountants determine to be likely to apply to Executive in the relevant tax year(s) in which any of the Payments are expected to be made), an amount that is greater than the amount, on a net after-tax basis, that Executive would be entitled to retain upon receipt of the Reduced Amount.  Unless the Company and Executive otherwise agree in writing, any determination required under this paragraph 21 shall be made in good faith by the Accountants in a timely manner and shall be binding on the parties absent manifest error.  In the event of a reduction of Payments hereunder, the Payments shall be reduced in the order determined by the Accountants that results in the greatest economic benefit to Executive in a manner that would not result in subjecting Executive to additional taxation under Section 409A.  For purposes of making the calculations required by this paragraph 21, the Accountants may make reasonable assumptions and approximations concerning applicable taxes and may rely on reasonable, good faith interpretations concerning the application of the Code, and other applicable legal authority.  The Company and Executive shall furnish to the Accountants such information and documents as the Accountants may reasonably require in order to make a determination under this paragraph 21, and the Company shall bear the cost of all fees charged by the Accountants in connection with any calculations contemplated by this paragraph 21.  To the extent requested by Executive, the Company shall cooperate with Executive in good faith in valuing, and the Accountants shall value, services to be provided by Executive (including  Executive refraining from performing services pursuant to a covenant not to compete) before, on or after the date of the transaction which causes the application of Section 280G of the Code such that Payments in respect of such services may be considered to be “reasonable compensation” within the meaning of the regulations under Section 280G of the Code.  Notwithstanding the foregoing, if the transaction which causes the application of Section 280G of the Code occurs at a time during which the Company qualifies under Section 2(a)(i) of Q&A-6 of Treasury Regulation Section 1.280G, upon the request of Executive, the Company

 

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shall use reasonable efforts to obtain the vote of equity holders described in Q&A-7 of Treasury Regulation Section 1.280G.

 

22.                               Operation of Agreement.  This Agreement will be binding immediately upon its execution, but, notwithstanding any provision of this Agreement to the contrary, this Agreement will not become effective or operative (and neither party will have any obligation hereunder) until the Effective Date.

 

23.                               Clawback.  Notwithstanding any other provisions in this Agreement to the contrary, Executive agrees that applicable incentive-based compensation or other applicable amounts paid to Executive pursuant to this Agreement or any other agreement with the Company will be subject to the terms and conditions of the Company’s clawback policy (if any) as may be in effect from time to time to implement Section 10D of the Exchange Act, and any applicable rules or regulations promulgated thereunder (including applicable rules and regulations of any national securities exchange on which the shares of common stock, $0.01 par value per share, of the Corporation may be traded) (the “Compensation Recovery Policy”), and that applicable sections of this Agreement and any related documents shall be deemed superseded by and subject to the terms and conditions of the Compensation Recovery Policy from and after the effective date thereof.

 

[SIGNATURES ON FOLLOWING PAGE]

 

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

 

	
 
    	
YETI Coolers, LLC
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/S/ Hollie S. Castro
    
	
 
    	
 
    	
Hollie S. Castro,
    
	
 
    	
 
    	
Senior Vice President of Talent
    
	
 
    	
 
    
	
 
    	
YETI Holdings, Inc. (solely with respect to   any of its obligations hereunder)
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/S/ Hollie S. Castro
    
	
 
    	
 
    	
Hollie S. Castro,
    
	
 
    	
 
    	
Senior Vice President of Talent
    
	
 
    	
 
    
	
 
    	
/S/ Matthew J. Reintjes
    
	
 
    	
Matthew J. Reintjes
    

 

 

EXHIBIT A

 

RELEASE AGREEMENT

 

RELEASE AGREEMENT, dated as of                  , 20   (this “Agreement”), by and between YETI Coolers, LLC, a Delaware limited liability company, on behalf of itself and its parent entities and subsidiaries that employed Executive from time to time (collectively, the “Company”), and Matthew J. Reintjes (“Executive”) (collectively, the “Parties”).

 

WHEREAS, Executive’s amended and restated employment agreement with the Company, dated [      ], 2018 (as amended from time to time, the “Employment Agreement”), provides for certain post-termination payments and benefits to Executive pursuant to subparagraphs 6(b), 6(c) or 6(d), as applicable, and under subparagraph 6(e), if applicable, thereof, subject to Executive executing and not revoking a release of claims against the Company; and

 

WHEREAS, Executive desires, and the Company agrees, that the Company shall provide a release of claims with respect to Executive’s employment and termination of employment. (1)

 

NOW, THEREFORE, in consideration of the mutual promises and obligations set forth in the Employment Agreement and this Agreement, and in consideration for the payments and benefits to be provided to Executive pursuant to subparagraphs 6(b), 6(c) or 6(d), as applicable, and under subparagraph 6(e), if applicable, of the Employment Agreement, and for other good and valuable consideration, the sufficiency of which is hereby recognized by the Parties, the Parties agree as follows:

 

1.             Termination of Employment.  Executive acknowledges and agrees that his employment with the Company and its subsidiaries and affiliates will terminate effective                  , 20   (the “Termination Date”).  As of the Termination Date, Executive will resign all positions he held as an officer, director or employee of the Company and its subsidiaries and affiliates, and will promptly execute such documents and take such actions as may be necessary or reasonably requested by the Company to effectuate or memorialize the resignation of such positions.

 

2.             Consideration.  Executive and the Company each acknowledge that in consideration of Executive’s employment and in consideration for the payments set forth in the Employment Agreement that are subject to the release provision of subparagraph 6(h) of the Employment Agreement (the “Payments”), the following shall apply.

 

3.             General Release of Claims. In exchange for the mutual promises set forth in this Agreement (including the Payments), Executive, on behalf of himself, his agents, attorneys,

 

(1)  Note to Draft: The Company will provide a mutual release to Executive in the case of Payments to Executive in connection with a termination of employment during the Change in Control Protection Period, but not in connection with any other termination of employment.

 

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heirs, administrators, executors, assigns, and other representatives, and anyone acting or claiming on his or their joint or several behalf, hereby releases, waives, and forever discharges the Company, including its past or present employees, officers, directors, trustees, board members, stockholders, agents, affiliates, parent entities, subsidiaries, successors, assigns, and other representatives, and anyone acting on their joint or several behalf (the “Releasees”), from any and all known and unknown claims, causes of action, demands, damages, costs, expenses, liabilities, or other losses that in any way arise from, grow out of, or are related to Executive’s employment with the Company or any of its affiliates and subsidiaries or the termination thereof.  By way of example only and without limiting the immediately preceding sentence, Executive agrees that he is releasing, waiving, and discharging any and all claims against the Company and the Releasees under (a) any federal, state, or local employment law or statute, including, but not limited to Title VII of the Civil Rights Act(s) of 1964 and 1991, the Americans with Disabilities Act, the Age Discrimination in Employment Act (“ADEA”), Older Workers Benefit Protection Act (“OWBPA”), the Genetic Information Non-Discrimination Act (GINA), the Sarbanes-Oxley Act, the Texas Labor Code, or other applicable state civil rights law(s) or any other federal law, statute, ordinance, rule, regulation or executive order relating to employment and/or discrimination in employment, and/or any claims to attorneys’ fees or costs thereunder, (b) any claims for wrongful discharge, retaliatory discharge, negligent or intentional infliction of emotional distress, interference with contractual relations, personal, emotional or physical injury, fraud, defamation, libel, slander, misrepresentation, violation of public policy, invasion of privacy, or any other statutory or common law theory of recovery under any federal, state or municipal common law, or (c) any other federal, state or municipal law, statute, ordinance or common law doctrine affecting employment rights.  Nothing herein shall be construed to prohibit Executive from filing a charge with the Equal Employment Opportunity Commission or the United States Securities and Exchange Commission Whistleblower unit or participating in investigations by those  entities.  However, Executive acknowledges that by signing this Agreement, Executive waives his right to seek individual remedies in any such action or accept individual remedies or monetary damages in any such action or lawsuit arising from such charges or investigations, including but not limited to, back pay, front pay, or reinstatement.  Executive further agrees that if any person, organization, or other entity should bring a claim against the Releasees involving any matter covered by this Agreement, Executive will not accept any personal relief in any such action, including damages, attorneys’ fees, costs, and all other legal or equitable relief.  Notwithstanding the generality of the foregoing, Executive does not release the following claims and rights: (i) claims for unemployment compensation or any state disability insurance benefits pursuant to the terms of applicable state law; (ii) claims to continued participation in certain of the Company’s group benefit plans pursuant to the terms and conditions of the Employment Agreement and Part 6 of Subtitle B of Title I of the Employee Retirement Income Security Act of 1974, as amended, and to any vested benefits to which he is entitled under any retirement plan of the Company that is intended to be qualified under Section 401(a) of the Internal Revenue Code of 1986, as amended, or under any equity-based plan or deferred compensation plan of the Company; (iii) Executive’s right, if any, to indemnification, advancement of expenses and the protections of any directors’ and officers’ liability policies of the Company, as set forth in paragraph 20 of the Employment Agreement; (iv) Executive’s rights to any payments or benefits due to him under paragraph 6 of the Employment Agreement (including under the applicable agreements referenced therein (to the extent provided in

 

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paragraph 6 of the Employment Agreement)); (v) any rights under this Agreement; and (vi) any claim that cannot lawfully be waived by private agreement.

 

4.             No Claims Filed.  Executive affirms that, as of the date of execution of this Agreement, he has filed no lawsuit, charge, claim or complaint with any governmental agency or in any court against the Company or the Releasees.

 

5.             Employment Agreement Provisions.  The provisions of paragraphs 7 (Competitive Activity; Confidentiality; Non-solicitation), 11 (Taxes), 12 (Notices) and 17 (Choice of Law/Dispute Resolution) of the Employment Agreement are hereby expressly incorporated by reference.

 

6.             Nondisclosure of Terms.  Executive agrees that the existence, terms and conditions of this Agreement, and any and all underlying communications and negotiations in connection with or leading to this Agreement, are and shall remain confidential unless publicly filed.  Except as specifically set forth in this paragraph 6, Executive shall not disclose the existence or terms of this Agreement in whole or in part to any individual or entity without prior written consent of the Company.  Executive agrees that he will not disclose the existence or terms of this Agreement to any person except (a) to members of Executive’s immediate family and his professional advisors, who shall be advised of this confidentiality provision; (b) to the extent required by a final and binding court order or other compulsory process; (c) to any federal, state, or local taxing authority or to any other governmental or regulatory body if requested in an investigation; or (d) to the extent reasonably appropriate in connection with litigation over this Agreement.  Upon Executive’s receipt of any order, subpoena or other compulsory process demanding production or disclosure of this Agreement, Executive agrees that, to the extent legally permitted, he will promptly notify the Company in writing of the requested disclosure, including the proposed date of the disclosure, the reason for the requested disclosure, and the identity of the individual or entity requesting the disclosure, at least ten (10) business days prior to the date that such disclosure is to be made or immediately upon receipt of the requested disclosure.  Executive agrees not to oppose any action that the Company might take with respect to any such requested disclosure.  Executive further agrees to instruct his counsel not to disclose to any person or entity, including potential or existing clients, the existence or terms of this Agreement.  Notwithstanding the foregoing, nothing in this Agreement prevents Executive from providing, without prior notice to the Company, information to governmental authorities regarding possible legal violations or otherwise testifying or participating in any investigation or proceeding by any governmental authorities regarding possible legal violations, and for purpose of clarity Executive is not prohibited from providing information voluntarily to the United States Securities and Exchange Commission pursuant to Section 21F of the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder, as such law, rules and regulations may be amended from time to time.

 

7.             Future Cooperation.  Executive agrees that, as reasonably requested for (a) the 12 months following the termination of his employment, he will (i) fully cooperate with the Company in effecting an orderly transition of his duties and (ii) without any additional compensation, respond to reasonable requests for information from the Company regarding matters that may arise in the Company’s business and (b) the three-year period following the

 

3

 

termination of his employment, fully and completely cooperate with the Company, its advisors and its legal counsel with respect to any litigation that is pending against the Company and any claim or action that may be filed against the Company in the future.  Such cooperation reflected in part (b) above shall include making himself available at reasonable times and places for interviews, reviewing documents, testifying in a deposition or a legal or administrative proceeding, and providing advice to the Company in preparing defenses to any pending or potential future claims against the Company. Any cooperation under this paragraph 7 shall be subject to Executive’s business and personal commitments and shall not require Executive to cooperate against his own legal interests or the legal interests of any future employer. The Company agrees to pay/reimburse Executive within thirty (30) days of receipt of an invoice for any reasonable expenses incurred as a result of his cooperation with the Company pursuant to this paragraph 7 including reasonable fees incurred by legal counsel for Executive if Executive believes separate counsel is reasonably necessary.

 

8.             Assistance to Others.  Executive agrees following the termination of his employment, not to assist or cooperate, in any way, directly or indirectly, with any person, entity or group (other than the Equal Employment Opportunity Commission (EEOC) or other governmental agency) involved in any proceeding, inquiry or investigation of any kind or nature against or involving the Company or any of its subsidiaries or affiliates, except as required by law, subpoena or other compulsory process.  Moreover, Executive agrees that to the extent he is compelled to cooperate with such third parties during the three-year period following the termination of his employment, he shall disclose to the Company in advance that he intends to cooperate and shall disclose the manner in which he intends to cooperate.  Further, Executive agrees that within three (3) days after such cooperation, he will offer to meet with representatives of the Company and disclose the information that he provided to the third party, to the extent permitted by law.  Further, if Executive is legally required to appear or participate in any proceeding that involves or is brought against the Company or its subsidiaries or affiliates, within three years following the termination of his employment, Executive agrees, unless prohibited by law, to disclose to the Company in advance what he plans to say or produce and otherwise cooperate fully with the Company or its subsidiaries or affiliates.  Executive’s agreement not to provide assistance or cooperation shall not require Executive to refrain from assisting or cooperating with any future employer.

 

9.             ADEA/OWBPA Waiver & Acknowledgment.  Insofar as this Agreement pertains to the release of Executive’s claims, if any, under the ADEA or other civil rights laws, Executive, pursuant to and in compliance with the rights afforded him under the Older Workers Benefit Protection Act: (a) is hereby advised to consult with an attorney before executing this Agreement; (b) is hereby afforded twenty-one (21) days to consider this Agreement (the “Consideration Period”); (c) may revoke this Agreement any time within the seven (7) day period following his execution of this Agreement (the “Revocation Period”) by providing written notice to the Company on or before 5:00 PM Eastern Daylight Time on the seventh day after Executive signs this Agreement; (d) is hereby advised that this Agreement shall not become effective or enforceable until the seven (7) day Revocation Period has expired; and (e) is hereby advised that he is not waiving claims that may arise after the date on which he executes this Agreement.  If this Agreement is revoked within the Revocation Period, the Company shall have no obligations under this Agreement, including the obligation to make the Payments.  If this

 

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Agreement is not revoked by Executive within the Revocation Period, this Agreement will be effective and enforceable on the date immediately following the last day of the seven (7) day Revocation Period (the “Effective Date”).  The offer to enter into this Agreement shall remain open for the twenty-one (21) day Consideration Period, after which time it shall be withdrawn.

 

10.          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 or unenforceable in any respect under any applicable law, such invalidity or unenforceability shall not affect any other provision, but this Agreement shall be reformed, construed and enforced as if such invalid or unenforceable provision had never been contained herein.

 

11.          Voluntary Execution.  Executive acknowledges that he is executing this Agreement voluntarily and of his own free will and that he fully understands and intends to be bound by the terms of this Agreement.  Further, Executive acknowledges that he received a copy of this Agreement on                  , 20  , and has had an opportunity to carefully review this Agreement with his attorney prior to executing it or warrants that he chooses not to have an attorney review this Agreement prior to signing.  Executive will be responsible for any attorneys’ fees incurred in connection with review of this Agreement by his attorneys.

 

12.          No Assignment of Claims.  Executive hereby represents and warrants that he has not previously assigned or purported to assign or transfer to any person or entity any of the claims or causes of action herein released.

 

13.          Governing Law.  This Agreement shall in all respects be interpreted, construed and governed by and in accordance with the internal substantive laws of the State of Texas.

 

14.          Complete Agreement.  This Agreement embodies the complete 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 to the subject matter hereof in any way.  Any amendments, additions or other modifications to this Agreement must be done in writing and signed by both Parties.

 

15.          Counterparts.  This Agreement may be executed in separate counterparts, each of which shall be deemed to be an original and both of which taken together shall constitute one and the same agreement.

 

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16.          Successors and Assigns.  This Agreement shall bind and inure to the benefit of and be enforceable by Executive, the Company and their respective heirs, executors, personal representatives, successors and assigns, except that neither Party may assign any rights or delegate any obligations hereunder without the prior written consent of the other Party.  Executive hereby consents to the assignment by the Company of all of its rights and obligations hereunder to any successor to the Company by merger or consolidation or purchase of all or substantially all of the Company’s assets, provided such transferee or successor assumes the liabilities of the Company hereunder.

 

[SIGNATURES ON FOLLOWING PAGE]

 

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IN WITNESS WHEREOF, Executive and a duly authorized representative of the Company hereby certify that they have read this Agreement in its entirety and voluntarily executed it in the presence of competent witnesses, as of the date set forth under their respective signatures.

 

	
EXECUTIVE
    	
YETI COOLERS, LLC
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    	
 
    
	
Matthew J. Reintjes
    	
 
    	
Title:
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Date
    	
 
    	
Date
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
YETI HOLDINGS, INC. (solely with   respect to any of its obligations hereunder)
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
 
    	
 
    
	
Name:
    	
 
    	
 
    
	
Title:
    	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
Date

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00288-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00288-of-00352.parquet"}]]