Annual Equity Grant During the first fiscal quarter of each year, or such other time as the Board, in its discretion, may determine, the Employee will receive an annual equity grant with a target value, measured as of the grant date, equal to the percentage of the Employee’s Salary determined by the Board or its designated committee, which for 2021 shall be 65% (the “Annual Equity Grant”). One-half of the Annual Equity Grant is expected to be in the form of restricted stock units or restricted share units with no performance restrictions or metrics associated with them, and which are expected to vest in three equal increments on each of the first, second and third anniversaries of the grant date. The other one-half of the Annual Equity Grant is expected to be in the form of performance shares or performance restricted stock units, which will have Board-determined performance restrictions and metrics associated with them. The determination of how many of those performance shares or performance restricted stock units have been earned will be made by the Board on or about the first anniversary of the grant date, based on the financial performance of the Company during the prior fiscal year, and any performance shares or performance stock units deemed by the Board to be earned are expected to vest in two equal increments on or about each of the second and third anniversaries of the grant date. Notwithstanding any other provision of this Agreement to the contrary, the determination of whether and when to make any Annual Equity Grant to Employee, and the design, nature and amount of any such Annual Equity Grant, shall be determined by the Board in its discretion. All Annual Equity Grants to Employee shall be subject to the terms of the grant agreement between Employer and Employee. In the event of a Change of Control, the Board or its designated committee will determine the manner in which any unvested restricted shares, performance shares, restricted stock units or other unvested equity grants will be treated, with respect to the amount and timing of the vesting of such unvested equity, to the extent that the same is not already addressed in the terms of the applicable grant agreement between the Employer and Employee.
Initial Equity Grant No later than 45 days following the Commencement Date, the Company shall take such actions as shall be necessary to grant you the right to purchase (the “Stock Purchase Right”) the number of shares of the Company’s common stock (the “Common Stock”) equal to six percent (6%) of the Company’s outstanding capital stock as of the Commencement Date, calculated based on the Fully Diluted Capitalization of the Company (as defined in the next sentence) at a per-share purchase price equal to the per-share fair market value of the underlying shares on the date of grant, as determined reasonably by the Board in good faith. For the purposes of this Agreement, “Fully Diluted Capitalization” includes all outstanding shares of capital stock plus all shares subject to issuance under outstanding options or warrants plus all shares of capital stock reserved for future issuance under the Company’s 2007 Stock Incentive Plan (the “Plan”) that are not subject to outstanding options or other equity awards plus, to the extent not already included in the foregoing, all shares purchased by you, or subject to your right to purchase, pursuant to this Section 3(d) and Section 3(f). The Stock Purchase Right will be granted under the Plan. Any shares of Common Stock purchased upon exercise of the Stock Purchase Right (the “Restricted Stock”) shall be subject to a right of repurchase in favor of the Company at the original purchase price thereof (the “Right of Repurchase”). The Restricted Stock shall vest, and the Right of Repurchase lapse, with respect to thirty-three and one-third percent (33 1/3%) of the total shares of Restricted Stock on the first anniversary of the Commencement Date and with respect to 1/36th of such shares of Restricted Stock on each monthly anniversary of the Commencement Date thereafter so that the Restricted Stock shall be fully vested and the Right of Repurchase fully lapsed on the third anniversary of the Commencement Date, in each case, subject to your continued service to the Company hereunder except as otherwise provided herein. You will be permitted to purchase the shares of Restricted Stock using a full recourse promissory note, equal to the value of the entire purchase, in a form attached hereto as Exhibit A, to the Company bearing an interest rate equal to the Applicable Federal Rate. The Restricted Stock shall be subject to the terms of the Plan and a restricted stock purchase agreement (the “Restricted Stock Purchase Agreement”) in the form attached hereto as Exhibit B to be entered into between you and the Company.
Equity Grant Subject to approval by the Board and your execution of the Company’s standard form of Restricted Stock Agreement for executives (the “Restricted Stock Agreement”), you will be eligible to receive shares of the Company’s common stock under the Company’s 2017 Stock Option and Grant Plan (the “Plan”) equaling 15% of the Company’s outstanding common stock on a fully-diluted basis as of the grant date and after giving effect to the grant. If the Company closes Preferred Round on or prior to December 31, 2019 (and provided that you are still employed by the Company at the time of such closing), the Company shall issue you an additional award of restricted shares of Company common stock under the Plan in an amount such that, after giving effect to such additional issuance, you have been granted shares of common stock equal to 15% of the Company’s outstanding common stock on a fully-diluted basis upon closing of (and giving effect to) the Preferred Round. If the Preferred Round closes in multiple tranches (including tranches closed in the future, if initial closings of at least $3,000,000 occur by December, 2019), you will receive an additional award upon the closing of each tranche, in accordance with the foregoing. All shares of Company common stock granted to you shall be subject to repurchase and forfeiture as set forth in Restricted Stock Agreement, which shall provide that, subject to Section 6, the granted shares shall vest as follows: (i) 25% of the granted shares will vest on the three-month anniversary of the Commencement Date and (ii) thereafter, the remaining unvested shares will vest in equal quarterly installments over a three-year period, on the last day of each calendar quarter (i.e., March 31, June 30, September 30 and December 31), commencing on September 30, 2018; provided, that upon a Sale Event (as defined in the Plan) all your then-unvested shares (to the extent not previously forfeited) shall vest. For the avoidance of doubt, the Company and the Board have reviewed and understands and accepts your academic and work experience, as the same has been provided to the Company by you. Accordingly, and assuming the accuracy of your academic and work experience, the definition of “Cause”, as applicable to any termination of your employment by the Company (whether under the Plan, your Restricted Stock Agreement or otherwise) shall not include, and shall not be triggered by, the Company’s or the Board’s assertion or belief that you lack requisite experience for your position. In addition to the foregoing equity grant, you shall be eligible for additional grants of Company common stock or options to acquire Company common stock at such time and on such terms as determined by the Company’s board of directors. You shall also receive pre-emptive rights permitting you to preserve your vested equity position in the Company in the event of any additional issuances of Company common stock (or securities convertible into common stock), at a per-share price equal to then current fair market value, as reasonably determined by the Board in good faith.
Equity Grants The Employee shall be granted as soon as practicable on or after the Effective Date, a stock option to purchase 734,900 shares of the Company’s common stock (the “Option”) (which option shall be issued as an incentive stock option to the maximum extent allowed under Section 422 of the Internal Revenue Code of 1986, as amended, and the regulations promulgated thereunder (the “Code”)) pursuant to the Company’s 2011 Employee, Director and Consultant Equity Incentive Plan (the “Plan”). The Option shall be granted with an exercise price equal to the fair market value of the Company’s common stock on the date of grant. Twenty-Five percent (25%) of the Option shall be vested one year from the Effective Date and the remaining portion of such Option shall vest in equal monthly installments over a thirty-six (36) month period commencing on the first day of the month one year following the Effective Date, subject to continued employment by the Company. Notwithstanding the foregoing, in connection with a Change of Control (as defined in the Plan) or if a termination of the Employee occurs within two (2) months prior thereto, then the vesting of all equity then owned by the Employee shall accelerate with respect to one hundred percent (100%) of the unvested shares. In lieu of the Option at the request of the Employee, the Company shall issue restricted common stock. Restricted common stock will be issued at par value. If the equity to be issued is restricted common stock and not stock options, the number of shares of restricted common stock to be issued shall be calculated by determining the black scholes value of the grant as if it had been issued solely as stock options and dividing such number by the then current fair market value of the Company’s common stock so as to provide no additional benefit to the Employee for the non-payment of the exercise price. The Employee acknowledges and agrees that effective as of the date of the grant of the equity as set forth in the preceding paragraph, option agreement No. SP-0040 granted by the Company to the Employee as of April 30, 2011 shall be terminated and of no further force and effect. The Company acknowledges that any other options previously granted to the Employee that vest based upon the Employee providing consulting services to the Company shall continue to vest upon its terms as long as the Employee is providing services as a director, consultant or employee of the Company and that the definition of “cause” applicable to all such option agreements shall be the definition set forth herein and not as set forth in the 2008 Stock Incentive Plan.
Subordinated Incentive Listing Fee Upon Listing, the Advisor shall be entitled to the Subordinated Incentive Listing Fee in an amount equal to 15.0% of the amount by which (i) the Market Value of the Company’s outstanding Shares plus distributions paid by the Company prior to Listing, exceeds (ii) the sum of (A) 100% of Invested Capital and (B) the total Distributions required to be paid to the Stockholders in order to pay the Stockholders’ 8.0% Return from inception through the date that Market Value is determined. The Company shall have the option to pay such fee in the form of cash, Shares, a promissory note, or any combination of the foregoing. If the Company pays such fee with a promissory note, payment in full shall be made from the Net Sales Proceeds of the first Sale completed by the Company after Listing, and interest will accrue at a rate deemed fair and reasonable by the Board from and after the date of Listing. If the Net Sales Proceeds from the first Sale after Listing are insufficient to pay the promissory note in full, including accrued interest, then the promissory note shall be paid in part with such Net Sales Proceeds, and in part from the Net Sales Proceeds from the next successive Sales until the amount owing pursuant to such promissory note is paid in full. If the promissory note has not been paid in full within five years from the date of Listing, then the Advisor, or its successors or assigns, may elect to convert the unpaid balance, including accrued but unpaid interest, into Shares at a price per Share equal to the average closing price of the Shares over the ten trading days immediately preceding the date of such election. If the Shares are no longer Listed at such time as the promissory note becomes convertible into Shares as provided by this paragraph, then the price per Share, for purposes of conversion, shall equal the fair market value for the Shares as determined by the Board based upon the Appraised Value of the Assets as of the date of election.
Issuance of Common Units in Connection with Reset of Incentive Distribution Rights (a) Subject to the provisions of this Section 5.11, the holder of the Incentive Distribution Rights (or, if there is more than one holder of the Incentive Distribution Rights, the holders of a majority in interest of the Incentive Distribution Rights) shall have the right, at any time when there are no Subordinated Units Outstanding and the Partnership has made a distribution pursuant to Section 6.4(b)(v) for each of the four most recently completed Quarters and the amount of each such distribution did not exceed Adjusted Operating Surplus for such Quarter, to make an election (the “IDR Reset Election”) to cause the Minimum Quarterly Distribution and the Target Distributions to be reset in accordance with the provisions of Section 5.11(e) and, in connection therewith, the holder or holders of the Incentive Distribution Rights will become entitled to receive their respective proportionate share of a number of Common Units (the “IDR Reset Common Units”) derived by dividing (i) the average amount of the aggregate cash distributions made by the Partnership for the two full Quarters immediately preceding the giving of the Reset Notice in respect of the Incentive Distribution Rights by (ii) the average of the cash distributions made by the Partnership in respect of each Common Unit for the two full Quarters immediately preceding the giving of the Reset Notice (the number of Common Units determined by such quotient is referred to herein as the “Aggregate Quantity of IDR Reset Common Units”). If at the time of any IDR Reset Election the General Partner and its Affiliates are not the holders of a majority in interest of the Incentive Distribution Rights, then the IDR Reset Election shall be subject to the prior written concurrence of the General Partner that the conditions described in the immediately preceding sentence have been satisfied. Upon the issuance of such IDR Reset Common Units, the Partnership will issue to the General Partner an additional General Partner Interest (represented by hypothetical limited partner units) equal to the product of (x) the quotient obtained by dividing (A) the Percentage Interest of the General Partner immediately prior to such issuance by (B) a percentage equal to 100% less such Percentage Interest by (y) the number of such IDR Reset Common Units, and the General Partner shall not be obligated to make any additional Capital Contribution to the Partnership in exchange for such issuance. The making of the IDR Reset Election in the manner specified in this Section 5.11 shall cause the Minimum Quarterly Distribution and the Target Distributions to be reset in accordance with the provisions of Section 5.11(e) and, in connection therewith, the holder or holders of the Incentive Distribution Rights will become entitled to receive IDR Reset Common Units and the General Partner will become entitled to receive an additional General Partner Interest on the basis specified above, without any further approval required by the General Partner or the Unitholders other than as set forth in this Section 5.11(a), at the time specified in Section 5.11(c) unless the IDR Reset Election is rescinded pursuant to Section 5.11(d).
No Restriction on Right of Company to Effect Corporate Changes Neither the Plan nor this Agreement shall affect in any way the right or power of the Company or its stockholders to make or authorize any or all adjustments, recapitalizations, reorganizations, or other changes in the Company’s capital structure or its business, or any merger or consolidation of the Company, or any issue of stock or of options, warrants or rights to purchase stock or of bonds, debentures, preferred, or prior preference stocks whose rights are superior to or affect the Common Stock or the rights thereof or which are convertible into or exchangeable for Common Stock, or the dissolution or liquidation of the Company, or any sale or transfer of all or any part of the assets or business of the Company, or any other corporate act or proceeding, whether of a similar character or otherwise.
Impact of Stock Splits, Etc In the event of any change in ---------------------------- Evergreen Common Stock and/or Shares between the date of this Agreement and the Effective Time of the Merger by reason of any stock split, stock dividend, subdivision, reclassification, recapitalization, combination, exchange of shares or the like, the number and class of shares of Surviving Corporation Common Stock to be issued and delivered in the Merger in exchange for each outstanding Share as provided in this Agreement shall be proportionately adjusted.
Adjustment of Common Stock Issuable Upon Exercise The Warrant Price shall be subject to be adjusted and re-adjusted from time to time as provided in this Section 4 and, as so adjusted or re-adjusted, shall remain in effect until a further adjustment or re-adjustment thereof is required by this Section 4:
Commencement of Regular Sales of Common Stock Upon the satisfaction of the conditions set forth in Sections 7 and 8 hereof (the “Commencement” and the date of satisfaction of such conditions the “Commencement Date”) and thereafter, the Company shall have the right, but not the obligation, to direct the Investor, by its delivery to the Investor of a Regular Purchase Notice from time to time, to purchase up to Fifty Thousand (50,000) Purchase Shares, subject to adjustment as set forth below in this Section 2(a) (such maximum number of Purchase Shares, as may be adjusted from time to time (the “Regular Purchase Share Limit”), at the Purchase Price on the Purchase Date, provided that the Closing Sale Price of the Common Stock is not below the Floor Price on the Purchase Date (each such purchase, a “Regular Purchase”); provided, however, that (i) the Regular Purchase Share Limit may be increased to up to Seventy-Five Thousand (75,000) Purchase Shares, provided that the Closing Sale Price of the Common Stock is not below $6.00 on the Purchase Date, and (ii) the Regular Purchase may be increased to up to One Hundred Thousand (100,000) Purchase Shares, provided that the Closing Sale Price of the Common Stock is not below $7.50 on the Purchase Date (all of which share and dollar amounts shall be appropriately adjusted for any reorganization, recapitalization, non-cash dividend, stock split or other similar transaction); provided that if, after giving effect to the full proportionate adjustment to the Regular Purchase Share Limit therefor, the Fully Adjusted Regular Purchase Share Limit then in effect would preclude the Company from delivering to the Investor a Regular Purchase Notice hereunder for a Purchase Amount (calculated by multiplying (X) the number of Purchase Shares equal to the Fully Adjusted Regular Purchase Share Limit, by (Y) the Purchase Price per Purchase Share covered by such Regular Purchase Notice on the applicable Purchase Date therefor) equal to or greater than One Hundred Fifty Thousand Dollars ($150,000), the Regular Purchase Share Limit for such Regular Purchase Notice shall not be fully adjusted to equal the applicable Fully Adjusted Regular Purchase Share Limit, but rather the Regular Purchase Share Limit for such Regular Purchase Notice shall be adjusted to equal the applicable Alternate Adjusted Regular Purchase Share Limit as of the applicable Purchase Date for such Regular Purchase Notice); provided, further, however, that the Investor’s committed obligation under any single Regular Purchase shall not exceed One Million Dollars ($1,000,000). If the Company delivers any Regular Purchase Notice for a Purchase Amount in excess of the limitations contained in the immediately preceding sentence, such Regular Purchase Notice shall be void ab initio to the extent of the amount by which the amount of Purchase Shares set forth in such Regular Purchase Notice exceeds the amount of Purchase Shares which the Company is permitted to include in such Purchase Notice in accordance herewith, and the Investor shall have no obligation to purchase such excess Purchase Shares in respect of such Regular Purchase Notice; provided that the Investor shall remain obligated to purchase the amount of Purchase Shares which the Company is permitted to include in such Regular Purchase Notice. The Company may deliver Regular Purchase Notices to the Investor as often as every Business Day, so long as the Company has not failed to deliver Purchase Shares for all prior Regular Purchases, Accelerated Purchases and Additional Accelerated Purchases, including, without limitation, those that have been effected on the same Business Day as the applicable Purchase Date, have theretofore been received by the Investor as DWAC Shares in accordance with this Agreement. Notwithstanding the foregoing, the Company shall not deliver any Regular Purchase Notices during the PEA Period.
