Exhibit 10.1
Execution Copy
EMPLOYMENTAGREEMENT
ThisEmploymentAgreement(the“Agreement”),enteredintoasofJuly 24,2026,ismadebyandbetween FiscalNoteHoldings,Inc.,aDelawarecorporation(the“Company”),andKey Compton(“Executive”andtogetherwiththeCompany,the“Parties”).
WHEREAS,the Company and the Executive mutually desire that the Executive serve the Companyasthe President andChiefExecutiveOfficeroftheCompanypursuanttothetermsand conditions set forth herein.
NOW,THEREFORE,inconsiderationoftheforegoing,andforothergoodandvaluableconsideration,includingtherespectivecovenantsand agreementssetforthbelow,thereceiptandsufficiencyofwhichareherebyacknowledged,thePartiesheretoagreeasfollows:
1)
Employment.
a)
General.DuringtheTerm(asdefinedbelow),theCompanyshallemployExecutiveuponthetermsandconditionsprovidedherein.
b)
PositionandDuties.DuringtheTerm,Executive(i)shallserveastheCompany’sPresidentandCEO,withresponsibilities,duties,and authorityusualandcustomaryforthesuchposition,subjecttodirectionbytheCompany’sBoardofDirectors(the“Board”)consistentwiththe foregoing;(ii)shallreportdirectlytotheBoardand(iii)shallcomplyinallmaterialrespectswithallpresentandfuturepolicies,requirements,rulesand regulations,andreasonabledirectionsandrequestsoftheCompanyinconnectionwiththeCompany’sbusinessthatareconsistentwithhisposition.During the Term, Executive shall continue to serve as a member of the Board, subject to applicable law, the Company’s organizational documents and any required stockholder approval. At theCompany’srequest,ExecutiveshallservetheCompanyand/oritssubsidiariesandaffiliatesinsuchothercapacitiesinadditiontotheforegoingas theCompanyshalldesignate,providedthatsuchadditionalcapacitiesareconsistentwithExecutive’spositionwiththeCompany.Intheeventthat Executiveservesinanyoneormoreofsuchadditionalcapacities,Executive’scompensationshallnotautomaticallybeincreasedonaccountofsuch additional service.
c)
PerformanceofExecutive’sDuties.DuringExecutive’semploymentwiththeCompany,andexceptforperiodsofillness,vacation,Disability (asdefinedbelow),orreasonableleavesofabsenceorasdiscussedinSection1(e),ExecutiveshalldevoteExecutive’sfulltimeandattentiontothe business and affairs of the Company pursuant to the general direction of the Board.
d)
PrincipalOffice.Except as may otherwise be mutually agreed, Executivewillworkremotelyas Executive’s principal place of employment.Executive may maintain Executive’s primary residence in New Jersey and, in such case, shall perform Executive’s duties remotely from such residence, subject to reasonable travel to Washington, District of Columbia and other locations for Company business as reasonably requested by the Company.
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e)
Exclusivity.ExceptwiththepriorwrittenapprovaloftheBoard,ExecutiveshalldevotesubstantiallyallofExecutive’sworkingtime, attention,andenergiestothebusinessoftheCompany,exceptduringanypaidvacationorotherexcusedabsenceperiods.Nothinginthissection preventsExecutivefromengaginginadditionalactivitiesinconnectionwithpersonalinvestmentsandnot-for-profitorcharitableaffairs(including withoutlimitationservingonboardsofnot-for-profitentities)withoutapprovaloftheBoard,providedsuchactivitiesdonotindividuallyorinthe aggregateinterferewiththeperformanceofExecutive’sdutiesunderthisAgreement,violatetheCompany’sstandardsofconductthenineffect,orraise aconflictunderany conflict of interest policy of the Company. With the written approval of the Board,Executivemayalsoserveontheboardof directorsorboardofadvisorsofuptoone(1)for-profitentityprovided(i)eachsuchorganizationisnotacompetitoroftheCompany;and(ii)such activitiesdonotindividuallyorintheaggregateinterferewiththeperformanceofExecutive’sdutiesunderthisAgreement,violatetheCompany’s standardsofconductthenineffect,orraiseaconflictunderanyconflictofinterestpolicyoftheCompany.Executiveagreestoresignfromanysuch boardserviceintheeventtheBoardreasonablydeterminesthatExecutivecontinuingsuchboardserviceviolatesclause(i)or(ii)ofthepreceding sentence.
f)
Permitted Outside Activity. Notwithstanding anything to the contrary in this Section 1 (including the exclusivity obligations set forth in Section 1(e)), the Company acknowledges and agrees that, during the Term, Executive serves, and may continue to serve, as a Managing Director of Urgent International, Inc. and its affiliated entities (including, without limitation, Urgent Capital LLC and Global Public Offering Master Fund LP) (collectively, “Urgent”), and that Executive may continue to perform services for, hold equity and partnership interests in, and receive compensation from Urgent. The Company agrees that such service and activities shall be deemed permitted activities for all purposes of this Agreement and shall not constitute a breach of Section 1 or a basis for Cause, provided that such service and activities do not (i) involve a business that is a competitor of the Company or (ii) individually or in the aggregate materially interfere with the performance of Executive's duties under this Agreement.
2)
Term.TheperiodofExecutive’semploymentunderthisAgreementshallbedeemedtohavecommencedonJune 22,2026(the“Effective Date”)andunlessearlierterminatedbyeitherParty,shallcontinueuntilthefirstanniversaryoftheEffectiveDate(the“InitialTerm”)anduponthe expirationoftheInitialTerm,andeachyearthereafter,thisAgreementshallrenewautomaticallyforanadditionaltwelve(12)months(anysuchtwelve (12)monthextension,onceineffect,alongwiththeInitialTerm,the“Term”)unlesseitherPartyprovideswrittennoticeofnon-renewaltotheother Partyatleastthree(3)monthsinadvanceofthethenscheduledexpirationoftheTerm.Notwithstandingany contraryprovisionherein,Executive’semploymentwiththeCompanyis“atwill”andmaybeterminatedbytheCompanyorExecutiveatanytimeand for any or no reason.
3)
CompensationandRelatedMatters.
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a)
AnnualBaseSalary.DuringtheTerm,Executiveshallreceiveabasesalaryattherateof$425,000peryear(asmaybeincreasedfromtimeto time,the“AnnualBaseSalary”),subjecttowithholdingsanddeductions,whichshallbepaidtoExecutiveinaccordancewiththecustomarypayroll practicesandproceduresoftheCompany.SuchAnnualBaseSalaryshallbereviewedbytheBoardand/ortheCompensationCommitteeoftheBoard (“Compensation Committee”) not less than annually.
b)
AnnualBonus.DuringtheTerm,ExecutiveshallbeeligibletoreceiveadiscretionaryannualbonusbasedonExecutive’sachievementof performanceobjectivesdeterminedannuallybytheCompensationCommitteeinconsultationwithExecutive(the“AnnualBonus”),suchbonustobe targetedat75%ofExecutive’sAnnualBaseSalary(the“TargetBonus”).AnyAnnualBonusapprovedbytheCompensationCommitteeoftheBoard shallbepaidatthesametimeannualbonusesarepaidtootherexecutivesoftheCompanygenerally,subjecttoExecutive’scontinuousemployment through the date of payment (other than as otherwise set forth in Section 6(a)). Executive’s annual bonus for 2026 will be no less than the Target Bonus, pro-rated based on the number of days during 2026 that Executive was employed by the Company.
c)
Benefits.DuringtheTerm,Executiveshallbeentitledtoparticipateinsuchemployeeandexecutivebenefitplansandprogramsasthe Companymayfromtimetotimeoffertoprovidetoitsexecutives,subjecttothetermsandconditionsofsuchplans.Notwithstandingtheforegoing, nothinghereinisintended,orshallbeconstrued,torequiretheCompanytoinstituteorcontinueany,oranyparticular,planorbenefit.
d)
BusinessExpenses.TheCompanyshallreimburseExecutiveforallreasonable,documented,out-of-pockettravelandotherbusinessexpenses incurredbyExecutiveintheperformanceofExecutive’sdutiestotheCompany, including reasonable, documented, out-of-pocket travel and related expenses incurred in connection with (i) travel to and within Washington, District of Columbia for Company business, and (iii) other Company-requested or Company-related business travel, in each caseinaccordancewiththeCompany’sapplicableexpensereimbursement policies and procedures as are in effect from time to time.
e)
Legal Fees. The Company shall reimburse Executive for reasonable legal fees and expenses incurred by Executive in connection with the preparation, negotiation, and documentation of this Agreement and any related documents, ancillary agreements, and any other matters arising out of the employment relationship, within ten (10) days after Executive’s presentation of reasonable documentation therefor.
f)
Vacation.ExecutivewillbeentitledtopaidvacationinaccordancewiththeCompany’svacationpolicy.Anyvacationshallbetakenatthe reasonable and mutual convenience of the Company and Executive.
4)
IncentiveAwards.
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a)
Initial Equity Award. Upon the date hereof, Executive shall be granted an award of no less than 1,450,000 shares of restricted common stock (the “Performance Stock”) that shall become vested and otherwise be subject to the terms and conditions of the Notice of Performance-Based Restricted Stock Award and Standard Terms and Conditions for Performance-Based Restricted Stock substantially in the form set forth on Exhibit B. In addition, within thirty (30) days following the grant of such Performance Stock, the Company shall provide Executive a cash payment in an amount sufficient, after payment of any and all applicable federal, state, local and foreign income and employment taxes imposed on such cash payment, to cover the taxes imposed on Executive as a result of taking such Performance Stock into income as of the date of grant, based on an assumed effective tax rate equal to the highest applicable U.S. federal, state and local tax rate applicable to Executive, provided that Executive timely files a Section 83(b) election with respect to all of the shares of the Performance Stock and provides evidence of such election to the Company.
b)
Annual Equity Grants. ExecutiveshallbeeligibleforsuchstockoptionsandequityawardsasmaybedeterminedbytheCompensationCommittee, in its sole discretion, consistent with its policies and practices pertaining to equity awards for Company executives.
c)
Transaction Bonus. Upon the occurrence of a Change in Control during the period that commences on the Effective Date and ends six-months following the Date of Termination, Executive shall receive a transaction bonus equal to $1,000,000, less the proceeds, if any, actually received by Executive in connection with the consummation of such Change in Control in respect of the outstanding Performance Stock (the “Transaction Bonus”), payable within thirty (30) days following the consummation of such Change in Control. To the extent that additional amounts become payable with respect to the Performance Stock after the date of the Change in Control, Executive shall repay to the Company the amount of the Transaction Bonus received by Executive that is equal to such additional amounts payable (but in no event shall Executive be required to repay an amount in excess of the Transaction Bonus paid to Executive).
5)
Termination.
a)
At-WillEmployment.TheCompanyandExecutiveacknowledgethatExecutive’semploymentisandshallcontinuetobe“atwill,”asdefined underapplicablelaw.ThismeansthatitisnotforanyspecifiedperiodoftimeandcanbeterminatedbyExecutiveorbytheCompanyatanytime,with orwithoutadvancenotice,andforanyornoparticularreasonorcause.ItalsomeansthatExecutive’sjobduties,title,responsibilityandreportinglevel, workschedule,compensation,andbenefits,aswellastheCompany’spersonnelpoliciesandprocedures,maybechangedwithprospectiveeffect,with orwithoutnotice,atanytimeinthesolediscretionoftheCompany(subjecttoanyramificationsuchchangesmayhaveunderSection6ofthis Agreement).This“at-will”natureofExecutive’semploymentshallremainunchangedduringExecutive’stenureasanemployeeandmaynotbe changed,exceptinanexpresswritingsignedbyExecutive,ontheonehand,andaduly-authorizedofficeroftheCompany(otherthanExecutive)acting withtheapproval
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oftheBoardortheCompensationCommittee,ontheotherhand.IfExecutive’semploymentterminatesforanylawfulreason, Executiveshallnotbeentitledtoanypayments,benefits,damages,award,orcompensationotherthanasprovidedinthisAgreementoranotherwritten agreement between a member of the Company Group and Executive.
b)
NoticeofTermination.DuringtheTerm,anyterminationofExecutive’semploymentbytheCompanyorbyExecutive(otherthanbyreasonof death)shallbecommunicatedbywrittennotice(a“NoticeofTermination”)fromonePartyheretototheotherPartyhereto(i)indicatingthespecific terminationprovisioninthisAgreementreliedupon,ifany;(ii)settingforthinreasonabledetailthefactsandcircumstancesclaimedtoprovideabasis forterminationofExecutive’semploymentundertheprovisionsoindicated;and(iii)specifyingtheDateofTermination(asdefinedbelow).Thefailure byeitherpartytosetforthintheNoticeofTerminationallofthefactsandcircumstancesthatcontributetoashowingofCauseorGoodReason,as applicable,shallnotwaiveanyrightofsuchpartyhereunderorprecludesuchpartyfromassertingsuchfactsorcircumstancesinenforcingitsrights hereunder.
c)
DateofTermination.ForpurposesofthisAgreement,“DateofTermination”shallmeanthedateoftheterminationofExecutive’s employmentwiththeCompanyspecifiedinaNoticeofTermination;provided,however,thatintheeventofExecutive’sresignationwithoutGood Reason(asdefinedbelow),suchdateshallnotbeearlierthanthirty(30)daysfollowingthedateonwhichtheNoticeofTerminationisdeliveredby ExecutivetotheCompany;andprovided,further,thattheCompanymaywaiveanyperiodofnoticeprovidedbyExecutive,therebyaccelerating Executive’s Date of Termination.
d)
DeemedResignation.UponterminationofExecutive’semploymentforanyreason,Executiveshallbedeemedtohaveresignedfromall officesandboardmemberships,ifany,thenheldwiththeCompanyoranyofitsaffiliates,and,attheCompany’srequest,Executiveshallimmediately execute such documents as are necessary or desirable to effectuate such resignations.
6)
ConsequencesofTermination.
a)
PaymentsofAccruedObligationsuponAllTerminationsofEmployment.UponaterminationofExecutive’semploymentforanyreason, Executive(orExecutive’sestateorlegalrepresentative,asapplicable)shallbeentitledtoreceive,within30daysafterExecutive’sDateofTermination (orsuchearlierdateasmayberequiredbyapplicablelaw):(i)anyportionofExecutive’sAnnualBaseSalaryearnedthroughExecutive’sDateof Terminationnottheretoforepaid;(ii)anyexpensesowedtoExecutiveunderSection3;(iii)anyaccruedbutunusedpaidtimeoffowedtoExecutive; (iv)anyvestedamountarisingfromExecutive’sparticipationinanyemployeebenefitplans,programsorarrangementsunderSection3or4,which amountsshallbepayableinaccordancewiththetermsandconditionsofsuchplans,programs,agreementsorarrangements;(v)otherthanin connectionwithaterminationbytheCompanyforCauseorbyExecutivewithoutGoodReason,paymentofanyprioryear’searneddiscretionary annualbonustotheextentnotpreviouslypaid,paidinaccordancewithSection3(b); and (vi) otherthanin connectionwithaterminationbytheCompanyforCause, forpurposesofvestingwith respect to
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the Transaction Bonus or Executive’s outstanding Company equity awards that are scheduled to vest subject to continued service or employment andtheattainmentofoneormoreperformanceobjectives,thetime (service) conditions shallacceleratesothatsuchawardsshallbevestedtothe sameextentasifExecutivehadprovidedanadditionalsix(6)monthsofserviceoremploymentfromtheDateofTermination, and the performance conditions will not be accelerated but will become vested if and to the extent a performance vesting milestone is attained as of the Date of Termination or within the additional six (6) month period following the Date of Termination.ExceptasotherwisesetforthinSections6(b)and(c),thepayments andbenefitsdescribedinthisSection6(a)shallbetheonlypaymentsandbenefitspayableintheeventofExecutive’sterminationofemploymentfor any reason under this Agreement.
b)
SeverancePaymentsuponCoveredTerminationOutsideaChangeinControlPeriod.IfExecutiveexperiencesaCoveredTerminationoutsideaChangeinControlPeriod(eachas definedbelow),theninadditiontothepaymentsandbenefitsdescribedinSection6(a),theCompanyshall,subjecttoExecutive’sdeliverytothe CompanyofaRelease(asdefinedbelow)thatbecomeseffectiveandirrevocableinaccordancewithSection11(d)andExecutive’scontinued compliancewiththetermsofthisAgreement,provideExecutivewiththefollowingbenefitssetforthinthisSection6(b).Forpurposesofthis Agreement,“Release”meansaseparationandgeneralreleaseagreementinallmaterialrespectsintheformattachedasheretoasExhibitA,subjectto such changes that the Company reasonably determines are appropriate in light of changes in applicable law.
i)
TheCompanyshallpaytoExecutiveanamountequaltothesumof(A)fifty percent (50%) of Executive’sAnnualBaseSalaryand(B)fifty percent (50%) of theTargetBonus for the fiscal year in which the Date of Termination occurs. Such amount shall be paid, subject to applicable withholding and Sections10and11(c),insubstantiallyequalinstallmentsoversix(6)monthsfollowingtheDateofTerminationinaccordance withtheCompany’sregularpayrollpractices;provided,however,thatamountsshallaccrue,withpaymentsofaccruedamounts made on the second regularly scheduled payroll date after the Release Expiration Date (as defined below) and then continuing thereafter.
ii)
ForpurposesofvestingwithrespecttoExecutive’s outstandingCompanyequityawardsthatarescheduledtovestsubjectto continuedserviceoremployment,vestingshallacceleratesothatsuchawardsshallbevestedtothesameextentasifExecutivehad providedanadditionalsix(6)monthsofserviceoremploymentfromtheDateofTermination.
iii)
DuringtheperiodcommencingontheDateofTerminationandendingonthesix(6)-monthanniversarythereofor,ifearlier, thedateofExecutive’sdeath,subjecttoExecutive’svalidelectiontocontinuehealthcarecoverageunderSection4980Bofthe Internal Revenue Code of 1986, as amended (the “Code”), and the regulations thereunder, the Company shall pay 100% of the Executive’sCOBRApremium;provided,however,thatiftheCompanycannotprovidethebenefitwithoutviolatingapplicablelaw (including, without limitation, Section 2716 of the Public Health
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Service Act), then the parties hereby agree to negotiate in good faithtomodifytheforegoingprovisioninsuchmannerastoavoidtheimpositionofsuchexcisetaxeswhilealsomaintaining,tothe maximumextentreasonablypossible,theoriginalintentandeconomicbenefitstotheExecutiveandtheCompanyunderthisclause (iii).
iv)
For avoidance of doubt, the Transaction Bonus shall remain payable upon any Change in Control that occurs within six months following the Date of Termination.
c)
SeverancePaymentsuponCoveredTerminationDuringaChangeinControl PeriodAtAnyTimeDuringtheTerm.If,ExecutiveexperiencesaCoveredTerminationduringaChange inControlPeriod(eachasdefinedbelow),then,inadditiontothepaymentsandbenefitsdescribedinSection6(a),theCompanyshall,subjectto Executive’sdeliverytotheCompanyofaReleasethatbecomeseffectiveandirrevocableinaccordancewithSection11(d)andExecutive’scontinued compliance with the terms of this Agreement, provide Executive with the following:
i)
TheCompanyshallpaytoExecutiveanamountequaltothesumof(A)one hundred percent (100%) of theExecutive’sAnnualBaseSalaryand(B)one hundred percent (100%) of the TargetBonusforthefiscalyearinwhichtheDateofTerminationoccurs.Suchamountshallbepaid,subjecttoapplicable withholdingandSections10(a)and10(b),payableinalumpsumonthesecondregularlyscheduledpayrolldateaftertheRelease Expiration Date.
ii)
ForpurposesofvestingwithrespecttoExecutive’soutstandingCompanyequityawardsthatarescheduledtovestsubjectto continuedserviceoremployment,vestingshallacceleratesothatall service conditions are fully metasoftheDateofTermination.For purposesofvestingwithrespecttoExecutive’soutstandingCompanyequityawardsthatarescheduledtovestsubjecttocontinued service or employment and the attainment of one or more performance objectives, the time vesting shall accelerate so that such awardsshallbefullyvestedasoftheDateofTermination,andtheperformancevestingwillnotbeacceleratedbutwillbecome vested if and to the extent the performance vesting requirements are attained as of the Date of Termination or within the subsequent six months following the Date of Termination.
iii)
DuringtheperiodcommencingontheDateofTerminationandendingonthetwelve(12)-monthanniversarythereofor,ifearlier, thedateofExecutive’sdeath,subjecttoExecutive’svalidelectiontocontinuehealthcarecoverageunderSection4980Bofthe Code,theCompanyshallpay100%oftheExecutive’sCOBRApremium;provided,however,thatiftheCompanycannotprovide thebenefitwithoutviolatingapplicablelaw(including,withoutlimitation,Section2716ofthePublicHealthServiceAct),then the parties hereby agree to negotiate in good faith to modify the foregoing provision in such manner as to avoid the imposition of such excise taxes while also maintaining, to the maximum extent reasonably possible, the original intent and economic benefits to the Executive and the Company under this clause (iii).
d)
NoOtherSeverance.TheprovisionsofthisSection6shallsupersedeintheirentiretyany
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severancepaymentprovisionsinanyseveranceplan, policy,program,orotherarrangementmaintainedbytheCompanyoranyofitssubsidiariesexceptasotherwiseapprovedbytheBoardorthe Compensation Committee.
e)
NoRequirementtoMitigate;Survival.Executiveshallnotberequiredtomitigatetheamountofanypaymentprovidedforunderthis Agreementbyseekingotheremploymentorinanyothermanner.NotwithstandinganythingtothecontraryinthisAgreement,theterminationof Executive’s employment shall not impair the rights or obligations of any Party.
f)
DefinitionofCause.Forpurposeshereof,“Cause”shallmeananyoneofthefollowing:
i)
Executive’smaterialviolationofanyapplicablelaworregulationrespectingthebusinessoftheCompany;(ii)Executive’s conviction of, or plea of guilty or nolo contendere to, any crime involving moral turpitude or any felony; (iii) any act of fraud, embezzlement,theft,misrepresentation,materialdishonesty,grossnegligenceorwillfulmisconductbyExecutive;(iv)Executive’s willful and repeated refusal to attempt in good faith to implement a clear, reasonable and lawful directive from the Board that is consistentwithhisposition;(v)conductbyExecutivethatbringsorisreasonablyexpectedtobringExecutiveortheCompanyinto disreputeorotherwisemakeExecutiveunfittocontinuetoserveasanofficeroftheCompany,ineachcase,inanymaterialrespect; (vi)Executive’sbreachoffiduciarydutyowedtotheCompany;or(vii)Executive’smaterialbreachofthisAgreement,another materialwrittenagreementwiththeCompanyortheCompany’smaterialwrittenpoliciesorprocedures;provided,thatsolelyfor purposesofclause(i),(iv)and(vii)ofthisparagraph,theCompanywillnotbedeemedtohaveCauseunless(1)theCompanyfirst provides Executive with written notice of the condition giving rise to Cause within 30 days of the date the Board first becomes awareofitsinitialoccurrence;and(2)ifcurable,Executivefailstocuresuchconditionwithin30daysafterreceivingsuchwritten notice.
g)
DefinitionofChangeinControl.ForpurposesofthisAgreement,“ChangeinControl”shallmean(i)theacquisitionbyanypersonorgroup ofaffiliatedorassociatedpersonsofmorethan50%oftheoutstandingcapitalstockoftheCompanyrepresentingmorethan50%ofthetotalvoting powerofoutstandingcapitalstockoftheCompany;(ii)theconsummationofasaleofallorsubstantiallyalloftheassetsoftheCompanytoathird party;(iii)theconsummationofanymerger,consolidation,reorganization,orbusinesscombinationinvolvingtheCompanyinwhich,immediatelyafter givingeffecttosuchmerger,lessthanamajorityofthetotalvotingpowerofoutstandingstockofthesurvivingorresultingentityisthen“beneficially owned”(withinthemeaningofRule13d-3undertheSecuritiesExchangeActof1934,asamended)intheaggregatebythestockholdersofthe Company,asapplicable,immediatelypriortosuchmerger,consolidation,reorganization,orbusinesscombination;or(iv)acircumstanceinwhichthe IncumbentDirectors(asdefinedbelow)ceaseforanyreasontoconstituteamajorityoftheBoard.Fortheavoidanceofdoubtandnotwithstanding anythinghereintothecontrary,in
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noeventshallatransactionconstitutea“ChangeinControl”if(x)itssolepurposeistochangethestateofthe Company’sincorporation;or(y)itssolepurposeistocreateaholdingcompanythatwillbeownedinsubstantiallythesameproportionsbythepersons who held the Company’s securities immediately before such transaction.
h)
DefinitionofChangeinControlPeriod.Forpurposeshereof,“ChangeinControlPeriod”shallmeantheperiodoftimecommencingsix (6)monthspriortoaChangeinControlandendingtwelve(12)monthsaftersuchChangeinControl.
i)
DefinitionofCoveredTermination.Forpurposeshereof,“CoveredTermination”shallmeantheterminationofExecutive’semploymentbythe CompanywithoutCauseorbyExecutiveforGoodReason, or Executive’s cessation of employment at the end of the Term following a notice of non-renewal by the Company,andshallnotincludeaterminationduetoExecutive’sdeathorDisability.
j)
DefinitionofDisability.Forpurposeshereof,“Disability”shallmeanaphysicalormentalincapacityofExecutivethatentitlesExecutiveto benefitsundertheCompany’slong-termdisabilityplan,or,intheabsenceofsuchaplan,itisreasonablydeterminedbytheBoardthatExecutiveis unabletoperform,byreasonofsuchphysicalormentalincapacity,theessentialfunctionsofhisorherpositionforaperiodofatleast180daysinany twelve (12)-month period or that is reasonably expected to result in Executive’s death.
k)
DefinitionofGoodReason.Forpurposeshereof,“GoodReason”shallmeananyoneofthefollowingthatoccurswithouttheconsentof Executive:(i)thereductionofExecutive’sAnnual BaseSalaryorTargetBonus,otherthanareductionofupto10%thatoccursinconnectionwithaCompany-widedecreaseinexecutiveteamcompensation;(ii)theassignmenttoExecutiveofanydutiesmateriallyandnegativelyinconsistentinanyrespectwith Executive’sposition(includingstatus,offices,titles,andreportingrequirements),authority,duties,orresponsibilities;(iii)anyotheractionbythe CompanyortheBoard(oranymemberthereof)thatresultsinamaterialdiminutionin,orunreasonableinterferencewith,Executive’sexerciseofsuch position,authority,duties,orresponsibilities,includinganyrequirementthatExecutivetakeanyactionthatExecutiveconsiders,ingoodfaith,toviolate legal,business,moralorethicalstandards;(iv)therelocationofExecutive’sprincipalplaceofemploymentbymorethan 35 miles; (v) the Company’s failure to nominate, or renominate, Executive to serve as a member of the Board; or (vi) the Company’s material breach of the Agreement or any other material written agreement with Executive; provided, that in each case, Executive will not be deemed to have Good Reason unless (1) Executive first provides theCompanywithwrittennoticeoftheconditiongivingrisetoGoodReasonwithin30daysof thedateExecutivefirstdeterminesingoodfaiththataGoodReasonoccurrenceispresent;(2)theCompanyorthesuccessorcompanyfailstocuresuch conditionwithin30daysafterreceivingsuchwrittennotice(the“CurePeriod”);and(3)Executive’sresignationbasedonsuchGoodReasonis effective within 30 days after the expiration of the Cure Period.
l)
DefinitionofIncumbentDirectors.Forpurposeshereof,“IncumbentDirectors”
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shallmeanforanyperiodoftwelve(12)consecutivemonths, individualswho,atthebeginningofsuchperiod,constitutetheBoardtogetherwithanynewdirector(s)whoseelectionornominationforelectiontothe Boardwasapprovedbyavoteofatleastamajority(eitherbyaspecificvoteorbyapprovaloftheproxystatementoftheCompanyinwhichsuch personisnamedasanomineefordirectorwithoutobjectiontosuchnomination)ofthedirectorsthenstillinofficewhoeitherweredirectorsatthe beginning of the twelve (12)-month period or whose election or nomination for election was previously so approved.
7.
ExecutiveCovenants.ToprotectthetradesecretsandConfidentialInformationoftheCompanyanditssubsidiaries(“CompanyGroup”)and itscustomersandclientsthathavebeenandwillbeentrustedtoExecutive,thebusinessgoodwilloftheCompanyGroupthatwillbedevelopedinand throughExecutiveandthebusinessopportunitiesthatwillbedisclosedorentrustedtoExecutivebytheCompanyGroup,andasanadditionalincentive for the Company to enter into this Agreement, pay the compensation and benefits hereunder, Executive agrees as follows:
(a)
NondisclosureofConfidentialInformation.
(i)
Executive acknowledges that it is the policy of the Company to maintain as secret and confidential (A) all valuable and unique information;(B)otherinformationheretoforeorhereafteracquiredbytheCompanyGroupanddeemedbyittobeconfidential;and (C)informationdevelopedorusedbytheCompanyGrouprelatingtotheBusiness,operations,employeesand/orcustomersofthe Company Groupincluding,butnotlimitedto,anyemployeeinformation(allsuchinformationdescribedintheforegoingclauses(A),(B)and (C)(otherthaninformationwhichis(x)knowntothepublicorbecomesknowntothepublicthroughnofaultofExecutive; (y) received by Executive on a non-confidential basis from a Person that is not bound by an obligation of confidentiality to the CompanyGroup;or(z)inExecutive’spossessionpriortoreceiptfromtheCompanyGroup,asevidencedbyExecutive’swritten records) is hereinafter referred to as “Confidential Information”). The Parties recognize that the services to be performed by ExecutivepursuanttothisAgreementarespecialanduniqueandthatbyreasonofExecutive’semploymentbytheCompany, ExecutivemayacquireConfidentialInformation.ExecutiverecognizesthatallsuchConfidentialInformationisthepropertyofthe CompanyGroup.Accordingly,ExecutiveshallnotatanytimeduringoraftertheTerm,exceptintheproperperformanceof Executive’sdutiesunderthisAgreement,directlyorindirectly,withoutthepriorwrittenconsentoftheBoard,disclosetoanyPerson otherthantheCompany,whetherornotsuchPersonisacompetitoroftheCompany,andshalluseExecutive’sbesteffortsto prevent the publication or disclosure of, any Confidential Information obtained by, or which has come to the knowledge of, Executive prior or subsequent to the date hereof.
(ii)
Notwithstandingtheforegoingoranythinghereintothecontrary,nothing
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containedhereinshallprohibitExecutivefrom(A)filinga chargewith,reportingpossibleviolationsoffederallaworregulationto,participatinginanyinvestigationby,orcooperatingwith any governmental agency or entity or making other disclosures that are protected under the whistleblower provisions of applicable law or regulation; and/or (B) communicating directly with, cooperating with, or providing information (including trade secrets) in confidence to, any federal, state or local government regulator (including, but not limited to, the U.S. Securities and Exchange Commission,theU.S.CommodityFuturesTradingCommissionortheU.S.DepartmentofJustice)forthepurposeofreportingor investigatingasuspectedviolationoflaw,orfromprovidingsuchinformationtoExecutive’sattorneyorinasealedcomplaintor otherdocumentfiledinalawsuitorothergovernmentalproceeding.Pursuantto18USCSection1833(b),Executivewillnotbeheld criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that is made: (A) in confidencetoafederal,state,orlocalgovernmentofficial,eitherdirectlyorindirectly,ortoanattorney,andsolelyforthepurpose of reporting or investigating a suspected violation of law; or (B) in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal.
(b)
Non-CompetitionandNon-SolicitationofCustomersorClients.
(i)
DuringtheTermandendingontheone(1)-yearanniversaryoftheDateofTermination(“RestrictedPeriod”),inanycase, Executiveshallnot,inanymanner,anywhereintheUnitedStatesoranyotherregion in which the Company Group is then operating or has taken affirmative steps to operate (the “Geographic Area”) (whether on Executive’s own account, or as an employee, director, consultant, contractor, agent, partner, manager, joint venturer, owner, operator or officer of any other Person, or in any other capacity) either directly or indirectly:
(1)
becomeengagedinorwith,eitheraloneorwithanyPersonthatisengagedinorpreparingtoengagein,theBusinessorany portion thereof
(2)
actinanycapacityfor,performservicesto,investin,aidorabet,orgiveinformationorfinancialassistanceto,anyPerson engaged in or preparing to engage in the Business or any portion thereof; or
(3)
seek to diminish the relationships between the Company Group and any of their customers or clients or seek, directly or indirectly,todivertsuchrelationshipsforExecutive’spersonalbenefitortosuchfirmorotherpersonorentitywithwhom Executive may then be employed or otherwise associated.
NothingcontainedinthisSection7(b)shallbedeemedtoprohibitExecutivefrompassivelyowning,directlyorindirectly,notmorethan twopercent(2%)ofthesecuritiesofanypublicly-tradedcompany,solongasExecutivehasnoactiveparticipationinthebusinessofsuch companyornotmorethantwopercent(2%)
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ofthelimitedpartnershipinterestsofaprivateequityfund,irrespectiveofthecompaniesinwhich the fund invests, so long as Executive has no active participation in the business of any such companies owned by the private equity fund.
(ii)
ForpurposesofthisAgreement,“Person”shallmeananyindividual,corporation,limitedliabilitycompany,partnership,firmor other business of whatever nature, in any case, to which is now existing or hereafter created.
(iii)
For purposes of this Agreement, “Business” shall mean the business of providing technology, information, tools, features, functionality,and/orrelatedservicesinregardstoanyofthefollowing:(a)local,state,federaland/orgloballegislative,regulatory and policy issues; (b) geopoliticalandrelatedeconomicriskandopportunity;(c)grassrootsand/orgrasstopsadvocacyand/or(d)anyotherbusinessoftheCompany Groupcommenced(orwithrespecttowhichaffirmativestepstowardcommencementhavebeentaken,includingwithoutlimitationbyacquisitionor investment) prior to the Date of Termination.
(c)
Non-SolicitationofEmployees.DuringtheRestrictedPeriod,Executiveshallnot,inanymanner,(whetheronExecutive’sownaccount,oras anemployee,director,consultant,contractor,agent,partner,manager,jointventurer,owner,operatororofficerofanyotherPerson,orinanyother capacity) either directly or indirectly:
(i)
hire or solicit the employment or engagement of any Person who (A) as of the period during the six (6) months prior to and includingtheDateofTerminationor(B)atthetimeofsuchsolicitationorhire,inanycase,isorwasemployedorengagedbythe Company Group; or
(ii)
solicit,canvass,induceorencourageanyemployeeorconsultantoftheCompanyGroupentitytoleavetheemploymentorservice of, or cease providing services to, the Company Group, as applicable.
NothingcontainedinthisSection7(c)shallrestrictExecutivefromconductinganygeneraladvertisementorsolicitation(oranyhiringpursuantto suchadvertisementorsolicitation)foremployeesorconsultantsthatisnottargetedatanyemployeeorconsultantoftheCompanyGroup,including, without limitation, through the use of employment agencies, provided Executive does not actually hire such employee or consultant.
(d)
IntellectualPropertyRights.Executiveacknowledgesandagreesthatallinventions,technology,processes,innovations,ideas,improvements, developments,methods,designs,analyses,trademarks,servicemarks,andotherindiciaoforigin,writings,audiovisualworks,concepts,drawings, reportsandallsimilar,related,orderivativeinformationorworks(whetherornotpatentableorsubjecttocopyright),includingbutnotlimitedtoall patents,copyrights,copyrightregistrations,trademarks,andtrademarkregistrationsinandtoanyoftheforegoing,alongwiththerighttopractice, employ,exploit,use,develop,reproduce,copy,distributecopies,
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publish,license,orcreateworksderivativeofanyoftheforegoing,andtherightto choosenottodoorpermitanyoftheaforementionedactions(collectively,the“Inventions”),whichrelateatthetimeofconceptionorreductionto practicetotheBusiness,researchanddevelopmentorexistingorfutureproductsorservicesandwhichareconceived,developedormadebyExecutive whileemployedbytheCompany(collectively,the“WorkProduct”)belongtotheCompany.AllWorkProductcreatedbyExecutivewhileemployedby theCompanywillbeconsidered“workmadeforhire,”andassuch,theCompanyisthesoleownerofallrights,title,andintereststherein.Executive herebyagreesthatallrightstoanynewWorkProductandallrightstoanyexistingWorkProduct,includingbutnotlimitedtoallofExecutive’srightsto anycopyrightsorcopyrightregistrationsrelatedthereto,areherebyconveyed,assignedandtransferredtotheCompanypursuanttothisAgreement. ExecutivewillpromptlydiscloseanddeliversuchWorkProducttotheCompanyand,attheCompany’sexpense,performallactionsreasonably requestedbytheCompany(whetherduringoraftertheTerm)toestablish,confirmandprotectsuchownership(including,withoutlimitation,the executionofassignments,copyrightregistrations,consents,licenses,powersofattorneyandotherinstruments).AllWorkProductmadewithinsix (6)monthsaftertheapplicableDateofTerminationwillbepresumedtohavebeenconceivedduringExecutive’semploymentwiththeCompany,unless Executivecanproveconclusivelythatitwascreatedsolelyaftersuchtermination.WorkProductwillnotincludeInventionsdevelopedentirelyon Executive’sowntimewithoutusinganyequipment,supplies,facilities,ortradesecretinformationoftheCompanyGroup;provided,however,Work Productwillinclude,withoutexception,anyInventionthateither(i)relates,atthetimeofconceptionorreductiontopracticeofsuchInvention,tothe Business,oractualordemonstrablyanticipatedresearchordevelopmentoftheCompanyGroupor(ii)resultsfromanyserviceorworkperformedby ExecutivetoorforthebenefitoftheCompanyGroup.ExecutivefurtheracknowledgesandagreesthatifExecutiveusesanyotherInventionsinwhich ExecutivehasaninterestandthatarenotWorkProduct(collectively,the“ExcludedInventions”)inthecourseofExecutive’semploymentforthe CompanyorincorporatesanyExcludedInventionsinanyWorkProduct,technology,product,orserviceoftheCompany,Executiveherebygrantsthe Companyanon-exclusive,royalty-free,perpetualandirrevocable,worldwiderighttouseandsublicensetheuseofExcludedInventionsforthe purposeofdeveloping,marketing,sellingandsupportingtheWorkProductandanyotherCompanytechnology,productsandservices,eitherdirectlyor throughmultipletiersofdistribution,butnotforthepurposeofsellingormarketingExcludedInventionsseparatelyfromtheWorkProductorother Company technology, products or services.
(e)
ContinuingOperation; Survival. If the restrictions and covenants set forth in this Section 7 are determined by any court of competent jurisdictiontobeunenforceablebyreasonofextendingfortoogreatofaperiodoftimeorovertoogreataGeographicArea,orbyreasonofbeingtoo extensiveinanyotherrespect,theapplicablecovenantshallbeinterpretedtoprovideforthelongestperiodoftime,overthegreatestGeographicArea and/orthebroadestscopeofactivitiesandtootherwisehavethebroadestapplication,asshallbeenforceablebyapplicablelaw.Theinvalidityor unenforceabilityofanyparticularprovisionofthisAgreementshallnotaffecttheotherprovisionshereof,whichshallcontinueinfullforceandeffect. Withoutlimitingtheforegoing,therestrictionscontainedhereinshallbeconstruedasseparatecovenants,covering
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theirrespectivesubjectmatters,with respecttoeachoftheseparatecities,countiesandstatesoftheUnitedStates,andeachothercountry,andpoliticalsubdivisionthereof,inwhichthe Businessisbeingconducted.NeithertheterminationofExecutive’semploymentnortheterminationoftheTermorthisAgreement,inanycase,will haveanyeffectonthecontinuingoperationofthisSection7,andthisSection7shallcontinuetoapplyinaccordancewithitstermsduringandafter Executive’semploymentwiththeCompany,whetherornotanyotherprovisionsofthisAgreementremainineffectatsuchtime.
(f)
Remedies.ExecutiveacknowledgesandunderstandsthatthisSection7andtheotherprovisionsofthisAgreementareofaspecialandunique nature,thebreachofwhichcannotbeadequatelycompensatedforindamagesbyanactionatlaw,andthatanybreachorthreatenedbreachofsuch provisionswouldcausetheCompanyGroupirreparableharm.IntheeventofabreachorthreatenedbreachbyExecutiveoftheprovisionsofthis Agreement,theCompanyshallbeentitledtoaninjunctionrestrainingExecutivefromsuchbreachwithouttheneedtopostbondtherefor.Nothing containedinthisSection7shallbeconstruedasprohibitingtheCompanyfrompursuing,orlimitingtheCompany’sabilitytopursue,anyother remediesavailableforanybreachorthreatenedbreachofthisAgreementbyExecutive.TheprovisionsofSection9(f)belowrelatingtoarbitrationof disputesshallnotbeapplicabletotheCompanytotheextentitseeksatemporaryorpermanentinjunctionorotherequitablereliefinanycourtto restrain Executive from violating the covenants set forth in this Section 7.
(g)
As a material inducement to the Company to enter into this Agreement and to provide the severance payments and benefits set forth in Section 6, and in recognition that Executive’s continued compliance with this Section 7 is of substantial and independent value to the Company, the Parties acknowledge and agree that the severance payments and benefits payable pursuant to Section 6(b) and Section 6(c) are in direct consideration for, and conditioned upon, Executive’s continued compliance with Executive’s obligations under this Section 7. The Parties further intend that the portion of any payments or benefits under this Agreement that is provided in consideration of Executive’s compliance with Section 7 be treated as reasonable compensation for services to be rendered before and after a Change in Control, including Executive’s agreement to refrain from performing services, within the meaning of Section 280G of the Code, to the maximum extent permitted by applicable law.
8.
AssignmentandSuccessors.TheCompanyshallassignitsrightsandobligationsunderthisAgreementtoanysuccessortoallorsubstantially allofthebusinessortheassetsoftheCompany(bymergerorotherwise).ThisAgreementshallbebindinguponandinuretothebenefitofthe Company,Executive,andtheirrespectivesuccessors,assigns,personnel,andlegalrepresentatives,executors,administrators,heirs,distributees, devisees,andlegatees,asapplicable.NoneofExecutive’srightsorobligationsmaybeassignedortransferredbyExecutive,otherthanExecutive’s rights to payments hereunder, which may be transferred only by will, operation of law, or as otherwise provided herein.
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9.
MiscellaneousProvisions.
(a)
GoverningLaw.ThisAgreementshallbegoverned,construed,interpreted,andenforcedinaccordancewithitsexpressterms,andotherwisein accordancewiththesubstantivelawsoftheStateofDelaware,withoutgivingeffecttoanyprinciplesofconflictsoflaw,whetheroftheStateof Delawareoranyotherjurisdiction,andwhereapplicable,thelawsoftheUnitedStates,thatwouldresultintheapplicationofthelawsofanyother jurisdiction.
(b)
Validity.TheinvalidityorunenforceabilityofanyprovisionorprovisionsofthisAgreementshallnotaffectthevalidityorenforceabilityof any other provision of this Agreement, which shall remain in full force and effect.
(c)
Counterparts.ThisAgreementmaybeexecutedinseveralcounterparts,eachofwhichshallbedeemedtobeanoriginal,butallofwhich together will constitute one and the same Agreement. Signatures delivered by facsimile shall be deemed effective for all purposes.
(d)
Entire Agreement. The terms of this Agreement are intended by the Parties to be the final expression of their agreement with respect to the employmentofExecutivebytheCompanyandsupersedeallpriorunderstandingsandagreements,whetherwrittenororal,regardingExecutive’s servicetotheCompany,excepttheIndemnificationAgreementbetweenExecutiveandFiscalNote Holdings,Inc.,effectiveasofMay2,2024(the“IndemnificationAgreement”),whichagreementshallremaininfullforceineffect.ThePartiesfurther intendthatthisAgreementshallconstitutethecompleteandexclusivestatementoftheirtermsandthatnoextrinsicevidencewhatsoevermaybe introduced in any judicial, administrative, or other legal proceeding to vary the terms of this Agreement.
(e)
Amendments;Waivers.ThisAgreementsetsforththeintentoftheParties.ThePartiesanticipatethat,intheordinarycourse,theCompany may ask Executive to sign other documents in connection with his continued employment with the Company (e.g., employee handbook acknowledgments,formsofgrantagreements,etc.).ThePartiesexpresslyacknowledgeandagreethat,intheeventofaconflictbetweenthisAgreement andanysuchdocuments,thetermsofthisAgreementshallcontrol;however,nothinginthisAgreementshallprohibittheCompanyfromconditioning Executive’sreceiptofanycompensationorbenefittowhichExecutiveisnotentitledunderthisAgreementonhisexecutionofanagreementthathas termsandconditionsthatmaybedifferentfromthisAgreement.ThisAgreementmaynotbemodified,amended,orterminatedexceptbyaninstrument inwritingsignedbyExecutiveandadulyauthorizedrepresentativeoftheCompany.Byaninstrumentinwritingsimilarlyexecuted,Executiveoraduly authorizedofficeroftheCompany,asapplicable,maywaivecompliancebytheotherPartywithanyspecificallyidentifiedprovisionofthisAgreement thatsuchotherPartywasorisobligatedtocomplywithorperform;provided,however,thatsuchwaivershallnotoperateasawaiverof,orestoppel withrespectto,anyotherorsubsequentfailure.Nofailuretoexerciseandnodelayinexercisinganyright,remedy,orpowerhereundershallpreclude any other or further exercise of any other right, remedy, or power provided herein or by law or in equity.
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(f)
DisputeResolution.BothExecutiveandtheCompanyagreetosubmitanyandalldisputes,controversies,orclaimsbasedupon,relatingto,or arisingfromthisAgreement(otherthanworkers’compensationclaims)ortheterms,interpretation,performance,breach,orarbitrabilityofthis Agreement,Executive’semploymentwiththeCompanyoranyterminationthereof(each,a“CoveredClaim”)tofinalandbindingarbitrationbeforea singleneutralarbitratorinWashington,DistrictofColumbia.Subjecttothetermsofthisparagraph,thearbitrationproceedingsshallbeinitiatedin accordancewith,andgovernedby,theapplicablerules(the“Rules”)fortheresolutionofemploymentdisputesoftheAmericanArbitrationAssociation (“AAA”)(suchrulespreviouslyreferredtoastheNationalRulesfortheResolutionofEmploymentDisputes).Thearbitratorshallbeappointedby agreementofthePartiesheretoor,ifnoagreementcanbereached,bytheAAApursuanttoitsRules.TheCompanyshallbearAAA’sadministrative feesandthearbitrator’sfeesandcosts.TheExecutiveshallbeentitledtopromptadvancementofanyandallreasonablecostsandexpenses(including withoutlimitationattorneys’fees,andotherprofessionalfeesandcharges)incurredbyhiminconnectionwithanysuchCoveredClaim,orin connectionwithseekingtoenforcehisrightsunderthisSection9(f),anysuchadvancementtobemadewithinfifteen(15)daysaftertheExecutivegives writtennotice,supportedbyreasonabledocumentation,requestingsuchadvancement.Totheextentthatitisdeterminedbythearbitratorthatthe CompanysubstantiallyprevailedinrespectoftheCoveredClaims,theExecutiveshallpromptlyreimbursetheCompanyallsuchcostsandexpenses. ThisSection9(f)isintendedtobetheexclusivemethodforresolvinganyandallclaimsbyExecutiveortheCompanyagainsteachotherforpaymentof damagesunderthisAgreement;provided,however,thatneitherthisAgreementnorthesubmissiontoarbitrationshalllimitExecutive’sorthe Company’srighttoseekprovisionalrelief,includingwithoutlimitationinjunctiverelief,inanycourtofcompetentjurisdiction.BothExecutiveandthe Companyexpresslywaivetheirrespectiverightstoajurytrial.PendingtheresolutionofanyCoveredClaimhereunder,theExecutive(andhis beneficiaries)shallcontinuetoreceiveallpaymentsandbenefitsthatarethendueunderthisAgreementandthatarenotthesubjectofagoodfaith dispute, unless the arbitrator determines otherwise.
(g)
Enforcement. If any provision of this Agreement is held to be illegal, invalid, or unenforceable under present or future laws, such provision shallbefullyseverable;thisAgreementshallbeconstruedandenforcedasifsuchillegal,invalid,orunenforceableprovisionhadnevercompriseda portionofthisAgreement,andtheremainingprovisionsofthisAgreementshallremaininfullforceandeffectandshallnotbeaffectedbytheillegal, invalid,orunenforceableprovisionorbyitsseverancefromthisAgreement.Furthermore,inlieuofsuchillegal,invalid,orunenforceableprovision thereshallbeaddedautomaticallyaspartofthisAgreementaprovisionassimilarintermstosuchillegal,invalid,orunenforceableprovisionasmaybe possible and be legal, valid, and enforceable.
(h)
Withholding.TheCompanyshallbeentitledtowithholdfromanyamountspayableunderthisAgreementanyfederal,state,local,orforeign withholdingorothertaxesorchargesthattheCompanyisrequiredtowithhold.TheCompanyshallbeentitledtorelyonanopinionofcounselifany questions as to the amount or requirement of withholding shall arise.
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(i)
Indemnification.TheCompanyagreestoadvanceandindemnifyExecutiveforallcosts,damages,lossesandexpensesreasonablyandactually incurredbyExecutiveinconnectionwithanyandallthird-partyclaimsorproceedingsarisingfrom,asaresultof,orinconnectionwithExecutive’s employmentbytheCompanyhereunder(andserviceontheBoardandinanyotherofficesordirectorshipswithanymemberoftheCompanyGroup,as applicable)tothegreatestextentpermittedundertheCompany’sorganizationaldocumentsandapplicablelaw.Thisrighttoadvancementofexpenses andindemnificationshallnotapplyto,andtheCompanywillhavenoobligationtoadvanceorindemnifyExecutivewithrespectto,anyaction,suitor proceedingbroughtbyoronbehalfofExecutiveagainsttheCompanyGroup,orbytheCompanyGroupagainstExecutive.TheIndemnification Agreement shall also remain in full force and effect.
(j)
ClawbackPolicy.ExecutiveacknowledgesthatExecutive’sAnnualBonusandequitycompensationshallbesubjectto“clawback”in accordance with applicable Company policy, if any, and applicable law.
10.
GoldenParachuteExciseTax.
(a)
BestPay.AnyprovisionofthisAgreementtothecontrarynotwithstanding,ifanypaymentorbenefitExecutivewouldreceivepursuanttothis Agreementorotherwise(“Payment”)wouldindividuallyorintheaggregatewithallotherPayments(i)constitutea“parachutepayment”withinthe meaningofSection280GoftheCodeand(ii)butforthissentence,besubjecttotheexcisetaximposedbySection4999oftheCode(the“Excise Tax”),thensuchPaymentwillbeequaltotheReducedAmount(asdefinedbelow).The“ReducedAmount”willbeeither(A)thelargestportionofthe PaymentthatwouldresultinnoportionofthePayment(afterreduction)beingsubjecttotheExciseTaxor(B)theentirePayment,whicheveramount aftertakingintoaccountallapplicablefederal,state,andlocalemploymenttaxes,incometaxes,andtheExciseTax(allcomputedatthehighest applicablemarginalrate,netofthemaximumreductioninfederalincometaxesthatcouldbeobtainedfromadeductionofsuchstateandlocaltaxes), resultsinExecutive’sreceipt,onanafter-taxbasis,ofthegreatereconomicbenefitnotwithstandingthatallorsomeportionofthePaymentmaybe subjecttotheExciseTax.IfareductioninaPaymentisrequiredpursuanttotheprecedingsentenceandtheReducedAmountisdeterminedpursuantto clause(A)oftheprecedingsentence,thereductionshalloccurinthemanner(the“ReductionMethod”)thatresultsinthegreatesteconomicbenefitfor Executive.Ifmorethanonemethodofreductionwillresultinthesameeconomicbenefit,theitemssoreducedwillbereducedprorata(the“ProRata ReductionMethod”).Notwithstandingtheforegoing,iftheReductionMethodortheProRataReductionMethodwouldresultinanyportionofthe PaymentbeingsubjecttotaxespursuanttoSection409A(asdefinedbelow)thatwouldnototherwisebesubjecttotaxespursuanttoSection409A,then theReductionMethodand/ortheProRataReductionMethod,asthecasemaybe,shallbemodifiedsoastoavoidtheimpositionoftaxespursuantto Section409Aasfollows:(1)asafirstpriority,themodificationshallpreserve,tothegreatestextentpossible,thegreatesteconomicbenefitfor Executiveasdeterminedonanafter-taxbasis;(2)asasecond
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priority,Paymentsthatarecontingentonfutureevents(e.g.,beingterminatedwithout cause),shallbereduced(oreliminated)beforePaymentsthatarenotcontingentonfutureevents;and(3)asathirdpriority,Paymentsthatare“deferred compensation”withinthemeaningofSection409Ashallbereduced(oreliminated)beforePaymentsthatarenotdeferredcompensationwithinthe meaning of Section 409A.
(b)
AccountingFirm. The accounting firm engaged by the Company for general tax purposes as of the day prior to the Change in Control will performthecalculationssetforthinSection10(a).IfthefirmsoengagedbytheCompanyisservingastheaccountantorauditorfortheacquiring company,theCompanywillappointanationallyrecognizedaccountingfirmtomakethedeterminationsrequiredhereunder.TheCompanywillbearall expenseswithrespecttothedeterminationsbysuchfirmrequiredtobemadehereunder.Theaccountingfirmengagedtomakethedeterminations hereunder will provide its calculations, together with detailed supporting documentation, to the Company within thirty (30) days before the consummationofaChangeinControl(ifrequestedatthattimebytheCompany)orsuchothertimeasrequestedbytheCompany.Iftheaccounting firmdeterminesthatnoExciseTaxispayablewithrespecttoaPayment,eitherbeforeoraftertheapplicationoftheReducedAmount,itwillfurnishthe CompanywithdocumentationreasonablyacceptabletotheCompanythatnoExciseTaxwillbeimposedwithrespecttosuchPayment.Anygood-faith determinations of the accounting firm made hereunder will be final, binding, and conclusive upon the Company and Executive.
11.
Section409A.
(a)
General.TheintentofthePartiesisthatthepaymentsandbenefitsunderthisAgreementcomplywithorbeexemptfromSection409Aofthe CodeandtheDepartmentofTreasuryregulationsandotherinterpretiveguidanceissuedthereunder,including,withoutlimitation,anysuchregulations orotherguidancethatmaybeissuedaftertheEffectiveDate(“Section409A”),and,accordingly,tothemaximumextentpermitted,thisAgreement shallbeinterpretedtobeincompliancetherewith.Notwithstandingtheforegoing,thisSection11doesnot,andshallnotbeconstruedsoasto,create anyobligationorliabilityonthepartoftheCompanyifthepaymentsandbenefitsunderthisAgreementdonotcomplywithSection409A.Executive shall be solely liable for any taxes imposed on him under or by operation of Section 409A.
(b)
Separation from Service. Notwithstanding any provision to the contrary in this Agreement, (i) no amount that constitutes “deferred compensation”underSection409AshallbepayablepursuanttoSection6unlesstheterminationofExecutive’semploymentconstitutesa“separation fromservice”withinthemeaningofSection1.409A-1(h)oftheDepartmentofTreasuryRegulations(“SeparationfromService”);(ii)forpurposesof Section409A,Executive’srighttoreceiveinstallmentpaymentsshallbetreatedasarighttoreceiveaseriesofseparateanddistinctpayments;and (iii)totheextentthatanyreimbursementofexpensesorin-kindbenefitsconstitutes“deferredcompensation”underSection409A,suchreimbursement orbenefitshallbeprovidednolaterthanDecember31oftheyearfollowingtheyearinwhichthe
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expensewasincurred.Theamountofexpenses reimbursedinoneyearshallnotaffecttheamounteligibleforreimbursementinanysubsequentyear.Theamountofanyin-kindbenefitsprovidedin one year shall not affect the amount of in-kind benefits provided in any other year.
(c)
SpecifiedEmployee.NotwithstandinganythinginthisAgreementtothecontrary,ifExecutiveisdeemedbytheCompanyatthetimeof Executive’sSeparationfromServicetobea“specifiedemployee”forpurposesofSection409A,totheextentthatdelayedcommencementofany portionofthebenefitstowhichExecutiveisentitledunderthisAgreementisrequiredinordertoavoidaprohibiteddistributionunderSection409A, suchportionofExecutive’sbenefitsshallnotbeprovidedtoExecutivepriortotheearlierof(i)theexpirationofthesix(6)-monthperiodmeasured fromthedateofExecutive’sSeparationfromServicewiththeCompanyor(ii)thedateofExecutive’sdeath.Uponthefirstbusinessdayfollowingthe expirationoftheapplicableSection409Aperiod,allpaymentsdeferredpursuanttotheprecedingsentenceshallbepaidinalumpsumtoExecutive(or Executive’sestateorbeneficiaries),andanyremainingpaymentsduetoExecutiveunderthisAgreementshallbepaidasotherwiseprovidedherein.
(d)
Release.NotwithstandinganythingtothecontraryinthisAgreement,totheextentthatanypaymentsdueunderthisAgreementorotherwise asaresultofExecutive’sterminationofemploymentaresubjecttoExecutive’sexecutionanddeliveryofaRelease,(i)ifExecutivefailstoexecutethe ReleaseonorpriortotheReleaseExpirationDate(asdefinedbelow)ortimelyrevokesExecutive’sacceptanceoftheReleasethereafter,Executiveshall not be entitled to any payments or benefitsotherwiseconditionedontheRelease,and(ii)inanycasewhereExecutive’sDateofTerminationandtheReleaseExpirationDatefallintwo separatetaxableyears,anypaymentsrequiredtobemadetoExecutivethatareconditionedontheReleaseandaretreatedasnonqualifieddeferred compensationforpurposesofSection409Ashallbemadeinthelatertaxableyear.ForpurposesofthisSection11(d),“ReleaseExpirationDate”shall meanthedatethatistwenty-one(21)daysfollowingthedateuponwhichtheCompanytimelydeliverstheReleasetoExecutive,or,intheeventthat Executive’sterminationofemploymentis“inconnectionwithanexitincentiveorotheremploymentterminationprogram”(assuchphraseisdefinedin theAgeDiscriminationinEmploymentActof1967),thedatethatisforty-five(45)daysfollowingsuchdeliverydate.Totheextentthatanypayments ofnonqualifieddeferredcompensation(withinthemeaningofSection409A)dueunderthisAgreementorotherwiseasaresultofExecutive’s terminationofemploymentaredelayedpursuanttothisSection11(d),suchamountsshallbepaidinalumpsumonthefirstpayrolldatefollowingthe datethatExecutiveexecutesanddoesnotrevoketheRelease(andtheapplicablerevocationperiodhasexpired)or,inthecaseofanypaymentssubject to Section 11(d)(ii), on the first payroll period to occur in the subsequent taxable year, if later.
12.
Executive Coach. During the Term, Executive shall have the option to retain a professional executive coach to provide Executive with professional advice, guidance and training. The Company shall directly pay all fees of the executive coach.
13.
ExecutiveAcknowledgement.ExecutiveacknowledgesthatExecutivehasreadandunderstandsthisAgreement,isfullyawareofitslegal effect,hasnotactedinrelianceuponany
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representationsorpromisesmadebytheCompanyotherthanthosecontainedinwritingherein,andhas entered into this Agreement freely based on Executive’s own judgment.
SIGNATUREPAGEFOLLOWSONNEXTPAGE
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ThePartieshaveexecutedthisAgreementasofthedatefirstsetforthabove.
FISCALNOTEHOLDINGS,INC.
By: /s/ Jon Slabaugh
Name: Jon Slabaugh
Its: Chief Financial Officer
EXECUTIVE
/s/ Key Compton
Name: Key Compton
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