FORM OF DIRECTOR NOMINATION AGREEMENT
Exhibit 10.9
FORM OF
This Director Nomination Agreement (this “Agreement”)
is made on _______, 2021 (the “Effective Date”), by and among Aris Water Solutions, Inc., a Delaware corporation (the “Company”), COG Operating LLC (“COG”), Trilantic Capital Partners Associates V L.P. (‘‘TCPAV’’) and Trilantic Energy Partners Associates L.P. (“TEPA” and
together with TCPVA, “Trilantic”), and Yorktown Energy Partners XI, L.P. (“Yorktown”).
RECITALS
WHEREAS, the Company has agreed
to permit each of COG, Trilantic and Yorktown to designate one director for nomination for election to the board of directors of the Company (the “Board”),
subject to the terms and conditions set forth herein.
NOW, THEREFORE, in consideration
of the mutual covenants and agreements contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree to the following:
ARTICLE I
DEFINITIONS
Section 1.01 Definitions. As used in this
Agreement, the following terms shall have the following meanings:
“Affiliate” means, with
respect to a specified Person, any other Person that directly, or indirectly through one or more intermediaries, Controls, is Controlled by, or is under common Control with, the specified Person; provided that the Company and any Person Controlled by the Company shall not be considered to be an Affiliate of any Major Shareholder for any purpose under this Agreement.
“Agreement” has the
meaning set forth in the Preamble.
“Beneficial Owner” means,
with respect to a security, a Person who directly or indirectly, through any contract, arrangement, understanding, relationship or otherwise has or shares (a) voting power, which includes the power to vote, or to direct the voting of, such security,
or (b) investment power, which includes the power to dispose, or to direct the disposition of, such security. The term “Beneficially Own” shall have a
correlative meaning.
“Board” has the meaning
set forth in the Recitals.
“Bylaws” means the Amended
and Restated Bylaws of the Company, as amended or restated from time to time.
“Certificate of Incorporation”
means the Amended and Restated Certificate of Incorporation of the Company, as amended or restated from time to time.
“COG” has the meaning set
forth in the Preamble.
“COG Designated Director”
has the meaning set forth in Section 2.01(a).
“Company” has the meaning
set forth in the Preamble.
“Control” means the
possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise. The terms “Controlled by” and “under common Control with” shall have correlative meanings.
“Effective Date” has the
meaning set forth in the Preamble.
“Exchange Act” means the
Securities Exchange Act of 1934, as amended.
“Major Shareholders” means
COG , Trilantic and Yorktown.
“Person” means any
individual, corporation, firm, partnership, joint venture, limited liability company, estate, trust, business association, organization, any court, administrative agency, regulatory body, commission or other governmental authority, board, bureau or
instrumentality, domestic or foreign and any subdivision thereof or other entity, and also includes any managed investment account.
“Proceeding” has the
meaning set forth in Section 4.08.
“Securities Exchange”
means the national securities exchange on which the Company’s Class A common stock, par value $0.01 per share, is then listed.
“Selected Courts” has the
meaning set forth in Section 4.08.
“Termination Date” means
with respect to the rights of COG hereunder, the date when the Voting Percentage of COG and its Affiliates is less than 12.5% for the first time following the Effective Date; with respect to the rights of Trilantic hereunder, the date when the Voting
Percentage of Trilantic and its Affiliates is less than 12.5% for the first time following the Effective Date; and with respect to the rights of Yorktown hereunder, the date when the Voting Percentage of Yorktown and its Affiliates is less than 12.5%
for the first time following the Effective Date.
“Termination Trigger” has
the meaning set forth in Section 3.01.
“Trilantic” has the
meaning set forth in the Preamble.
“Trilantic Designated Director”
has the meaning set forth in Section 2.02(a).
“Voting Percentage”
means, with respect to any Person, the percentage voting power in the general election of directors of the Company represented by all shares of Voting Stock Beneficially Owned by such Person.
“Voting Stock” means the
Class A common stock and Class B common stock, each with par value $0.01 per share, of the Company, as well as any other class or series of capital stock of the Company entitled to vote generally in the election of directors to the Board.
“Yorktown” has the meaning
set forth in the Preamble.
“Yorktown Designated Director”
has the meaning set forth in Section 2.01(a).
Section 1.02 Other Definitional and Interpretive
Provisions. The words “hereof,” “herein” and “hereunder” and words of like import used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement. References in the singular or to
“him,” “her,” “it,” “itself” or other like references, and references in the plural or the feminine or masculine reference, as the case may be, shall also, when the context so requires, be deemed to include the plural or singular, or the masculine or
feminine reference, as the case may be. References to the Preamble, Recitals, Articles and Sections shall refer to the Preamble, Recitals, Articles and Sections of this Agreement, unless otherwise specified. The headings in this Agreement are for
convenience and identification only and are not intended to describe, interpret, define or limit the scope, extent or intent of this Agreement or any provision thereof. References to any statute shall be deemed to refer to such statute as amended
from time to time and to any rules or regulations promulgated thereunder. References to any agreement or contract are to that agreement or contract as amended, modified or supplemented from time to time in accordance with the terms hereof and
thereof. References to “include,” “includes” and “including” in this Agreement shall be deemed to be followed by the words “without limitation,” whether or not so specified. This Agreement shall be construed without regard to any presumption or other
rule requiring construction against the party that drafted and caused this Agreement to be drafted.
ARTICLE II
NOMINATION RIGHTS
Section 2.01 Board Nominees.
(a) Subject to the terms and conditions of this Agreement, from and after the Effective Date until the Termination
Date, at every meeting of the Board, or a committee thereof, at which directors of the Company are appointed by the Board or are nominated to stand for election by stockholders of the Company, the Major Shareholder shall have the right, but not the
obligation, to nominate directors for election to the Board as follow:
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COG shall have the right to nominate one nominee until the first time when the Voting Percentage of COG and its Affiliates is less than 12.5%, who shall be a Class III
director (the “COG Designated Director”);
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Trilantic shall have the right to nominate one nominee until the first time when the Voting Percentage of Trilantic and its Affiliates is less than 12.5%, who shall be
a Class I director (the “Trilantic Designated Director”); and
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Yorktown shall have the right to nominate one nominee until the first time when the Voting Percentage of Yorktown and its Affiliates is less than 12.5%, who shall be a
Class I director (the “Yorktown Designated Director”).
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The initial COG Designated Director, Trilantic Designated Director and Yorktown Designated Director, respectively, as of the Effective
Date are Xxxxxx X’Xxxxx, Xxxxxxxxxxx Xxxxxxx and W. Xxxxxx Xxxxxx, Xx.
(b) Subject to Section 2.01(c), the Company
shall take all actions (to the extent such actions are permitted by applicable law) to (i) include each COG Designated Director, Trilantic Designated Director and Yorktown Designated Director in the slate of director nominees for election by the
Company’s stockholders and (ii) include each COG Designated Director, Trilantic Designated Director and Yorktown Designated Director in the proxy statement prepared by the Company in connection with soliciting proxies for every meeting of the
stockholders of the Company called with respect to the election of members of the Board, and at every adjournment or postponement thereof, and on every action or approval by written consent of the Board with respect to the election of members of the
Board.
(c) The Company’s obligations pursuant to Sections
2.01(b), (d) and (e) shall be subject to each person designated as a nominee or successor for the COG Designated Director, Trilantic Designated Director and Yorktown Designated Director, as applicable, providing, fully and completely,
(i) any information that is required to be disclosed in any filing or report under the listing standards of the Securities Exchange and applicable law or regulatory guidance or requests, (ii) any information that is required in connection with
determining the independence status of the COG Designated Director, Trilantic Designated Director and Yorktown Designated Director under the listing standards of the Securities Exchange and applicable law, and (iii) if required by applicable law,
such individual’s written consent to being named in a proxy statement as a nominee and to serving as director if elected.
(d) If a COG Designated Director, Trilantic Designated Director or Yorktown Designated Director is not appointed, nominated or elected
to the Board because of such person’s death, disability, disqualification, withdrawal as a nominee or for other reason, (i) the Major Shareholder who originally designated such director as a nominee shall be entitled to designate another nominee and
shall do so as promptly as practicable following the failure of such designated director to be appointed, nominated or elected to the Board and (ii) the director position for which the original designated director was nominated shall not be filled
pending such designation.
(e) If a vacancy occurs because of the death, disability, disqualification, resignation or removal of a COG Designated Director,
Trilantic Designated Director or Yorktown Designated Director or for any other reason, the Major Shareholder who originally designated such director shall be entitled to designate such person’s successor, and the Company hereby agrees, to the fullest
extent permitted by applicable law (including with respect to fiduciary duties under Delaware law), to promptly fill the vacancy with such successor, it being understood that any such successor designee shall serve the remainder of the term of the
designated director whom such designee replaces. A Major Shareholder shall designate a successor pursuant to this Section 2.01(e) as promptly as practicable
following any such vacancy.
(f) In the event that COG, Trilantic or Yorktown shall cease to have the right to designate a Director hereunder, then the current COG
Designated Director, Trilantic Designated Director or Yorktown Designated Director, respectively, shall (i) at the request of a majority of the Directors then in office resign immediately if such resignation would not reasonably be expected to
violate such director’s fiduciary duties under applicable law, and, upon such request by a majority of the Directors then in office, COG, Trilantic or Yorktown, as applicable, shall take such action as reasonably necessary to facilitate such
resignation or (ii) if no such request is made, continue to serve until his or her term expires at the next annual meeting of stockholders of the Company.
ARTICLE III
EFFECTIVENESS AND TERMINATION
Section 3.01 Termination. This rights of
each of COG, Trilantic and Yorktown shall terminate upon the earlier to occur of (a) the Termination Date applicable to such Major Shareholder and (b) the delivery of written notice to the Company by a Major Shareholder agreeing to terminate its
rights under this Agreement (each a “Termination Trigger”). This Agreement will terminate and be of no further force and effect once a Termination Trigger has
occurred with respect to each Major Shareholder.
ARTICLE IV
MISCELLANEOUS
Section 4.01 Notices. All notices, requests,
consents and other communications hereunder to any party shall be in writing and shall be personally delivered, sent by nationally recognized overnight courier or mailed by registered or certified mail to such party at the address set forth below, or
sent by e-mail transmission (or such other address or contact information as shall be specified by like notice):
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If to the Company:
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Attention:
0000 Xxxx Xxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Electronic mail:
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With copy to:
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Xxxxxx, Xxxx & Xxxxxxxx LLP
Attention: Xxxxxxx X. Xxxxxx
000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Electronic mail: xxxxxxx@xxxxxxxxxx.xxx
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If to any Major Shareholder:
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To the address of such Major Shareholder as it appears in the applicable register for securities of the Company or such other address as may be
designated in writing by such Major Shareholder (including on the signature pages hereto).
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And in the case of notice to COG or any Affiliate thereof, with a copy to:
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King & Spalding LLP
0000 Xxxxxxxxx Xxxxxx, XX
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxx X. Xxxxxxxx
Electronic email: xxxxxxxxx@xxxxx.xxx
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And in the case of notice to Yorktown, with a copy to:
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[______]
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And in the case of notice to Trilantic, with a copy to:
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[______]
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Notices will be deemed to have been given hereunder when personally delivered or when receipt of e-mail has been acknowledged by non-automated response,
one calendar day after deposit with a nationally recognized overnight courier and five calendar days after deposit in U.S. mail.
Section 4.02 Severability. The provisions of
this Agreement shall be deemed severable, and the invalidity or unenforceability of any provision shall not affect the validity or enforceability of the other provisions hereof. If any provision of this Agreement, or the application thereof to any
Person or any circumstance, is found to be invalid or unenforceable in any jurisdiction, (a) a suitable and equitable provision shall be substituted therefor in order to carry out, so far as may be valid and enforceable, the intent and purpose of
such invalid or unenforceable provision and (b) the remainder of this Agreement and the application of such provision to other Persons or circumstances shall not be affected by such invalidity or unenforceability, nor shall such invalidity or
unenforceability affect the validity or enforceability of such provision, or the application thereof, in any other jurisdiction.
Section 4.03 Counterparts. This Agreement
may be executed in any number of counterparts, each of which shall be deemed an original and all of which, taken together, shall be considered one and the same agreement.
Section 4.04 Entire Agreement; No Third Party
Beneficiaries. This Agreement (a) constitutes the entire agreement and supersedes all other prior agreements, both written and oral, among the parties with respect to the subject matter hereof and (b) is not intended to confer upon any
Person, other than the parties hereto, any rights or remedies hereunder.
Section 4.05 Further Assurances. Each party
shall execute, deliver, acknowledge and file such other documents and take such further actions as may be reasonably requested from time to time by the other parties hereto to give effect to and carry out the transactions contemplated herein.
Section 4.07 Governing Law; Equitable Remedies.
THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF DELAWARE (WITHOUT GIVING EFFECT TO CONFLICT OF LAWS PRINCIPLES THEREOF). The parties hereto agree that irreparable damage would occur in the event that
any of the provisions of this Agreement were not performed in accordance with its specific terms or was otherwise breached. It is accordingly agreed that the parties hereto shall be entitled to an injunction or injunctions and other equitable
remedies to prevent breaches of this Agreement and to enforce specifically the terms and provisions hereof in any of the Selected Courts (as defined below), this being in addition to any other remedy to which they are entitled at law or in equity.
Any requirements for the securing or posting of any bond with respect to such remedy are hereby waived by each of the parties hereto. Each party further agrees that, in the event of any action for an injunction or other equitable remedy in respect of
such breach or enforcement of specific performance, it will not assert the defense that a remedy at law would be adequate.
Section 4.08 Consent To Jurisdiction. With
respect to any suit, action or proceeding (“Proceeding”) arising out of or relating to this Agreement, each of the parties hereto hereby irrevocably (a)
submits to the non-exclusive jurisdiction of the Court of Chancery of the State of Delaware and the United States District Court for the District of Delaware and the appellate courts therefrom (the “Selected Courts”) and waives any objection to venue being laid in the Selected Courts whether based on the grounds of forum non conveniens or otherwise and hereby agrees not to commence any such Proceeding
other than before one of the Selected Courts; provided, however,
that a party may commence any Proceeding in a court other than a Selected Court solely for the purpose of enforcing an order or judgment issued by one of the Selected Courts; (b) consents to service of process in any Proceeding by the mailing of
copies thereof by registered or certified mail, postage prepaid, or by recognized international express carrier or delivery service, to the Company or the Major Shareholders at their respective addresses referred to in Section 4.01 hereof; provided, however, that nothing herein shall affect the right of any party hereto to serve process in any other manner permitted by law; and (c) TO THE EXTENT NOT PROHIBITED BY APPLICABLE LAW THAT CANNOT BE WAIVED, WAIVES, AND
COVENANTS THAT IT WILL NOT ASSERT (WHETHER AS PLAINTIFF, DEFENDANT OR OTHERWISE) ANY RIGHT TO TRIAL BY JURY IN ANY ACTION ARISING IN WHOLE OR IN PART UNDER OR IN CONNECTION WITH THIS AGREEMENT, WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER
SOUNDING IN CONTRACT, TORT OR OTHERWISE, AND AGREES THAT ANY OF THEM MAY FILE A COPY OF THIS PARAGRAPH WITH ANY COURT AS WRITTEN EVIDENCE OF THE KNOWING, VOLUNTARY AND BARGAINED-FOR AGREEMENT AMONG THE PARTIES IRREVOCABLY TO WAIVE THE RIGHT TO TRIAL
BY JURY IN ANY PROCEEDING WHATSOEVER BETWEEN THEM RELATING TO THIS AGREEMENT AND TO HAVE ALL MATTERS RELATING TO THIS AGREEMENT BE TRIED IN A COURT OF COMPETENT JURISDICTION BY A JUDGE SITTING WITHOUT A JURY.
Section 4.09 Amendments; Waivers.
(a) No provision of this Agreement may be amended or waived unless such amendment or waiver is in writing and signed, in the case of an
amendment, by the Company and each of the Major Shareholders, or, in the case of a waiver, by each of the parties against whom the waiver is to be effective.
(b) No failure or delay by any party in exercising any right, power or privilege hereunder shall operate as waiver thereof nor shall any
single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege. The rights and remedies herein provided shall be cumulative and not exclusive of any rights or remedies provided
by law.
Section 4.10 Assignment
Neither this Agreement nor any of the rights or obligations hereunder shall be assigned by any of the parties hereto without the prior
written consent of the other parties; provided that any Major Shareholder may assign this Agreement to any of its Affiliates with only the Company’s prior
written consent, which shall not be unreasonably withheld. This Agreement will be binding upon, inure to the benefit of and be enforceable by the parties and their respective successors and permitted assigns.
IN WITNESS WHEREOF, the parties
have caused this Agreement to be duly executed and delivered, all as of the date first set forth above.
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By:
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Name:
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Title:
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MAJOR SHAREHOLDERS:
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COG OPERATING LLC
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By:
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Name:
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Title:
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Address for notice:
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[●]
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TRILANTIC CAPITAL PARTNERS ASSOCIATES V L.P.
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By:
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Name:
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Title:
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Address for notice:
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TRILANTIC ENERGY PARTNERS ASSOCIATES L.P.
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By:
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Name:
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Title:
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Address for notice:
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[●]
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YORKTOWN ENERGY PARTNERS XI, L.P.
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By:
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Name:
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Title:
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Address for notice:
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[●]
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[Signature Page to Director Nomination Agreement]
