Exhibit 1.1

 

[●] Shares

 

FLUENCE ENERGY, INC.

 

CLASS A COMMON STOCK, PAR VALUE $0.00001 PER SHARE

 

UNDERWRITING AGREEMENT

 

[●], 2021

 

[●], 2021

 

J.P. Morgan Securities LLC
Morgan Stanley & Co. LLC
As Representatives of the several Underwriters named in Schedule I hereto

 

c/o J.P. Morgan Securities LLC
383 Madison Avenue
New York, New York 10179

 

c/o Morgan Stanley & Co. LLC
1585 Broadway
New York, New York 10036

 

Ladies and Gentlemen:

 

Fluence Energy Inc., a Delaware corporation (the “Company”), proposes to issue and sell to the several Underwriters named in Schedule I hereto (the “Underwriters”), an aggregate of [●] shares of its Class A common stock, par value $0.00001 per share (the “Firm Shares”).

 

The Company also proposes to issue and sell to the several Underwriters not more than an additional [●] shares of its Class A common stock, par value $0.00001 per share (the “Additional Shares”), if and to the extent that J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC, as representatives of the several Underwriters (the “Representatives”), shall have determined to exercise, on behalf of the Underwriters, the right to purchase such Additional Shares granted to the Underwriters in Section 2 hereof. The Firm Shares and the Additional Shares are hereinafter collectively referred to as the “Shares.” The shares of Class A common stock, par value $0.00001 per share, of the Company to be outstanding after giving effect to the sales contemplated hereby are hereinafter referred to as the “Common Stock.” The Company is a newly formed Delaware corporation and, upon consummation of the offering, will be a holding company and the sole managing member of Fluence Energy LLC, a Delaware limited liability company (the “Predecessor”), as a result of the Transactions (as defined in the Time of Sale Prospectus and the Prospectus). For the purposes of Section 1 hereof, all references to the Company shall also refer to the Predecessor prior to the Transactions.

 

 

The Company has filed with the Securities and Exchange Commission (the “Commission”) a registration statement on Form S-1 (File No. 333-259839) including a preliminary prospectus, relating to the Shares. The registration statement as amended at the time it becomes effective, including the information (if any) deemed to be part of the registration statement at the time of effectiveness pursuant to Rule 430A under the Securities Act of 1933, as amended (the “Securities Act”), is hereinafter referred to as the “Registration Statement”; the prospectus in the form first used to confirm sales of Shares (or in the form first made available to the Underwriters by the Company to meet requests of purchasers pursuant to Rule 173 under the Securities Act) is hereinafter referred to as the “Prospectus.” If the Company has filed an abbreviated registration statement to register additional shares of Common Stock pursuant to Rule 462(b) under the Securities Act (a “Rule 462 Registration Statement”), then any reference herein to the term “Registration Statement” shall be deemed to include such Rule 462 Registration Statement.

 

For purposes of this Underwriting Agreement (this “Agreement”), “free writing prospectus” has the meaning set forth in Rule 405 under the Securities Act, “preliminary prospectus” shall mean each prospectus used prior to the effectiveness of the Registration Statement, and each prospectus that omitted information pursuant to Rule 430A under the Securities Act that was used after such effectiveness and prior to the execution and delivery of this Agreement, “Time of Sale Prospectus” means the preliminary prospectus contained in the Registration Statement at the time of its effectiveness together with the documents and pricing information set forth in Schedule II hereto, and “broadly available road show” means a “bona fide electronic road show” as defined in Rule 433(h)(5) under the Securities Act that has been made available without restriction to any person. For purposes of this Agreement, (a) except where otherwise expressly provided, the term “affiliate” has the meaning set forth in Rule 405 under the Securities Act; (b) the term “business day” means any day other than a day on which banks are permitted or required to be closed in New York City; and (c) the term “subsidiary” has the meaning set forth in Rule 405 under the Securities Act. As used herein, the terms “Registration Statement,” “preliminary prospectus,” “Time of Sale Prospectus” and “Prospectus” shall include the documents, if any, incorporated by reference therein as of the date hereof.

 

Morgan Stanley & Co. LLC has agreed to reserve a portion of the Shares to be purchased by it under this Agreement for sale to the Company’s directors, officers, employees, business associates and related persons of the Company (collectively, “Participants”), as set forth in each of the Time of Sale Prospectus and the Prospectus under the heading “Underwriters” (the “Directed Share Program”). The Shares to be sold by Morgan Stanley & Co. LLC and its affiliates pursuant to the Directed Share Program, at the direction of the Company, are referred to hereinafter as the “Directed Shares”. Any Directed Shares not orally confirmed for purchase by any Participant by the end of the business day on which this Agreement is executed will be offered to the public by the Underwriters as set forth in the Prospectus.

 

1.              Representations and Warranties of the Company. The Company represents and warrants to and agrees with each of the Underwriters that:

 

(a)            The Registration Statement has become effective; no stop order suspending the effectiveness of the Registration Statement is in effect, and no proceedings for such purpose or pursuant to Section 8A under the Securities Act are pending before or, to the knowledge of the Company, threatened by the Commission. No order preventing or suspending the use of any preliminary prospectus or any free writing prospectus has been issued by the Commission.

 

 

(b)            (i) The Registration Statement, when it became effective, did not contain and, as amended or supplemented, if applicable, as of the date of such amendment or supplement, will not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading, (ii) the Registration Statement, the Time of Sale Prospectus and the Prospectus comply and, as amended or supplemented, if applicable, will as of the date of such amendment or supplement, comply in all material respects with the Securities Act and the applicable rules and regulations of the Commission thereunder, (iii) the Time of Sale Prospectus does not, and at the time of each sale of the Shares in connection with the offering when the Prospectus is not yet available to prospective purchasers and at the Closing Date (as defined in Section 4), the Time of Sale Prospectus, as then amended or supplemented by the Company, if applicable, will not contain, as of the date of such amendment or supplement, any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, (iv) each broadly available road show, if any, when considered together with the Time of Sale Prospectus, does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading and (v) the Prospectus, as of its date, does not contain and, as amended or supplemented, if applicable, will not contain, as of the date of such amendment or supplement and as of the Closing Date and any Option Closing Date (as defined in Section 2), any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, except that the representations and warranties set forth in this paragraph do not apply to statements or omissions in the Registration Statement, the Time of Sale Prospectus or the Prospectus based upon information relating to any Underwriter furnished to the Company in writing by or on behalf of any such Underwriter through the Representatives expressly for use therein.

 

(c)            The Company is not an “ineligible issuer” in connection with the offering pursuant to Rules 164, 405 and 433 under the Securities Act. Any free writing prospectus that the Company is required to file pursuant to Rule 433(d) under the Securities Act has been, or will be, filed with the Commission in accordance with the requirements of the Securities Act and the applicable rules and regulations of the Commission thereunder. Each free writing prospectus, if any, that the Company has filed, or is required to file, pursuant to Rule 433(d) under the Securities Act or that was prepared by or on behalf of or used or referred to by the Company complies or, if filed after the effective time of this Agreement, will comply as of the date of such filing in all material respects with the applicable requirements of the Securities Act and the applicable rules and regulations of the Commission thereunder. Except for the free writing prospectuses, if any, identified in Schedule II hereto, and electronic road shows, if any, each furnished to the Representatives before first use, the Company has not prepared, used or referred to, and will not, without the Representatives’ prior consent, prepare, use or refer to, any free writing prospectus.

 

(d)            The Company has been duly incorporated, is validly existing as a corporation in good standing under the laws of the jurisdiction of its incorporation, has the corporate power and authority to own or lease its property and to conduct its business as described in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus and is duly qualified to transact business and is in good standing (to the extent the concept of good standing is applicable in such jurisdiction) in each jurisdiction in which the conduct of its business or its ownership or leasing of property requires such qualification, except to the extent that the failure to be so qualified or be in good standing (to the extent the concept of good standing is applicable in such jurisdiction) would not reasonably be expected to, singly or in the aggregate, have a material adverse effect on the Company and its subsidiaries, taken as a whole.

 

 

(e)            Each subsidiary of the Company has been duly incorporated, organized or formed, is validly existing as a corporation or other business entity in good standing under the laws of the jurisdiction of its incorporation (to the extent the concept of good standing is applicable in such jurisdiction), organization or formation, has the corporate or other business entity power and authority to own or lease its property and to conduct its business as described in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus and is duly qualified to transact business and is in good standing in each jurisdiction (to the extent the concept of good standing is applicable in such jurisdiction) in which the conduct of its business or its ownership or leasing of property requires such qualification, except to the extent that the failure to be so qualified or be in good standing (to the extent the concept of good standing is applicable in such jurisdiction) would not reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole; all of the issued shares of capital stock or other equity interests of each subsidiary of the Company have been duly and validly authorized and issued (to the extent such concepts are applicable in such jurisdictions), are fully paid and non-assessable and are owned directly or indirectly by the Company, free and clear of all liens, encumbrances, equities or claims, except for any such liens, encumbrances, equity or claims (i) that would not reasonably be expected to have a material adverse effect on the Company and its subsidiaries taken as a whole or (ii) pursuant to any credit facility of the Company or its subsidiaries described in Registration Statement, the Time of Sale Prospectus and the Prospectus.

 

(f)            This Agreement has been duly authorized, executed and delivered by the Company.

 

(g)            The authorized capital stock of the Company conforms as to legal matters, in all material respects, to the description thereof contained in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus.

 

(h)            The shares of Common Stock outstanding prior to the issuance of the Shares to be sold by the Company have been duly authorized and are validly issued, fully paid and non-assessable.

 

(i)             The Shares to be sold by the Company have been duly authorized and, when issued, delivered and paid for in accordance with the terms of this Agreement, will be duly and validly issued and fully paid and non-assessable, and the issuance of the Shares will not be subject to any preemptive or similar rights that have not been validly waived.

 

(j)             The execution and delivery by the Company of, and the performance by the Company of its obligations under, this Agreement will not contravene any provision of (i) applicable law, (ii) the certificate of incorporation and bylaws of the Company, (iii) any agreement or other instrument binding upon the Company or any of its subsidiaries that is material to the Company and its subsidiaries, taken as a whole, or to which any of the property or assets of the Company or any of its subsidiaries is subject, or (iv) any judgment, order or decree of any governmental body, agency or court having jurisdiction over the Company or any subsidiary, except, in the case of clauses (i), (iii) and (iv), as would not, singly or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole, or adversely affect the ability of the Company to perform its obligations under this Agreement and no consent, approval, authorization or order of, or qualification with, any governmental body, agency or court is required for the performance by the Company of its obligations under this Agreement, except such as have been obtained or waived, or may be required by the securities or Blue Sky laws of the various states or foreign jurisdictions or the rules and regulations of the Financial Industry Regulatory Authority (“FINRA”) in connection with the offer and sale of the Shares.

 

 

(k)            There has not occurred any material adverse change, or any development involving a prospective material adverse change, in the condition, financial or otherwise, or in the earnings, business or operations of the Company and its subsidiaries, taken as a whole, from that set forth in the Time of Sale Prospectus.

 

(l)             There are no legal or governmental proceedings pending or, to the knowledge of the Company, threatened to which the Company or any of its subsidiaries is a party or to which any of the properties of the Company or any of its subsidiaries is subject (A) other than (i) proceedings accurately described in all material respects in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus and (ii) proceedings that would not reasonably be expected to, singly or in the aggregate, have a material adverse effect on the Company and its subsidiaries, taken as a whole, or on the power or ability of the Company to perform its obligations under this Agreement or to consummate the transactions contemplated by each of the Registration Statement, the Time of Sale Prospectus and the Prospectus or (B) that are required to be described in the Registration Statement, the Time of Sale Prospectus or the Prospectus and are not so described in all material respects; and there are no statutes, regulations, contracts or other documents to which the Company or any of its subsidiaries is subject or by which the Company or any of its subsidiaries is bound that are required to be described in the Registration Statement, the Time of Sale Prospectus or the Prospectus or to be filed as exhibits to the Registration Statement that are not described in all material respects or filed as required.

 

(m)           Each preliminary prospectus filed as part of the Registration Statement as originally filed or as part of any amendment thereto, or filed pursuant to Rule 424 under the Securities Act, complied when so filed in all material respects with the applicable requirements of the Securities Act and the applicable rules and regulations of the Commission thereunder.

 

(n)            The Company is not, and immediately after giving effect to the offering and sale of the Shares and the application of the proceeds thereof as described in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus will not be, required to register as an “investment company” as such term is defined in the Investment Company Act of 1940, as amended.

 

(o)            The Company and each of its subsidiaries (i) are in compliance with all applicable foreign, federal, state and local laws and regulations relating to climate change, to the protection of human health and safety, the environment or natural resources, or to hazardous or toxic substances or wastes, pollutants or contaminants (“Environmental Laws”), (ii) have received and maintained all permits, licenses or other approvals required of them under applicable Environmental Laws necessary to conduct their respective businesses as presently conducted and (iii) are in compliance with all terms and conditions of any such permit, license or approval, except where such noncompliance with Environmental Laws, failure to receive and maintain required permits, licenses or other approvals or failure to comply with the terms and conditions of such permits, licenses or approvals would not, singly or in the aggregate, be reasonably expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole.

 

 

(p)            (i) There are no costs, obligations or liabilities associated with Environmental Laws (including, without limitation, any capital or operating expenditures required for clean-up, closure of properties or compliance with Environmental Laws or any permit, license or approval, any related constraints on operating activities and any potential liabilities to third parties), or any obligations to combat, respond to or mitigate the effects of climate change which would, singly or in the aggregate, be reasonably expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole and (ii) neither the Company nor any of its subsidiaries is aware of any pending or threatened notice, claim, proceeding or investigation which would be reasonably expected lead to liability under Environmental Laws, except where the potential liability or obligation would not, individually or in the aggregate, be reasonably expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole, except where the potential liability or obligation would not, individually or in the aggregate, be reasonably expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole, or result in monetary sanctions in excess of $300,000.

 

(q)            Except as described in the Registration Statement, the Time of Sale Prospectus and the Prospectus, or validly waived or complied with in connection with the sale of the Shares contemplated hereby, there are no contracts, agreements or understandings between the Company and any person granting such person the right to require the Company to file a registration statement under the Securities Act with respect to any securities of the Company or to require the Company to include such securities with the Shares registered pursuant to the Registration Statement.

 

(r)             (i) None of the Company or any of its subsidiaries or affiliates, or any director or officer thereof, or, to the Company’s knowledge, any employee, agent or representative of the Company or of any of its subsidiaries or affiliates, has taken or will take any action in furtherance of an offer, payment, promise to pay, or authorization or approval of the payment, giving or receipt of money, property, gifts or anything else of value, directly or indirectly, to any government official (including any officer or employee of a government or government-owned or controlled entity or of a public international organization, or any person acting in an official capacity for or on behalf of any of the foregoing, or any political party or party official or candidate for political office) (“Government Official”) in order to unlawfully influence official action, or to any person in violation of any applicable anti-corruption laws; (ii) the Company and each of its subsidiaries and affiliates have conducted their businesses in compliance with applicable anti-corruption laws and have instituted and maintained and will continue to maintain policies and procedures reasonably designed to promote and achieve compliance with such laws and with the representations and warranties contained herein; and (iii) neither the Company nor any of its subsidiaries will use, directly or indirectly, the proceeds of the offering in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, to any person in violation of any applicable anti-corruption laws.

 

 

(s)            The operations of the Company and each of its subsidiaries are and have been conducted at all times in material compliance with all applicable financial recordkeeping and reporting requirements, including those of the Bank Secrecy Act, as amended by Title III of the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (USA PATRIOT Act), and the applicable anti-money laundering statutes of jurisdictions where the Company and each of its subsidiaries conduct business, the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any governmental agency (collectively, the “Anti-Money Laundering Laws”), and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or any of its subsidiaries with respect to the Anti-Money Laundering Laws is pending or, to the knowledge of the Company, threatened.

 

(t)             (i)          None of the Company, any of its subsidiaries, or any director or officer thereof, or, to the Company’s knowledge, any employee, agent, affiliate or representative of the Company or any of its subsidiaries, is an individual or entity (“Person”) that is, or is owned or controlled by one or more Persons that are:

 

(A)            the subject of any sanctions administered or enforced by the U.S. Department of the Treasury’s Office of Foreign Assets Control, the United Nations Security Council, the European Union, Her Majesty’s Treasury, or other relevant sanctions authority (collectively, “Sanctions”), or

 

(B)            located, organized or resident in a country or territory that is the subject of Sanctions (including, without limitation, Crimea, Cuba, Iran, North Korea and Syria).

 

(ii)            The Company will not, directly or indirectly, use the proceeds of the offering, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other Person:

 

(A)            to fund or facilitate any activities or business of or with any Person or in any country or territory that, at the time of such funding or facilitation, is the subject of Sanctions; or

 

(B)            in any other manner that will result in a violation of Sanctions by any Person (including any Person participating in the offering, whether as underwriter, advisor, investor or otherwise).

 

(iii)           The Company and each of its subsidiaries have not knowingly engaged in, are not now knowingly engaged in, and will not engage in, any dealings or transactions with any Person, or in any country or territory, that at the time of the dealing or transaction is or was the subject of Sanctions.

 

 

(u)            Subsequent to the respective dates as of which information is given in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus, (i) the Company and its subsidiaries, taken as a whole, have not incurred any material liability or obligation, direct or contingent, nor entered into any material transaction; (ii) the Company has not purchased any of its outstanding capital stock, other than from employees or other service providers in connection with such person’s termination of service from the Company or its subsidiaries pursuant to the existing terms of the agreements or equity compensation plans described in the Time of Sale Prospectus or in exercise of the Company’s right of first refusal upon a proposed transfer, nor declared, paid or otherwise made any dividend or distribution of any kind on its capital stock other than ordinary and customary dividends; and (iii) there has not been any material change in the capital stock (other than the exercise, settlement or conversion of equity awards, warrants or convertible notes or loans or grants of equity awards or forfeiture of equity awards outstanding as of such respective dates as of which information is given in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus, in each case granted pursuant to the equity compensation plans described in the Time of Sale Prospectus), short-term debt or long-term debt of the Company and its subsidiaries, taken as a whole, except in each case as described in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus.

 

(v)            The Company and each of its subsidiaries do not own any real property and have good and marketable title to all personal property owned by them (excluding intellectual property, which is addressed exclusively in Section 1(w)) which is material to the business of the Company and its subsidiaries, in each case free and clear of all liens, encumbrances and defects except such as are described in the Time of Sale Prospectus or such as do not materially interfere with the use made and proposed to be made of such property by the Company and its subsidiaries; and any real property and buildings held under lease by the Company and its subsidiaries are held by them under valid, subsisting and, to the Company’s knowledge, enforceable leases with such exceptions as are not material and do not interfere with the use made and proposed to be made of such property and buildings by the Company and its subsidiaries.

 

(w)            Except as described in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus or except as would not reasonably be expected to have a material adverse effect on the Company and its subsidiaries taken as a whole, (i) the Company or one of its subsidiaries is the sole and exclusive owner of all right, title and interest in and to all patents, inventions, copyrights, know how, trade secrets, confidential information, trademarks, service marks, trade names, Internet domain names, and all other worldwide intellectual property and proprietary rights (including all registrations and applications for registration of, and all goodwill associated with, any of the foregoing) (collectively, “Intellectual Property Rights”) that are owned or purported to be owned by the Company and its subsidiaries; (ii) the Company and its subsidiaries have the right to use all other Intellectual Property Rights used in the conduct of their respective businesses as now conducted by them; (iii) the Intellectual Property Rights owned by the Company and its subsidiaries and, to the Company’s knowledge, the Intellectual Property Rights exclusively licensed to the Company and its subsidiaries, are valid, subsisting and enforceable, and there is no pending or, to the Company’s knowledge, threatened action, suit, proceeding or claim by others challenging the ownership, validity, scope or enforceability of any Intellectual Property Rights owned or used by the Company or any of its subsidiaries; (iv) neither the Company nor any of its subsidiaries has received any written notice alleging any infringement, misappropriation or other violation of Intellectual Property Rights of any Person by the Company or any of its subsidiaries; (v) to the Company’s knowledge, no Person is infringing, misappropriating or otherwise violating, or has, in the past three (3) years, infringed, misappropriated or otherwise violated, any Intellectual Property Rights owned or used by the Company or any of its subsidiaries; (vi) to the Company’s knowledge, neither the Company nor any of its subsidiaries, nor the conduct and operation of the businesses of the Company and its subsidiaries, as conducted in the past three (3) years, is infringing, misappropriating or violating or has infringed, misappropriated or violated or any Intellectual Property Rights of any Person; (vii) the Company and its subsidiaries use and have used, commercially reasonable efforts to appropriately maintain the confidentiality of the know how, trade secrets and other confidential information of the Company and its subsidiaries the value of which to the Company or any of its subsidiaries is contingent upon maintaining the confidentiality thereof, and, to the Company’s knowledge, no such know how, trade secrets, or confidential information have been disclosed other than to Persons bound by confidentiality obligations restricting the disclosure and use of such Intellectual Property Rights; and (viii) neither the Company nor any of its subsidiaries is a party to any source code escrow contract (or a party to any contract obligating such Person to enter into a source code escrow contract or other contract) requiring the deposit of any source code or related materials for any software owned or purported to be owned by the Company or any of its subsidiaries, in each case, which requires the release or disclosure of any source code or related materials to any Person in connection with the consummation of the Transactions.

 

 

(x)            Except as described in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus or except as would not reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole, (i) to the extent that the Company and its subsidiaries use, or have used, in any of the products or services of the Company or any of its subsidiaries, any software or other materials distributed under a “free,” “open source,” or similar licensing model (“Open Source Software”), such use is and has been in compliance with all license terms applicable to such Open Source Software; and (ii) neither the Company nor any of its subsidiaries uses, incorporates or distributes or has used, incorporated or distributed any Open Source Software in connection with any products or services of the Company or any of its subsidiaries in any manner that requires or has required (A) the Company or any of its subsidiaries to permit reverse engineering of any software code or other technology owned or purported to be owned by the Company or any of its subsidiaries or (B) any software code or other technology owned or purported to be owned by the Company or any of its subsidiaries to be (1) disclosed or distributed in source code form, (2) licensed for the purpose of making derivative works or (3) redistributed at no charge.

 

(y)            Except as described in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus or except as would not reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole, for the past three (3) years (i) the Company and each of its subsidiaries have been and are presently in compliance in all material respects with all of the Company’s and each of its subsidiaries external written privacy policies, contractual obligations and applicable laws, statutes, judgments, orders, rules, and regulations of any court or arbitrator or other governmental or regulatory authority, in each case, relating to the collection, use, transfer, import, export, storage, protection, disposal and disclosure by the Company or any of its subsidiaries of information defined as “personal information”, “personal data” or any equivalent term by applicable data privacy laws (“Data Security Obligations,” and such data and information, “Personal Data”); (ii) the Company and its subsidiaries have not received any written notification of or written complaint regarding non-compliance with any Data Security Obligation by the Company or any of its subsidiaries; and (iii) the Company has not received written notice of any action, suit or proceeding by or before any court or governmental agency, authority or body pending or, to the Company’s knowledge, threatened alleging non-compliance with any Data Security Obligation by the Company or any of its subsidiaries.

 

 

(z)            Except as described in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus and except as would not reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole, (i) the Company and its subsidiaries own or have a valid right to access and use pursuant to a written agreement, each of their respective information technology assets and equipment, computers, systems, networks, hardware, software, websites, and applications owned or controlled by the Company and its subsidiaries and used in the conduct of their businesses as currently conducted by them (“IT Systems”) (A) operate and perform in all material respects as reasonably required in connection with the operation of the business of the Company and its subsidiaries as currently conducted and (B) do not, to the Company’s knowledge, contain any viruses, worms, trojan horses, bugs, faults or other devices, errors, contaminants or effects that: (x) materially disrupt or adversely affect the functionality of the IT Systems, or (y) enable or assist any Person to access without authorization the IT Systems or Personal Data; (ii) the Company and each of its subsidiaries have (A) established and maintain commercially reasonable technical and organizational measures designed to protect the material IT Systems, as well as Personal Data, and have established and maintain, commercially reasonable information technology, information security, cyber security and data protection controls, policies and procedures, including oversight, access controls, encryption, technological and physical safeguards and business continuity/disaster recovery and security plans that are designed to protect against and prevent any material breach or unauthorized, access, disablement, or other material compromise or misuse of the IT Systems or the material destruction, loss, unauthorized distribution, use, misappropriation or modification of any Personal Data (“Breach”) and (B) taken commercially reasonable steps to ensure that any third party with access to or otherwise processing Personal Data on behalf of the Company or any of its subsidiaries has implemented and maintained appropriate safeguards; (iii) to the Company’s knowledge, there has been no such Breach, and the Company and its subsidiaries have not been notified of and have no knowledge of any event or condition that would reasonably be expected to result in any such Breach; and (iv) the Company and its subsidiaries have not provided or been legally required to provide any notices to any Person in connection with a disclosure of Personal Data.

 

(aa)          No material labor dispute with the employees of the Company or any of its subsidiaries exists or, to the knowledge of the Company, is imminent; and the Company is not aware of any existing, threatened or imminent labor disturbance by the employees of any of its principal suppliers, manufacturers or contractors that would reasonably be expected have a material adverse effect on the Company and its subsidiaries, taken as a whole.

 

(bb)         The Company and each of its subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks and in such amounts as, in the Company’s reasonable judgement, are customary in the businesses in which they are engaged; neither the Company nor any of its subsidiaries has been refused any insurance coverage sought or applied for; and neither the Company nor any of its subsidiaries has any reason to believe that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business at a cost that would not, singly or in the aggregate, have a material adverse effect on the Company and its subsidiaries, taken as a whole.

 

 

 

(cc)       The Company and each of its subsidiaries possess all certificates, authorizations and permits issued by the appropriate federal, state or foreign regulatory authorities necessary to conduct their respective businesses as presently conducted, except where the failure to obtain such certificates, authorizations or permits would not, singly or in the aggregate, be reasonably expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole, and neither the Company nor any of its subsidiaries has received any written notice of proceedings relating to the revocation or modification of any such certificate, authorization or permit which, singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would have a material adverse effect on the Company and its subsidiaries, taken as a whole.

 

(dd)      The financial statements included in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus, together with the related schedules and notes thereto, comply as to form in all material respects with the applicable accounting requirements of the Securities Act and present fairly in all material respects the consolidated financial position of the Company and its subsidiaries as of the dates shown and its results of operations and cash flows for the periods shown, and such financial statements have been prepared in conformity with generally accepted accounting principles in the United States (“U.S. GAAP”) applied on a consistent basis throughout the periods covered thereby except for any normal year-end adjustments in the Company’s quarterly financial statements. The other financial information included in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus has been derived from the accounting records of the Company and its consolidated subsidiaries and presents fairly in all material respects the information shown thereby. The statistical, industry-related and market-related data included in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus are based on or derived from sources which the Company reasonably and in good faith believes are reliable and accurate and such data is consistent with the sources from which they are derived, in each case in all material respects. Except as included therein, no historical or pro forma financial statements or supporting schedules are required to be included in the Registration Statement, the Time of Sale Prospectus or the Prospectus under the Securities Act or the rules and regulations promulgated thereunder. All disclosures contained in the Registration Statement, the Time of Sale Prospectus and the Prospectus regarding “non-GAAP financial measures” (as such term is defined by the rules and regulations of the Commission) comply in all material respects with Regulation G of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and Item 10 of Regulation S-K of the Securities Act, to the extent applicable.

 

(ee)        Ernst & Young LLP, who have certified certain financial statements of the Company and its subsidiaries and delivered its report with respect to the audited consolidated financial statements and schedules filed with the Commission as part of the Registration Statement and included in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus, is an independent registered public accounting firm with respect to the Company within the meaning of the Securities Act and the applicable rules and regulations thereunder adopted by the Commission and the Public Company Accounting Oversight Board (United States).

 

 

(ff)        The Company and its subsidiaries, taken as a whole, maintain a system of internal control over financial reporting (as such term is defined in Rule 13a-15(f) under the Exchange Act) designed by, or under the supervision of, the Company’s principal executive officer and principal financial officer, or persons performing similar functions, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. GAAP and provides reasonable assurance that (i) transactions are executed in accordance with management’s general or specific authorizations; (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with U.S. GAAP and to maintain asset accountability; (iii) access to assets is permitted only in accordance with management’s general or specific authorization; and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences. Except as described in the Registration Statement, the Time of Sale Prospectus and the Prospectus, since the end of the Company’s most recent audited fiscal year, there has been (i) no material weakness in the Company’s internal control over financial reporting (whether or not remediated) and (ii) no change in the Company’s internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting. Except as disclosed in the Time of Sale Prospectus, the Company maintains disclosure controls and procedures (as such term is defined in Rule 13a-15(e) under the Exchange Act) that comply with the requirements of the Exchange Act; such disclosure controls and procedures have been designed to ensure that material information relating to the Company and its subsidiaries is made known to the Company’s principal executive officer and principal financial officer by others within those entities; and such disclosure controls and procedures are effective.

 

(gg)       Except as described in the Registration Statement, the Time of Sale Prospectus and the Prospectus, the Company has not sold, issued or distributed any shares of Common Stock during the six-month period preceding the date hereof, including any sales pursuant to Rule 144A under, or Regulation D or S of, the Securities Act, other than shares issued pursuant to employee benefit plans, qualified stock option plans or other employee compensation plans or pursuant to outstanding options, rights or warrants.

 

(hh)      The Company and each of its subsidiaries have filed all federal, state, local and foreign tax returns required to be filed through the date of this Agreement or have requested extensions thereof (except where the failure to file would not be reasonably expected to, singly or in the aggregate, have a material adverse effect on the Company and its subsidiaries, taken as a whole) and have paid all taxes required to be paid thereon (except for cases in which the failure to file or pay would not be reasonably expected to, singly or in the aggregate, have a material adverse effect on the Company and its subsidiaries, taken as a whole, or, except as currently being contested in good faith and for which reserves required by U.S. GAAP have been created in the financial statements of the Company), and no tax deficiency has been determined adversely to the Company or any of its subsidiaries which has had (nor does the Company nor any of its subsidiaries have any notice or knowledge of any tax deficiency which could reasonably be expected to be determined adversely to the Company or its subsidiaries and which could reasonably be expected to have) a material adverse effect on the Company and its subsidiaries, taken as a whole.

 

(ii)          From the time of initial confidential submission of the Registration Statement to the Commission through the date hereof, the Company has been and is an “emerging growth company,” as defined in Section 2(a) of the Securities Act (an “Emerging Growth Company”).

 

 

(jj)         The Company (i) has not alone engaged in any Testing-the-Waters Communication with any person other than Testing-the-Waters Communications with the consent of the Representatives with entities that are reasonably believed to be qualified institutional buyers within the meaning of Rule 144A under the Securities Act or institutions that are reasonably believed to be accredited investors within the meaning of Rule 501 under the Securities Act and (ii) has not authorized anyone other than the Representatives to engage in Testing-the-Waters Communications. The Company reconfirms that the Representatives have been authorized to act on its behalf in undertaking Testing-the-Waters Communications. The Company has not distributed any Testing-the-Waters Communication that is a written communication within the meaning of Rule 405 under the Securities Act. “Testing-the-Waters Communication” means any communication with potential investors undertaken in reliance on Section 5(d) or Rule 163B of the Securities Act.

 

(kk)        As of the time of each sale of the Shares in connection with the offering when the Prospectus is not yet available to prospective purchasers, none of (A) the Time of Sale Prospectus, (B) any free writing prospectus, when considered together with the Time of Sale Prospectus, and (C) any individual Testing-the-Waters Communication, when considered together with the Time of Sale Prospectus, included, includes or will include an untrue statement of a material fact or omitted, omits or will omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided, however, that this representation and warranty shall not apply to any statements or omissions made in reliance upon and in conformity with information furnished in writing to the Company by an Underwriter through or on behalf of the Representatives for use therein.

 

(ll)          Neither the Company nor any of its subsidiaries has any securities rated by any “nationally recognized statistical rating organization,” as such term is defined in Section 3(a)(62) of the Exchange Act.

 

(mm)     The Registration Statement, the Prospectus, the Time of Sale Prospectus and any preliminary prospectus comply, and any amendments or supplements thereto will comply, with any applicable laws or regulations of foreign jurisdictions in which the Prospectus, the Time of Sale Prospectus or any preliminary prospectus, as amended or supplemented, if applicable, are distributed in connection with the Directed Share Program.

 

(nn)       No consent, approval, authorization or order of, or qualification with, any governmental body or agency, other than those obtained, is required in connection with the offering of the Directed Shares in any jurisdiction where the Directed Shares are being offered.

 

(oo)      The Company has not offered, or caused Morgan Stanley & Co. LLC to offer, Shares to any person pursuant to the Directed Share Program with the specific intent to unlawfully influence (i) a customer or supplier of the Company to alter the customer’s or supplier’s level or type of business with the Company, or (ii) a trade journalist or publication to write or publish favorable information about the Company or its products.

 

 

(pp)        (i) Each employee benefit plan, within the meaning of Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), that is subject to the funding rules of Section 412 of the Code or Section 302 of ERISA (other than any “multiemployer plan” within the meaning of Section 4001(a)(3) of ERISA (a “Multiemployer Plan”)) for which the Company or any member of its “Controlled Group” (defined as any entity, whether or not incorporated, that is under common control with the Company within the meaning of Section 4001(a)(14) of ERISA or any entity that would be regarded as a single employer with the Company under Section 414(b),(c),(m) or (o) of the Internal Revenue Code of 1986, as amended (the “Code”)) would have any liability (each, a “Plan”) has been maintained in compliance with its terms and the requirements of any applicable statutes, orders, rules and regulations, including but not limited to ERISA and the Code; (ii) for each Plan, no Plan has failed (whether or not waived), or is reasonably expected to fail, to satisfy the minimum funding standards (within the meaning of Section 302 of ERISA or Section 412 of the Code) applicable to such Plan; (iii) no Plan is, or is reasonably expected to be, in “at risk status” (within the meaning of Section 303(i) of ERISA) and no “Multiemployer Plan” is in “endangered status” or “critical status” (within the meaning of Sections 304 and 305 of ERISA) (iv) except to the extent that notice would be waived by applicable regulation, no “reportable event” (within the meaning of Section 4043(c) of ERISA and the regulations promulgated thereunder) has occurred or is reasonably expected to occur; and (v) neither the Company nor any member of the Controlled Group has incurred, nor reasonably expects to incur, any liability under Title IV of ERISA (other than contributions to the Plan or premiums to the Pension Benefit Guarantee Corporation, in the ordinary course and without default) in respect of a Plan or Multiemployer Plan, except in each case with respect to the events or conditions set forth in (i) through (v) hereof, as would not, individually or in the aggregate, have a material adverse effect.

 

(qq)       No subsidiary of the Company is currently prohibited, directly or indirectly, under any agreement or other instrument to which it is a party or is subject, from paying any dividends to the Company, from making any other distribution on such subsidiary’s capital stock or similar ownership interest, from repaying to the Company any loans or advances to such subsidiary from the Company or from transferring any of such subsidiary’s properties or assets to the Company or any other subsidiary of the Company, except for any dividend, distribution, repayment or transfer that is prohibited pursuant to any credit facility of the Company’s subsidiaries described in the Registration Statement, the Time of Sale Prospectus and the Prospectus.

 

2.            Agreements to Sell and Purchase. The Company hereby agrees to sell to the several Underwriters, and each Underwriter, upon the basis of the representations and warranties herein contained, but subject to the terms and conditions hereinafter stated, agrees, severally and not jointly, to purchase from the Company the respective numbers of Firm Shares set forth in Schedule I hereto opposite its name at $[●] a share (the “Purchase Price”).

 

On the basis of the representations and warranties contained in this Agreement, and subject to its terms and conditions, the Company agrees to sell to the Underwriters the Additional Shares, and the Underwriters shall have the right to purchase, severally and not jointly, up to [●] Additional Shares at the Purchase Price, provided, however, that the amount paid by the Underwriters for any Additional Shares shall be reduced by an amount per share equal to any dividends declared by the Company and payable on the Firm Shares but not payable on such Additional Shares. The Representatives may exercise this right on behalf of the Underwriters in whole or from time to time in part by giving written notice not later than 30 days after the date of this Agreement. Any exercise notice shall specify the number of Additional Shares to be purchased by the Underwriters and the date on which such Additional Shares are to be purchased. Each purchase date must be at least one business day after the written notice is given and may not be earlier than the closing date for the Firm Shares or later than ten business days after the date of such notice. Additional Shares may be purchased as provided in Section 4 hereof solely for the purpose of covering over-allotments made in connection with the offering of the Firm Shares. On each day, if any, that Additional Shares are to be purchased (an “Option Closing Date”), each Underwriter agrees, severally and not jointly, to purchase the number of Additional Shares (subject to such adjustments to eliminate fractional shares as the Representatives may determine) that bears the same proportion to the total number of Additional Shares to be purchased on such Option Closing Date as the number of Firm Shares set forth in Schedule I hereto opposite the name of such Underwriter bears to the total number of Firm Shares.

 

 

3.          Terms of Public Offering. The Company is advised by the Representatives that the Underwriters propose to make a public offering of their respective portions of the Shares as soon after the Registration Statement and this Agreement have become effective as in the Representatives’ judgment is advisable. The Company is further advised by the Representatives that the Shares are to be offered to the public initially at $[●] a share (the “Public Offering Price”) and to certain dealers selected by the Representatives at a price that represents a concession not in excess of $[●] a share under the Public Offering Price.

 

4.           Payment and Delivery. Payment for the Firm Shares to be sold by the Company shall be made to the Company in Federal or other funds immediately available in New York City against delivery of such Firm Shares for the respective accounts of the several Underwriters at 10:00 a.m., New York City time, on [●], 2021, or at such other time on the same or such other date, not later than [●], 2021, as shall be designated in writing by the Representatives. The time and date of such payment are hereinafter referred to as the “Closing Date.”

 

Payment for any Additional Shares shall be made to the Company in Federal or other funds immediately available in New York City against delivery of such Additional Shares for the respective accounts of the several Underwriters at 10:00 a.m., New York City time, on the date specified in the corresponding notice described in Section 2 or at such other time on the same or on such other date, in any event not later than [●], 2021, as shall be designated in writing by the Representatives.

 

The Firm Shares and Additional Shares shall be registered in such names and in such denominations as the Representatives shall request in writing not later than one full business day prior to the Closing Date or the applicable Option Closing Date, as the case may be. The Firm Shares and Additional Shares shall be delivered to the Representatives on the Closing Date or an Option Closing Date, as the case may be, for the respective accounts of the several Underwriters, with any transfer taxes payable in connection with the transfer of the Shares to the Underwriters duly paid, against payment of the Purchase Price therefor.

 

5.           Conditions to the Underwriters’ Obligations. The obligations of the Company to sell the Shares to the Underwriters and the several obligations of the Underwriters to purchase and pay for the Shares on the Closing Date are subject to the condition that the Registration Statement shall have become effective not later than [●] (New York City time) on the date hereof.

 

The several obligations of the Underwriters are subject to the following further conditions:

 

(a)           Subsequent to the execution and delivery of this Agreement and prior to the Closing Date:

 

(i)            no order suspending the effectiveness of the Registration Statement shall be in effect, no proceeding for such purpose or pursuant to Section 8A under the Securities Act shall be pending before or, to the Company’s knowledge, threatened by the Commission; and

 

 

(ii)           there shall not have occurred any change, or any development involving a prospective change, in the condition, financial or otherwise, or in the earnings, business or operations of the Company and its subsidiaries, taken as a whole, from that set forth in the Time of Sale Prospectus that, in the Representatives’ judgment, is material and adverse and that makes it, in the Representatives’ judgment, impracticable to market the Shares on the terms and in the manner contemplated in the Time of Sale Prospectus.

 

(b)          The Underwriters shall have received on the Closing Date a certificate, dated the Closing Date and signed on behalf of the Company by an executive officer of the Company, to the effect set forth in Sections 5(a)(i) and 5(a)(ii) above and to the effect that the representations and warranties of the Company contained in this Agreement are true and correct as of the Closing Date and that the Company has complied with all of the agreements and satisfied all of the conditions on its part to be performed or satisfied hereunder on or before the Closing Date.

 

The officer signing and delivering such certificate may rely upon the best of his or her knowledge as to proceedings threatened.

 

(c)          The Underwriters shall have received on the Closing Date an opinion and negative assurance letter of Latham & Watkins LLP, outside counsel for the Company, dated the Closing Date, in form and substance reasonably satisfactory to the Underwriters.

 

(d)          The Underwriters shall have received on the Closing Date an opinion and negative assurance letter of Weil, Gotshal & Manges LLP, counsel for the Underwriters, dated the Closing Date, in form and substance reasonably satisfactory to the Underwriters.

 

With respect to the negative assurance letters to be delivered pursuant to Sections 5(c) and 5(d) above, Latham & Watkins LLP and Weil, Gotshal & Manges LLP may state that their opinions and beliefs are based upon their participation in the preparation of the Registration Statement, the Time of Sale Prospectus and the Prospectus and any amendments or supplements thereto and review and discussion of the contents thereof, but are without independent check or verification, except as specified.

 

The opinions of Latham & Watkins LLP and Weil, Gotshal & Manges LLP described in Sections 5(c) and 5(d) above, respectively, shall be rendered to the Underwriters at the request of the Company and shall so state therein.

 

(e)          The Underwriters shall have received, on each of the date hereof and the Closing Date, a letter dated the date hereof or the Closing Date, as the case may be, in form and substance satisfactory to the Underwriters, from Ernst & Young LLP, an independent registered public accounting firm, containing statements and information of the type ordinarily included in accountants’ “comfort letters” to underwriters with respect to the financial statements and certain financial information contained in the Registration Statement, the Time of Sale Prospectus and the Prospectus; provided that the letter delivered on the Closing Date shall use a “cut-off date” not earlier than the date hereof.

 

 

(f)           The “lock-up” agreements, each substantially in the form of Exhibit A hereto, executed by certain shareholders, officers and directors of the Company relating to restrictions on sales and certain other dispositions of shares of Common Stock or certain other securities, delivered to the Representatives on or before the date hereof (the “Lock-up Agreements”), shall be in full force and effect on the Closing Date.

 

(g)          The several obligations of the Underwriters to purchase Additional Shares hereunder are subject to the delivery to the Representatives on the applicable Option Closing Date of the following:

 

(i)            a certificate, dated the Option Closing Date and signed by an executive officer of the Company, confirming that the certificate delivered on the Closing Date pursuant to Section 5(b) hereof remains true and correct as of such Option Closing Date;

 

(ii)           an opinion and negative assurance letter of Latham & Watkins LLP, outside counsel for the Company, dated the Option Closing Date, relating to the Additional Shares to be purchased on such Option Closing Date and otherwise to the same effect as the opinion required by Section 5(c) hereof;

 

(iii)          an opinion and negative assurance letter of Weil, Gotshal & Manges LLP, counsel for the Underwriters, dated the Option Closing Date, relating to the Additional Shares to be purchased on such Option Closing Date and otherwise to the same effect as the opinion required by Section 5(d) hereof;

 

(iv)          a letter dated the Option Closing Date, in form and substance reasonably satisfactory to the Underwriters, from Ernst & Young LLP, an independent registered public accounting firm, substantially in the same form and substance as the letter furnished to the Underwriters pursuant to Section 5(e) hereof; provided that the letter delivered on the Option Closing Date shall use a “cut-off date” not earlier than two business days prior to such Option Closing Date; and

 

(v)           such other documents as the Representatives may reasonably request, including with respect to the good standing of the Company and its significant subsidiaries, the due authorization and issuance of the Additional Shares to be sold on such Option Closing Date and other matters related to the issuance of such Additional Shares.

 

6.            Covenants of the Company. The Company covenants with each Underwriter as follows:

 

(a)          To prepare the Prospectus in a form approved by the Representatives and to file such Prospectus pursuant to Rule 424(b) under the Securities Act not later than the Commission’s close of business on the second business day following the execution and delivery of this Agreement, or, if applicable, such earlier time as may be required by Rule 430A(a)(3) under the Securities Act; to make no further amendment or any supplement to the Registration Statement or the Prospectus prior to the last time and date for delivery of the Firm Shares which shall be disapproved by the Representatives promptly after reasonable notice thereof; to advise the Representatives, promptly after it receives notice thereof, of the time when any amendment to the Registration Statement has been filed or becomes effective or any amendment or supplement to the Prospectus has been filed; to file promptly all material required to be filed by the Company with the Commission pursuant to Rule 433(d) under the Securities Act; to advise the Representatives, promptly after it receives notice thereof, of the issuance by the Commission of any stop order or of any order preventing or suspending the use of any preliminary prospectus or other prospectus in respect of the Shares, of the suspension of the qualification of the Shares for offering or sale in any jurisdiction, of the initiation or threatening of any proceeding for any such purpose, or of any request by the Commission for the amending or supplementing of the Registration Statement or the Prospectus or for additional information; and, in the event of the issuance of any stop order or of any order preventing or suspending the use of any preliminary prospectus or other prospectus or suspending any such qualification, to promptly use its best efforts to obtain the withdrawal of such order.

 

 

(b)          To furnish to the Representatives, at their request, without charge, as many copies of the Registration Statement (including exhibits thereto) as the Representatives may reasonably request and to furnish to the Representatives in New York City, without charge, prior to 10:00 a.m. New York City time on the business day next succeeding the date of this Agreement and during the period mentioned in Section 6(e) or 6(f) below, as many copies of the Time of Sale Prospectus, the Prospectus and any supplements and amendments thereto or to the Registration Statement as the Representatives may reasonably request.

 

(c)          To furnish to the Representatives a copy of each proposed free writing prospectus to be prepared by or on behalf of, used by, or referred to by the Company and not to use or refer to any proposed free writing prospectus to which the Representatives reasonably object in a timely manner.

 

(d)          Not to take any action that would result in an Underwriter or the Company being required to file with the Commission pursuant to Rule 433(d) under the Securities Act a free writing prospectus prepared by or on behalf of the Underwriter that the Underwriter otherwise would not have been required to file thereunder.

 

(e)           If the Time of Sale Prospectus is being used to solicit offers to buy the Shares at a time when the Prospectus is not yet available to prospective purchasers and any event shall occur or condition exist as a result of which it is necessary to amend or supplement the Time of Sale Prospectus in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, or if any event shall occur or condition exist as a result of which the Time of Sale Prospectus conflicts with the information contained in the Registration Statement then on file, or if, in the opinion of counsel for the Underwriters, it is necessary to amend or supplement the Time of Sale Prospectus to comply with applicable law, forthwith to prepare, file with the Commission and furnish, at its own expense, to the Underwriters and to any dealer upon request, either amendments or supplements to the Time of Sale Prospectus so that the statements in the Time of Sale Prospectus as so amended or supplemented will not, in the light of the circumstances when the Time of Sale Prospectus is delivered to a prospective purchaser, be misleading or so that the Time of Sale Prospectus, as amended or supplemented, will no longer conflict with the Registration Statement, or so that the Time of Sale Prospectus, as amended or supplemented, will comply with applicable law.

 

 

(f)           If, during such period after the first date of the public offering of the Shares as in the opinion of counsel for the Underwriters the Prospectus (or in lieu thereof the notice referred to in Rule 173(a) of the Securities Act) is required by law to be delivered in connection with sales by an Underwriter or dealer (the “Prospectus Delivery Period”), any event shall occur or condition exist as a result of which it is necessary to amend or supplement the Prospectus in order to make the statements therein, in the light of the circumstances when the Prospectus (or in lieu thereof the notice referred to in Rule 173(a) of the Securities Act) is delivered to a purchaser, not misleading, or if, in the opinion of counsel for the Underwriters, it is necessary to amend or supplement the Prospectus to comply with applicable law, forthwith to prepare, file with the Commission and furnish, at its own expense, to the Underwriters and to the dealers (whose names and addresses the Representatives will furnish to the Company) to which Shares may have been sold by the Representatives on behalf of the Underwriters and to any other dealers upon request, either amendments or supplements to the Prospectus so that the statements in the Prospectus as so amended or supplemented will not, in the light of the circumstances when the Prospectus (or in lieu thereof the notice referred to in Rule 173(a) of the Securities Act) is delivered to a purchaser, be misleading or so that the Prospectus, as amended or supplemented, will comply with applicable law.

 

(g)          To endeavor to qualify the Shares for offering and sale under the securities or Blue Sky laws of such jurisdictions as the Representatives may reasonably request; provided that nothing contained herein shall require the Company to qualify to do business in any jurisdiction, execute a general consent to service of process in any jurisdiction or to subject itself to taxation in any jurisdiction in which it is not otherwise subject.

 

(h)           To make generally available (which may be satisfied by filing with the Commission on its Electronic Data Gathering Analysis and Retrieval System (“EDGAR”)) to the Company’s security holders and to the Underwriters as soon as practicable but in any event not later than sixteen months after the effective date of the Registration Statement an earnings statement covering a period of at least twelve months beginning with the first fiscal quarter of the Company occurring after the date of this Agreement which shall satisfy the provisions of Section 11(a) of the Securities Act and the rules and regulations of the Commission thereunder.

 

 

(i)           Whether or not the transactions contemplated in this Agreement are consummated or this Agreement is terminated, the Company agrees to pay or cause to be paid all expenses incident to the performance of its obligations under this Agreement, including: (i) the fees, disbursements and expenses of the Company’s counsel and the Company’s accountants in connection with the registration and delivery of the Shares under the Securities Act and all other fees or expenses in connection with the preparation and filing of the Registration Statement, any preliminary prospectus, the Time of Sale Prospectus, the Prospectus, any free writing prospectus prepared by or on behalf of, used by, or referred to by the Company and amendments and supplements to any of the foregoing, including all printing costs associated therewith, and the mailing and delivering of copies thereof to the Underwriters and dealers, in the quantities hereinabove specified, (ii) all costs and expenses related to the transfer and delivery of the Shares to the Underwriters, including any transfer or other similar taxes payable thereon, (iii) the cost of printing or producing any Blue Sky or Legal Investment memorandum in connection with the offer and sale of the Shares under state securities laws and all expenses in connection with the qualification of the Shares for offer and sale under state securities laws as provided in Section 6(g) hereof, including filing fees and the reasonable fees and disbursements of counsel for the Underwriters in connection with such qualification and in connection with the Blue Sky or Legal Investment memorandum, (iv) all filing fees and the reasonable fees and disbursements of counsel to the Underwriters incurred in connection with the review and qualification of the offering of the Shares by FINRA (provided that the amount payable by the Company with respect to fees and disbursements of counsel for the Underwriters pursuant to subsections (iii) and (iv) shall not exceed $40,000 in the aggregate), (v) all fees and expenses in connection with the preparation and filing of the registration statement on Form 8-A relating to the Common Stock and all costs and expenses incident to listing the Shares on the Nasdaq Global Select Market, (vi) the cost of printing certificates representing the Shares, (vii) the costs and charges of any transfer agent, registrar or depositary, (viii) the costs and expenses of the Company relating to investor presentations on any “road show” undertaken in connection with the marketing of the offering of the Shares, including, without limitation, expenses associated with the preparation or dissemination of any electronic road show, expenses associated with the production of road show slides and graphics, fees and expenses of any consultants engaged in connection with the road show presentations with the prior approval of the Company, travel and lodging expenses of the representatives and officers of the Company and any such consultants, and 50% of the cost of any aircraft chartered in connection with the road show (with the remaining 50% to be paid by the Underwriters), (ix) the document production charges and expenses associated with printing this Agreement, (x) all fees and disbursements of counsel incurred by the Underwriters in connection with the Directed Share Program and stamp duties, similar taxes or duties or other taxes, if any, incurred by the Underwriters in connection with the Directed Share Program, and (xi) all other costs and expenses incident to the performance of the obligations of the Company hereunder for which provision is not otherwise made in this Section. It is understood, however, that except as provided in this Section, Section 8 entitled “Indemnity and Contribution,” Section 9 entitled “Directed Share Program Indemnification” and the last paragraph of Section 11 below, the Underwriters will pay all of their costs and expenses, including fees and disbursements of their counsel, share transfer taxes payable on resale of any of the Shares by them and any advertising expenses connected with any offers they may make, and all travel and other expenses of the Underwriters or any of their employees incurred by them in connection with participation in investor presentations on any “road show” undertaken in connection with the marketing of the offering of the Shares, other than the cost of aircraft chartered in connection with the roadshow, for which the Underwriters agree to pay for 50% not paid for by the Company, as described above.

 

(j)           The Company will promptly notify the Representatives if the Company ceases to be an Emerging Growth Company at any time prior to the later of (i) completion of the distribution of the Shares within the meaning of the Securities Act and (ii) completion of the Restricted Period (as defined in this Section 6).

 

(k)          If at any time during the Prospectus Delivery Period and following the distribution of any Testing-the-Waters Communication that is a written communication within the meaning of Rule 405 under the Securities Act there occurred or occurs an event or development as a result of which such Testing-the-Waters Communication included or would include an untrue statement of a material fact or omitted or would omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances existing at that subsequent time, not misleading, the Company will promptly notify the Representatives and will promptly amend or supplement, at its own expense, such Testing-the-Waters Communication to eliminate or correct such untrue statement or omission.

 

 

(l)            The Company will deliver to each Underwriter (or its agent), on the date of execution of this Agreement, a properly completed and executed Certification Regarding Beneficial Owners of Legal Entity Customers, together with copies of identifying documentation, and the Company undertakes to provide such additional supporting documentation as each Underwriter may reasonably request in connection with the verification of the foregoing Certification.

 

(m)          During a period of three (3) years from the effective date of the Registration Statement, for so long as the Company is subject to the reporting requirements of either Section 13 or Section 15(d) of the Exchange Act, to furnish to its stockholders as soon as practicable after the end of each fiscal year an annual report (including a balance sheet and statements of income, stockholders’ equity and cash flows of the Company and its consolidated subsidiaries certified by independent public accountants) and, as soon as practicable after the end of each of the first three quarters of each fiscal year (beginning with the fiscal quarter ending after the effective date of the Registration Statement), to make available to its stockholders consolidated summary financial information of the Company and its subsidiaries for such quarter in reasonable detail; provided that the Company will be deemed to have satisfied the requirements of this Section 6(m) to the extent such information is filed through EDGAR.

 

(n)           During a period of three (3) years from the effective date of the Registration Statement, so long as the Company is subject to the reporting requirements of either Section 13 or Section 15(d) of the Exchange Act, to furnish to the Representatives copies of all reports or other communications (financial or other) furnished to shareholders, and to deliver to the Representatives as soon as they are available, copies of any reports and financial statements furnished to or filed with the Commission or any national securities exchange on which any class of securities of the Company is listed; provided that the Company will be deemed to have satisfied the requirements of this Section 6(n)to the extent such information is filed through EDGAR.

 

(o)            To comply with all applicable securities and other laws, rules and regulations in each jurisdiction in which the Directed Shares are offered in connection with the Directed Share Program.

 

(p)          The Company also covenants with each Underwriter that, without the prior written consent of J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC on behalf of the Underwriters, it will not, and will not publicly disclose an intention to, during the period beginning on the date of this Agreement and ending at the close of business 180 days after the date of the Prospectus (the “Restricted Period”), (1) offer, pledge, sell, contract to sell, sell any option, warrant or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any shares of Common Stock or any securities substantially similar to the Common Stock, convertible into or exercisable or exchangeable for Common Stock or (2) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the Common Stock, whether any such transaction described in clause (1) or (2) above is to be settled by delivery of Common Stock or such other securities, in cash or otherwise or (3) file any registration statement with the Commission relating to the offering of any shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock; provided that confidential or non-public submissions to the Commission of any registration statements under the Securities Act may be made if and only if (x) no public announcement of such confidential or non-public submission shall be made during the Restricted Period and (y) the Company shall have provided the Representatives prior written notice of its intention to confidentially submit a draft registration statement with the Commission at least two business days prior to such confidential or non-public submission.

 

 

The restrictions contained in the preceding paragraph shall not apply to (A) the Shares to be sold hereunder, (B) the issuance by the Company of shares of Common Stock upon the exercise of an option or warrant, the settlement of restricted stock units or share value award, or the conversion of a convertible loan, note or other security outstanding on the date hereof as described in each of the Time of Sale Prospectus and the Prospectus, (C) the grant of options, restricted stock units, share value awards or any other type of equity award pursuant to employee benefit plans in effect on the date hereof and described in the Time of Sale Prospectus and the Prospectus (the “Plans”) or the issuance of shares of Common Stock by the Company (whether upon the exercise of stock options or other equity awards) to employees, officers, directors, advisors or consultants of the Company pursuant to the Plans, (D) the filing by the Company of a registration statement on Form S-8 relating to issuance, vesting, exercise or settlement of equity awards granted or to be granted pursuant to the Plans, (E) the issuance of or entry into an agreement to issue shares of Common Stock or any securities substantially similar to the Common Stock or convertible into or exercisable or exchangeable for Common Stock in connection with one or more mergers, acquisitions or securities, businesses, property or other assets, products or technologies, joint ventures, commercial relationships or other strategic corporate transactions or alliances; provided that the aggregate amount of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock (on an as-converted, as-exercised or as-exchanged basis) that the Company may issue or agree to issue pursuant to this clause (E) shall not exceed 10% of the total number of shares of Common Stock of the Company issued and outstanding immediately following the completion of the transactions contemplated by this Agreement determined on a fully diluted basis, and provided further, that each recipient of shares of Common Stock or any securities convertible into or exercisable or exchangeable for shares of Common Stock pursuant to this clause (E) shall execute a lock-up agreement substantially in the form of Exhibit A hereto, (F) facilitating the establishing of a trading plan on behalf of a shareholder, officer or director of the Company pursuant to Rule 10b5-1 under the Exchange Act for the transfer of shares of Common Stock, provided that (i) such plan does not provide for the transfer of shares of Common Stock during the Restricted Period and (ii) to the extent a public announcement or filing under the Exchange Act, if any, is required of or voluntarily made by the Company regarding the establishment of such plan, such announcement or filing shall include a statement to the effect that no transfer of shares of Common Stock may be made under such plan during the Restricted Period or (G) the issuance of Common Stock or other securities to effect the Transactions.

 

If J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC, in their sole discretion, agree to release or waive the restrictions on the transfer of Shares set forth in a Lock-up Agreement for an officer or director of the Company (including, for the avoidance of doubt, in connection with the Final Lock-Up Expiration Date, as defined in the Lock-up Agreement) and provide the Company with notice of the impending release or waiver at least three business days before the effective date of the release or waiver, the Company agrees to announce the impending release or waiver by a press release substantially in the form of Exhibit B hereto through a major news service at least two business days before the effective date of the release or waiver.

 

 

7.            Covenants of the Underwriters. Each Underwriter, severally and not jointly, covenants with the Company not to take any action that would result in the Company being required to file with the Commission under Rule 433(d) a free writing prospectus prepared by or on behalf of such Underwriter that otherwise would not be required to be filed by the Company thereunder, but for the action of the Underwriter.

 

8.            Indemnity and Contribution. (a) The Company agrees to indemnify and hold harmless each Underwriter, the directors, officers and affiliates of each Underwriter within the meaning of Rule 405 under the Securities Act and each person, if any, who controls any Underwriter within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act from and against any and all losses, claims, damages and liabilities (including, without limitation, any legal or other expenses reasonably incurred in connection with defending or investigating any such action or claim) that arise out of, or are based upon, any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement or any amendment thereof, any preliminary prospectus, the Time of Sale Prospectus or any amendment or supplement thereto, any issuer free writing prospectus as defined in Rule 433(h) under the Securities Act, any Company information that the Company has filed, or is required to file, pursuant to Rule 433(d) under the Securities Act, any road show as defined in Rule 433(h) under the Securities Act (a “road show”), the Prospectus or any amendment or supplement thereto, or any Testing-the-Waters Communication, or arise out of, or are based upon, any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein, (insofar as related to the Prospectus, the Time of Sale Prospectus or any Testing-the-Waters Communication, in the light of the circumstances under which they were made), not misleading, except insofar as such losses, claims, damages or liabilities arise out of, or are based upon, any such untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with any information relating to any Underwriter furnished to the Company in writing by such Underwriter through the Representatives expressly for use therein, it being understood and agreed that the only such information furnished by the Underwriters through the Representatives consists of the information described as such in subsection (b) below.

 

(b)          Each Underwriter agrees, severally and not jointly, to indemnify and hold harmless the Company, its directors, its officers who sign the Registration Statement and each person, if any, who controls the Company within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act to the same extent as the foregoing indemnity from the Company to such Underwriter, but only with reference to information relating to such Underwriter furnished to the Company in writing by such Underwriter through the Representatives expressly for use in the Registration Statement, any preliminary prospectus, the Time of Sale Prospectus, any issuer free writing prospectus, road show, the Prospectus or any amendment or supplement thereto or Testing the Waters Communication, it being understood and agreed that the only such information furnished by any Underwriter through the Representatives consists of the following information in the Prospectus: [●].

 

 

(c)           In case any proceeding (including any governmental investigation) shall be instituted involving any person in respect of which indemnity may be sought pursuant to Section 8(a) or 8(b), such person (the “indemnified party”) shall promptly notify the person against whom such indemnity may be sought (the “indemnifying party”) in writing and the indemnifying party, upon request of the indemnified party, shall retain counsel reasonably satisfactory to the indemnified party to represent the indemnified party and any others the indemnifying party may designate in such proceeding and shall pay the fees and disbursements of such counsel related to such proceeding. In any such proceeding, any indemnified party shall have the right to retain its own counsel, but the fees and expenses of such counsel shall be at the expense of such indemnified party unless (i) the indemnifying party and the indemnified party shall have mutually agreed in writing to the retention of such counsel or (ii) the named parties to any such proceeding (including any impleaded parties) include both the indemnifying party and the indemnified party and representation of both parties by the same counsel would be inappropriate due to actual or potential differing interests between them. It is understood that the indemnifying party shall not, in respect of the legal expenses of any indemnified party in connection with any proceeding or related proceedings in the same jurisdiction, be liable for the fees and expenses of more than one separate firm (in addition to any local counsel) for all such indemnified parties and that all such fees and expenses shall be reimbursed as they are incurred. In the case of any such separate firm for the Underwriters and such control persons and affiliates of any Underwriters, such firm shall be designated in writing by the Representatives. In the case of any such separate firm for the Company, and such directors, officers and control persons of the Company, such firm shall be designated in writing by the Company. The indemnifying party shall not be liable for any settlement of any proceeding effected without its written consent, but if settled with such consent or if there be a final judgment for the plaintiff, the indemnifying party agrees to indemnify the indemnified party from and against any loss or liability by reason of such settlement or judgment. Notwithstanding the foregoing sentence, if at any time an indemnified party shall have requested an indemnifying party to reimburse the indemnified party for fees and expenses of counsel as contemplated by the second and third sentences of this paragraph, the indemnifying party agrees that it shall be liable for any settlement of any proceeding effected without its written consent if (i) such settlement is entered into more than 30 days after receipt by such indemnifying party of the aforesaid request and (ii) such indemnifying party shall not have reimbursed the indemnified party in accordance with such request prior to the date of such settlement. No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement of any pending or threatened proceeding in respect of which any indemnified party is or could have been a party and indemnity could have been sought hereunder by such indemnified party, unless such settlement (x) includes an unconditional release of such indemnified party from all liability on claims that are the subject matter of such proceeding and (y) does not include a statement as to or an admission of fault, culpability or a failure to act by or on behalf of any indemnified party.

 

 

(d)            To the extent the indemnification provided for in Section 8(a) or 8(b) is unavailable to an indemnified party or insufficient in respect of any losses, claims, damages or liabilities referred to therein, then each indemnifying party under such paragraph, in lieu of indemnifying such indemnified party thereunder, shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages or liabilities (i) in such proportion as is appropriate to reflect the relative benefits received by the indemnifying party or parties on the one hand and the indemnified party or parties on the other hand from the offering of the Shares or (ii) if the allocation provided by Section 8(d)(i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in Section 8(d)(i) above but also the relative fault of the Company on the one hand and of the Underwriters on the other hand in connection with the statements or omissions that resulted in such losses, claims, damages or liabilities, as well as any other relevant equitable considerations. The relative benefits received by the indemnifying party or parties on the one hand and the indemnified party or parties on the other hand in connection with the offering of the Shares shall be deemed to be in the same respective proportions as the net proceeds from the offering of the Shares (after deducting underwriting discounts and commissions but before deducting expenses) received by the Company and the total underwriting discounts and commissions received by the Underwriters, in each case as set forth in the table on the cover of the Prospectus, bear to the aggregate Public Offering Price of the Shares. The relative fault of the indemnifying party or parties on the one hand and the indemnified party or parties on the other hand shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company or by the Underwriters and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The Underwriters’ respective obligations to contribute pursuant to this Section 8 are several in proportion to the respective number of Shares they have purchased hereunder, and not joint.

 

(e)            The Company and the Underwriters agree that it would not be just or equitable if contribution pursuant to this Section 8 were determined by pro rata allocation (even if the Underwriters were treated as one entity for such purpose) or by any other method of allocation that does not take account of the equitable considerations referred to in Section 8(d). The amount paid or payable by an indemnified party as a result of the losses, claims, damages and liabilities referred to in Section 8(d) shall be deemed to include, subject to the limitations set forth above, any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this Section 8, no Underwriter shall be required to contribute any amount in excess of the amount by which the total price at which the Shares underwritten by it and distributed to the public were offered to the public exceeds the amount of any damages that such Underwriter has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The remedies provided for in this Section 8 are not exclusive and shall not limit any rights or remedies which may otherwise be available to any indemnified party at law or in equity.

 

(f)           The indemnity and contribution provisions contained in this Section 8(f) and the representations, warranties and other statements of the Company contained in this Agreement shall remain operative and in full force and effect regardless of (i) any termination of this Agreement, (ii) any investigation made by or on behalf of any Underwriter, any director, officer, or affiliate of any Underwriter and each person, if any, who controls any Underwriter or by or on behalf of the Company, its officers or directors or any person controlling the Company and (iii) acceptance of and payment for any of the Shares.

 

 

9.            Directed Share Program Indemnification.

 

(a)           The Company agrees to indemnify and hold harmless Morgan Stanley & Co. LLC, each person, if any, who controls Morgan Stanley & Co. LLC within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act (“DSP Entities”) from and against any and all losses, claims, damages and liabilities (including, without limitation, any legal or other expenses reasonably incurred in connection with defending or investigating any such action or claim) (i) that arise out of, or are based upon, any untrue statement or alleged untrue statement of a material fact contained in any material prepared by or with the consent of the Company for distribution to Participants in connection with the Directed Share Program or arise out of, or are based upon, any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; (ii) that arise out of, or are based upon, the failure of any Participant to pay for and accept delivery of Directed Shares that the Participant agreed to purchase; or (iii) related to, arising out of, or in connection with the Directed Share Program, other than losses, claims, damages or liabilities (or expenses relating thereto) that are finally judicially determined to have resulted from the bad faith or gross negligence of the DSP Entities.

 

(b)         In case any proceeding (including any governmental investigation) shall be instituted involving any DSP Entity in respect of which indemnity may be sought pursuant to Section 9(a), the DSP Entity seeking indemnity, shall promptly notify the Company in writing and the Company, upon request of the DSP Entity, shall retain counsel reasonably satisfactory to the DSP Entity to represent the DSP Entity and any others the Company may designate in such proceeding and shall pay the reasonably incurred and documented fees and disbursements of such counsel related to such proceeding. In any such proceeding, any DSP Entity shall have the right to retain its own counsel, but the fees and expenses of such counsel shall be at the expense of such DSP Entity unless (i) the Company shall have agreed in writing to the retention of such counsel or (ii) the named parties to any such proceeding (including any impleaded parties) include both the Company and the DSP Entity and representation of both parties by the same counsel would be inappropriate due to actual or potential differing interests between them. The Company shall not, in respect of the legal expenses of the DSP Entities in connection with any proceeding or related proceedings in the same jurisdiction, be liable for the fees and expenses of more than one separate firm (in addition to any local counsel) for all DSP Entities. Any such separate firm for the DSP Entities shall be designated in writing by Morgan Stanley & Co. LLC, as applicable. The Company shall not be liable for any settlement of any proceeding effected without its written consent, but if settled with such consent or if there be a final judgment for the plaintiff, the Company agrees to indemnify the DSP Entities from and against any loss or liability by reason of such settlement or judgment. Notwithstanding the foregoing sentence, if at any time a DSP Entity shall have requested the Company to reimburse it for fees and expenses of counsel as contemplated by the second and third sentences of this paragraph, the Company agrees that it shall be liable for any settlement of any proceeding effected without its written consent if (i) such settlement is entered into more than 30 days after receipt by the Company of the aforesaid request and (ii) the Company shall not have reimbursed the DSP Entity in accordance with such request prior to the date of such settlement. The Company shall not, without the prior written consent of Morgan Stanley & Co. LLC, as the case may be, effect any settlement of any pending or threatened proceeding in respect of which any DSP Entity is or could have been a party and indemnity could have been sought hereunder by such DSP Entity, unless such settlement (x) includes an unconditional release of the DSP Entities from all liability on claims that are the subject matter of such proceeding and (y) does not include a statement as to or an admission of fault, culpability or a failure to act by or on behalf of any indemnified party.

 

 

(c)           To the extent the indemnification provided for in Section 9(a) is unavailable to a DSP Entity or insufficient in respect of any losses, claims, damages or liabilities referred to therein, then the Company in lieu of indemnifying the DSP Entity thereunder, shall contribute to the amount paid or payable by the DSP Entity as a result of such losses, claims, damages or liabilities (i) in such proportion as is appropriate to reflect the relative benefits received by the Company on the one hand and the DSP Entities on the other hand from the offering of the Directed Shares or (ii) if the allocation provided by Section 9(c)(i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in Section 9(c)(i) above but also the relative fault of the Company on the one hand and of the DSP Entities on the other hand in connection with any statements or omissions that resulted in such losses, claims, damages or liabilities, as well as any other relevant equitable considerations. The relative benefits received by the Company on the one hand and the DSP Entities on the other hand in connection with the offering of the Directed Shares shall be deemed to be in the same respective proportions as the net proceeds from the offering of the Directed Shares (after deducting underwriting discounts and commissions but before deducting expenses) and the total underwriting discounts and commissions received by the DSP Entities for the Directed Shares, bear to the aggregate Public Offering Price of the Directed Shares. If the loss, claim, damage or liability arises out of, or is based upon, an untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact, the relative fault of the Company on the one hand and the DSP Entities on the other hand shall be determined by reference to, among other things, whether the untrue or alleged untrue statement or the omission or alleged omission relates to information supplied by the Company or by the DSP Entities and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.

 

(d)            The Company and the DSP Entities agree that it would not be just or equitable if contribution pursuant to this Section 9 were determined by pro rata allocation (even if the DSP Entities were treated as one entity for such purpose) or by any other method of allocation that does not take account of the equitable considerations referred to in Section 9(c). The amount paid or payable by the DSP Entities as a result of the losses, claims, damages and liabilities referred to in the immediately preceding paragraph shall be deemed to include, subject to the limitations set forth above, any legal or other expenses reasonably incurred by the DSP Entities in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this Section 9, no DSP Entity shall be required to contribute any amount in excess of the amount by which the total price at which the Directed Shares distributed to the public were offered to the public exceeds the amount of any damages that such DSP Entity has otherwise been required to pay. The remedies provided for in this Section 9 are not exclusive and shall not limit any rights or remedies which may otherwise be available to any indemnified party at law or in equity.

 

(e)            The indemnity and contribution provisions contained in this Section 9 shall remain operative and in full force and effect regardless of (i) any termination of this Agreement, (ii) any investigation made by or on behalf of any DSP Entity or the Company, its officers or directors or any person controlling the Company and (iii) acceptance of and payment for any of the Directed Shares.

 

 

10.            Termination. The Underwriters may terminate this Agreement by notice given by the Representatives to the Company, if after the execution and delivery of this Agreement and prior to or on the Closing Date or any Option Closing Date, as the case may be, (i) trading generally shall have been suspended or materially limited on, or by, as the case may be, any of the New York Stock Exchange, the NYSE American, the Nasdaq Global Select Market, the Chicago Board of Options Exchange, the Chicago Mercantile Exchange or the Chicago Board of Trade or other relevant exchanges, (ii) trading of any securities of the Company shall have been suspended on any exchange or in any over-the-counter market, (iii) a material disruption in securities settlement, payment or clearance services in the United States shall have occurred, (iv) any moratorium on commercial banking activities shall have been declared by Federal or New York State authorities or (v) there shall have occurred any outbreak or escalation of hostilities, or any change in financial markets or any calamity or crisis that, in the Representatives’ judgment, is material and adverse and which, singly or together with any other event specified in this clause (v), makes it, in the Representatives’ judgment, impracticable or inadvisable to proceed with the offer, sale or delivery of the Shares on the terms and in the manner contemplated in the Time of Sale Prospectus or the Prospectus.

 

11.         Effectiveness; Defaulting Underwriters. This Agreement shall become effective upon the execution and delivery hereof by the parties hereto.

 

If, on the Closing Date or an Option Closing Date, as the case may be, any one or more of the Underwriters shall fail or refuse to purchase Shares that it has or they have agreed to purchase hereunder on such date, and the aggregate number of Shares which such defaulting Underwriter or Underwriters agreed but failed or refused to purchase is not more than one-tenth of the aggregate number of the Shares to be purchased on such date, the other Underwriters shall be obligated severally in the proportions that the number of Firm Shares set forth opposite their respective names in Schedule I bears to the aggregate number of Firm Shares set forth opposite the names of all such non-defaulting Underwriters, or in such other proportions as the Representatives may specify, to purchase the Shares which such defaulting Underwriter or Underwriters agreed but failed or refused to purchase on such date; provided that in no event shall the number of Shares that any Underwriter has agreed to purchase pursuant to this Agreement be increased pursuant to this Section 11 by an amount in excess of one-ninth of such number of Shares without the written consent of such Underwriter. If, on the Closing Date, any Underwriter or Underwriters shall fail or refuse to purchase Firm Shares and the aggregate number of Firm Shares with respect to which such default occurs is more than one-tenth of the aggregate number of Firm Shares to be purchased on such date, and arrangements satisfactory to the Representatives and the Company for the purchase of such Firm Shares are not made within 36 hours after such default, this Agreement shall terminate without liability on the part of any non-defaulting Underwriter or the Company. In any such case either the Representatives or the Company shall have the right to postpone the Closing Date, but in no event for longer than seven days, in order that the required changes, if any, in the Registration Statement, in the Time of Sale Prospectus, in the Prospectus or in any other documents or arrangements may be effected. If, on an Option Closing Date, any Underwriter or Underwriters shall fail or refuse to purchase Additional Shares and the aggregate number of Additional Shares with respect to which such default occurs is more than one-tenth of the aggregate number of Additional Shares to be purchased on such Option Closing Date, the non-defaulting Underwriters shall have the option to (i) terminate their obligation hereunder to purchase the Additional Shares to be sold on such Option Closing Date or (ii) purchase not less than the number of Additional Shares that such non-defaulting Underwriters would have been obligated to purchase in the absence of such default. Any action taken under this paragraph shall not relieve any defaulting Underwriter from liability in respect of any default of such Underwriter under this Agreement.

 

 

If this Agreement shall be terminated by the Underwriters, or any of them, because of any failure or refusal on the part of the Company to comply with the terms or to fulfill any of the conditions of this Agreement, or if for any reason the Company shall be unable to perform its obligations under this Agreement other than by reason of a default by the Underwriters, the Company will reimburse the Underwriters or such Underwriters as have so terminated this Agreement with respect to themselves, severally, for all out-of-pocket expenses (including the reasonably incurred fees and disbursements of their counsel) reasonably incurred by such Underwriters in connection with this Agreement or the offering contemplated hereunder.

 

12.          Entire Agreement. (a) This Agreement, together with any contemporaneous written agreements and any prior written agreements (to the extent not superseded by this Agreement) that relate to the offering of the Shares, represents the entire agreement between the Company, on the one hand, and the Underwriters, on the other, with respect to the preparation of any preliminary prospectus, the Time of Sale Prospectus, the Prospectus, the conduct of the offering, and the purchase and sale of the Shares.

 

(b)          The Company acknowledges that in connection with the offering of the Shares: (i) the Underwriters have acted at arm’s length, are not agents of, and owe no fiduciary duties to, the Company or any other person, (ii) the Underwriters owe the Company only those duties and obligations set forth in this Agreement, any contemporaneous written agreements and prior written agreements (to the extent not superseded by this Agreement), if any, (iii) the Underwriters may have interests that differ from those of the Company, and (iv) none of the activities of the Underwriters in connection with the transactions contemplated herein constitutes a recommendation, investment advice, or solicitation of any action by the Underwriters with respect to any entity or natural person. The Company waives to the full extent permitted by applicable law any claims it may have against the Underwriters arising from an alleged breach of fiduciary duty in connection with the offering of the Shares.

 

13.          Recognition of the U.S. Special Resolution Regimes. (i) In the event that any Underwriter that is a Covered Entity becomes subject to a proceeding under a U.S. Special Resolution Regime, the transfer from such Underwriter of this Agreement, and any interest and obligation in or under this Agreement, will be effective to the same extent as the transfer would be effective under the U.S. Special Resolution Regime if this Agreement, and any such interest and obligation, were governed by the laws of the United States or a state of the United States.

 

(b)          In the event that any Underwriter that is a Covered Entity or a BHC Act Affiliate of such Underwriter becomes subject to a proceeding under a U.S. Special Resolution Regime, Default Rights under this Agreement that may be exercised against such Underwriter are permitted to be exercised to no greater extent than such Default Rights could be exercised under the U.S. Special Resolution Regime if this Agreement were governed by the laws of the United States or a state of the United States.

 

 

 

For purposes of this Section a “BHC Act Affiliate” has the meaning assigned to the term “affiliate” in, and shall be interpreted in accordance with, 12 U.S.C. § 1841(k). “Covered Entity” means any of the following: (i) a “covered entity” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 252.82(b); (ii) a “covered bank” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 47.3(b); or (iii) a “covered FSI” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 382.2(b). “Default Right” has the meaning assigned to that term in, and shall be interpreted in accordance with, 12 C.F.R. §§ 252.81, 47.2 or 382.1, as applicable. “U.S. Special Resolution Regime” means each of (i) the Federal Deposit Insurance Act and the regulations promulgated thereunder and (ii) Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act and the regulations promulgated thereunder.

 

14.            Counterparts. This Agreement may be signed in two or more counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. Counterparts may be delivered via facsimile, electronic mail (including any electronic signature complying with the U.S. federal ESIGN Act of 2000, Uniform Electronic Transactions Act or other applicable law, e.g. www.docusign.com) or other transmission method and any counterpart so delivered shall be deemed to have been duly and validly delivered and be valid and effective for all purposes.

 

15.            Applicable Law. This Agreement and any claim, controversy or dispute arising under or related to this Agreement shall be governed by and construed in accordance with the internal laws of the State of New York, without regard to the conflict of laws principles thereof.

 

16.            Submission to Jurisdiction. The Company irrevocably submits to the non-exclusive jurisdiction of any New York State or United States Federal court sitting in The City of New York (the “Specified Courts”) over any suit, action or proceeding arising out of or relating to this Agreement, the Time of Sale Prospectus, the Prospectus, the Registration Statement or the offering of the Shares (each, a “Related Proceeding”). The Company irrevocably waives, to the fullest extent permitted by law, any objection which it may now or hereafter have to the laying of venue of any Related Proceeding brought in such a court and any claim that any such Related Proceeding brought in such a court has been brought in an inconvenient forum. To the extent that the Company has or hereafter may acquire any immunity (on the grounds of sovereignty or otherwise) from the jurisdiction of any court or from any legal process with respect to itself or its property, the Company irrevocably waives, to the fullest extent permitted by law, such immunity in respect of any such suit, action or proceeding.

 

17.            Headings. The headings of the sections of this Agreement have been inserted for convenience of reference only and shall not be deemed a part of this Agreement.

 

18.           Notices. All communications hereunder shall be in writing and effective only upon receipt and if to the Underwriters shall be delivered, mailed or sent to J.P. Morgan Securities LLC, 383 Madison Avenue, New York, NY 10179 Attention: Equity Syndicate Desk (Fax: (212) 622-8358); Morgan Stanley & Co. LLC, 1585 Broadway, New York, New York 10036, Attention: Equity Syndicate Desk; and if to the Company shall be delivered, mailed or sent to Fluence Energy, Inc., 4601 Fairfax Drive, Suite 600 Arlington, VA 22203.

 

 

	Very truly yours,
	FLUENCE ENERGY INC.
	By:
		Name:
		Title:

 

 

Accepted as of the date hereof

 

J.P. Morgan Securities LLC
Morgan Stanley & Co. LLC

 

Acting severally on behalf of themselves

and the several Underwriters named in

Schedule I hereto.

 

By:

J.P. Morgan Securities LLC

 

By:
	Name:
	Title:

 

By:

Morgan Stanley & Co. LLC

 

By:
	Name:
	Title:

 

 

SCHEDULE I

 

Underwriter			Number of Firm Shares To Be Purchased
J.P. Morgan Securities LLC
Morgan Stanley & Co. LLC
Barclays Capital Inc.
BofA Securities, Inc.
Total:

 

 

SCHEDULE II

 

Time of Sale Prospectus

 

1.

Preliminary Prospectus issued [●], 2021

 

2.

[all free writing prospectuses filed by the Company under Rule 433(d) of the Securities Act]

 

3.

The initial public offering price per share for the Shares is $[●]

 

4.

The number of Firm Shares purchased by the Underwriters is [●]

 

5.

The number of Additional Shares that may be purchased by the Underwriters pursuant to the Underwriters’ option to purchase Additional Shares is [●]

 

 

EXHIBIT A

 

FORM OF LOCK-UP AGREEMENT

 

[●], 2021

 

J.P. Morgan Securities LLC
Morgan Stanley & Co. LLC

 

As Representatives of the several Underwriters named in Schedule I hereto

 

c/o J.P. Morgan Securities LLC
383 Madison Avenue
New York, New York 10179

 

c/o Morgan Stanley & Co. LLC
1585 Broadway
New York, New York 10036

 

Ladies and Gentlemen:

 

The undersigned understands that J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC, (the “Representatives”) propose to enter into an Underwriting Agreement (the “Underwriting Agreement”) with Fluence Energy, Inc., a Delaware corporation (the “Company”), providing for the public offering (the “Public Offering”) by the several Underwriters, including the Representatives (the “Underwriters”), of shares of the Class A common stock, par value $0.00001 per share, of the Company (the “Class A Shares”). As used herein, the term “Common Stock” refers to shares of the Company’s common stock, including any shares of Class A Shares.

 

To induce the Underwriters that may participate in the Public Offering to continue their efforts in connection with the Public Offering, the undersigned hereby agrees that, without the prior written consent of J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC on behalf of the Underwriters, it will not, and will not publicly disclose an intention to, during the period beginning on the date of this letter agreement (this “Lock-Up Agreement”) and ending at the close of business 180 days after the date of the final prospectus relating to the Public Offering (the “Prospectus”) (such period, the “Restricted Period”), (1) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any shares of Common Stock beneficially owned (as such term is used in Rule 13d-3 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), by the undersigned or any other securities so owned convertible into or exercisable or exchangeable for shares of Common Stock or (2) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the Common Stock, whether any such transaction described in clause (1) or (2) above is to be settled by delivery of Common Stock or such other securities, in cash or otherwise. The undersigned acknowledges and agrees that the foregoing precludes the undersigned from engaging in any hedging or other transactions designed or intended, or which could reasonably be expected to lead to or result in, a sale or disposition of any shares of Common Stock, or securities convertible into or exercisable or exchangeable for Common Stock, even if any such sale or disposition transaction or transactions would be made or executed by someone other than the undersigned on their behalf.

 

 

The foregoing shall not apply to:

 

(a)            transactions relating to Common Stock or other securities acquired in the Public Offering or in open market transactions after the completion of the Public Offering, provided that no filing under Section 16(a) of the Exchange Act reporting a reduction in beneficial ownership of Common Stock shall be required or shall be voluntarily made in connection with subsequent sales of Common Stock or other securities acquired in the Public Offering or such open market transactions during the Restricted Period;

 

(b)            transfers of Common Stock or any security convertible into or exercisable or exchangeable for Common Stock as a bona fide gift, for bona fide estate planning purposes or to any member of the immediate family of the undersigned or to any trust for the direct or indirect benefit of the undersigned or the immediate family of the undersigned, provided that (i) each recipient shall sign and deliver a lock-up agreement substantially in the form of this Lock-Up Agreement, (ii) no filing under Section 16(a) of the Exchange Act reporting a reduction in beneficial ownership of Common Stock shall be required or shall be voluntarily made during the Restricted Period and (iii) and such transfer does not involve a disposition for value;

 

(c)            transfers of Common Stock or any security convertible into or exercisable or exchangeable for Common Stock by will or intestate succession upon the death of the undersigned, including to the transferee’s nominee or custodian;

 

(d)            transfers of Common Stock or any security convertible into or exercisable or exchangeable for Common Stock that occurs by operation of law pursuant to a qualified domestic order or in connection with a divorce settlement or other court order; provided that any filing required under Section 16(a) of the Exchange Act during the Restricted Period shall clearly indicate in the footnotes thereto that the filing relates to the circumstances described in this clause (d);

 

(e)            if the undersigned is a corporation, partnership, limited liability company or other business entity, any transfer or distribution of Common Stock or any security convertible into or exercisable or exchangeable for Common Stock, including, without limitation, limited liability company interests in Fluence Energy, LLC (“Units”) to limited partners, members, managers, stockholders or holders of similar equity interests in the undersigned or to another corporation, partnership, limited liability company, trust or other business entity that is an affiliate (as defined in Rule 405 as promulgated under the Securities Act of 1933, as amended) of the undersigned or to any investment fund or other entity controlled or managed by the undersigned or affiliates of the undersigned, provided that (i) each transferee shall sign and deliver a lock-up agreement substantially in the form of this Lock-Up Agreement and (ii) no filing under Section 16(a) of the Exchange Act, reporting a reduction in beneficial ownership of Common Stock, shall be required or shall be voluntarily made during the Restricted Period;

 

 

(f)            transfers of Common Stock or any security convertible into or exercisable or exchangeable for Common Stock to a nominee or custodian of a person or entity to whom a disposition or transfer would be permissible under clauses (a) through (e) above;

 

(g)            transfers to the Company of shares of Common Stock or any security convertible into or exercisable or exchangeable for Common Stock in connection with the repurchase by the Company from the undersigned of shares of Common Stock or any security convertible into or exercisable or exchangeable for Common Stock pursuant to a repurchase right arising in connection with the termination of the undersigned’s employment with or provision of services to the Company; provided that any public announcement or filing under Section 16(a) of the Exchange Act shall clearly indicate in the footnotes thereto that such transfer is being made pursuant to the circumstances described in this clause (g);

 

(h)            the transfer or other disposition of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock, in each case to the Company, upon a vesting or settlement event of the Company’s securities or upon the exercise of options, restricted share units, share value awards, warrants or other equity awards to purchase the Company’s securities on a “cashless” or “net exercise” basis to the extent permitted by the instruments representing such securities (including any transfer or other disposition in each case to the Company, necessary to generate such amount of cash needed for the payment of taxes, including estimated taxes, due as a result of such vesting or exercise whether by means of a “net settlement” or otherwise) so long as such “cashless exercise” or “net exercise” is effected solely by surrender of outstanding options, restricted share units, share value awards, warrants or other equity awards (or the Common Stock issuable upon the exercise thereof) to the Company and the Company’s cancellation of all or a portion thereof to pay the exercise price and/or withholding tax obligations, but for the avoidance of doubt, excluding all methods of exercise that would involve a sale other than to the Company of any Common Stock relating to such equity awards, whether to cover the applicable exercise price and/or withholding tax obligations or otherwise; provided that any filing under Section 16(a) of the Exchange Act shall clearly indicate in the footnotes thereto that (i) the filing relates to the circumstances described in this clause (h), and (ii) any shares received upon exercise or settlement of the option, restricted share unit, share value award or other equity award or exercise of warrants are subject to a lock-up agreement substantially in the form of this Lock-Up Agreement;

 

(i)            in connection with any reclassification or conversion of any outstanding preferred shares of the Company into Common Stock prior to or in connection with the consummation of the Public Offering or pursuant to any sale, exchange or other transfer to effect the Transactions (as defined in the Prospectus); provided that (i) such reclassification, conversion, sale, exchange or other transfer is disclosed in the Prospectus, (ii) any such Common Stock received upon such reclassification, conversion, sale, exchange or other transfer shall be subject to the terms of this Lock-Up Agreement and (iii) any filing required under Section 16(a) of the Exchange Act during the Restricted Period shall clearly indicate in the footnotes thereto that the filing relates to the circumstances described in this clause (i);

 

(j)            transfers of Common Stock pursuant to a bona fide third-party tender offer, merger, consolidation or other similar transaction after the completion of the Public Offering that is approved by the Board of Directors of the Company and made to all holders of the Company’s capital stock involving a Change of Control (as defined below) of the Company, provided that in the event that such tender offer, merger, consolidation or other such transaction is not completed, the undersigned’s shares of Common Stock shall remain subject to the provisions of this Lock-Up Agreement; or

 

 

(k)            establishing trading plans pursuant to Rule 10b5-1 under the Exchange Act for the transfer of shares of Common Stock, provided that (i) such plan does not provide for the transfer of Common Stock during the Restricted Period and (ii) to the extent a public announcement or filing under the Exchange Act, if any, is required of or voluntarily made by or on behalf of the undersigned or the Company regarding the establishment of such plan, such announcement or filing shall include a statement to the effect that no transfer of Common Stock may be made under such plan during the Restricted Period.

 

Nothing in this Lock-Up Agreement shall prevent the undersigned from making a demand for, or exercising any right with respect to, the registration of the undersigned’s shares of Common Stock, except for any such demand or any such exercise that is publicly disclosed (or required to be publicly disclosed) by the undersigned or any of its affiliates prior to the expiration of the Lock-Up Period; provided that in no event shall the Company be obligated to take an action in violation of Section 6(q) of the Underwriting Agreement. The undersigned also agrees and consents to the entry of stop transfer instructions with the Company’s transfer agent and registrar against the transfer of the undersigned’s Common Stock except in compliance with the foregoing restrictions.

 

For purposes of this letter, “immediate family” shall mean any relationship by blood, marriage or adoption, not more remote than first cousin. For purposes of this letter, “Change of Control” shall mean the transfer (whether by tender offer, merger, consolidation or other similar transaction), in one transaction or a series of related transactions, to a person or group of affiliated persons (other than an Underwriter pursuant to the Public Offering), of the Company’s voting securities if, after such transfer, such person or group of affiliated persons would hold more than 50% of the outstanding voting securities of the Company (or the surviving entity).

 

If the undersigned is an officer or director of the Company, the undersigned further agrees that the foregoing restrictions shall be equally applicable to any issuer-directed shares of Common Stock the undersigned may purchase in the offering.

 

If the undersigned is an officer or director of the Company, (i) J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC severally and not jointly agree that, at least three business days before the effective date of any release or waiver of the foregoing restrictions in connection with a transfer of Common Stock, J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC will notify the Company of the impending release or waiver, and (ii) the Company has agreed in the Underwriting Agreement to announce the impending release or waiver by press release through a major news service at least two business days before the effective date of the release or waiver. Any release or waiver granted by J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC hereunder to any such officer or director shall only be effective two business days after the publication date of such press release. The provisions of this paragraph will not apply if (a) the release or waiver is effected solely to permit a transfer not for consideration or to an immediate family member as defined in FINRA Rule 5130(i)(5) and (b) the transferee has agreed in writing to be bound by the same terms described in this Lock-Up Agreement to the extent and for the duration that such terms remain in effect at the time of the transfer.

 

 

The undersigned understands that the Company and the Underwriters are relying upon this Lock-Up Agreement in proceeding toward consummation of the Public Offering. The undersigned further understands that this Lock-Up Agreement is irrevocable and shall be binding upon the undersigned’s heirs, legal representatives, successors and assigns.

 

The undersigned acknowledges and agrees that the Underwriters have not provided any recommendation or investment advice nor have the Underwriters solicited any action from the undersigned with respect to the Public Offering of the Common Stock and the undersigned has consulted their own legal, accounting, financial, regulatory and tax advisors to the extent deemed appropriate. The undersigned further acknowledges and agrees that, although the Underwriters may provide certain Regulation Best Interest and Form CRS disclosures or other related documentation to you in connection with the Public Offering, the Underwriters are not making a recommendation to you to participate in the Public Offering or sell any shares of Common Stock at the price determined in the Public Offering, and nothing set forth in such disclosures or documentation is intended to suggest that any Underwriter is making such a recommendation.

 

The undersigned hereby consents to receipt of this Lock-Up Agreement in electronic form and understands and agrees that this letter agreement may be signed electronically. If any signature is delivered by facsimile transmission, electronic mail, or otherwise by electronic transmission evidencing an intent to sign this Lock-Up Agreement (including any electronic signature complying with the U.S. federal ESIGN Act of 2000, e.g., www.docusign.com), such facsimile transmission, electronic mail or other electronic transmission shall create a valid and binding obligation of the undersigned with the same force and effect as if such signature were an original. Execution and delivery of this Lock-Up Agreement by facsimile transmission, electronic mail or other electronic transmission is legal, valid and binding for all purposes.

 

Whether or not the Public Offering actually occurs depends on a number of factors, including market conditions. Any Public Offering will only be made pursuant to an Underwriting Agreement, the terms of which are subject to negotiation between the Company and the Underwriters.

 

This Lock-Up Agreement shall automatically terminate and the undersigned will be released from all obligations hereunder upon the earliest to occur, if any, of (a) the Company, on the one hand, or the Representatives, on the other hand, advising the other in writing that it has determined not to proceed with the Public Offering prior to the execution of the Underwriting Agreement, (b) the date the registration statement is withdrawn, if prior to the execution of the Underwriting Agreement and the closing of the Public Offering, (c) the date the Underwriting Agreement is terminated, if prior to the closing of the Public Offering, and (d) December 31, 2021, if the Underwriting Agreement has not been executed by such date; provided that the Company may by written notice to the undersigned prior to December 31, 2021, extend such date for a period of up to an additional three months.

 

This Lock-Up Agreement and any claim, controversy or dispute arising thereunder or related hereto shall be governed by and construed in accordance with the laws of the State of New York, without regard to the conflict of laws principles thereof.

 

 

Very truly yours,

 

IF AN INDIVIDUAL:			IF AN ENTITY:
(duly authorized signature)			(please print complete name of entity)
Name:			By:
	(please print full name)			(duly authorized signature)
			Name:
				(please print full name)
			Title:
				(please print full title)
Address:			Address:
E-mail:			E-mail:

 

 

EXHIBIT B

 

FORM OF WAIVER OF LOCK-UP

 

, 20

 

[Name and Address of
Officer or Director
Requesting Waiver]

 

Dear Mr./Ms. [Name]:

 

This letter is being delivered to you in connection with the offering by Fluence Energy Inc. (the “Company”) of shares of Common Stock, par value $0.00001 per share (the “Common Stock”), of the Company and the lock-up agreement dated                     , 20     (the “Lock-up Agreement”), executed by you in connection with such offering, and your request for a [waiver] [release] dated                     , 20    , with respect to                      shares of Common Stock (the “Shares”).

 

J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC hereby agree to [waive] [release] the transfer restrictions set forth in the Lock-up Agreement, but only with respect to the Shares, effective                     , 20    ; provided, however, that such [waiver] [release] is conditioned on the Company announcing the impending [waiver] [release] by press release through a major news service at least two business days before effectiveness of such [waiver] [release]. This letter will serve as notice to the Company of the impending [waiver] [release].

 

Except as expressly [waived] [released] hereby, the Lock-up Agreement shall remain in full force and effect.

 

	Very truly yours,
	J.P. Morgan Securities LLC Morgan Stanley & Co. LLC
	Acting severally on behalf of themselves and the several Underwriters named in Schedule I hereto
	By:
		Name:
		Title:

 

cc:      Company

 

 

FORM OF PRESS RELEASE

 

Fluence Energy, Inc.

 

[Date]

 

Fluence Energy, Inc. (the “Company”) announced today that J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC, the lead book-running managers in the Company’s recent public sale of                      Common Stock, are [waiving][releasing] a lock-up restriction with respect to                      shares of the Company’s Common Stock held by [certain officers or directors] [an officer or director] of the Company. The [waiver][release] will take effect on                     , 20    , and the shares may be sold on or after such date.

 

This press release is not an offer for sale of the securities in the United States or in any other jurisdiction where such offer is prohibited, and such securities may not be offered or sold in the United States absent registration or an exemption from registration under the United States Securities Act of 1933, as amended.

 

 

 

Exhibit 3.2

 

AMENDED AND RESTATED CERTIFICATE OF INCORPORATION

 

OF

 

FLUENCE ENERGY, INC.

 

Fluence Energy, Inc., a corporation organized and existing under the laws of the State of Delaware, hereby certifies as follows:

 

1.            The original Certificate of Incorporation of the Corporation was filed with the Office of the Secretary of State of the State of Delaware on June 21, 2021 (the “Original Certificate”).

 

2.            The Corporation is filing this Amended and Restated Certificate of Incorporation of the Corporation, which restates, integrates and further amends the Original Certificate, as heretofore amended (the “Certificate of Incorporation”), and which was duly adopted by all necessary action of the board of directors of the Corporation and the stockholders of the Corporation in accordance with the provisions of Sections 242, 245 and 228 of the General Corporation Law of the State of Delaware.

 

3.            The text of the Original Certificate is hereby amended and restated in its entirety by this Certificate of Incorporation to read in full as follows:

 

Article I.

 

The name of the corporation is Fluence Energy, Inc. (the “Corporation”).

 

Article II.

 

The address of the Corporation’s registered office in the State of Delaware is 251 Little Falls Drive, County of New Castle, Wilmington, Delaware, 19808. The name of its registered agent at such address is The Corporation Trust Company.

 

Article III.

 

The nature of the business of the Corporation and the objects or purposes to be transacted, promoted or carried on by the Corporation is to engage in any lawful act or activity for which corporations may be organized under the General Corporation Law of the State of Delaware (the “DGCL”), including, without limitation, (i) investing in securities of Fluence Energy, LLC, a Delaware limited liability company, or any successor entities thereto (“Fluence LLC”) and any of its subsidiaries, (ii) exercising all rights, powers, privileges and other incidents of ownership or possession with respect to the Corporation’s assets, including managing, holding, selling and disposing of such assets and (iii) engaging in any other activities incidental or ancillary thereto.

 

Article IV.

 

Section 4.1      Authorized Stock. The total number of shares of all classes of stock that the Corporation is authorized to issue is one billion, eight hundred and ten million (1,810,000,000), consisting of:

 

(a)            1,200,000,0000 shares of Class A common stock, with a par value of $0.00001 per share (the “Class A Common Stock”);

 

(b)            300,000,000 shares of Class B-1 common stock, with a par value of $0.00001 per share (the “Class B-1 Common Stock”);

 

(c)            300,000,000 shares of Class B-2 common stock, with a par value of $0.00001 per share (the “Class B-2 Common Stock” and together with the Class A Common Stock and Class B-1 Common Stock, the “Common Stock”); and

 

 

(d)            10,000,000 shares of preferred stock, with a par value of $0.00001 per share (the “Preferred Stock”).

 

Section 4.2      Preferred Stock. The board of directors of the Corporation (the “Board of Directors”) is authorized, subject to any limitations prescribed by law or by that certain stockholders agreement, dated as of [●], 2021, by and among the Corporation and the other Persons party thereto (as it may be amended from time to time in accordance with its terms, the “Stockholders Agreement”) (for so long as it remains in effect), to provide, out of the unissued shares of Preferred Stock, for the issuance of shares of Preferred Stock in one or more series, and by filing a certificate pursuant to the applicable law of the State of Delaware (such certificate being hereinafter referred to as a “Preferred Stock Designation”), to establish from time to time the number of shares to be included in each such series and to fix the powers, designations, preferences and relative, participating, optional or other special rights, and qualifications, limitations or restrictions thereof, including, without limitation, the authority to fix or alter the dividend rights, dividend rates, conversion rights, exchange rights, voting rights, rights and terms of redemption (including sinking and purchase fund provisions), the redemption price or prices, restrictions on the issuance of shares of such series, the dissolution preferences and the rights in respect of any distribution of assets of any wholly unissued series of Preferred Stock and the number of shares constituting any such series, and the designation thereof, or any of them and to increase (but not above the total number of authorized shares of Preferred Stock) or decrease (but not below the number of shares of such series then outstanding) the number of shares of any series so created (except where otherwise provided in the Preferred Stock Designation), subsequent to the issue of that series. In case the authorized number of shares of any series shall be so decreased, the shares constituting such decrease shall resume the status which they had prior to the adoption of the resolution originally fixing the number of shares of such series. There shall be no limitation or restriction on any variation between any of the different series of Preferred Stock as to the designations, powers preferences and relative, participating, optional or other special rights, and the qualifications, limitations or restrictions thereof; and the several series of Preferred Stock may vary in any and all respects as fixed and determined by the resolution or resolutions of the Board of Directors or by a committee of the Board of Directors, providing for the issuance of the various series of Preferred Stock.

 

Section 4.3      Number of Authorized Shares. Subject to any limitations prescribed by the Stockholders Agreement, and except as set forth in any Preferred Stock Designation, the number of authorized shares of any of the Class A Common Stock, Class B-1 Common Stock, Class B-2 Common Stock or Preferred Stock may be increased or decreased (but not below the number of shares thereof then outstanding) by the affirmative vote of the holders of a majority of the voting power of all of the outstanding shares of stock of the Corporation entitled to vote thereon, irrespective of the provisions of Section 242(b)(2) of the DGCL, and no vote of the holders of shares of Class A Common Stock, Class B-1 Common Stock, Class B-2 Common Stock or Preferred Stock, or of any series thereof, separately as a class shall be required therefor.

 

Section 4.4      Common Stock. The powers, preferences and rights of the Class A Common Stock, the Class B-1 Common Stock and the Class B-2 Common Stock, and the qualifications, limitations or restrictions thereof are as follows:

 

(a)            Voting Rights. Except as otherwise required by law,

 

(i)            Each share of Class A Common Stock shall entitle the record holder thereof as of the applicable record date to one (1) vote per share in person or by proxy on all matters submitted to a vote of the holders of Class A Common Stock, whether voting separately as a class or otherwise.

 

(ii)            Each share of Class B-1 Common Stock shall entitle the record holder thereof as of the applicable record date to five (5) votes per share in person or by proxy on all matters submitted to a vote of the holders of Class B-1 Common Stock, whether voting separately as a class or otherwise.

 

(iii)            Each share of Class B-2 Common Stock shall entitle the record holder thereof as of the applicable record date to one (1) vote per share in person or by proxy on all matters submitted to a vote of the holders of Class B-2 Common Stock, whether voting separately as a class or otherwise.

 

 

(iv)            Except as otherwise required in this Certificate of Incorporation or by applicable law, the holders of shares of Class A Common Stock, Class B-1 Common Stock and Class B-2 Common Stock shall vote together as a single class (or, if any holders of shares of Preferred Stock are entitled to vote together with the holders of Class A Common Stock, Class B-1 Common Stock and Class B-2 Common Stock, as a single class with such holders of Preferred Stock) on all matters submitted to a vote of stockholders of the Corporation.

 

(v)            Except as otherwise required by law, holders of Class A Common Stock, Class B-1 Common Stock and Class B-2 Common Stock shall not be entitled to vote on any amendment to this Certificate of Incorporation (including any Preferred Stock Designation) that relates solely to the terms of one or more outstanding series of Preferred Stock if the holders of such affected series are entitled, either separately or together with the holders of one or more other such series, to vote thereon pursuant to this Certificate of Incorporation (including any Preferred Stock Designation).

 

(vi)            If at any time the ratio at which Common Units (as defined below) are redeemable or exchangeable for shares of Class A Common Stock is amended or adjusted pursuant to the LLC Agreement (as defined below), (A) the number of votes per share of Class B-1 Common Stock to which holders of shares of Class B-1 Common Stock are entitled pursuant to Section ‎4.4(a)(ii) of this Article IV shall be automatically adjusted so that from and after such time the aggregate number of votes that a holder of Class B-1 Common Stock is entitled to vote with respect to all shares of Class B-1 Common Stock held by such holder is equal to the number of Class A Common Stock subject to be exchanged or redeemed for all Common Units held by such holder and (B) the number of votes per share of Class B-2 Common Stock to which holders of shares of Class B-2 Common Stock are entitled pursuant to Section ‎4.4(a)(iii) of this Article IV shall be automatically adjusted so that from and after such time the aggregate number of votes that a holder of Class B-2 Common Stock is entitled to vote with respect to all shares of Class B-2 Common Stock held by such holder is equal to the number of Class A Common Stock subject to be exchanged or redeemed for all Common Units held by such holder.

 

(b)            Dividends; Stock Splits or Combinations.

 

(i)            Subject to applicable law and the rights, if any, of the holders of any outstanding series of Preferred Stock or of any class or series of stock having a preference over or the right to participate with the Class A Common Stock with respect to the payment of dividends, dividends may be declared and paid on the Class A Common Stock out of the assets or funds of the Corporation that are by law available therefor, at such times and in such amounts as the Board of Directors in its discretion shall determine. Dividends shall not be declared or paid on the Class B-1 Common Stock or the Class B-2 Common Stock; the holders of shares of Class B-1 Common Stock shall have no right to receive dividends in respect of such shares of Class B-1 Common Stock; and the holders of shares of Class B-2 Common Stock shall have no right to receive dividends in respect of such shares of Class B-2 Common Stock.

 

(ii)            In no event will any stock dividend, stock split, reverse stock split, combination of stock, reclassification or recapitalization be declared or made on the Class A Common Stock, the Class B-1 Common Stock or the Class B-2 Common Stock (each, a “Stock Adjustment”) unless (A) a corresponding Stock Adjustment on the Class A Common Stock, the Class B-1 Common Stock or the Class B-2 Common Stock, as the case may be, at the time outstanding is made in the same proportion and the same manner and (B) the Stock Adjustment has been reflected in the same economically equivalent manner on all LLC Units.

 

(iii)            Stock dividends paid on (A) the Class A Common Stock may only be paid in shares of Class A Common Stock, (B) the Class B-1 Common Stock may only be paid with shares of Class B-1 Common Stock and (C) the Class B-2 Common Stock may only be paid with shares of Class B-2 Common Stock.

 

(c)            Liquidation Rights. In the event of liquidation, dissolution or winding up of the affairs of the Corporation, whether voluntary or involuntary, after payment or provision for payment of the debts and other liabilities of the Corporation and after making provisions for preferential and other amounts, if any, to which the holders of Preferred Stock or any class or series of stock having a preference over or the right to participate with the Common Stock with respect to payments in liquidation shall be entitled, the remaining assets and funds of the Corporation available for distribution shall be divided among and paid ratably to the holders of all outstanding shares of Class A Common Stock in proportion to the number of shares of Class A Common Stock held by them. Without limiting the rights of the holders of Class B-1 Common Stock or Class B-2 Common Stock to have their Common Units redeemed or exchanged in accordance with Article IX of the LLC Agreement, neither the holders of shares of Class B-1 Common Stock nor the holders of Class B-2 Common Stock shall be entitled to receive any assets of the Corporation in any liquidation, dissolution or winding up. A consolidation, reorganization or merger of the Corporation with any other Person or Persons (as defined below), or a sale of all or substantially all of the assets of the Corporation, shall not be considered to be a dissolution, liquidation or winding up of the Corporation within the meaning of this Section 4.4(c).

 

 

(d)            Class B-1 Common Stock and Class B-2 Common Stock.

 

(i)            From and after the effectiveness of this Certificate of Incorporation with the Secretary of State of the State of Delaware (the “Effective Time”), (x) shares of Class B-1 Common Stock and Class B-2 Common Stock may be issued only to, and registered only in the name of, the Existing Owners and their respective Permitted Transferees (as defined below) in accordance with Section 4.5 (including all subsequent Permitted Transferees) (the Existing Owners together with such persons, collectively, the “Permitted Owners”) and (y) the aggregate number of shares of Class B-1 Common Stock and Class B-2 Common Stock at any time registered in the name of each such Permitted Owner must be equal to the aggregate number of Common Units held of record at such time by such Permitted Owner under the LLC Agreement (as defined below). As used in this Certificate of Incorporation, (A) “Existing Owner” means each of the holders of Common Units (other than the Corporation) of Fluence LLC, as set forth on Schedule A hereto, (B) “Common Unit” means a limited liability company interest in Fluence LLC, authorized and issued under the Third Amended and Restated Limited Liability Company Agreement of Fluence LLC, dated as of the date hereof, as such agreement may be further amended, restated, amended and restated, supplemented or otherwise modified from time to time (the “LLC Agreement”), and constituting a “Common Unit” as defined in such LLC Agreement and (C) “Permitted Transferee” means (1) the Corporation and any of its subsidiaries, (2) any Affiliate (as defined below) of the respective transferor, and (3) any transferee of Common Units pursuant to a transfer made in compliance with the LLC Agreement.

 

(ii)            Shares of Class B-1 Common Stock and Class B-2 Common Stock may be issued or transferred only in connection with the simultaneous issuance or transfer of an identical number of Common Units. Any purported issuance or transfer of shares of Class B-1 Common Stock or Class B-2 Common Stock not accompanied by a issuance or transfer of the identical number of Common Units shall be null and void and no force or effect, and the shares of Class B-1 Common Stock or Class B-2 Common Stock, as applicable, so issued or transferred shall be automatically transferred and to the Corporation and cancelled for no consideration.

 

(iii)            Each outstanding share of Class B-1 Common Stock shall automatically convert into one (1) validly issued, fully paid and nonassessable share of Class B-2 Common Stock upon the earliest of (A) any transfer by an Existing Owner of such shares of Class B-1 Common Stock other than to an Affiliate of such Existing Owner, (B) with respect to each Existing Owner and its Affiliates, 5:00 p.m. (New York City time) on a date fixed by the Board of Directors that is not less than 60 days nor more than 180 days following the date that such Existing Owner, together with its Affiliates, ceases to hold an aggregate number of shares of all classes of Common Stock representing at least twenty percent (20%) of the aggregate number of all outstanding shares of all classes of Common Stock, and (C) 5:00 p.m. (New York City time) on the date that is seven (7) years following the closing of the Corporation’s initial public offering of Class A Common Stock in a firm commitment underwritten offering pursuant to an effective registration statement under the Securities Act of 1933, as amended.

 

(iv)            In the event that there is a merger, consolidation or Change of Control (as defined below) of the Corporation, without limiting the rights of the holders of Class B-1 Common Stock and Class B-2 Common Stock to have their Common Units redeemed or exchanged in accordance with Article IX of the LLC Agreement, neither the holders of shares of Class B-1 Common Stock nor the holders of shares of Class B-2 Common Stock shall be entitled to receive any assets of the Corporation, whether in the form of consideration for such shares or in the form of a distribution of the proceeds of a sale of all or substantially all of the assets of the Corporation with respect to such shares.

 

 

(e)            Ratio of Common Stock to Common Units. The Corporation shall, to the fullest extent permitted by law, undertake all necessary and appropriate action within its control to ensure that (i) the number of shares of Class A Common Stock issued by the Corporation at any time is equal to the aggregate number of Common Units held of record by the Corporation, and (ii) the number of shares of Class B-1 Common Stock and Class B-2 Common Stock issued by the Corporation at any time to, or otherwise held of record by, any Permitted Owner is no more than the aggregate number of Common Units held of record by such Permitted Owner, in each case, in accordance with the terms of the LLC Agreement.

 

Section 4.5      Transfer of Class B-1 Common Stock and Class B-2 Common Stock.

 

(a)            A holder of Class B-1 Common Stock or Class B-2 Common Stock may surrender and transfer shares of such Class B-1 Common Stock or Class B-2 Common Stock, as applicable, to the Corporation for cancellation for no consideration at any time. Following the surrender and transfer, or other acquisition, of any shares of Class B-1 Common Stock or Class B-2 Common Stock to or by the Corporation, the shares shall automatically be cancelled and retired and such shares shall not be re-issued by the Corporation.

 

(b)            Except as set forth in Section 4.5(a), a holder of Class B-1 Common Stock or Class B-2 Common Stock may Transfer shares of Class B-1 Common Stock or Class B-2 Common Stock only to a Permitted Transferee of such holder, and only if such holder Transfers an equal number of such holder’s Common Units to such Permitted Transferee in compliance with the LLC Agreement. The Transfer restrictions described in this Section 4.5(b) are referred to as the “Restrictions”.

 

(c)            Any purported Transfer of shares of Class B-1 Common Stock or Class B-2 Common Stock in violation of the Restrictions shall be null and void ab initio. If, notwithstanding the Restrictions, a Person, voluntarily or involuntarily (including by way of a foreclosure), purportedly becomes or attempts to become, the purported owner (the “Purported Owner”) of shares of Class B-1 Common Stock or Class B-2 Common Stock in violation of the Restrictions, then the Purported Owner shall not obtain any rights in, to or with respect to such shares of Class B-1 Common Stock or Class B-2 Common Stock (the “Restricted Shares”), and each Restricted Share shall automatically, without any further action on the part of the Corporation, be transferred to the Corporation for no consideration and cancelled.

 

(d)            The Board of Directors may, to the extent permitted by law, from time to time establish, modify, amend or rescind, by law or otherwise, regulations and procedures not inconsistent with the provisions of this Section 4.5 for determining whether any Transfer or acquisition of shares of Class B-1 Common Stock or Class B-2 Common Stock would violate the Restrictions, and for the orderly application, administration and implementation of the provisions of this Section 4.5. Any such procedures and regulations shall be kept on file with the Secretary of the Corporation and with the Corporation’s transfer agent and shall be made available for inspection by and, upon written request shall be mailed to, any requesting holders of shares of Class B-1 Common Stock or Class B-2 Common Stock, as applicable.

 

(e)            As used in this Section 4.5, the term “Transfer”, as it relates to the shares of Class B-1 Common Stock or Class B-2 Common Stock, shall not be deemed to include any bona fide pledge or collateralization by a holder thereof to a financial institution in connection with any bona fide loan or debt transaction, but such term shall include any foreclosure on such shares by such financial institution following or in connection with any such pledge or collateralization.

 

Section 4.6      Certificates. All certificates or book entries representing shares of Class B-1 Common Stock or Class B-2 Common Stock shall bear a legend substantially in the following form (or in such other form as the Board of Directors may determine):

 

THE SECURITIES REPRESENTED HEREBY ARE SUBJECT TO THE RESTRICTIONS (INCLUDING RESTRICTIONS ON TRANSFER) SET FORTH IN THE CERTIFICATE OF INCORPORATION OF THE CORPORATION (A COPY OF WHICH IS ON FILE WITH THE SECRETARY OF THE CORPORATION AND SHALL BE PROVIDED FREE OF CHARGE TO ANY STOCKHOLDER MAKING A REQUEST THEREFOR).

 

 

Article V.

 

The Corporation shall at all times reserve and keep available out of its authorized but unissued shares of Class A Common Stock, solely for the purpose of effecting a redemption of the Common Units, such number of shares of Class A Common Stock as shall from time to time be sufficient to effect the redemption of all outstanding Common Units (other than those held by the Corporation and any direct or indirect majority-owned subsidiary of the Corporation) in exchange for shares of Class A Common Stock.

 

Article VI.

 

Subject to the Stockholders Agreement (for so long as it remains in effect), the Board of Directors is expressly authorized to adopt, amend, repeal or rescind the bylaws of the Corporation (the “Bylaws”). The affirmative vote of at least a majority of the Board of Directors then in office shall be required in order for the Board of Directors to adopt, amend, repeal, or rescind the Bylaws. The stockholders shall also have power to adopt, repeal, alter, amend or rescind the Bylaws. In addition to any vote of the holders of any class or series of stock of the Corporation required by applicable law or by this Certificate of Incorporation (including any Preferred Stock outstanding at any time), such adoption, repeal, alteration, amendment or rescission of the Bylaws by the stockholders shall require the affirmative vote of the holders of at least sixty-six and two-thirds percent (66 2/3%) of the voting power of the then outstanding shares of capital stock of the Corporation entitled to vote generally in the election of directors, voting together as a single class.

 

Article VII.

 

Section 7.1      Ballot. Elections of directors (each such director, in such capacity, a “Director”) need not be by written ballot unless the Bylaws shall so provide.

 

Section 7.2      Number and Terms of the Board of Directors. Subject to the terms of the Stockholders Agreement (for so long as it remains in effect) and the rights of the holders of any series of Preferred Stock to elect directors under specified circumstances, the number of Directors shall be fixed from time to time exclusively by resolution adopted by a majority of the total number of authorized directors (from time to time) whether or not there exist any vacancies in previously authorized directorships; provided, that for as long as the Stockholders Agreement is in effect, the number of Directors shall never be less than the aggregate number of Directors that the parties to the Stockholders Agreement are entitled to designate from time to time pursuant to Section 1 thereof.

 

Section 7.3      Newly Created Directorships and Vacancies. Except as otherwise required by law and subject to the Stockholders Agreement (for so long as it remains in effect) and the separate rights of the holders of any series of Preferred Stock then outstanding, unless the Board of Directors otherwise determines, newly created directorships resulting from any increase in the authorized number of directors or any vacancies on the Board of Directors resulting from the death, resignation, disqualification, removal from office or other cause shall be filled only by a majority vote of the Directors then in office, though less than a quorum, or by a sole remaining Director entitled to vote thereon, and not by the stockholders. Subject to the Stockholders Agreement (for so long as it remains in effect), any Director so chosen shall hold office until his or her successor shall be elected and qualified.

 

Section 7.4      Notice. Advance notice of stockholder nominations for election of Directors and other business to be brought by stockholders before a meeting of stockholders shall be given in the manner provided by the Bylaws.

 

Article VIII.

 

Subject to the rights of the holders of any series of Preferred Stock with respect to such series of Preferred stock, from and after the Voting Threshold Date (as defined below), any action required or permitted to be taken at any annual or special meeting of stockholders may only be taken at a duly called annual or special meeting of stockholders and may not be taken by written consent in lieu of a meeting. “Voting Threshold Date” shall mean 5:00 p.m. (New York City time) on the first day falling on or after the date on which the aggregate number of outstanding shares of Class B-1 Common Stock and Class B-2 Common Stock, voting together as a single class, cease to represent at least fifty percent (50%) of the total voting power of the outstanding shares of capital stock of the Corporation then entitled to vote generally in the election of directors.

 

 

Article IX.

 

Subject to the Stockholders Agreement (for so long as it remains in effect), the Corporation reserves the right to amend, alter, change or repeal any provision contained in this Certificate of Incorporation, in the manner now or hereafter prescribed by statute, and all rights conferred upon stockholders herein are granted subject to this reservation; provided that, notwithstanding any other provision of this Certificate of Incorporation or any provision of law that might otherwise permit a lesser vote or no vote, but in addition to any vote of the holders of any class or series of the stock of the Corporation, and, as applicable, such other approvals of the Board of Directors, as are required by law or by this Certificate of Incorporation, (A) the affirmative vote of the holders of sixty-six and two-thirds percent (66 2/3%) of the voting power of the outstanding shares of capital stock of the Corporation entitled to vote generally in the election of directors, voting together as a single class, shall be required to amend or repeal, or adopt any provision of this Certificate of Incorporation inconsistent with, Article IV, Article V, Article VI, Article VII, Article VIII, this Article IX, Article X, Article XI, Article XII, and Article XIII; and (B) for so long as any shares of Class B-1 Common Stock or Class B-2 Common Stock are outstanding, (i) the affirmative vote of the holders at least eighty percent (80%) of the shares of Class B-1 Common Stock and Class B-2 Common Stock outstanding at the time of such vote, voting together as a single class, shall be required to amend or repeal, or adopt any provision of this Certificate of Incorporation inconsistent with Section 4.4 of Article IV or this clause (B) of Article IX, and (ii) the affirmative vote of the holders of a majority of the shares of Class A Common Stock outstanding at the time of such vote, voting as a separate class, shall be required to amend or repeal, by merger or otherwise, or adopt any provision of this Certificate of Incorporation that provides the holders of the Class B-1 Common Stock or Class B-2 Common Stock (1) any rights to receive Dividends or any other kind of distribution, (2) other than redemptions as permitted by the LLC Agreement, any right to convert into or be exchanged for shares of Class A Common Stock or (3) any other economic rights.

 

If any provision or provisions of this Certificate of Incorporation shall be held to be invalid, illegal or unenforceable as applied to any Person or circumstance for any reason whatsoever, then, to the fullest extent permitted by law, the validity, legality and enforceability of such provisions in any other circumstance and of the remaining provisions of this Certificate of Incorporation (including, without limitation, each portion of any sentence of this Certificate of Incorporation containing any such provision held to be invalid, illegal or unenforceable that is not itself held to be invalid, illegal or unenforceable) and the application of such provision to other Persons and circumstances shall not in any way be affected or impaired thereby.

 

Article X.

 

The Corporation is authorized to indemnify, and to advance expenses to, each current or former Director, officer, employee or agent of the Corporation to the fullest extent permitted by Section 145 of the DGCL as it presently exists or may hereafter be amended. To the fullest extent permitted by the laws of the State of Delaware as it exists on the date hereof or as it may hereafter be amended, no Director shall be personally liable to the Corporation or its stockholders for monetary damages for any breach of his or her fiduciary duties as a director. No amendment to, or modification or repeal of, this Article X shall adversely affect any right or protection of a Director or of any officer, employee or agent of the Corporation existing hereunder with respect to any act or omission occurring prior to such amendment, modification or repeal.

 

 

Article XI.

 

Section 11.1      Corporate Opportunity.

 

(a)            To the fullest extent permitted by the laws of the State of Delaware and in accordance with Section 122(17) of the DGCL, (i) the Corporation hereby renounces all interest and expectancy that it otherwise would be entitled to have in, and all rights to be offered an opportunity to participate in, any business opportunity that from time to time may be presented to (1) AES Grid Stability, any Directors who are employees of or Affiliates of AES Grid Stability (other than any such Director who is also an employee of the Corporation or its subsidiaries), (2) Siemens Industry, any Directors who are employees of or Affiliates of Siemens Industry (other than any such Director who is also an employee of the Corporation or its subsidiaries), (3) QIA, any Directors who are employees of or Affiliates of QIA (other than any such Director who is also an employee of the Corporation or its subsidiaries) or (4) any Director or stockholder who is not employed by the Corporation or its subsidiaries (each such Person in clauses (1) through (4), an “Exempt Person”); (ii) no Exempt Person will have any duty to refrain from (1) engaging in a corporate opportunity in the same or similar lines of business in which the Corporation or its subsidiaries from time to time is engaged or proposes to engage or (2) otherwise competing, directly or indirectly, with the Corporation or any of its subsidiaries; and (iii) if any Exempt Person acquires knowledge of a potential transaction or other business opportunity which may be a corporate opportunity both for such Exempt Person or any of his or her respective Affiliates, on the one hand, and for the Corporation or its subsidiaries, on the other hand, such Exempt Person shall have no duty to communicate or offer such transaction or business opportunity to the Corporation or its subsidiaries and such Exempt Person may take any and all such transactions or opportunities for itself or offer such transactions or opportunities to any other Person. Notwithstanding the foregoing, the preceding sentence of this Section 11.1(a) shall not apply to any potential transaction or business opportunity (x) that is expressly offered to a Director, executive officer or employee of the Corporation or its subsidiaries, solely in his or her capacity as a Director, executive officer or employee of the Corporation or its subsidiaries or (y) is agreed to be offered to the Corporation by AES Grid Stability or Siemens Industry pursuant to contractual arrangements among such parties.

 

(b)            To the fullest extent permitted by the laws of the State of Delaware, no potential transaction or business opportunity may be deemed to be a corporate opportunity of the Corporation or its subsidiaries unless (i) the Corporation or its subsidiaries would be permitted to undertake such transaction or opportunity in accordance with this Certificate of Incorporation, (ii) the Corporation or its subsidiaries at such time have sufficient financial resources to undertake such transaction or opportunity, (iii) the Corporation or its subsidiaries have an interest or expectancy in such transaction or opportunity and (iv) such transaction or opportunity would be in the same or similar line of business in which the Corporation or its subsidiaries are then engaged or a line of business that is reasonably related to, or a reasonable extension of, such line of business.

 

Section 11.2      Liability. To the fullest extent permitted by law, no stockholder and no Director will be liable to the Corporation or its subsidiaries or stockholders for breach of any duty solely by reason of any activities or omissions of the types referred to in this Article XI, except to the extent such actions or omissions are in breach of this Article XI.

 

Article XII.

 

Unless the Corporation consents in writing to the selection of an alternative forum, (A) the Court of Chancery of the State of Delaware (or, if such court does not have subject matter jurisdiction thereof, the federal district court of the State of Delaware) shall, to the fullest extent permitted by law, be the sole and exclusive forum for: (i) any derivative action or proceeding brought on behalf of the Corporation, (ii) any action asserting a claim for or based on a breach of a fiduciary duty owed by any current or former director, officer, other employee, agent or stockholder of the Corporation to the Corporation or the Corporation’s stockholders, (iii) any action asserting a claim against the Corporation or any current or former director, officer, employee, agent or stockholder of the Corporation arising pursuant to any provision of the DGCL or the Corporation’s Certificate of Incorporation or Bylaws (as either may be amended and/or restated from time to time) or as to which the DGCL confers jurisdiction on the Court of Chancery of the State of Delaware, or (iv) any action asserting a claim related to or involving the Corporation that is governed by the internal affairs doctrine; and (B) subject to the preceding provisions of this Article XII, the federal district courts of the United States of America shall, to the fullest extent permitted by law, be the sole and exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.

 

 

Notwithstanding the foregoing, this Article XII shall not apply to claims seeking solely to enforce any liability or duty created by the Securities Exchange Act of 1934, as amended, or any other claim for which the U.S. federal courts have exclusive jurisdiction.

 

To the fullest extent permitted by law, any person or entity purchasing or otherwise acquiring or holding any interest in shares of capital stock of the Corporation shall be deemed to have notice of and consented to the provisions of this Article XII.

 

Article XIII.

 

Section 13.1      Section 203 of the DGCL. The Corporation expressly elects not to be governed by Section 203 of the DGCL and the restrictions and limitations set forth therein.

 

Section 13.2      Interested Stockholder Transactions. Notwithstanding anything to the contrary set forth in this Certificate of Incorporation, the Corporation shall not engage in any Business Combination (as defined below) at any point in time at which the Corporation’s Class A Common Stock or Class B-1 Common Stock is registered under Section 12(b) or 12(g) of the Exchange Act with any Interested Stockholder (as defined below) for a period of three (3) years following the time that such stockholder became an Interested Stockholder, unless:

 

(a)            prior to such time that such stockholder became an Interested Stockholder, the Board of Directors approved either the Business Combination or the transaction which resulted in such stockholder becoming an Interested Stockholder; or

 

(b)            at or subsequent to such time that such stockholder became an Interested Stockholder, the Business Combination is approved by the Board of Directors and authorized at an annual or special meeting of stockholders by the affirmative vote of at least sixty-six and two-thirds percent (66 2/3%) of the voting power of the outstanding shares of capital stock of the Corporation which is not owned by such Interested Stockholder; or

 

(c)            upon consummation of the transaction which resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least eighty-five percent (85%) of the voting stock of the corporation outstanding at the time the transaction commenced, excluding for purposes of determining the voting stock outstanding (but not the outstanding voting stock owned by the interested stockholder) those shares owned (i) by persons who are directors and also officers and (ii) employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; or

 

(d)            a stockholder becomes an interested stockholder inadvertently and (A) as soon as practicable divests itself of ownership of sufficient shares so that the stockholder ceases to be an interested stockholder; and (B) would not, at any time within the three- year period immediately prior to a business combination between the Corporation and such stockholder, have been an interested stockholder but for the inadvertent acquisition of ownership; or

 

(e)            the business combination is proposed prior to the consummation or abandonment of and subsequent to the earlier of the public announcement or the notice required hereunder of a proposed transaction which (A) constitutes one of the transactions described in the second sentence of this Section 13 of Article XIII; (B) the business combination is with or by a person who either was not an interested stockholder during the previous three years or who became an interested stockholder with the approval of the Board; and (C) is approved or not opposed by a majority of the directors then in office (but not less than one) who were directors prior to any person becoming an interested stockholder during the previous three years or were recommended for election or elected to succeed such directors by a majority of such directors. The proposed transactions referred to in the preceding sentence are limited to (x) a merger or consolidation of the Corporation (except for a merger in respect of which, pursuant to Section 251(f) of the DGCL, no vote of the stockholders of the Corporation is required); (y) a sale, lease, exchange, mortgage, pledge, transfer or other disposition (in one transaction or a series of transactions), whether as part of a dissolution or otherwise, of assets of the Corporation or of any direct or indirect majority-owned subsidiary of the Corporation (other than to any direct or indirect wholly-owned subsidiary or to the Corporation) having an aggregate market value equal to fifty percent (50%) or more of either that aggregate market value of all of the assets of the Corporation determined on a consolidated basis or the aggregate market value of all the outstanding stock (as defined hereinafter) of the Corporation; or (z) a proposed tender or exchange offer for fifty percent (50%) or more of the outstanding voting stock of the Corporation. The Corporation shall give not less than 20 days’ notice to all interested stockholders prior to the consummation of any of the transactions described in clause (x) or (y) of the second sentence of this Section 13(ii) of Article XIII.

 

 

Section 13.3      Definitions. As used in this Certificate of Incorporation, the following terms shall have the following meaning:

 

(a)            “AES Grid Stability” means AES Grid Stability, LLC, a Delaware limited liability company.

 

(b)            “AES Related Parties” means AES Grid Stability and its Affiliates.

 

(c)            “Affiliate” means a Person that directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, another Person;

 

(d)            “Associate”, when used to indicate a relationship with any Person, means: (i) any corporation, partnership, unincorporated association or other entity of which such Person is a director, officer or partner or is, directly or indirectly, the owner of twenty percent (20%) or more of any class of shares of voting stock of the Corporation; (ii) any trust or other estate in which such Person has at least a twenty percent (20%) beneficial interest or as to which such Person serves as trustee or in a similar fiduciary capacity; and (iii) any relative or spouse of such Person, or any relative of such spouse, who has the same residence as such Person.

 

(e)            “Business Combination” means (i) any merger or consolidation of the Corporation or any direct or indirect majority-owned subsidiary of the Corporation with the Interested Stockholder or (ii) any sale, lease, exchange, mortgage, pledge, Transfer or other disposition (in one transaction or a series of transactions), except proportionately as a stockholder of the Corporation, to or with the Interested Stockholder, whether as part of a dissolution or otherwise, of assets of the Corporation or of any direct or indirect majority-owned subsidiary of the Corporation which assets have an aggregate market value equal to ten percent (10%) or more of either the aggregate market value of all the assets of the Corporation determined on a consolidated basis or the aggregate market value of all the outstanding shares of capital stock of the Corporation.

 

(f)            “Change of Control” means the occurrence of any of the following events: (1) any “person” or “group” (within the meaning of Sections 13(d) and 14(d) of the Exchange Act, but excluding any employee benefit plan of such person and its subsidiaries, and any person or entity acting in its capacity as trustee, agent or other fiduciary or administrator of any such plan) becomes the “beneficial owner” (within the meaning of Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of shares of Class A Common Stock, Class B-1 Common Stock, Preferred Stock and/or any other class or classes of capital stock of the Corporation (if any) representing in the aggregate more than fifty percent (50%) of the voting power of all of the outstanding shares of capital stock of the Corporation entitled to vote; (2) the stockholders of the Corporation approve a plan of complete liquidation or dissolution of the Corporation or there is consummated a transaction or series of related transactions for the sale), lease, exchange or other disposition, directly or indirectly, by the Corporation of all or substantially all of the Corporation’s assets (including a sale of all or substantially all of the assets of Fluence LLC); (3) there is consummated a merger or consolidation of the Corporation with any other corporation or entity, and, immediately after the consummation of such merger or consolidation, the voting securities of the Corporation immediately prior to such merger or consolidation do not continue to represent, or are not converted into, voting securities representing more than fifty percent (50%) of the combined voting power of the outstanding voting securities of the Person resulting from such merger or consolidation or, if the surviving company is a subsidiary, the ultimate parent thereof; or (4) the Corporation ceases to be the sole managing member of Fluence LLC; provided, however, that a “Change of Control” shall not be deemed to have occurred by virtue of the consummation of any transaction or series of related transactions immediately following which (a) the beneficial owners of the Class A Common Stock, Class B-1 Common Stock, Preferred Stock and/or any other class or classes of capital stock of the Corporation immediately prior to such transaction or series of transactions continue to have substantially the same proportionate ownership in and voting control over, and own substantially all of the shares of, an entity which owns all or substantially all of the assets of the Corporation immediately following such transaction or series of transactions or (b) in the case of the foregoing clauses (1) or (3), either the AES Related Parties or the Siemens Related Parties are the “beneficial owner” (within the meaning of Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of shares of Class A Common Stock, Class B-1 Common Stock, Preferred Stock and/or any other class or classes of capital stock of the Corporation (if any) representing in the aggregate more than fifty percent (50%) of the voting power of all of the outstanding shares of capital stock of the Corporation entitled to vote (or), in the case of a transaction described in the foregoing clause (3), more than fifty percent (50%) of the combined voting power of the then outstanding voting securities of the Person resulting from such merger of consolidation or, if the surviving company is a subsidiary, the ultimate parent thereof).

 

 

(g)            “Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended, and any applicable rules and regulations promulgated thereunder, and any successor to such statute, rules or regulations.

 

(h)            “Interested Stockholder” means any Person (other than the Corporation and any direct or indirect majority-owned subsidiary of the Corporation) that (i) is the beneficial owner (within the meaning of Rules 13d-3 and 13d-5 under the Exchange Act) of fifteen percent (15%) or more of the outstanding shares of capital stock of the Corporation that are entitled to vote generally in an election of directors, or (ii) is an Affiliate of the Corporation and was the beneficial owner of fifteen percent (15%) or more of the outstanding shares of capital stock of the Corporation that are entitled to vote generally in an election of directors at any time within the three-year period immediately prior to the date on which it is sought to be determined whether such Person is an Interested Stockholder, and the Affiliates and Associates of such Person. Notwithstanding anything in this Article XIII to the contrary, the term “Interested Stockholder” shall not include: (x) the AES Related Parties or any of their current or future Affiliates (so long as such Affiliate remains an Affiliate) or Associates or any other Person with whom any of the foregoing are acting as a group or in concert for the purpose of acquiring, holding, voting or disposing of shares of capital stock of the Corporation, (y) the Siemens Related Parties or any of their current or future Affiliates (so long as such Affiliate remains an Affiliate) or Associates, or any other Person with whom any of the foregoing are acting as a group or in concert for the purpose of acquiring, holding, voting or disposing of shares of capital stock of the Corporation, or (z) any Person who acquires beneficial ownership of fifteen percent (15%) or more of the then- outstanding shares of capital stock of the Corporation that are entitled to vote generally in an election of directors directly or indirectly from a AES Related Party or a Siemens Related Party, and excluding, for the avoidance of doubt, any Person who acquires voting stock of the Corporation through a broker’s transaction executed on any securities exchange or other over-the-counter market or pursuant to an underwritten public offering.

 

(i)            “Person” means any individual, corporation, partnership, limited liability company, unincorporated association or other entity.

 

(j)            “QIA” refers to QIA Florence Holding LLC.

 

(k)            “Securities Act” means the U.S. Securities Act of 1933, as amended, and applicable rules and regulations promulgated thereunder, and any successor to such statute, rules or regulations.

 

(l)            “Siemens Industry” refers to Siemens Industry, Inc., a Delaware corporation.

 

(m)            “Siemens Related Parties” means Siemens Industry and its Affiliates.

 

(n)            “Transfer” (and, with a correlative meaning, “Transferring”) means any sale, transfer, assignment, redemption or other disposition of (whether directly or indirectly, whether with or without consideration and whether voluntarily or involuntarily or by operation of Law) (a) any interest (legal or beneficial) in any shares of capital of stock of the Corporation or (b) any equity or other interest (legal or beneficial) in any stockholder if substantially all of the assets of such stockholder consist solely of shares of capital stock of the Corporation.

 

*      *      *

 

 

IN WITNESS WHEREOF, the Corporation has caused this Certificate of Incorporation to be signed on [●], 2021.

 

	FLUENCE ENERGY, INC.
	By:
	Name:
	Title:

 

[Signature Page to Amended and Restated Certificate of Incorporation]

 

 

SCHEDULE A

 

ISSUANCE OF CLASS B-1 COMMON STOCK

 

 

 

Exhibit 3.4

 

 

AMENDED AND RESTATED BYLAWS

 

OF

 

FLUENCE ENERGY, INC.

 

Dated as of [●], 2021

 

 

 

CONTENTS

 

Page

 

Article I. Meetings of Stockholders		1
Section 1.01	Place of Meetings	1
Section 1.02	Annual Meetings	1
Section 1.03	Special Meetings	1
Section 1.04	Notice of Meetings	1
Section 1.05	Adjournments	2
Section 1.06	Quorum	2
Section 1.07	Organization	2
Section 1.08	Voting; Proxies	3
Section 1.09	Fixing Date for Determination of Stockholders of Record	3
Section 1.10	List of Stockholders Entitled to Vote	4
Section 1.11	Action by Written Consent in Lieu of a Meeting	5
Section 1.12	Inspectors of Election	5
Section 1.13	Conduct of Meetings	6
Section 1.14	Advance Notice Procedures for Business Brought before a Meeting	6
Section 1.15	Advance Notice Procedures for Nominations of Directors	10
Article II. Board of Directors		13
Section 2.01	Number; Tenure; Qualifications	13
Section 2.02	Election; Resignation; Removal; Vacancies	13
Section 2.03	Regular Meetings	14
Section 2.04	Special Meetings	14
Section 2.05	Telephonic Meetings Permitted	14
Section 2.06	Quorum; Vote Required for Action	14
Section 2.07	Organization	14
Section 2.08	Action by Unanimous Consent of Directors	15
Section 2.09	Compensation of Directors	15
Section 2.10	Chairperson	15
Article III. Committees		15
Section 3.01	Committees	15
Section 3.02	Committee Minutes	16
Section 3.03	Committee Rules	16
Article IV. Officers		16
Section 4.01	Officers	16
Section 4.02	Appointment of Officers	16
Section 4.03	Subordinate Officers	16
Section 4.04	Removal and Resignation of Officers	17
Section 4.05	Vacancies in Offices	17

 

 

Section 4.06	Chief Executive Officer	17
Section 4.07	President	17
Section 4.08	Vice Presidents and Senior Vice Presidents	17
Section 4.09	Secretary	17
Section 4.10	Chief Financial Officer	18
Section 4.11	Treasurer	18
Section 4.12	Representation of Shares of Other Entities	18
Section 4.13	Authority and Duties of Officers	18
Section 4.14	Compensation	19
Article V. Stock		19
Section 5.01	Certificates	19
Section 5.02	Lost, Stolen or Destroyed Stock Certificates; Issuance of New Certificates	19
Article VI. Indemnification and Advancement of Expenses		19
Section 6.01	Right to Indemnification	19
Section 6.02	Indemnification of Others	20
Section 6.03	Advancement of Expenses	20
Section 6.04	Claims	20
Section 6.05	Non-exclusivity of Rights	20
Section 6.06	Insurance	20
Section 6.07	Other Sources	21
Section 6.08	Continuation of Indemnification	21
Section 6.09	Amendment or Repeal	21
Section 6.10	Other Indemnification and Advancement of Expenses	21
Article VII. Miscellaneous		21
Section 7.01	Fiscal Year	21
Section 7.02	Execution of Corporate Contracts and Instruments	21
Section 7.03	Dividends	21
Section 7.04	Registered Stockholders	21
Section 7.05	Corporate Seal	22
Section 7.06	Construction; Definitions	22
Section 7.07	Manner of Notice	22
Section 7.08	Waiver of Notice of Meetings of Stockholders, Directors and Committees	23
Section 7.09	Form of Records	23
Section 7.10	Amendment of Bylaws	23

 

 

Article I.
Meetings of Stockholders

 

Section 1.01      Place of Meetings. Meetings of stockholders of Fluence Energy, Inc., a Delaware corporation (the “Corporation”; and such stockholders, the “Stockholders”), may be held at any place, within or without the State of Delaware, as may be designated by or in the manner determined by the board of directors of the Corporation (the “Board of Directors”). In the absence of such designation, meetings of Stockholders shall be held at the principal executive office of the Corporation. The Board of Directors may, in its sole discretion, determine that a meeting of Stockholders shall not be held at any place, but may instead be held solely by means of remote communication authorized by and in accordance with Section 211(a) of the General Corporation Law of the State of Delaware (the “DGCL”).

 

Section 1.02      Annual Meetings. The annual meeting of Stockholders shall be held for the election of members of the Board of Directors (the “Directors”) at such date and time as may be designated by or in the manner determined by resolution of the Board of Directors from time to time. Any other business as may be properly brought before the annual meeting of Stockholders may be transacted at the annual meeting of Stockholders. The Board of Directors may postpone, reschedule or cancel any annual meeting of Stockholders previously scheduled by the Board of Directors.

 

Section 1.03      Special Meetings. Special meetings of the Stockholders may be called only by such persons and only in such manner as may be set forth in the Certificate of Incorporation of the Corporation (as the same may be amended, restated, amended and restated or otherwise modified from time to time, the “Certificate of Incorporation”) and in these bylaws. From and after the Voting Threshold Date (as defined in the Certificate of Incorporation), special meetings of Stockholders for any purpose or purposes may be called only by (i) the chairperson of the Board of Directors (the “Chairperson”) or (ii) an officer of the Corporation pursuant to a resolution adopted by a majority of the Directors then in office. Special meetings of Stockholders validly called in accordance with this Section 1.03 of these bylaws (as the same may be amended, restated, amended and restated or otherwise modified from time to time, these “Bylaws”) may be held at such date and time as specified in the applicable notice of such meeting. Notice of every special meeting of Stockholders shall state the purpose or purposes of the meeting, and the business transacted at any special meeting of Stockholders shall be limited to the purpose or purposes stated in the notice. Upon the prior written consent of a majority of the Directors then in office, the Board of Directors may postpone, reschedule or cancel any special meeting of Stockholders previously scheduled by the Chairperson or Board of Directors.

 

Section 1.04      Notice of Meetings. Whenever Stockholders are required or permitted to take any action at a meeting of Stockholders, a notice of the meeting shall be given that shall state the place, if any, date and hour of the meeting, the means of remote communications, if any, by which Stockholders and proxy holders may be deemed to be present in person and vote at such meeting, the record date for determining the Stockholders entitled to vote at the meeting (if such date is different from the record date for Stockholders entitled to notice of the meeting) and, in the case of a special meeting of Stockholders, the purpose or purposes for which the meeting is called. Unless otherwise required by applicable law, the Certificate of Incorporation or these Bylaws, the notice of any meeting of Stockholders shall be given not less than 10 nor more than 60 days before the date of the meeting to each Stockholder entitled to vote at the meeting as of the record date for determining the Stockholders entitled to notice of the meeting. If mailed, such notice shall be deemed to be given when deposited in the United States mail, postage prepaid, directed to the Stockholder at such Stockholder’s address as it appears on the records of the Corporation.

 

 

Section 1.05      Adjournments. Any meeting of Stockholders, annual or special, may be adjourned from time to time by the chairperson of the meeting (or by the Stockholders in accordance with Section 1.06) to reconvene at the same or some other place, if any, and the same or some other time, and notice need not be given to the Stockholders of any such adjourned meeting if the time and place, if any, thereof, and the means of remote communications, if any, by which Stockholders and proxy holders may be deemed to be present in person and vote at such adjourned meeting are announced at the meeting at which the adjournment is taken. At the adjourned meeting of Stockholders, the Corporation may transact any business which might have been transacted at the original meeting of Stockholders. If the adjournment is for more than 30 days, a notice of the adjourned meeting of Stockholders shall be given to each Stockholder of record entitled to vote at the adjourned meeting of Stockholders. If after the adjournment a new record date for determination of Stockholders entitled to vote is fixed for the adjourned meeting of Stockholders, the Board of Directors shall fix a new record date for determining Stockholders entitled to notice of such adjourned meeting of Stockholders in accordance with Section 1.09(a) of these Bylaws, and shall give notice of the adjourned meeting of Stockholders to each Stockholder of record entitled to vote at such adjourned meeting of Stockholders as of the record date fixed for notice of such adjourned meeting of Stockholders. If mailed, such notice shall be deemed to be given when deposited in the United States mail, postage prepaid, directed to the Stockholder at such Stockholder’s address as it appears on the records of the Corporation.

 

Section 1.06      Quorum. At any meeting of the Stockholders, the holders of a majority of the voting power of the outstanding shares of capital stock of the Corporation (“Stock”) entitled to vote at the meeting, present in person or represented by proxy, shall constitute a quorum for all purposes, unless or except to the extent that the presence of a larger number may be required by applicable law, the rules of any stock exchange upon which the Corporation’s securities are listed, the Certificate of Incorporation or these Bylaws. In the absence of a quorum, then either (i) the chairperson of the meeting or (ii) the Stockholders by the affirmative vote of a majority of the voting power of the outstanding shares of Stock entitled to vote thereon, present in person or represented by proxy, shall have the power to adjourn the meeting of Stockholders from time to time in the manner provided in Section 1.05 of these Bylaws until a quorum is present or represented. Where a separate vote by a class or classes or series of Stock is required by applicable law or the Certificate of Incorporation, the holders of a majority of voting power of the shares of such class or classes or series of Stock issued and outstanding and entitled to vote on such matter, present in person or represented by proxy, shall constitute a quorum entitled to take action with respect to the vote on such matter. A quorum, once established at a meeting, shall not be broken by the withdrawal of enough votes to leave less than a quorum.

 

Section 1.07      Organization. Meetings of Stockholders shall be presided over by the Chairperson or by such other officer of the Corporation or Director as designated by the Board of Directors or the Chairperson, or in the absence of such person or designation, by a chairperson chosen at the meeting by the affirmative vote of a majority of the voting power of the outstanding shares of Stock present or represented at the meeting and entitled to vote at the meeting (provided there is a quorum). The Secretary of the Corporation (“Secretary”) shall act as secretary of the meeting, but in his or her absence, the chairperson of the meeting may appoint any person to act as secretary of the meeting.

 

 

Section 1.08      Voting; Proxies. Each Stockholder entitled to vote at any meeting of Stockholders shall be entitled to the number of votes, if any, for each share of Stock held of record by such Stockholder which has voting power upon the matter in question as set forth in the Certificate of Incorporation. Each Stockholder entitled to vote at a meeting of Stockholders or express consent to corporate action in writing without a meeting (if permitted by the Certificate of Incorporation) may authorize another person or persons to act for such Stockholder by proxy, but no such proxy shall be voted or acted upon after three years from its date, unless the proxy provides for a longer period. A proxy may be authorized by an instrument in writing or by a transmission permitted by law filed in accordance with the procedure established for the meeting. A proxy shall be irrevocable if it states that it is irrevocable and if, and only as long as, it is coupled with an interest sufficient in law to support an irrevocable power. A Stockholder may revoke any proxy which is not irrevocable by attending the meeting and voting in person (or by means of remote communication, if applicable) or by delivering to the Secretary a revocation of the proxy or a new proxy bearing a later date. Voting at meetings of Stockholders need not be by written ballot. Unless otherwise provided in the Certificate of Incorporation, at all meetings of Stockholders for the election of Directors at which a quorum is present, a plurality of the votes cast shall be sufficient to elect Directors. No holder of shares of Stock shall have the right to cumulate votes. All other elections and questions presented to the Stockholders at a meeting at which a quorum is present shall be decided by the affirmative vote of the holders of a majority of votes cast (excluding abstentions and broker non-votes) on such matter, unless a different or minimum vote is required by the Certificate of Incorporation, these Bylaws, the rules or regulations of any stock exchange applicable to the Corporation, or applicable law or pursuant to any regulation applicable to the Corporation or its securities, in which case such different or minimum vote shall be the applicable vote on the matter.

 

Section 1.09      Fixing Date for Determination of Stockholders of Record.

 

(a)            In order that the Corporation may determine the Stockholders entitled to notice of any meeting of Stockholders or any adjournment thereof, the Board of Directors may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board of Directors, and which record date shall, unless otherwise required by applicable law, not be more than 60 nor less than 10 days before the date of such meeting. If the Board of Directors so fixes a date, such date shall also be the record date for determining the Stockholders entitled to vote at such meeting unless the Board of Directors determines, at the time it fixes such record date, that a later date on or before the date of the meeting shall be the date for making such determination. If no record date is fixed by the Board of Directors, the record date for determining Stockholders entitled to notice of and to vote at a meeting of Stockholders shall be at the close of business on the day immediately preceding the day on which notice is given, or, if notice is waived, at the close of business on the day immediately preceding the day on which the meeting is held. A determination of Stockholders of record entitled to notice of or to vote at a meeting of Stockholders shall apply to any adjournment of the meeting; provided, however, that the Board of Directors may fix a new record date for determination of Stockholders entitled to vote at the adjourned meeting, and in such case shall also fix as the record date for Stockholders entitled to notice of such adjourned meeting the same or an earlier date as that fixed for determination of Stockholders entitled to vote in accordance with the foregoing provisions of this Section 1.09(a) at the adjourned meeting.

 

 

(b)            In order that the Corporation may determine the Stockholders entitled to receive payment of any dividend or other distribution or allotment of any rights, or entitled to exercise any rights in respect of any change, conversion or exchange of Stock or for the purpose of any other lawful action, the Board of Directors may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted, and which record date shall not be more than 60 days prior to such action. If no such record date is fixed, the record date for determining Stockholders for any such purpose shall be at the close of business on the day on which the Board of Directors adopts the resolution relating thereto.

 

(c)            Unless otherwise restricted by the Certificate of Incorporation, in order that the Corporation may determine the Stockholders entitled to consent to corporate action in writing without a meeting, the Board of Directors may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board of Directors, and which record date shall not be more than 10 days after the date upon which the resolution fixing the record date is adopted by the Board of Directors. If no record date for determining Stockholders entitled to consent to corporate action in writing without a meeting is fixed by the Board of Directors, (i) when no prior action of the Board of Directors is required by applicable law or the Certificate of Incorporation, the record date for such purpose shall be the first date on which a signed written consent setting forth the action taken or proposed to be taken is delivered to the Corporation in accordance with applicable law and (ii) if prior action by the Board of Directors is required by applicable law or the Certificate of Incorporation, the record date for such purpose shall be at the close of business on the day on which the Board of Directors adopts the resolution taking such prior action.

 

Section 1.10      List of Stockholders Entitled to Vote. The Corporation shall prepare, at least 10 days before every meeting of Stockholders, a complete list of the Stockholders entitled to vote at the meeting (provided, however, if the record date for determining the Stockholders entitled to vote is less than 10 days before the date of the meeting, the list shall reflect the Stockholders entitled to vote as of the 10^th day before the meeting date), arranged in alphabetical order, and showing the address of each Stockholder and the number of shares registered in the name of each Stockholder as of the record date (or such other date). Such list shall be open to the examination of any Stockholder, for any purpose germane to the meeting at least 10 days prior to the meeting (i) on a reasonably accessible electronic network, provided that the information required to gain access to such list is provided with the notice of the meeting or (ii) during ordinary business hours at the principal place of business of the Corporation. If the meeting is to be held at a place, then a list of Stockholders entitled to vote at the meeting shall be produced and kept at the time and place of the meeting during the whole time thereof and may be examined by any Stockholder who is present. If the meeting is to be held solely by means of remote communication, then the list shall also be open to the examination of any Stockholder during the whole time of the meeting on a reasonably accessible electronic network, and the information required to access such list shall be provided with the notice of the meeting. Except as otherwise provided by law, the “stock ledger” shall be the only evidence as to who are the Stockholders entitled to examine the list of Stockholders required by this Section 1.10 or to vote in person or by proxy at any meeting of Stockholders. For purposes of these Bylaws, the term “stock ledger” means one or more records administered by or on behalf of the Corporation in which the names of all of the Corporation’s Stockholders of record, the address and number of shares registered in the name of each such Stockholder, and all issuances and transfers of stock of the Corporation are recorded.

 

 

Section 1.11      Action by Written Consent in Lieu of a Meeting. Any action required or permitted to be taken at any annual or special meeting of Stockholders may be taken without a meeting, without prior notice and without a vote, only (i) to the extent set forth in the Certificate of Incorporation of the Corporation, and (ii) if a consent or consents in writing, setting forth the action so taken, are signed by the holders of outstanding shares of the relevant class(es) or series of Stock representing not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares of Stock then issued and outstanding (other than treasury Stock) entitled to vote thereon were present and voted and are delivered to the Corporation by delivery to its registered office in Delaware, its principal place of business, or to an officer or agent of the Corporation having custody of the book in which proceedings of meetings of Stockholders are recorded. Delivery made to the Corporation’s registered office shall be by hand or by certified or registered mail, return receipt requested.

 

Section 1.12      Inspectors of Election. The Corporation may, and shall if required by law, in advance of any meeting of Stockholders, appoint one or more inspectors of election, who may be employees of the Corporation, to act at the meeting or any adjournment thereof and to make a written report thereof. The Corporation may designate one or more persons as alternate inspectors to replace any inspector who fails to act. In the event that no inspector so appointed or designated is able to act at a meeting of Stockholders, the person presiding at the meeting may, and to the extent required by law, shall appoint one or more inspectors to act at the meeting. Each inspector, before entering upon the discharge of his or her duties, shall take and sign an oath to execute faithfully the duties of inspector with strict impartiality and according to the best of his or her ability. Any report or certificate made by the inspectors of election is prima facie evidence of the facts stated therein. The inspector or inspectors so appointed or designated shall (i) ascertain the number of shares of Stock outstanding and the voting power of each such share, (ii) determine the shares of Stock represented at the applicable meeting of the Stockholders and the validity of proxies and ballots, (iii) count all votes and ballots, (iv) determine and retain for a reasonable period a record of the disposition of any challenges made to any determination by the inspectors, and (v) certify their determination of the number of shares of Stock represented at the meeting and such inspectors’ count of all votes and ballots. Such certification and report shall specify such other information as may be required by applicable law. In determining the validity and counting of proxies and ballots cast at any meeting of Stockholders, the inspectors may consider such information as is permitted by applicable law. No person who is a candidate for an office at an election may serve as an inspector at such election.

 

 

Section 1.13      Conduct of Meetings. The date and time of the opening and the closing of the polls for each matter upon which the Stockholders will vote at a meeting of the Stockholders shall be announced at the meeting by the person presiding over the meeting designated in accordance with Section 1.07 of these Bylaws. After the polls close, no ballots, proxies or votes or any revocations or changes thereto may be accepted. The Board of Directors may adopt by resolution such rules and regulations for the conduct of the meeting of Stockholders as it shall deem appropriate. Except to the extent inconsistent with such rules and regulations as adopted by the Board of Directors, the person presiding over any meeting of Stockholders shall have the right and authority to convene and (for any or no reason) to recess and/or adjourn the meeting, to prescribe such rules, regulations and procedures and to do all such acts as, in the judgment of such presiding person, are appropriate for the proper conduct of the meeting. Such rules, regulations or procedures, whether adopted by the Board of Directors or prescribed by the presiding person of the meeting, may include, without limitation, the following: (i) the establishment of an agenda or order of business for the meeting; (ii) rules and procedures for maintaining order at the meeting and the safety of those present; (iii) limitations on attendance at or participation in the meeting to Stockholders entitled to vote at the meeting, their duly authorized and constituted proxies or such other persons as the presiding person of the meeting shall determine; (iv) restrictions on entry to the meeting after the time fixed for the commencement thereof; and (v) limitations on the time allotted to questions or comments by participants. The presiding person at any meeting of Stockholders, in addition to making any other determinations that may be appropriate to the conduct of the meeting, shall, if the facts warrant, determine that a matter or business was not properly brought before the meeting and if such presiding person should so determine, such presiding person shall so declare to such meeting and any such matter or business not properly brought before the meeting shall not be transacted or considered. Unless and to the extent determined by the Board of Directors or the person presiding over the applicable meeting of Stockholders, meetings of Stockholders shall not be required to be held in accordance with the rules of parliamentary procedure.

 

Section 1.14      Advance Notice Procedures for Business Brought before a Meeting. This Section 1.14 shall apply to any business that may be brought before an annual meeting of Stockholders other than nominations for election to the Board of Directors at such a meeting, which shall be governed by Section 1.15 of these Bylaws. Stockholders seeking to nominate Persons for election to the Board of Directors must comply with Section 1.15 of these Bylaws, and this Section 1.14 shall not be applicable to nominations for election to the Board of Directors except as expressly provided in Section 1.15 of these Bylaws.

 

(a)            At an annual meeting of the Stockholders, only such business shall be conducted as shall have been properly brought before the meeting. To be properly brought before an annual meeting of the Stockholders, business must be (a) specified in a notice of meeting of the Stockholders given by or at the direction of the Board of Directors or a duly authorized committee thereof, (b) if not specified in a notice of meeting of the Stockholders, otherwise brought before the meeting by the Board of Directors or the chairperson of the meeting, or (c) otherwise properly brought before the meeting by a Stockholder present in person who (A)(1) was a Stockholder of record of the Corporation both at the time of giving the notice provided for in this Section 1.14 and at the time of the meeting, (2) is entitled to vote at the meeting and (3) has complied with this Section 1.14 or (B) properly made such proposal in accordance with Rule 14a-8 under the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder (as so amended and inclusive of such rules and regulations, the “Exchange Act”). The foregoing clause (c) shall be the exclusive means for a Stockholder to propose business to be brought before an annual meeting of the Stockholders. The only matters that may be brought before a special meeting of the Stockholders are the matters specified in the Corporation’s notice of meeting of the Stockholders given by or at the direction of the Person calling the meeting pursuant to the Certificate of Incorporation and Section 1.03 of these Bylaws. For purposes of these Bylaws, “Person” shall mean any individual, general partnership, limited partnership, limited liability company, corporation, trust, business trust, joint stock company, joint venture, unincorporated association, cooperative or association or any other legal entity or organization of whatever nature, and shall include any successor (by merger or otherwise) of such entity. For purposes of this Section 1.14 and Section 1.15 of these Bylaws, “present in person” shall mean that the Stockholder proposing that the business be brought before the annual meeting or special meeting of the Stockholders, as applicable, or, if the proposing Stockholder is not an individual, a qualified representative of such proposing Stockholder, appear in person at such annual or special meeting, and a “qualified representative” of such proposing Stockholder shall be, if such proposing Stockholder is (x) a general or limited partnership, any general partner or Person who functions as a general partner of the general or limited partnership or who controls the general or limited partnership, (y) a corporation or a limited liability company, any officer or Person who functions as an officer of the corporation or limited liability company or any officer, director, general partner or Person who functions as an officer, director or general partner of any entity ultimately in control of the corporation or limited liability company or (z) a trust, any trustee of such trust.

 

 

(b)            Without qualification, for business to be properly brought before an annual meeting of the Stockholders by a Stockholder, the Stockholder must (a) provide Timely Notice (as defined below) thereof in writing and in proper form to the Secretary and (b) provide any updates or supplements to such notice at the times and in the forms required by this Section 1.14. To be timely, a Stockholder’s notice must be delivered to, or mailed and received at, the principal executive offices of the Corporation not less than 90 days nor more than 120 days prior to the one-year anniversary of the immediately preceding year’s annual meeting (which anniversary, in the case of the first annual meeting of the Stockholders following the closing of the Corporation’s initial public offering, shall be deemed to be February 28, 2022); provided, however, that if the date of the annual meeting of the Stockholders is more than 30 days before or more than 60 days after such anniversary date, notice by such Stockholder to be timely must be so delivered, or mailed and received, not later than the later of (A) the 90^th day prior to such annual meeting and (B) the 10^th day following the day on which public disclosure of the date of such annual meeting was first made (such notice within such time periods, “Timely Notice”). In no event shall any adjournment or postponement of an annual meeting or the announcement thereof commence a new time period for the giving of Timely Notice as described above.

 

(c)            To be in proper form for purposes of this Section 1.14, a Stockholder’s notice to the Secretary shall set forth:

 

(i)            As to each Proposing Person (as defined below), (A) the name and address of such Proposing Person (including, if applicable, the name and address that appear on the Corporation’s books and records); and (B) the number of shares of each class or series of Stock of the Corporation that are, directly or indirectly, owned of record or beneficially owned (within the meaning of Rule 13d-3 under the Exchange Act) by such Proposing Person, except that such Proposing Person shall in all events be deemed to beneficially own any shares of any class or series of Stock of the Corporation as to which such Proposing Person has a right to acquire beneficial ownership at any time in the future (the disclosures to be made pursuant to the foregoing clauses (A) and (B) are referred to as “Stockholder Information”);

 

 

(ii)            As to each Proposing Person, (A) the full notional amount of any securities that, directly or indirectly, underlie any “derivative security” (as such term is defined in Rule 16a-1(c) under the Exchange Act) that constitutes a “call equivalent position” (as such term is defined in Rule 16a-1(b) under the Exchange Act) (“Synthetic Equity Position”) and that is, directly or indirectly, held or maintained by such Proposing Person with respect to any shares of any class or series of Stock of the Corporation; provided that, for the purposes of the definition of “Synthetic Equity Position,” the term “derivative security” shall also include any security or instrument that would not otherwise constitute a “derivative security” as a result of any feature that would make any conversion, exercise or similar right or privilege of such security or instrument becoming determinable only at some future date or upon the happening of a future occurrence, in which case the determination of the amount of securities into which such security or instrument would be convertible or exercisable shall be made assuming that such security or instrument is immediately convertible or exercisable at the time of such determination; and, provided, further, that any Proposing Person satisfying the requirements of Rule 13d-1(b)(1) under the Exchange Act (other than a Proposing Person that so satisfies Rule 13d-1(b)(1) under the Exchange Act solely by reason of Rule 13d-1(b)(1)(ii)(E)) shall not be deemed to hold or maintain the notional amount of any securities that underlie a Synthetic Equity Position held by such Proposing Person as a hedge with respect to a bona fide derivatives trade or position of such Proposing Person arising in the ordinary course of such Proposing Person’s business as a derivatives dealer, (B) any rights to dividends on the shares of any class or series of Stock of the Corporation owned beneficially by such Proposing Person that are separated or separable from the underlying shares of the Corporation, (C) any material pending or threatened legal proceeding in which such Proposing Person is a party or material participant involving the Corporation or any of its officers or Directors, or any affiliate of the Corporation, (D) any other material relationship between such Proposing Person, on the one hand, and the Corporation or any affiliate of the Corporation, on the other hand, (E) any direct or indirect material interest in any material contract or agreement of such Proposing Person with the Corporation or any affiliate of the Corporation (including, in any such case, any employment agreement, collective bargaining agreement or consulting agreement) and (F) any other information relating to such Proposing Person that would be required to be disclosed in a proxy statement or other filing required to be made in connection with solicitations of proxies or consents by such Proposing Person in support of the business proposed to be brought before the applicable meeting of the Stockholders pursuant to Section 14(a) of the Exchange Act (the disclosures to be made pursuant to the foregoing clauses (A) through (F) are referred to as “Disclosable Interests”); provided, however, that Disclosable Interests shall not include any such disclosures with respect to the ordinary course business activities of any broker, dealer, commercial bank, trust company or other nominee who is a Proposing Person solely as a result of being the Stockholder directed to prepare and submit the notice required by these Bylaws on behalf of a beneficial owner; and

 

 

(iii)            As to each item of business that the Stockholder proposes to bring before the annual meeting of the Stockholders, (A) a brief description of the business desired to be brought before the annual meeting, the reasons for conducting such business at the annual meeting and any material interest in such business of each Proposing Person, (B) the text of the proposal or business (including the text of any resolutions proposed for consideration and the text of any proposed amendment to these Bylaws), (C) a reasonably detailed description of all agreements, arrangements and understandings (x) between or among any of the Proposing Persons or (y) between or among any Proposing Person and any other Person or entity (including their names) in connection with the proposal of such business by such Stockholder and (D) any other information relating to such item of business that would be required to be disclosed in a proxy statement or other filing required to be made in connection with solicitations of proxies in support of the business proposed to be brought before the meeting pursuant to Section 14(a) of the Exchange Act; provided, however, that the disclosures required by this Section 1.14(c)(iii) shall not include any disclosures with respect to any broker, dealer, commercial bank, trust company or other nominee who is a Proposing Person solely as a result of being the Stockholder directed to prepare and submit the notice required by these Bylaws on behalf of a beneficial owner.

 

(d)            For purposes of this Section 1.14, the term “Proposing Person” shall mean (a) the Stockholder providing the notice of business proposed to be brought before an annual meeting of the Stockholders, (b) the beneficial owner or beneficial owners, if different, on whose behalf the notice of the business proposed to be brought before the annual meeting of the Stockholders is made, (c) any participant (as defined in paragraphs (a)(ii)-(vi) of Instruction 3 to Item 4 of Schedule 14A) with such Stockholder in such solicitation.

 

(e)            A Proposing Person shall update and supplement its notice to the Corporation of its intent to propose business at an annual meeting of the Stockholders, if necessary, so that the information provided or required to be provided in such notice pursuant to this Section 1.14 shall be true and correct as of the record date for notice of the meeting and as of the date that is ten business days prior to the meeting or any adjournment or postponement thereof, and such update and supplement shall be delivered to, or mailed and received by, the Secretary at the principal executive offices of the Corporation not later than five business days after the record date for notice of the meeting (in the case of the update and supplement required to be made as of such record date), and not later than eight business days prior to the date for the meeting or, if practicable, any adjournment or postponement thereof (and, if not practicable, on the first practicable date prior to the date to which the meeting has been adjourned or postponed) (in the case of the update and supplement required to be made as of 10 business days prior to the meeting or any adjournment or postponement thereof).

 

(f)            Notwithstanding anything in these Bylaws to the contrary, no business shall be conducted at an annual meeting of the Stockholders that is not properly brought before the meeting in accordance with this Section 1.14. The presiding officer of the meeting shall, if the facts warrant, determine that the business was not properly brought before the meeting in accordance with this Section 1.14, and if he or she should so determine, he or she shall so declare to the meeting and any such business not properly brought before the meeting shall not be transacted.

 

(g)            In addition to the requirements of this Section 1.14 with respect to any business proposed to be brought before an annual meeting of the Stockholders, each Proposing Person shall comply with all applicable requirements of the Exchange Act with respect to any such business. Nothing in this Section 1.14 shall be deemed to affect the rights of Stockholders to request inclusion of proposals in the Corporation’s proxy statement pursuant to Rule 14a-8 under the Exchange Act.

 

 

(h)            For purposes of these Bylaws, “public disclosure” shall mean disclosure in a press release reported by a national news service or in a document publicly filed by the Corporation with the Securities and Exchange Commission pursuant to Sections 13, 14 or 15(d) of the Exchange Act.

 

Section 1.15      Advance Notice Procedures for Nominations of Directors.

 

(a)            Nominations of any Person for election to the Board of Directors at an annual meeting or at a special meeting of the Stockholders (but only if the election of Directors is a matter specified in the notice of meeting given by or at the direction of the person calling such special meeting) may be made at such meeting only (a) by or at the direction of the Board of Directors, including by any committee or Persons authorized to do so by the Board of Directors or these Bylaws, or (b) by a Stockholder present in Person (as defined in Section 1.14) (1) who was a Stockholder of record of the Corporation both at the time of giving the notice provided for in this Section 1.15 and at the time of the meeting, (2) is entitled to vote at the meeting and (3) has complied with this Section 1.15 as to such notice and nomination. Other than as provided in that certain stockholders agreement, dated as of [●], 2021, by and among the Corporation and the other Persons party thereto (as it may be amended from time to time in accordance with its terms, the “Stockholders Agreement”) for so long as it remains in effect, the foregoing clause (b) shall be the exclusive means for a Stockholder to make any nomination of a Person or Persons for election to the Board of Directors at any annual meeting or special meeting of Stockholders.

 

(i)            Without qualification, for a Stockholder to make any nomination of a Person or Persons for election to the Board of Directors at an annual meeting of the Stockholders, the Stockholder must (a) provide Timely Notice (as defined in Section 1.14(b) of these Bylaws) thereof in writing and in proper form to the Secretary at the principal executive offices of the Corporation, (b) provide the information, agreements and questionnaires with respect to such Stockholder and its candidate for nomination as required by this Section 1.15, and (c) provide any updates or supplements to such notice at the times and in the forms required by this Section 1.15.

 

(ii)            Without qualification, if the election of Directors is a matter specified in the notice of meeting given by or at the direction of the person calling a special meeting of the Stockholders, then for a Stockholder to make any nomination of a person or persons for election to the Board of Directors at a special meeting of the Stockholders, the Stockholder must (a) provide timely notice thereof in writing and in proper form to the Secretary at the principal executive offices of the Corporation, (b) provide the information, agreements and questionnaires with respect to such Stockholder and its candidate for nomination required by this Section 1.15, and (c) provide any updates or supplements to such notice at the times and in the forms required by this Section 1.15. To be timely for purposes of this Section 1.15(b)(ii), a Stockholder’s notice for nominations to be made at a special meeting of the Stockholders must be delivered to, or mailed to and received by the Secretary not earlier than the 120^th day prior to such special meeting and not later than the 90^th day prior to such special meeting or, if later, the 10^th day following the day on which public disclosure (as defined in Section 1.14(h)) of the date of such special meeting was first made.

 

 

(iii)            In no event shall any adjournment or postponement of an annual meeting or special meeting of the Stockholders or the announcement thereof commence a new time period for the giving of a Stockholder’s notice as described above.

 

(iv)            In no event may a Nominating Person (as defined below) provide notice under this Section 1.15 or otherwise with respect to a greater number of Director candidates than are subject to election by Stockholders at the applicable meeting. If the Corporation shall, subsequent to such notice, increase the number of Directors subject to election at the meeting, such notice as to any additional nominees shall be due on the later of (i) the conclusion of the time period for Timely Notice (with respect to an annual meeting of the Stockholders), (ii) the date set forth in Section 1.15(b)(ii) (with respect to a special meeting) or (iii) the 10^th day following the date of public disclosure (as defined in Section 1.14(h)) of such increase.

 

(b)            To be in proper form for purposes of this Section 1.15, a Stockholder’s notice to the Secretary shall set forth:

 

(i)            As to each Nominating Person, the Stockholder Information (as defined in Section 1.14(c)(i) of these Bylaws) except that for purposes of this Section 1.15, the term “Nominating Person” shall be substituted for the term “Proposing Person” in all places it appears in Section 1.14(c)(i);

 

(ii)            As to each Nominating Person, any Disclosable Interests (as defined in Section 1.14(c)(ii), except that for purposes of this Section 1.15 the term “Nominating Person” shall be substituted for the term “Proposing Person” in all places it appears in Section 1.14(c)(ii) and the disclosure with respect to the business to be brought before the meeting of the Stockholders in Section 1.14(c)(iii) shall be made with respect to nomination of each Person for election as a Director at such meeting); and

 

(iii)            As to each candidate whom a Nominating Person proposes to nominate for election as a Director, (A) all information with respect to such candidate for nomination that would be required to be set forth in a Stockholder’s notice pursuant to this Section 1.15 if such candidate for nomination were a Nominating Person, (B) all information relating to such candidate for nomination that is required to be disclosed in a proxy statement or other filings required to be made in connection with solicitations of proxies for election of Directors in a contested election pursuant to Section 14(a) under the Exchange Act (including such candidate’s written consent to being named in the Corporation’s proxy statement as a nominee and to serving as a Director if elected), (C) a description of any direct or indirect material interest in any material contract or agreement between or among any Nominating Person, on the one hand, and each candidate for nomination or any other participants in such solicitation, on the other hand, including, without limitation, all information that would be required to be disclosed pursuant to Item 404 under Regulation S-K if such Nominating Person were the “registrant” for purposes of such rule and the candidate for nomination were a Director or executive officer of such registrant (the disclosures to be made pursuant to the foregoing clauses (A) through (C) are referred to as “Nominee Information”), and (D) a completed and signed questionnaire, representation and agreement as provided in Section 1.15(f).

 

 

(c)            For purposes of this Section 1.15, the term “Nominating Person” shall mean (a) the Stockholder providing the notice of the nomination proposed to be made at the meeting of the Stockholders, (b) the beneficial owner or beneficial owners, if different, on whose behalf the notice of the nomination proposed to be made at the meeting is made and (c) any other participant in such solicitation.

 

(d)            A Stockholder providing notice of any nomination proposed to be made at a meeting of the Stockholders shall further update and supplement such notice, if necessary, so that the information provided or required to be provided in such notice pursuant to this Section 1.15 shall be true and correct as of the record date for notice of the meeting and as of the date that is 10 business days prior to the meeting or any adjournment or postponement thereof, and such update and supplement shall be delivered to, or mailed and received by, the Secretary at the principal executive offices of the Corporation not later than five business days after the record date for notice of the meeting (in the case of the update and supplement required to be made as of such record date), and not later than eight business days prior to the date for the meeting or, if practicable, any adjournment or postponement thereof (and, if not practicable, on the first practicable date prior to the date to which the meeting has been adjourned or postponed) (in the case of the update and supplement required to be made as of 10 business days prior to the meeting or any adjournment or postponement thereof).

 

(e)            To be eligible to be a candidate for election as a Director at an annual or special meeting of the Stockholders, a candidate must be nominated in the manner prescribed in this Section 1.15 and the candidate for nomination, whether nominated by the Board of Directors or by a Stockholder of record, must have previously delivered (in accordance with the time period prescribed for delivery in a notice to such candidate given by or on behalf of the Board of Directors), to the Secretary at the principal executive offices of the Corporation, (a) a completed written questionnaire (in the form provided by the Corporation) with respect to the background, qualifications, stock ownership and independence of such candidate for nomination and (b) a written representation and agreement (in the form provided by the Corporation) that such candidate for nomination (A) is not, and will not become a party to, any agreement, arrangement or understanding with any Person or entity other than the Corporation with respect to any direct or indirect compensation or reimbursement for service as a Director that has not been disclosed in such written questionnaire and (B) if elected as a Director, will comply with all applicable corporate governance, conflict of interest, confidentiality, stock ownership and trading and other policies and guidelines of the Corporation applicable to all Directors and in effect during such Person’s term in office as a Director (and, if requested by any candidate for nomination, the Secretary shall provide to such candidate for nomination all such policies and guidelines then in effect).

 

(f)            The Board of Directors may also require any proposed candidate for nomination as a Director to furnish such other information as may reasonably be requested by the Board of Directors in writing prior to the meeting of Stockholders at which such candidate’s nomination is to be acted upon in order for the Board of Directors to determine the eligibility of such candidate for nomination to be an independent Director in accordance with the Corporation’s Corporate Governance Guidelines.

 

 

(g)            In addition to the requirements of this Section 1.15 with respect to any nomination proposed to be made at a meeting, each Proposing Person shall comply with all applicable requirements of the Exchange Act with respect to any such nominations.

 

(h)            No candidate shall be eligible for nomination as a Director unless such candidate for nomination and the Nominating Person seeking to place such candidate’s name in nomination has complied with this Section 1.15, as applicable. The presiding officer at the meeting shall, if the facts warrant, determine that a nomination was not properly made in accordance with this Section 1.15, and if he or she should so determine, he or she shall so declare such determination to the meeting, the defective nomination shall be disregarded and any ballots cast for the candidate in question (but in the case of any form of ballot listing other qualified nominees, only the ballots case for the nominee in question) shall be void and of no force or effect.

 

(i)            Notwithstanding anything in these Bylaws to the contrary, no candidate for nomination shall be eligible to be seated as a Director unless nominated and elected in accordance with this Section 1.15.

 

(j)            Notwithstanding anything in this Section 1.15 to the contrary, the requirements of this Section 1.15 shall not apply to a Stockholder exercising its rights to designate persons for nomination for election to the Board of Directors in accordance with the provisions of the Stockholders Agreement for so long as it remains in effect.

 

Article II.
Board of Directors

 

Section 2.01      Number; Tenure; Qualifications. Subject to the Certificate of Incorporation, the terms of the Stockholders Agreement (for so long as it remains in effect) and the separate rights of holders of any series of Preferred Stock to elect Directors, the total number of Directors constituting the entire Board of Directors shall be fixed from time to time exclusively by resolution adopted by a majority of the Directors then in office. Each Director shall hold office until such time as provided in the Certificate of Incorporation. Directors need not be Stockholders to be qualified for election or service as a Director.

 

Section 2.02      Election; Resignation; Removal; Vacancies. Except as otherwise provided in the Certificate of Incorporation or these Bylaws, Directors shall be elected at the annual meeting of Stockholders by such Stockholders that have the right to vote on such election. Any Director may resign at any time upon written or electronic notice to the Corporation. Such resignation shall be effective upon delivery unless otherwise specified. Subject to the rights of holders of any series of Preferred Stock and the terms of the Stockholders Agreement (for so long as it remains in effect), Directors may be removed only as expressly provided in the Certificate of Incorporation. Except as otherwise required by applicable law, and subject to and in accordance with the rights of the holders of any series of Preferred Stock then outstanding and the terms of the Stockholders Agreement (for so long as it remains in effect), unless the Board of Directors otherwise determines, newly created directorships resulting from any increase in the authorized number of Directors or any vacancies on the Board of Directors resulting from the death, resignation, disqualification, removal from office or other cause shall be filled only by a majority vote of the Directors then in office, though less than a quorum, or by a sole remaining Director entitled to vote thereon, and not by the Stockholders. Any Director so chosen shall hold office until his or her successor shall be elected and qualified.

 

 

Section 2.03      Regular Meetings. Regular meetings of the Board of Directors may be held at such places, if any, within or without the State of Delaware, and at such times as the Board of Directors may from time to time determine. A notice of regular meetings of the Board of Directors shall not be required.

 

Section 2.04      Special Meetings. Special meetings of the Board of Directors may be called by the Chairperson, the Chief Executive Officer or a majority of the Directors then in office and shall be held at such time, date and place, if any, within or without the State of Delaware as he or she or they shall fix. Notice to Directors of the date, place and time of any special meeting of the Board of Directors shall be given to each Director by the Secretary or by the officer or one of the Directors calling the meeting. Such notice may be given in person, by recognized international express courier service, or by e-mail, telephone, telecopier, facsimile or other means of electronic transmission. If the notice is delivered in person, by e-mail, telephone, telecopier, facsimile or other means of electronic transmission, it shall be delivered or sent at least 24 hours before the time of holding of the meeting. If the notice is sent by recognized international express courier service, it shall be deposited with such courier service at least seven days before the time of the holding of the meeting.

 

Section 2.05      Telephonic Meetings Permitted. Members of the Board of Directors may participate in any meetings of the Board of Directors thereof by means of conference telephone or other communications equipment by means of which all persons participating in the meeting can hear each other, and participation in a meeting of the Board of Directors pursuant to this Section 2.05 shall constitute presence in person at such meeting.

 

Section 2.06      Quorum; Vote Required for Action. At all meetings of the Board of Directors a majority of the total number of authorized Directors shall constitute a quorum for the transaction of business; provided that, solely for the purposes of filling vacancies pursuant to Section 2.02 of these Bylaws, a meeting of the Board of Directors may be held if a majority of the Directors then in office participate in such meeting. The affirmative vote of a majority of the Directors present at any meeting of the Board of Directors at which a quorum is present shall be the act of the Board of Directors, except as may be otherwise specifically required by applicable law, the Certificate of Incorporation or these Bylaws.

 

Section 2.07      Organization. Meetings of the Board of Directors shall be presided over by the Chairperson, or in his or her absence by the person whom the Chairperson shall designate, or in the absence of the foregoing persons by a chairperson chosen at the meeting by the affirmative vote of a majority of the Directors present at the meeting. The Secretary shall act as secretary of the meeting, but in his or her absence, the chairperson of the meeting may appoint any person to act as secretary of the meeting.

 

 

Section 2.08      Action by Unanimous Consent of Directors. Unless otherwise restricted by the Certificate of Incorporation or these Bylaws, any action required or permitted to be taken at any meeting of the Board of Directors, or of any committee thereof, may be taken without a meeting of the Board of Directors if all members of the Board of Directors or such committee, as the case may be, consent thereto in writing or by electronic transmission. Thereafter, the writing or writings or electronic transmissions shall be filed with the minutes of proceedings of the Board of Directors or such committee in accordance with applicable law.

 

Section 2.09      Compensation of Directors. Unless otherwise restricted by the Certificate of Incorporation or these Bylaws, the Board of Directors shall have the authority to fix the compensation of Directors. The Directors may be paid their expenses, if any, of attendance at each meeting of the Board of Directors and may be paid a fixed sum for attendance at each meeting of the Board of Directors or a stated salary or other compensation as a Director. No such payment shall preclude any Director from serving the Corporation in any other capacity and receiving compensation therefor. Members of special or standing committees may be allowed compensation for attending committee meetings. Any Director may decline any or all such compensation payable to such Director in his or her discretion.

 

Section 2.10      Chairperson. Subject to the provisions of the Stockholders Agreement for so long as it is in effect, the Board of Directors may appoint from its members a Chairperson. The Board of Directors may, in its sole discretion, from time to time appoint one or more vice chairpersons (each, a “Vice Chairperson”), each of whom in such capacity shall report directly to the Chairperson.

 

Article III.
Committees

 

Section 3.01      Committees. Subject to the provisions of the Stockholders Agreement for so long as it is in effect, the Board of Directors may designate one or more committees, each committee to consist of one or more of the Directors. The Board of Directors may designate one or more Directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of such committee. In the absence or disqualification of a member of any committee, the member or members thereof present at any meeting and not disqualified from voting, whether or not he, she or they constitute a quorum, may unanimously appoint another member of the Board of Directors to act at the meeting in place of any such absent or disqualified member. Any such committee, to the extent permitted by applicable law and to the extent provided in a resolution of the Board of Directors, shall have and may exercise all of the powers and authority of the Board of Directors in the management of the business and affairs of the Corporation, and may authorize the seal of the Corporation (if one be adopted) to be affixed to all papers which may require it. Except as otherwise provided in the Certificate of Incorporation, these Bylaws, or the resolution of the Board of Directors designating the committee, a committee may create one or more subcommittees, each subcommittee to consist of one or more members of the committee, and delegate to a subcommittee any or all of the powers and authority of the committee. Except as otherwise provided in the Certificate of Incorporation, these Bylaws, or the resolution of the Board of Directors designating the committee (or resolution of the committee designating the subcommittee, if applicable), a majority of the Directors then serving on a committee or subcommittee, as applicable, shall constitute a quorum for the transaction of business, and the vote of a majority of the members of the committee or subcommittee, as applicable, present at a meeting at which a quorum is present shall be the act of the committee or subcommittee, as applicable. Special meetings of any committee of the Board of Directors may be held at any time or place, if any, within or without the State of Delaware whenever called by the Chairperson or a majority of the members of such committee.

 

 

Section 3.02      Committee Minutes. Each committee of the Board of Directors shall keep regular minutes of its meetings and report the same to the Board of Directors when required.

 

Section 3.03      Committee Rules. Unless the Board of Directors otherwise provides, each committee designated by the Board of Directors may make, alter and repeal rules for the conduct of its business. In the absence of such rules, each such committee shall conduct its business in the same manner as the Board of Directors conducts its business pursuant to Article II of these Bylaws.

 

Article IV.
Officers

 

Section 4.01      Officers. The officers of the Corporation shall be a Chief Executive Officer, a President and a Secretary. The offices of Chief Executive Officer and President may be held by the same person. The Corporation may also have, at the discretion of the Board of Directors, a Chairperson of the Board of Directors (subject to the requirements of the Stockholders Agreement for so long as it is in effect), a Vice Chairperson of the Board of Directors, a Chief Financial Officer, one or more Senior Vice Presidents, one or more Vice Presidents, a Treasurer (who may be the same person as the Chief Financial Officer), one or more Assistant Treasurers, one or more Assistant Secretaries, and any such other officers as may be appointed in accordance with the provisions of these Bylaws. Each officer of the Corporation shall hold office for such term as may be prescribed by the Board of Directors and until his or her successor is duly elected and qualified or until his or her earlier death, resignation or removal. No officer need be a Stockholder or Director.

 

Section 4.02      Appointment of Officers. The Board of Directors shall appoint the officers of the Corporation, except such officers as may be appointed in accordance with the provisions of Section 4.03 of these Bylaws.

 

Section 4.03      Subordinate Officers. The Board of Directors may appoint, or empower the Chief Executive Officer of the Corporation or, in the absence of a Chief Executive Officer of the Corporation, the President of the Corporation, to appoint, such other officers and agents as the business of the Corporation may require (any such officer or agent, a “Subordinate Officer”). Each of such Subordinate Officer shall hold office for such period, have such authority, and perform such duties as are provided in these Bylaws or as the Board of Directors may from time to time determine.

 

 

Section 4.04      Removal and Resignation of Officers. Any officer may be removed, either with or without cause, by an affirmative vote of the Board of Directors at any regular or special meeting of the Board of Directors; provided further that any Subordinate Officer may also be removed, either with or without cause, by the Chief Executive Officer of the Corporation or, in the absence of a Chief Executive Officer of the Corporation, the President of the Corporation. Any officer may resign at any time by giving notice in writing or by electronic transmission to the Corporation. Any resignation shall take effect at the date of the receipt of that notice or at any later time specified in that notice. Unless otherwise specified in the notice of resignation, the acceptance of the resignation shall not be necessary to make it effective. If a resignation is made effective at a later date and the Corporation accepts the future effective date, the Board of Directors may fill the pending vacancy before the effective date if the Board of Directors provides that the successor shall not take office until the effective date. Any resignation is without prejudice to the rights, if any, of the Corporation under any contract to which the officer is a party.

 

Section 4.05      Vacancies in Offices. Any vacancy occurring in any office of the Corporation shall be filled by the Board of Directors or as provided in Section 4.03.

 

Section 4.06      Chief Executive Officer. Subject to any supervisory powers as may be given by the Board of Directors to the Chairperson (if any), the Chief Executive Officer of the Corporation shall, subject to the control of the Board of Directors, have general supervision, direction, and control of the business and the officers of the Corporation. He or she shall preside at all meetings of the Stockholders and, in the absence or nonexistence of a Chairperson, at all meetings of the Board of Directors at which he or she is present and shall have the general powers and duties of management usually vested in the office of chief executive officer of a corporation and shall have such other powers and duties as may be prescribed by the Board of Directors or these Bylaws.

 

Section 4.07      President. The Board of Directors may, but is not obligated to, appoint a President of the Corporation. Subject to such supervisory powers, if any, as may be given by the Board of Directors to the Chairperson (if any) or the Chief Executive Officer, the President of the Corporation, if appointed, shall have general supervision, direction, and control of the business and other officers of the Corporation. He or she shall have the general powers and duties of management usually vested in the office of president of a corporation and such other powers and duties as may be prescribed by the Board of Directors or these Bylaws.

 

Section 4.08      Vice Presidents and Senior Vice Presidents. The Board of Directors may, but is not obligated to, appoint one or more Vice Presidents and Senior Vice Presidents of the Corporation. The Vice Presidents and Senior Vice Presidents of the Corporation, if appointed, shall have supervision, direction, and control of those functions and departments the business of the Corporation as the Board of Directors or the Chief Executive Officer prescribe for such persons from time to time.

 

Section 4.09      Secretary. The Secretary shall keep or cause to be kept, at the principal executive office of the Corporation or such other place as the Board of Directors may direct, a book of minutes of all meetings and actions of the Board of Directors, committees of the Board of Directors, and Stockholders. The minutes shall show the time and place of each such meeting, the names of those present at such Directors’ meetings or committee meetings, the number of shares of Stock present or represented at such Stockholders’ meetings, and the proceedings thereof. The Secretary shall keep, or cause to be kept, at the principal executive office of the Corporation or at the office of the Corporation’s transfer agent or registrar, as determined by resolution of the Board of Directors, a share register, or a duplicate share register, showing the names of all Stockholders and their addresses, the number and classes of shares of Stock held by each, the number and date of certificates evidencing such shares, and the number and date of cancellation of every certificate surrendered for cancellation. The Secretary shall give, or cause to be given, notice of all meetings of the Stockholders and of the Board of Directors required to be given by applicable law or by these Bylaws. He or she shall keep the seal of the Corporation, if one be adopted, in safe custody and shall have such other powers and perform such other duties as may be prescribed by the Board of Directors or by these Bylaws. The Board of Directors or the Chief Executive Officer may, but are not obligated to, appoint one or more Assistant Secretaries to assist the Secretary in his or her duties and to perform such duties during any absence of the Secretary.

 

 

Section 4.10      Chief Financial Officer. The Chief Financial Officer of the Corporation shall keep and maintain, or cause to be kept and maintained, adequate and correct books and records of accounts of the properties and business transactions of the Corporation, including accounts of its assets, liabilities, receipts, disbursements, gains, losses, capital retained earnings, and shares. The books of account shall at all reasonable times be open to inspection by any Director. The Chief Financial Officer shall deposit all moneys and other valuables in the name and to the credit of the Corporation with such depositories as may be designated by the Board of Directors. He or she shall disburse the funds of the Corporation as may be ordered by the Board of Directors, shall render to the President, if any is appointed, the Chief Executive Officer, or the Directors, upon request, an account of all his or her transactions as Chief Financial Officer and of the financial condition of the Corporation, and shall have other powers and perform such other duties as may be prescribed by the Board of Directors or these Bylaws. If at any time there shall be no Treasurer of the Corporation, then the Chief Financial Officer shall be the Treasurer.

 

Section 4.11      Treasurer. The Board of Directors or the Chief Executive Officer may, but shall not be obligated to, appoint a Treasurer of the Corporation to assist and hold office separate from the Chief Financial Officer of the Corporation. The Treasurer shall deposit all moneys and other valuables in the name and to the credit of the Corporation with such depositories as may be designated by the Board of Directors. He or she shall disburse the funds of the Corporation as may be ordered by the Board of Directors, shall render to the Chief Financial Officer, the Chief Executive Officer, or the Directors, upon request, an account of all his or her transactions as Treasurer, and shall have other powers and perform such other duties as may be prescribed by the Board of Directors, the Chief Executive Officer or these Bylaws. The Board of Directors or the Chief Executive Officer may, but are not obligated to, appoint one or more Assistant Treasurers to assist the Treasurer in his or her duties and to perform such duties during any absence of the Treasurer.

 

Section 4.12      Representation of Shares of Other Entities. Unless otherwise directed by the Board of Directors, the Chief Executive Officer, or any other person authorized by the Board of Directors or the Chief Executive Officer, is authorized to vote, represent and exercise on behalf of the Corporation all rights incident to any and all shares, securities or interests of any other corporation or entity standing in the name of the Corporation. The authority granted herein may be exercised either by such person directly or by any other person authorized to do so by proxy or power of attorney duly executed by such person having the authority.

 

Section 4.13      Authority and Duties of Officers. All officers of the Corporation shall respectively have such powers and authority and shall perform such duties in the management of the business of the Corporation as may be provided herein or designated from time to time by the Board of Directors and, to the extent not so provided, as generally pertain to their respective offices, subject to the control of the Board of Directors.

 

 

Section 4.14      Compensation. The compensation of the officers of the Corporation for their services as such shall be fixed from time to time by or at the direction of the Board of Directors. An officer of the Corporation shall not be prevented from receiving compensation by reason of the fact that he or she is also a Director.

 

Article V.
Stock

 

Section 5.01      Certificates. The shares of Stock shall be represented by certificates, provided that the Board of Directors may provide by resolution or resolutions that some or all of any or all classes or series of Stock shall be uncertificated shares. Any such resolution shall not apply to shares represented by a certificate until such certificate is surrendered to the Corporation. Every holder of Stock represented by certificates shall be entitled to have a certificate, in such form as may be prescribed by law and by the Board of Directors, representing the number of shares held by such holder registered in certificate form. Each such certificate shall be signed in a manner that complies with Section 158 of the DGCL.

 

Section 5.02      Lost, Stolen or Destroyed Stock Certificates; Issuance of New Certificates. The Corporation may issue a new certificate for shares of Stock in the place of any certificate theretofore issued by it, alleged to have been lost, stolen or destroyed, and the Corporation may require the owner of the lost, stolen or destroyed certificate, or such owner’s legal representative, to give the Corporation a bond sufficient to indemnify it against any claim that may be made against it on account of the alleged loss, theft or destruction of any such certificate or the issuance of such new certificate. The Board of Directors may establish regulations, rules or procedures concerning the proof required for adequately alleging the loss, theft or destruction of any Stock certificate and concerning the giving of a satisfactory bond or bonds of indemnity.

 

Article VI.
Indemnification and Advancement of Expenses

 

Section 6.01      Right to Indemnification. The Corporation shall indemnify and hold harmless, to the fullest extent permitted by applicable law (including as it presently exists or may hereafter be amended, but, in the case of any such amendment, only to the extent that such amendment permits the Corporation to provide broader indemnification rights than such law permitted the Corporation to provide prior to such amendment), any person (a “Covered Person”) who was or is made or is threatened to be made a party or is otherwise involved in any action, suit or proceeding, whether civil, criminal, administrative or investigative (any such action, suit or proceeding, a “proceeding”), by reason of the fact that he or she, or a person for whom he or she is the legal representative, is or was a Director or officer of the Corporation or, while a Director or officer of the Corporation, is or was serving at the request of the Corporation as a director, officer, employee or agent of another Person, including service with respect to employee benefit plans, against all liability and loss suffered and expenses (including attorneys’ fees, judgments, fines ERISA excise taxes or penalties and amounts paid in settlement) reasonably incurred by such Covered Person. Notwithstanding the preceding sentence, except as otherwise provided in Section 6.04 of these Bylaws or with respect to any compulsory counterclaim brought by such Covered Person, the Corporation shall be required to indemnify a Covered Person in connection with a proceeding (or part thereof) commenced by such Covered Person only if the commencement of such proceeding (or part thereof) by the Covered Person was authorized in the specific case by the Board of Directors.

 

 

Section 6.02      Indemnification of Others. The Corporation shall have the power (but not the obligation) to indemnify and hold harmless, to the fullest extent permitted by applicable law as it presently exists or may hereafter be amended, any employee or agent of the Corporation who was or is made or is threatened to be made a party or is otherwise involved in any proceeding by reason of the fact that he or she, or a Person for whom he or she is the legal representative, is or was an employee or agent of the Corporation or is or was serving at the request of the Corporation as a director, officer, employee or agent of another Person, including service with respect to employee benefit plans, against all liability and loss suffered and expenses reasonably incurred by such Person in connection with any such proceeding.

 

Section 6.03      Advancement of Expenses. The Corporation shall to the fullest extent not prohibited by applicable law pay the expenses (including attorneys’ fees) incurred by a Covered Person in defending any proceeding in advance of its final disposition, provided, however, that, to the extent required by applicable law, such payment of expenses in advance of the final disposition of the proceeding shall be made only upon receipt of an undertaking by the Covered Person to repay all amounts advanced if it should be ultimately determined that the Covered Person is not entitled to be indemnified under this Article VI or otherwise.

 

Section 6.04      Claims. If a claim for indemnification under this Article VI (following the final disposition of such proceeding) is not paid in full within 60 days after the Corporation has received a written claim therefor by the Covered Person, or if a claim for any advancement of expenses under this Article VI is not paid in full within 30 days after the Corporation has received a written statement or statements requesting such amounts to be advanced, the Covered Person shall thereupon (but not before) be entitled to file suit to recover the unpaid amount of such claim. If successful in whole or in part, the Covered Person shall be entitled to be paid the expense of prosecuting such claim to the fullest extent permitted by applicable law. In any such action, the Corporation shall have the burden of proving that the Covered Person is not entitled to the requested indemnification or advancement of expenses under applicable law.

 

Section 6.05      Non-exclusivity of Rights. The rights conferred on any Covered Person by this Article VI shall not be exclusive of any other rights which such Covered Person may have or hereafter acquires under any applicable statute, provision of the Certificate of Incorporation, these Bylaws, agreement, vote of Stockholders or disinterested Directors or otherwise.

 

Section 6.06      Insurance. The Corporation may purchase and maintain insurance on behalf of any Person who is or was a Director, officer, employee or agent of the Corporation, or is or was serving at the request of the Corporation as a director, officer, employee or agent of another Person against any liability asserted against him or her and incurred by him or her in any such capacity, or arising out of his or her status as such, whether or not the Corporation would have the power to indemnify him or her against such liability under the provisions of the DGCL.

 

 

Section 6.07      Other Sources. The Corporation’s obligation, if any, to indemnify or to advance expenses to any Covered Person who was or is serving at its request as a director, officer, employee or agent of another Person shall be reduced by any amount such Covered Person may collect as indemnification or advancement of expenses from such other Person.

 

Section 6.08      Continuation of Indemnification. The rights to indemnification and to advancement of expenses provided by, or granted pursuant to, this Article VI shall continue as to a Person who has ceased to be a Director or officer of the Corporation and shall inure to the benefit of the estate, heirs, executors, administrators, legatees and distributees of such Person.

 

Section 6.09      Amendment or Repeal. Any right to indemnification or to advancement of expenses of any Covered Person arising hereunder shall not be eliminated or impaired by an amendment to or repeal of these Bylaws or an amendment to the Certificate of Incorporation after the occurrence of the act or omission that is the subject of the proceeding for which indemnification or advancement of expenses is sought.

 

Section 6.10      Other Indemnification and Advancement of Expenses. This Article VI shall not limit the right of the Corporation, to the extent and in the manner permitted by applicable law, to indemnify and to advance expenses to persons other than Covered Persons when and as authorized by appropriate corporate action.

 

Article VII.
Miscellaneous

 

Section 7.01      Fiscal Year. The fiscal year of the Corporation shall be determined by resolution of the Board of Directors.

 

Section 7.02      Execution of Corporate Contracts and Instruments. The Board of Directors, except as otherwise provided in these Bylaws, may authorize any officer or officers, or agent or agents, to enter into any contract or execute any instrument in the name of and on behalf of the Corporation; such authority may be general or confined to specific instances. Unless so authorized or ratified by the Board of Directors or within the agency power of an officer, no officer, agent or employee shall have any power or authority to bind the Corporation by any contract or engagement or to pledge its credit or to render it liable for any purpose or for any amount.

 

Section 7.03      Dividends. The Board of Directors, subject to any restrictions contained in either (i) the DGCL or (ii) the Certificate of Incorporation, may declare and pay dividends upon the shares of its Stock. Dividends may be paid in cash, in property or in shares of the Corporation’s Stock. The Board of Directors may set apart out of any of the funds of the Corporation available for dividends a reserve or reserves for any proper purpose and may abolish any such reserve. Such purposes shall include but not be limited to equalizing dividends, repairing or maintaining any property of the Corporation, and meeting contingencies.

 

Section 7.04      Registered Stockholders. The Corporation: (i) shall be entitled to recognize the exclusive right of a Person registered on its books as the owner of shares of Stock to receive dividends and to vote as such owner; and (ii) shall not be bound to recognize any equitable or other claim to or interest in such share or shares on the part of another Person, whether or not it shall have express or other notice thereof, except as otherwise provided by the laws of the State of Delaware.

 

 

Section 7.05      Corporate Seal. The Corporation may adopt a corporate seal, which shall be adopted and which may be altered by the Board of Directors. The Corporation may use the corporate seal by causing it or a facsimile thereof to be impressed or affixed or in any other manner reproduced.

 

Section 7.06      Construction; Definitions. Unless the context requires otherwise, the general provisions, rules of construction and definitions in the DGCL shall govern the construction of these Bylaws. Without limiting the generality of this provision, the singular number includes the plural and the plural number includes the singular.

 

Section 7.07      Manner of Notice.

 

(a)            Notice by Electronic Transmission. Without limiting the manner by which notice otherwise may be given effectively to Stockholders pursuant to the DGCL, the Certificate of Incorporation or these Bylaws, any notice to Stockholders given by the Corporation under any provision of the DGCL, the Certificate of Incorporation or these Bylaws shall be effective if given by a form of electronic transmission to the extent permitted by applicable law.

 

Subject to the provisions of the Stockholders Agreement for so long as it is in effect, any notice given pursuant to the preceding paragraph shall be deemed given (a) if by facsimile telecommunication, when directed to a number at which the Stockholder has consented to receive notice; (b) if by electronic mail, when directed to such Stockholder’s electronic mail address unless the Stockholder has notified the Corporation in writing or by electronic transmission of an objection to receiving notice by electronic mail; (c) if by a posting on an electronic network together with separate notice to the Stockholder of such specific posting, upon the later of (i) such posting and (ii) the giving of such separate notice; and (d) if by any other form of electronic transmission, when directed to the Stockholder. A notice by electronic mail must include a prominent legend that the communication is an important notice regarding the Corporation.

 

An affidavit of the Secretary or an Assistant Secretary of the Corporation or of the transfer agent or other agent of the Corporation that the notice has been given shall, in the absence of fraud, be prima facie evidence of the facts stated therein. For the purposes of these Bylaws, an “electronic transmission” means any form of communication, not directly involving the physical transmission of paper, that creates a record that may be retained, retrieved and reviewed by a recipient thereof, and that may be directly reproduced in paper form by such a recipient through an automated process.

 

(b)            Notice to Stockholders Sharing an Address. Without limiting the manner by which notice otherwise may be given effectively to Stockholders, and except as prohibited by applicable law, any notice to Stockholders given by the Corporation under any provision of applicable law, the Certificate of Incorporation, or these Bylaws shall be effective if given by a single written notice to Stockholders who share an address if consented to by the Stockholders at that address to whom such notice is given. Any such consent shall be revocable by the Stockholder by written notice to the Corporation. Any Stockholder who fails to object in writing to the Corporation, within 60 days of having been given written notice by the Corporation of its intention to send the single notice permitted under this Section 7.07, shall be deemed to have consented to receiving such single written notice.

 

 

(c)            Notice to Directors. Except as otherwise provided herein or permitted by applicable law, notices to any Director may be in writing and delivered personally, or delivered by recognized international courier service to such Director at such Director’s address appearing on the books of the Corporation, or mailed to such Director at such Director’s address appearing on the books of the Corporation, or may be given by telephone or by any means of electronic transmission (including, without limitation, electronic mail) directed to an address for receipt by such Director of electronic transmissions appearing on the books of the Corporation.

 

Section 7.08      Waiver of Notice of Meetings of Stockholders, Directors and Committees. A written waiver of any notice, signed by the person entitled to notice, or waiver by electronic transmission by such person, whether given before or after the time stated therein, shall be deemed equivalent to notice. Attendance of a person at a meeting shall constitute a waiver of notice of such meeting, except when the person attends a meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the Stockholders, Board of Directors, or committee or subcommittee of the Board of Directors need be specified in a waiver of notice.

 

Section 7.09      Form of Records. Any records maintained by or on behalf of the Corporation in the regular course of its business, including its stock ledger, books of account, and minute books, may be kept on, or by means of, or be in the form of, any information storage device, method or one or more electronic networks or databases, provided that the records so kept can be converted into clearly legible paper form within a reasonable time, and the stock ledger is maintained in accordance with applicable law.

 

Section 7.10      Amendment of Bylaws. Except as otherwise provided in the Certificate of Incorporation and subject to the Stockholders Agreement (for so long as it remains in effect), these Bylaws may be altered, amended or repealed, and new bylaws made, only by the affirmative vote of (i) at least a majority of the Directors then in office or (ii) holders of at least sixty-six and two-thirds percent (66 2/3%) of the voting power of the then outstanding shares of Stock entitled to vote generally in the election of Directors, voting together as a single class.

 

*      *      *

 

 

 

Exhibit 4.1

 

 

THIS CERTIFIES THAT is the owner of CUSIP DATED COUNTERSIGNED AND REGISTERED: COMPUTERSHARE TRUST COMPANY, N.A. TRANSFER AGENT AND REGISTRAR, FULLY-PAID AND NON-ASSESSABLE SHARES OF CLASS A COMMON STOCK OF Fluence Energy, Inc. (hereinafter called the “Company”), transferable on the books of the Company in person or by duly authorized attorney, upon surrender of this Certificate properly endorsed. This Certificate and the shares represented hereby, are issued and shall be held subject to all of the provisions of the Certificate of Incorporation, as amended, and the By-Laws, as amended, of the Company (copies of which are on file with the Company and with the Transfer Agent), to all of which each holder, by acceptance hereof, assents. This Certificate is not valid unless countersigned and registered by the Transfer Agent and Registrar. Witness the facsimile seal of the Company and the facsimile signatures of its duly authorized officers. CLASS A COMMON STOCK PAR VALUE $0.00001 CLASS A COMMON STOCK SEE REVERSE FOR CERTAIN DEFINITIONS Certificate Number Shares . FLUENCE ENERGY, INC. INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE FACSIMILE SIGNATURE TO COME FACSIMILE SIGNATURE TO COME President Secretary By AUTHORIZED SIGNATURE June 21, 2021 DEL AWAR E CO R PO RATE FLUENCE ENER GY, INC. ZQ|CERT#|COY|CLS|RGSTRY|ACCT#|TRANSTYPE|RUN#|TRANS# 34379V 10 3 DD-MMM-YYYY * * 000000* * * * * * * * * * * * * * * * * * * * * 000000* * * * * * * * * * * * * * * * * * * * * 000000* * * * * * * * * * * * * * * * * * * * * 000000* * * * * * * * * * * * * * * * * * * * * 000000* * * * * * * * * * * * * * ** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Sample **** Mr. Sample **000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares*** *000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares**** 000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****0 00000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****00 0000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000 000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****0000 00**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****00000 0**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000 **Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000* *Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000** Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**Shares****000000**S ***ZERO HUNDRED THOUSAND ZERO HUNDRED AND ZERO*** MR. SAMPLE & MRS. SAMPLE & MR. SAMPLE & MRS. SAMPLE ZQ00000000 Certificate Numbers 1234567890/1234567890 1234567890/1234567890 1234567890/1234567890 1234567890/1234567890 1234567890/1234567890 1234567890/1234567890 Total Transaction Num/No. 123456 Denom. 123456 Total 1234567 MR A SAMPLE DESIGNATION (IF ANY) ADD 1 ADD 2 ADD 3 ADD 4 Fluence Energy, Inc. PO BOX 505006, Louisville, KY 40233-5006 CUSIP/IDENTIFIER XXXXXX XX X Holder ID XXXXXXXXXX Insurance Value 1,000,000.00 Number of Shares 123456 DTC 12345678 123456789012345 THIS CERTIFICATE IS TRANSFERABLE IN CITIES DESIGNATED BY THE TRANSFER AGENT, AVAILABLE ONLINE AT www.computershare.com Exhibit 4.1

 

Exhibit 5.1

 

	1271 Avenue of the Americas
	New York, New York  10020-1401
	Tel: +1.212.906.1200  Fax: +1.212.751.4864
	www.lw.com
	FIRM / AFFILIATE OFFICES
	Beijing	Moscow
	Boston	Munich
	Brussels	New York
	Century City	Orange County
	Chicago	Paris
	Dubai	Riyadh
	Düsseldorf	San Diego
	Frankfurt	San Francisco
	Hamburg	Seoul
	Hong Kong	Shanghai
	Houston	Silicon Valley
	London	Singapore
	Los Angeles	Tokyo
	Madrid	Washington, D.C.
	Milan

 

October 18, 2021

 

Fluence Energy, Inc.

4601 Fairfax Drive, Suite 600

Arlington, Virginia 22203

 

Re:	Registration Statement No. 333-259839;
	35,650,000 shares of Class A common stock, par value $0.00001 per share

 

Ladies and Gentlemen:

 

We have acted as special counsel to Fluence Energy, Inc., a Delaware corporation (the “Company”), in connection with the proposed issuance of up to 35,650,000 shares of Class A common stock, $0.00001 par value per share, which are being offered by the Company (the “Shares”). The Shares are included in a registration statement on Form S-1 under the Securities Act of 1933, as amended (the “Act”), initially filed with the Securities and Exchange Commission (the “Commission”) on September 28, 2021 (Registration No. 333-259839, as amended, the “Registration Statement”). The term “Shares” shall include any additional shares of common stock registered by the Company pursuant to Rule 462(b) under the Act in connection with the offering contemplated by the Registration Statement. This opinion is being furnished in connection with the requirements of Item 601(b)(5) of Regulation S-K under the Act, and no opinion is expressed herein as to any matter pertaining to the contents of the Registration Statement or related Prospectus, other than as expressly stated herein with respect to the issue of the Shares.

 

As such counsel, we have examined such matters of fact and questions of law as we have considered appropriate for purposes of this letter. With your consent, we have relied upon certificates and other assurances of officers of the Company and others as to factual matters without having independently verified such factual matters. We are opining herein as to General Corporation Law of the State of Delaware, and we express no opinion with respect to any other laws.

 

Subject to the foregoing and the other matters set forth herein, it is our opinion that, as of the date hereof, upon the proper filing of the amended and restated certificate of incorporation of the Company, substantially in the form most recently filed as an exhibit to the Registration Statement, with the Secretary of State of Delaware and when such Shares shall have been duly registered on the books of the transfer agent and registrar therefor in the name or on behalf of the purchasers and have been issued by the Company against payment therefor (not less than par value) in the circumstances contemplated by the form of underwriting agreement most recently filed as an exhibit to the Registration Statement, the issue and sale of the Shares will have been duly authorized by all necessary corporate action of the Company, and the Shares will be validly issued, fully paid and nonassessable. In rendering the foregoing opinion, we have assumed that the Company will comply with all applicable notice requirements regarding uncertificated shares provided in the General Corporation Law of the State of Delaware.

 

 

October 18, 2021
Page 2

 

 

 

This opinion is for your benefit in connection with the Registration Statement and may be relied upon by you and by persons entitled to rely upon it pursuant to the applicable provisions of the Act. We consent to your filing this opinion as an exhibit to the Registration Statement and to the reference to our firm in the Prospectus under the heading “Legal Matters.” We further consent to the incorporation by reference of this letter and consent into any post-effective amendment to the Registration Statement filed pursuant to Rule 462(b) with respect to the Shares. In giving such consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Act or the rules and regulations of the Commission thereunder.

 

	Very truly yours,
	/s/ Latham & Watkins LLP

 

 

 

Exhibit 10.1

 

TAX RECEIVABLE AGREEMENT

 

by and among

 

FLUENCE ENERGY, INC.,

 

FLUENCE ENERGY, LLC,

 

the several TRA PARTIES (as defined herein),

 

and

 

OTHER PERSONS FROM TIME TO TIME PARTY HERETO

 

Dated as of [______]

 

 

CONTENTS

 

		Page
ARTICLE I. DEFINITIONS		1
Section 1.1	Definitions	1
Section 1.2	Rules of Construction	8
ARTICLE II. DETERMINATION OF REALIZED TAX BENEFIT		9
Section 2.1	Attribute Schedule	9
Section 2.2	Tax Benefit Schedule	10
Section 2.3	Procedures, Amendments.	10
ARTICLE III. TAX BENEFIT PAYMENTS		11
Section 3.1	Timing and Amount of Tax Benefit Payments	11
Section 3.2	No Duplicative Payments	12
Section 3.3	Pro Rata Payments.	12
ARTICLE IV. TERMINATION		12
Section 4.1	Early Termination of Agreement; Breach of Agreement	12
Section 4.2	Early Termination Notice	13
Section 4.3	Payment upon Early Termination.	13
ARTICLE V. SUBORDINATION AND LATE PAYMENTS		14
Section 5.1	Subordination	14
Section 5.2	Late Payments by the Corporation	14
ARTICLE VI. TAX MATTERS; CONSISTENCY; COOPERATION		14
Section 6.1	Participation in the Corporation’s and the LLC’s Tax Matters	14
Section 6.2	Consistency	15
Section 6.3	Cooperation	15

 

 

ARTICLE VII. MISCELLANEOUS		15
Section 7.1	Notices	15
Section 7.2	Counterparts; Electronic Signature	16
Section 7.3	Entire Agreement; No Third Party Beneficiaries	16
Section 7.4	Governing Law	16
Section 7.5	Severability	16
Section 7.6	Assignments; Amendments; Successors; No Waiver	16
Section 7.7	Titles and Subtitles	17
Section 7.8	Resolution of Disputes	17
Section 7.9	Reconciliation	18
Section 7.10	Withholding	18
Section 7.11	Consolidated Group; Transfers of Corporate Assets	19
Section 7.12	Confidentiality	19
Section 7.13	Change in Law	20
Section 7.14	Interest Rate Limitation	20
Section 7.15	Independent Nature of Rights and Obligations	21
Section 7.16	LLC Agreement	21
Section 7.17	Tax Characterization and Elections	21
Section 7.18	Payment Amounts	21

 

Annexes
Annex A	-	Form of Joinder Agreement
Annex B	-	TRA Parties

 

 

 

TAX RECEIVABLE AGREEMENT

 

This TAX RECEIVABLE AGREEMENT (as the same may be amended, restated, amended and restated, supplemented or otherwise modified from time to time, this “Agreement”), dated [________], is hereby entered into by and among Fluence Energy, Inc., a Delaware corporation (the “Corporation”) (and, along with any other member of any U.S. federal income tax consolidated group including the Corporation, the “Corporate Group”), Fluence Energy, LLC, a Delaware limited liability company (the “LLC”), and each of the TRA Parties from time to time party hereto. Capitalized terms used but not otherwise defined herein have the respective meanings set forth in Section 1.01.

 

RECITALS

 

WHEREAS, the TRA Parties hold (or prior to an Exchange will hold) equity interests in the LLC (the “Units”);

 

WHEREAS, after the date hereof, pursuant to, and subject to the provisions of, the LLC Agreement and any other applicable documentation, each TRA Party has the right from time to time to require the LLC to redeem (a “Redemption”) all or a portion of such TRA Party’s Units, which Redemption may be effected, at the Corporation’s election, for cash or Class A Common Stock (to be paid by the LLC), or by the Corporation effecting a direct exchange (a “Direct Exchange”) for such Units, and as a result of such sales, Redemptions or Direct Exchanges the Corporation or the Corporate Group may be entitled to utilize (or otherwise be entitled to the benefits arising out of) the Covered Tax Assets;

 

WHEREAS, the income, gain, loss, expense, deduction and other Tax items of the Corporation or the Corporate Group may be affected by the Covered Tax Assets;

 

WHEREAS, the parties to this Agreement desire to make certain arrangements with respect to the effects of the Covered Tax Assets;

 

NOW, THEREFORE, in connection with the foregoing and the respective covenants and agreements set forth herein, and intending to be legally bound hereby, the parties hereto agree as follows:

 

ARTICLE I.
DEFINITIONS

 

Section 1.1      Definitions. As used in this Agreement, the terms set forth in this Article I shall have the following meanings (such meanings to be equally applicable to both (i) the singular and plural and (ii) the active and passive forms of the terms defined).

 

“Actual Tax Liability” means, with respect to any Taxable Year, the actual liability for U.S. federal, state and local income Taxes of (i) the Corporation or the Corporate Group, as applicable, and (ii) without duplication, the LLC, but in the case of this clause (ii) only with respect to U.S. federal, state and local income Taxes imposed on the LLC and allocable to the Corporation or the Corporate Group, in each case using the same methods, elections, conventions, and practices used on the relevant Tax Return; provided, that the actual liability for Taxes described in clauses (i) and (ii) shall be calculated (a) using the Assumed State and Local Tax Rate, solely for purposes of calculating the state and local Actual Tax Liability and (b) assuming, solely for purposes of calculating the liability for U.S. federal income Taxes, that state and local income and franchise Taxes are not deductible by the Corporation or the Corporate Group for U.S. federal income Tax purposes.

 

 

“Advance Payment” is defined in Section 3.1(b) of this Agreement.

 

“Affiliate” means, with respect to any Person, any other Person that directly or indirectly, through one or more intermediaries, Controls, is Controlled by, or is under common Control with, such first Person.

 

“Agreed Rate” means a per annum rate of LIBOR plus 100 basis points.

 

“Agreement” is defined in the preamble.

 

“Amended Schedule” is defined in Section 2.3(b) of this Agreement.

 

“Assumed State and Local Tax Rate” means six percent (6%), (which amount, for the avoidance of doubt, was selected by taking into account and is intended to reflect the deductibility by the Corporation for federal income tax purposes of state and local income taxes under current law), provided that the Corporation may adjust the Assumed State and Local Tax Rate from time to time (a) in the event of a change in Law, (b) in the event of a change in material fact or (c) if the Corporation otherwise determines in good faith from time to time that such adjustment is necessary or advisable.

 

“Attributable” is defined in Section 3.1(b) of this Agreement.

 

“Attribute Schedule” is defined in Section 2.1 of this Agreement.

 

“Basis Adjustment” means the increase or decrease to the tax basis of, or the Corporation’s share of, the tax basis of the Reference Assets (i) under Section 734(b), 743(b) and 754 of the Code and, in each case, the comparable sections of U.S. state and local tax law (in situations where, following an Exchange, the LLC remains in existence as an entity for tax purposes) and (ii) under Sections 732 and 1012 of the Code and, in each case, the comparable sections of U.S. state and local tax law (in situations where, as a result of one or more Exchanges, the LLC becomes an entity that is disregarded as separate from its owner for tax purposes), in each case, as a result of any Exchange and any payments made under this Agreement. For purposes of determining the Basis Adjustments (and any payments made hereunder with respect to such Basis Adjustments) that are attributable to Reference Assets held by an entity in which the LLC owns a direct or indirect interest and where obtaining information necessary to determine the allocation of the Basis Adjustments is not practicable (as reasonably determined by the Corporation), the Corporation may make reasonable estimates and assumptions, including if determined by the Corporation assuming that such Basis Adjustments will be allocable to property that is depreciable or amortizable over a 15-year period. Notwithstanding any other provision of this Agreement, the amount of any Basis Adjustment resulting from an Exchange of one or more Units shall be determined without regard to any Pre-Exchange Transfer of such Units and as if any such Pre-Exchange Transfer had not occurred.

 

“Business Day” means any day excluding Saturday, Sunday and any day that is a legal holiday under the laws of the State of New York or is a day on which banking institutions located in New York are closed.

 

 

“Change of Control” means the occurrence of any of the following events:

 

(a)            any “person” or “group” (within the meaning of Sections 13(d) and 14(d) of the Exchange Act (as defined in the LLC Agreement), but excluding any employee benefit plan of such person and its subsidiaries, and any person or entity acting in its capacity as trustee, agent or other fiduciary or administrator of any such plan) becomes the “beneficial owner” (within the meaning of Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of shares of Class A Common Stock, Class B Common Stock, preferred stock and/or any other class or classes of capital stock of the Corporation (if any) representing in the aggregate more than fifty percent (50%) of the voting power of all of the outstanding shares of capital stock of the Corporation entitled to vote;

 

(b)            the stockholders of the Corporation approve a plan of complete liquidation or dissolution of the Corporation or there is consummated an agreement or series of related agreements for the sale or other disposition, directly or indirectly, by the Corporation of all or substantially all of the Corporation’s assets (including a sale of all or substantially all of the assets of the Company);

 

(c)            there is consummated a merger or consolidation of the Corporation with any other corporation or entity, and, immediately after the consummation of such merger or consolidation, the voting securities of the Corporation immediately prior to such merger or consolidation do not continue to represent, or are not converted into, more than fifty percent (50%) of the combined voting power of the then outstanding voting securities of the Person resulting from such merger or consolidation or, if the surviving company is a Subsidiary, the ultimate parent thereof; or

 

(d)            the Corporation ceases to be the sole Managing Member (as defined in the LLC Agreement) of the LLC.

 

Notwithstanding the foregoing, a “Change of Control” shall not be deemed to have occurred by virtue of the consummation of any transaction or series of integrated transactions immediately following which the record holders of the Class A Common Stock, Class B Common Stock, preferred stock and/or any other class or classes of capital stock of the Corporation immediately prior to such transaction or series of transactions continue to have substantially the same proportionate ownership in and voting control over, and own substantially all of the shares of, an entity which owns all or substantially all of the assets of the Corporation immediately following such transaction or series of transactions.

 

“Class A Common Stock” means Class A common stock, $0.00001 par value per share, of the Corporation.

 

“Class B Common Stock” means Class B-1 common stock, $0.00001 par value per share, of the Corporation, and Class B-2 common stock, $0.00001 par value per share, of the Corporation.

 

“Code” means the U.S. Internal Revenue Code of 1986, as amended, or successor statute, as applicable.

 

 

“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 ownership of voting securities, by contract or other agreement.

 

“Corporation” is defined in the preamble to this Agreement.

 

“Covered Tax Assets” means, with respect to a TRA Party, (i) Basis Adjustments and (ii) Imputed Interest. The determination of the Covered Tax Assets that are allocable to Units being exchanged by a TRA Party (and payments made hereunder with respect thereto) shall be determined in good faith by the Corporation in consultation with its tax return preparer, including by taking into account reasonable estimates and assumptions as determined by the Corporation. For the avoidance of doubt, Covered Tax Assets shall include any carryforwards or similar attributes that are attributable to the Tax items described in clauses (i) through (ii).

 

“Cumulative Net Realized Tax Benefit” for a Taxable Year means the cumulative amount of Realized Tax Benefits for all Taxable Years of the Corporation or the Corporate Group, as applicable, up to and including such Taxable Year, net of the cumulative amount of Realized Tax Detriments for the same period. The Realized Tax Benefit and Realized Tax Detriment for each Taxable Year shall be based on the most recent Tax Benefit Schedules or Amended Schedules, if any, in existence at the time of such determination.

 

“Default Rate” means a per annum rate of LIBOR plus 500 basis points.

 

“Determination” shall have the meaning ascribed to such term in Section 1313(a) of the Code or similar provision of law, as applicable, or any other event (including the execution of IRS Form 870-AD) that finally and conclusively establishes the amount of any liability for tax and shall also include the acquiescence of the Corporation to the amount of any assessed liability for Tax.

 

“Direct Exchange” is defined in the recitals to this agreement.

 

“Dispute” is defined in Section 7.8(a) of this Agreement.

 

“Early Termination Agreed Rate” means LIBOR plus 100 basis points.

 

“Early Termination Date” means the date of an Early Termination Notice for purposes of determining the Early Termination Payment.

 

“Early Termination Effective Date” is defined in Section 4.2 of this Agreement.

 

“Early Termination Notice” is defined in Section 4.2 of this Agreement.

 

“Early Termination Payment” is defined in Section 4.3(b) of this Agreement.

 

“Early Termination Rate” means the lesser of (i) 6.50% per annum, compounded annually, and (ii) the Early Termination Agreed Rate.

 

“Early Termination Schedule” is defined in Section 4.2 of this Agreement.

 

 

“Exchange” means any Direct Exchange or Redemption.

 

“Expert” is defined in Section 7.9 of this Agreement.

 

“Governing Body” means the board of directors of the Corporation.

 

“Hypothetical Tax Liability” means, with respect to any Taxable Year, the liability for U.S. federal, state and local income Taxes of (i) the Corporation or the Corporate Group, as applicable, and (ii) without duplication, the LLC, but in the case of this clause (ii) only with respect to U.S. federal, state and local income Taxes imposed on the LLC and allocable to the Corporation or the Corporate Group, in each case using the same methods, elections, conventions, and practices used on the relevant Tax Return; provided, that the actual liability for Taxes described in clauses (i) and (ii) shall be calculated (a) calculated without taking into account the Covered Tax Assets (including, for the avoidance of doubt, any carryforward or carryback of any tax item attributable to the Covered Tax Assets), (b) using the Assumed State and Local Tax Rate, solely for purposes of calculating the state and local Hypothetical Tax Liability, and (c) assuming, solely for purposes of calculating the liability for U.S. federal income Taxes, that state and local income and franchise Taxes are not deductible by the Corporation or the Corporate Group for U.S. federal income Tax purposes.

 

“Imputed Interest” in respect of a TRA Party shall mean any interest imputed under the provisions of the Code with respect to the Corporation’s payment obligations in respect of such TRA Party under this Agreement.

 

“Interest Amount” is defined in Section 3.1(b) of this Agreement.

 

“IPO” means the initial public offering of shares of Class A Common Stock by the Corporation.

 

“IPO Date” means the closing date of the IPO.

 

“IRS” means the U.S. Internal Revenue Service.

 

“Joinder” means a joinder to this Agreement, in form and substance substantially similar to Annex A to this Agreement.

 

“Joinder Requirement” is defined in Section 7.6(b) of this Agreement.

 

“LIBOR” means during any period, the rate which appears on the Bloomberg Page BBAM1 (or on such other substitute Bloomberg page that displays rates at which U.S. dollar deposits are offered by leading banks in the London interbank deposit market), or the rate which is quoted by another source selected by the Corporation as an authorized information vendor for the purpose of displaying rates at which U.S. dollar deposits are offered by leading banks in the London interbank deposit market (an “Alternate Source”), at approximately 11:00 a.m., London time, two (2) Business Days prior to the first day of such period as the London interbank offered rate for U.S. dollars having a borrowing date and a maturity comparable to such period (or if there shall at any time, for any reason, no longer exist a Bloomberg Page BBAM1 (or any substitute page) or any LIBOR Alternate Source, a comparable replacement rate determined by the Corporation at such time, which determination shall be conclusive absent manifest error; provided, that at no time shall LIBOR be less than 0%.

 

 

 

“LLC” is defined in the recitals to this Agreement.

 

“LLC Agreement” means that certain Third Amended and Restated Limited Liability Company Agreement of the LLC, dated as of the date hereof, as such agreement may be further amended, restated, supplemented and/or otherwise modified from time to time.

 

“Market Value” means the Common Unit Redemption Price (as defined in the LLC Agreement), determined as of an Early Termination Date (treating such Early Termination Date as a Redemption Date (as defined in the LLC Agreement) for such purpose).

 

“Net Tax Benefit” is defined in Section 3.1(b) of this Agreement.

 

“Objection Notice” is defined in Section 2.3(a) of this Agreement.

 

“Person” means any individual, corporation, firm, partnership, joint venture, limited liability company, estate, trust, business association, organization, governmental entity or other entity.

 

“Pre-Exchange Transfer” means any transfer of one or more Units (including upon the death of a Member) (i) that occurs after the IPO but prior to a Redemption or Direct Exchange of such Units and (ii) to which Section 743(b) of the Code applies.

 

“Realized Tax Benefit” means, for a Taxable Year, the excess, if any, of the Hypothetical Tax Liability over the Actual Tax Liability. If all or a portion of the actual liability for such Taxes for the Taxable Year arises as a result of an audit by a Taxing Authority of any Taxable Year, such liability shall not be included in determining the Realized Tax Benefit until there has been a Determination.

 

“Realized Tax Detriment” means, for a Taxable Year, the excess, if any, of the Actual Tax Liability over the Hypothetical Tax Liability. If all or a portion of the actual liability for such Taxes for the Taxable Year arises as a result of an audit by a Taxing Authority of any Taxable Year, such liability shall not be included in determining the Realized Tax Detriment unless and until there has been a Determination.

 

“Reconciliation Dispute” is defined in Section 7.9 of this Agreement.

 

“Reconciliation Procedures” is defined in Section 2.3(a) of this Agreement.

 

“Redemption” has the meaning in the recitals to this Agreement.

 

“Reference Asset” means any tangible or intangible asset of the LLC or any of its successors or assigns, and any asset held by any entity in which the LLC owns a direct or indirect equity interest and that is treated as a partnership or disregarded entity for U.S. federal income Tax purposes (but only to the extent such entity is held either directly or only through other entities treated as partnerships or disregarded entities) for purposes of the applicable Tax, as of the relevant date. A Reference Asset also includes any asset that is “substituted basis property” under Section 7701(a)(42) of the Code with respect to a Reference Asset.

 

 

“Schedule” means any of the following: (i) an Attribute Schedule, (ii) a Tax Benefit Schedule, or (iii) the Early Termination Schedule, and, in each case, any amendments thereto.

 

“Senior Obligations” is defined in Section 5.1 of this Agreement.

 

“Stockholders Agreement” means the Stockholders Agreement, dated as of the date hereof, by and among the Corporation and the other persons party thereto or that may become parties thereto from time to time, as the same may be amended, restated, supplemented and/or otherwise modified, from time to time.

 

“Subsidiary” means, with respect to any Person and as of the date of any determination, any other Person as to which such Person, owns, directly or indirectly, or otherwise controls, more than 50% of the voting power or other similar interests, or the sole general partner interest, or managing member or similar interest, of such Person.

 

“Tax Benefit Payment” is defined in Section 3.1(b) of this Agreement.

 

“Tax Benefit Schedule” is defined in Section 2.2(a) of this Agreement.

 

“Tax Return” means any return, declaration, report or similar statement filed or required to be filed with respect to Taxes (including any attached schedules), including, without limitation, any information return, claim for refund, amended return and declaration of estimated Tax.

 

“Taxable Year” means a taxable year of the Corporation or the Corporate Group under the Code or comparable sections of U.S. state or local tax law, as applicable (and, therefore, for the avoidance of doubt, may include a period of less than 12 months for which a Tax Return is made), ending on or after the closing date of the IPO.

 

“Taxes” means any and all United States federal, state or local taxes, assessments or other charges that are based on or measured with respect to net income or profits (including alternative minimum taxes).

 

“Taxing Authority” means any national, federal, state, county, municipal, or local government, or any subdivision, agency, commission or authority thereof, or any quasi-governmental body, or any other authority of any kind, exercising regulatory or other authority in relation to tax matters.

 

“TRA Parties” means the Persons listed on Annex B.

 

“Treasury Regulations” means the final, temporary, and (to the extent they can be relied upon) proposed regulations under the Code, as promulgated from time to time (including corresponding provisions and succeeding provisions) as in effect for the relevant taxable period.

 

“U.S.” means the United States of America.

 

“Units” is defined in the recitals to this Agreement.

 

 

“Valuation Assumptions” means, as of an Early Termination Date, the assumptions that:

 

(1)            in each Taxable Year ending on or after such Early Termination Date, the Corporation or the Corporate Group, as applicable, will have taxable income sufficient to fully use the Covered Tax Assets (other than any such Covered Tax Assets that constitute or have resulted in net operating losses, excess interest deduction, or credit carryforwards or carryovers (determined as of the Early Termination Date), which shall be governed by paragraph 4 below) during such Taxable Year or future Taxable Years in which such deductions or other attributes would become available;

 

(2)            the U.S. federal income tax rates that will be in effect for each such Taxable Year will be those specified for each such Taxable Year by the Code and other law as in effect on the Early Termination Date, except to the extent any change to such tax rates for such Taxable Year has already been enacted into law;

 

(3)            all taxable income of the Corporation or the Corporate Group, as applicable, will be subject to the maximum applicable tax rate for U.S. federal income tax purposes throughout the relevant period, and the tax rate for U.S. state and local income taxes shall be the Assumed State and Local Tax Rate as in effect for the Taxable Year of the Early Termination Date;

 

(4)            any net operating loss, excess interest deduction, or credit carryovers or carrybacks (or similar items with respect to carryovers or carrybacks) generated by any Covered Tax Asset and available as of the Early Termination Date will be used by the Corporation ratably over a period beginning on the Early Termination Date and ending on the earlier of (i) 15 years following the Early Termination Date, or (ii) the scheduled expiration date, if any, under applicable Tax law of such net operating losses, excess interest deductions, or credit carryovers or carrybacks (or similar items with respect to carryovers or carrybacks);

 

(5)            any non-amortizable assets (other than equity interests in Subsidiaries that are treated as corporations for U.S. federal income tax purposes) will be disposed of in a fully taxable transaction on the fifteenth anniversary of the IPO Date (or, if later, on the Early Termination Date) ; provided, that in the event of a Change of Control, (i) such non-amortizable assets shall be disposed of at the time of the sale of the relevant asset (if earlier than such fifteenth anniversary); and (ii) such non-amortizable assets shall be considered to have been disposed of on the date of the Change of Control, if such Change of Control occurs more than 15 years after the applicable Exchange or IPO Date, as applicable;

 

(6)            if, on the Early Termination Date, any TRA Party has Units that have not been Exchanged, then such Units shall be deemed to be Exchanged for the Market Value that would be received by such TRA Party if such Units had been Exchanged on the Early Termination Date, and such TRA Party shall be entitled to receive the amount of cash such TRA Party would have been entitled to pursuant to Section 4.3(a) had such Units actually been Exchanged on the Early Termination Date; and

 

(7)            any payment obligations pursuant to this Agreement will be satisfied on the date that any Tax Return to which such payment obligation relates is required to be filed excluding any extensions.

 

Section 1.2             Rules of Construction. Unless otherwise specified herein:

 

(a)            The meanings of defined terms are equally applicable to the singular and plural forms of the defined terms.

 

 

(b)            For purposes of interpretation of this Agreement:

 

(i)            The words “herein,” “hereto,” “hereof” and “hereunder” and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision thereof.

 

(ii)            References in this Agreement to a Schedule, Article, Section, clause or sub-clause refer to the appropriate Schedule to, or Article, Section, clause or subclause in, this Agreement.

 

(iii)            References in this Agreement to dollars or “$” refer to the lawful currency of the United States of America.

 

(iv)            The term “including” is by way of example and not limitation.

 

(v)            The term “documents” includes any and all instruments, documents, agreements, certificates, notices, reports, financial statements and other writings, however evidenced, whether in physical or electronic form.

 

(c)            In the computation of periods of time from a specified date to a later specified date, the word “from” means “from and including;” the words “to” and “until” each mean “to but excluding;” and the word “through” means “to and including.”

 

(d)            Section headings herein are included for convenience of reference only and shall not affect the interpretation of this Agreement.

 

(e)            Unless otherwise expressly provided herein, (a) references to organization documents (including the LLC Agreement), agreements (including this Agreement) and other contractual instruments shall be deemed to include all subsequent amendments, restatements, extensions, supplements and other modifications thereto, but only to the extent that such amendments, restatements, extensions, supplements and other modifications are permitted hereby; and (b) references to any law (including the Code and the Treasury Regulations) shall include all statutory and regulatory provisions consolidating, amending, replacing, supplementing or interpreting such law.

 

ARTICLE II.
DETERMINATION OF REALIZED TAX BENEFIT

 

Section 2.1             Attribute Schedule. Following the IPO Date, within one hundred twenty (120) calendar days after the filing of Form 1120 (or any successor form) of the Corporation or the Corporate Group for a given Taxable Year, the Corporation shall deliver to the TRA Parties a schedule (the “Attribute Schedule”) that shows, in reasonable detail, the Covered Tax Assets that are available for use by the Corporation or the Corporate Group with respect to such Taxable Year with respect to each TRA Party (including the Basis Adjustments with respect to the Reference Assets resulting from any Exchanges and the periods over which such Basis Adjustments are amortizable or depreciable). The Attribute Schedule shall also list any limitations on the ability of the Corporation or the Corporate Group to utilize any Covered Tax Assets under applicable laws (including as a result of the operation of Section 197(f)(9) of the Code, Section 382 of the Code or Section 383 of the Code).

 

 

Section 2.2             Tax Benefit Schedule.

 

(a)            Tax Benefit Schedule. Within one hundred twenty (120) calendar days after the filing of the Form 1120 (or any successor form) of the Corporation or the Corporate Group for any Taxable Year, the Corporation shall provide to the TRA Parties a schedule showing, in reasonable detail, the calculation of the Tax Benefit Payment in respect of each TRA Party for such Taxable Year and the calculation of the Realized Tax Benefit and Realized Tax Detriment and the components thereof for such Taxable Year (a “Tax Benefit Schedule”). Each Tax Benefit Schedule will become final as provided in Section 2.3(a) and may be amended as provided in Section 2.3(b) (subject to the procedures set forth in Section 2.3(b)).

 

(b)            Applicable Principles. For purposes of calculating the Realized Tax Benefit or Realized Tax Detriment for any period, carryovers or carrybacks of any Tax item attributable to the Covered Tax Assets shall be considered to be subject to the rules of the Code and the Treasury Regulations, as applicable, governing the use, limitation and expiration of carryovers or carrybacks of the relevant type. If a carryover or carryback of any Tax item includes a portion that is attributable to a Covered Tax Asset and another portion that is not, such respective portions shall be considered to be used in accordance with the “with and without” methodology. For the avoidance of doubt, the Corporation shall be entitled to make reasonable simplifying assumptions in making determinations contemplated by this Agreement, including reasonable assumptions regarding basis recovery periods (and the parties hereby agree that, among other things, the Corporation’s determination of the Realized Tax Benefit and Realized Tax Detriment with respect to U.S. state and local taxes might not take into account jurisdiction-specific U.S. state and local adjustments to the U.S. federal taxable income base or to the U.S. federal rules regarding the utilization of tax attribute carryovers).

 

Section 2.3             Procedures, Amendments.

 

(a)            Procedure. Every time the Corporation delivers to the TRA Parties a Schedule under this Agreement, including any Amended Schedule delivered pursuant to Section 2.3(b), and any Early Termination Schedule or amended Early Termination Schedule, the Corporation shall also (x) deliver to the TRA Parties schedules, valuation reports, if any, and work papers, as determined by the Corporation or reasonably requested by the TRA Parties, providing reasonable detail regarding the preparation of the Schedule, and (y) allow the TRA Parties reasonable access at no cost to the appropriate representatives of the Corporation, as determined by the Corporation or requested by the TRA Parties in connection with the review of such Schedule. Without limiting the application of the preceding sentence, each time the Corporation delivers to the TRA Parties a Tax Benefit Schedule, in addition to the Tax Benefit Schedule duly completed, the Corporation shall deliver to the TRA Parties a reasonably detailed calculation of the applicable Hypothetical Tax Liability and a reasonably detailed calculation of the applicable Actual Tax Liability, as well as any other work papers as determined by the Corporation or reasonably requested by the TRA Parties, provided that the Corporation shall not be required to provide any information that it reasonably believes is unnecessary for purposes of determining the items in the applicable Schedule or amendment thereto. An applicable Schedule or amendment thereto shall become final and binding on all parties sixty (60) calendar days after the first date on which the TRA Parties have received the applicable Schedule or amendment thereto unless (i) a TRA Party provides the Corporation with notice of a material objection to such Schedule (“Objection Notice”) made in good faith or (ii) each TRA Party provides a written waiver of such right of any Objection Notice within the period described in clause (i) above, in which case such Schedule or amendment thereto becomes binding on the date the last such waiver is received by the Corporation. If the Corporation and the TRA Parties, for any reason, are unable to successfully resolve the issues raised in an Objection Notice within thirty (30) calendar days after receipt by the Corporation of an Objection Notice, then the Corporation and the TRA Parties shall employ the reconciliation procedures described in Section 7.9 of this Agreement (the “Reconciliation Procedures”).

 

 

(b)            Amended Schedule. The applicable Attribute Schedule or Tax Benefit Schedule for any Taxable Year may be amended from time to time by the Corporation (i) in connection with a Determination affecting such Schedule, (ii) to correct inaccuracies in the Schedule identified after the date the Schedule was provided to the TRA Parties, (iii) to comply with the Expert’s determination under the Reconciliation Procedures, (iv) to reflect a change in the Realized Tax Benefit or Realized Tax Detriment for such Taxable Year attributable to a carryback or carryforward of a loss or other tax item to such Taxable Year, (v) to reflect a change in the Realized Tax Benefit or Realized Tax Detriment for such Taxable Year attributable to an amended Tax Return filed for such Taxable Year or (vi) as otherwise determined in good faith by the Corporation to be reasonably necessary or appropriate (any such Schedule, an “Amended Schedule”). The Attribute Schedule shall be appropriately amended by the Corporation and the TRA Parties to the extent that, as a result of a Determination, the Corporation is required to calculate its Tax liability in a manner inconsistent with the Attribute Schedule. The Corporation shall provide an Amended Schedule to the TRA Parties within one hundred twenty (120) calendar days of the occurrence of an event referenced in clauses (i) through (vi) of the first sentence of this Section 2.3(b).

 

ARTICLE III.
TAX BENEFIT PAYMENTS

 

Section 3.1             Timing and Amount of Tax Benefit Payments.

 

(a)            Within five (5) Business Days after a Tax Benefit Schedule delivered to the TRA Parties becomes final in accordance with Section 2.3(a), the Corporation shall pay or cause to be paid to each TRA Party for such Taxable Year an amount equal to the excess, if any, of (i) the Tax Benefit Payment in respect of such TRA Party for such Taxable Year determined pursuant to Section 3.1(b) over (ii) the aggregate amount of Advance Payments previously made to such TRA Party in respect of such Taxable Year; provided that, if the Corporation makes Advance Payments, it shall make Advance Payments to all parties eligible to receive payments under this Tax Receivable Agreement with respect to a particular Taxable Year in proportion to their respective amount of anticipated payments under this Tax Receivable Agreement in respect of such Taxable Year, as determined by the Corporation. Each such Tax Benefit Payment or such Advance Payment shall be made by wire transfer of immediately available funds to the bank account previously designated by such TRA Party to the Corporation or as otherwise agreed by the Corporation and such TRA Party.

 

(b)            A “Tax Benefit Payment” in respect of a TRA Party means an amount, not less than zero, equal to the sum of the portion of the Net Tax Benefit that is Attributable to such TRA Party and the Interest Amount with respect thereto. A Net Tax Benefit is “Attributable” to a TRA Party to the extent that is derived from a Covered Tax Asset this is allocable to Units that were Exchanged by such TRA Party, as determined by the Corporation in accordance with the definition of “Covered Tax Assets.” The “Net Tax Benefit” for a Taxable Year shall be an amount equal to the excess, if any, of (i) 85% of the Cumulative Net Realized Tax Benefit as of the end of such Taxable Year over (ii) the sum of the total amount of payments previously made under Section 3.1(a) (excluding payments attributable to Interest Amounts) and the Advance Payments previously made under Section 3.1(b) of this Agreement; provided, for the avoidance of doubt, that (1) a TRA Party shall not be required to return any portion of any previously made Tax Benefit Payment or Advance Payment it receives under this Agreement; (2) no amounts due to a TRA Party under this Agreement shall be escrowed and (3) no TRA Party shall be required to make a payment to the Corporation on account of a Realized Tax Detriment. The “Interest Amount” in respect of the TRA Party shall equal the interest on the amount of the unpaid Net Tax Benefit Attributable to such TRA Party for a Taxable Year, which interest shall accrue on any unpaid Net Tax Benefit from and after the date on which the calculation of such Tax Benefit Payment for such Taxable Year becomes final pursuant to Section 2.3(a), calculated at the Agreed Rate, until the date such unpaid amounts are paid. For the avoidance of doubt, for Tax purposes, the Interest Amount shall not be treated as interest but instead shall be treated as additional consideration in the Exchange unless otherwise required by law. “Advance Payments” in respect of a TRA Party for a Taxable Year means the payments, if any, made by the Corporation to such TRA Party as an advance of such TRA Party’s anticipated Tax Benefit Payment for such Taxable Year. The Corporation shall be entitled at its option to make Advance Payments. Notwithstanding the foregoing, for each Taxable Year ending on or after the date of a Change of Control, all Tax Benefit Payments shall be calculated by utilizing Valuation Assumptions (1) and (5), substituting in (1) “the date of a Change of Control” for the term “Early Termination Date.” Notwithstanding anything to the contrary in this Agreement, after any lump-sum payment under Article IV of this Agreement in respect of present or future Covered Tax Assets, such Covered Tax Assets shall no longer be considered Covered Tax Assets for purposes of determining Tax Benefit Payments or the Net Tax Benefit.

 

 

Section 3.2             No Duplicative Payments. It is intended that the provisions of this Agreement will not result in duplicative payment of any amount (including interest) required under this Agreement. The provisions of this Agreement shall be construed consistent with such intent.

 

Section 3.3             Pro Rata Payments.

 

(a)            Notwithstanding anything in Section 3.1 to the contrary, to the extent that the aggregate amount of the tax benefit to the Corporation or the Corporate Group from the reduction in Tax Liability as a result of the Covered Tax Assets is limited in a particular Taxable Year because the Corporation or the Corporate Group does not have sufficient taxable income to fully utilize available deductions and other attributes, the Net Tax Benefit giving rise to Tax Benefit Payments shall be allocated among the TRA Parties in proportion to the respective amounts of Tax Benefit Payments that would have been paid under this Agreement if the Corporation or the Corporate Group, as applicable, had sufficient taxable income so that there were no such limitation; provided, that, for the avoidance of doubt, for purposes of allocating among the TRA Parties the aggregate Tax Benefit Payments payable under this Agreement with respect to any Taxable Year, the operation of this Section 3.3(a) with respect to any prior Taxable Years shall be taken into account. Consistent with the foregoing, the Attribute Schedule for a given Taxable Year shall reflect the operation of this Section 3.3(a) in respect of previous Taxable Years, with the Covered Tax Assets described in such Attribute Schedule that are attributable to a TRA Party being adjusted to reflect payments received in respect of such Covered Tax Assets (the intention of the parties being to avoid duplicative payments and maintain records sufficient to allow the Corporation to allocate Tax Benefit Payments consistent with the terms of this Section 3.3(a)).

 

(b)            After taking into account Section 3.3(a), if for any reason the Corporation does not fully satisfy its payment obligations to make Tax Benefit Payments due under this Agreement in respect of a particular Taxable Year (for example, as a result of having insufficient cash to make the Tax Benefit Payments due hereunder), then the Corporation and the TRA Parties agree that (i) the Corporation shall make payments due hereunder to the TRA Parties in respect of a Taxable Year in the same proportion as such payments would have been made if the relevant payment had been made in full by the Corporation, and (ii) no Tax Benefit Payment shall be made in respect of any Taxable Year until all Tax Benefit Payments in respect of prior Taxable Years have been paid.

 

(c)            To the extent the Corporation makes a payment to a TRA Party in respect of a particular Taxable Year under Section 3.1(a) of this Agreement (taking into account Section 3.3(a) and (b)) in an amount in excess of the amount of such payment that should have been made to the TRA Party in respect of such Taxable Year, then (i) the TRA Party shall not receive further payments under Section 3.1(a) until the TRA Party has foregone an amount of payments equal to such excess and (ii) the Corporation shall pay the amount of the TRA Party’s foregone payments to other TRA Parties (to the extent applicable) in a manner such that each of the other TRA Parties, to the extent possible, shall have received aggregate payments under Section 3.1(a) and (b) in the amount it would have received if there had been no excess payment to the TRA Party.

 

ARTICLE IV.
TERMINATION

 

Section 4.1             Early Termination of Agreement; Breach of Agreement.

 

(a)            With the prior written approval of each of a majority of the “independent directors” (within the meaning of Rule 10A-3 promulgated under the Exchange Act and the Nasdaq rules) of the Governing Body, the Corporation may terminate this Agreement with respect to all amounts payable to the TRA Parties at any time by paying to each TRA Party the Early Termination Payment in respect of the TRA Party; provided, however, that (i) this Agreement shall only terminate pursuant to this Section 4.1(a) upon the receipt in full of the Early Termination Payment by the TRA Parties; (ii) the Corporation shall deliver an Early Termination Notice only if it is able to make all required Early Termination Payments under this Agreement and (iii) the Corporation may withdraw any notice to execute its termination rights under this Section 4.1(a) prior to the time at which any Early Termination Payment has been paid.

 

 

(b)            In the event that the Corporation breaches any of its material obligations under this Agreement, whether as a result of a failure to make any payment when due, a failure to honor any other material obligation required hereunder or by operation of law as a result of the rejection of this Agreement in a case commenced under the Bankruptcy Code or otherwise, and the Corporation fails to cure such breach within thirty (30) Business Days of a TRA Party notifying the Corporation in writing of such breach, then, at the election of the TRA Parties, subject to the following proviso, all obligations hereunder shall be accelerated and such obligations shall be calculated as if an Early Termination Notice had been delivered on the date of such breach; provided, that (i) each TRA Party’s election shall apply only in respect of such TRA Party and (ii) at least five (5) Business Days prior to making any such election, the applicable TRA Party shall provide written notice to the other TRA Parties in order to permit each other TRA Party, if it wishes, to make its election simultaneously. Procedures similar to the procedures of Section 4.2 shall apply, mutatis mutandis, with respect to the determination of the amounts payable by the Corporation pursuant to this Section 4.1(b). Notwithstanding the foregoing, in the event that the Corporation breaches any of its material obligations under this Agreement, in lieu of electing to receive the amounts referred to in this Section 4.1(b) pursuant to the provisions hereof, the TRA Parties may seek specific performance of the terms of this Agreement. Notwithstanding anything in this Agreement to the contrary, it shall not be a breach of this Agreement if the Corporation fails to make any Tax Benefit Payment when due; provided, that (x) the interest provisions of Section 5.2 shall apply to such late payment, and (y) solely with respect to a Tax Benefit Payment, if the Corporation does not have sufficient cash to make such payment as a result of limitations imposed by existing credit agreements or other indebtedness to which the LLC is a party, Section 5.2 shall apply, but the Default Rate shall be replaced by the Agreed Rate; provided that it shall be a breach of a material obligation under this Agreement if the Corporation makes any distribution of cash or other property with respect to any equity interest in the Corporation while any Tax Benefit Payment is due and payable under this Agreement but unpaid (excluding, for the avoidance of doubt, (i) issuances of Class A Common Stock or Class B Common Stock, (ii) issuances of rights to purchase Class A Common Stock or Class B Common Stock pursuant to a shareholders’ rights or similar plan and (iii) any compensation, withholdings or other payments under the Corporation’s or its subsidiaries’ equity incentive plans and awards thereunder as in effect from time to time).

 

(c)            In connection with a Change of Control, at the election of the TRA Parties, all obligations hereunder with respect to the TRA Parties shall be terminated. The Corporation hereby agrees to provide twenty (20) calendar days prior written notice to each TRA Party of a Change of Control. Within ten (10) calendar days of receipt of such notice, each TRA Party shall provide written notice as to whether it will terminate this Agreement. If a TRA Party elects to terminate the Agreement, then all obligations under this Agreement with respect to the applicable TRA Party shall be accelerated and such obligations shall be calculated as if an Early Termination Notice had been delivered on the date of the Change of Control. Procedures similar to the procedures of Section 4.2 shall apply, mutatis mutandis, with respect to the determination of the amounts payable by the Corporation.

 

Section 4.2             Early Termination Notice. If the Corporation chooses to exercise its right of early termination under Section 4.1(a) above, the Corporation shall deliver to the TRA Parties notice of such intention to exercise such right (“Early Termination Notice”). In addition, if the Corporation chooses to exercise its right of early termination under Section 4.1(a) above, the obligations under this Agreement are accelerated under Section 4.1(b) above or a TRA Party exercises their right to terminate this Agreement under Section 4.1(c) above, the Corporation shall deliver to the TRA Parties a schedule (the “Early Termination Schedule”) showing in reasonable detail the calculation of the Early Termination Payment due to each TRA Party. Such Early Termination Schedule shall become final and binding on all parties consistent with the procedures described in Section 2.3(a). The date on which the Early Termination Schedule becomes final shall be the “Early Termination Effective Date.”

 

Section 4.3             Payment upon Early Termination.

 

(a)            Within three (3) calendar days after an Early Termination Effective Date, the Corporation shall pay to each of the TRA Parties an amount equal to the Early Termination Payment in respect of such TRA Party. Such payment shall be made by wire transfer of immediately available funds to a bank account or accounts designated by the TRA Party or as otherwise agreed by the Corporation and such TRA Party.

 

 

(b)            “Early Termination Payment” in respect of a TRA Party shall equal, without duplication, (i) the present value, discounted at the Early Termination Rate, as of the date of the Early Termination Notice, of all Tax Benefit Payments in respect of such TRA Party that would be required to be paid by the Corporation beginning from the date of the Early Termination Notice and applying the Valuation Assumptions, plus (ii) any Tax Benefit Payment determined by the Corporation to be due and payable with respect to such TRA Party that is unpaid as of the date of the Early Termination Notice, plus (iii) any other Tax Benefit Payment due and payable with respect to such TRA Party for a Taxable Year ending prior to the date of the Early Termination Notice, plus (iv) interest accruing on the amounts described in clauses (i) through (iii) (which shall include interest accruing on the amount described in clause (i) from the date of the Early Termination Notice).

 

(c)             Upon the payment of the Early Termination Payment by the Corporation to a TRA Party, the Corporation shall not have any further payment obligations under this Agreement in respect of such TRA Party.

 

ARTICLE V.
SUBORDINATION AND LATE PAYMENTS

 

Section 5.1             Subordination. Notwithstanding any other provision of this Agreement to the contrary, any Tax Benefit Payment or Early Termination Payment required to be made by the Corporation under this Agreement shall rank subordinate and junior in right of payment to any principal, interest, or other amounts due and payable in respect of any obligations owed in respect of secured or unsecured indebtedness for borrowed money of the Corporation and its Subsidiaries (“Senior Obligations”) and shall rank pari passu in right of payment with all current or future unsecured obligations of the Corporation that are not Senior Obligations. To the extent that any payment under this Agreement is not permitted to be made at the time payment is due as a result of this Section 5.1 and the terms of the agreements governing Senior Obligations, such payment obligation nevertheless shall accrue for the benefit of the applicable TRA Parties and the Corporation shall make such payments at the first opportunity that such payments are permitted to be made in accordance with the terms of the Senior Obligations. Except as otherwise determined by the Governing Body with the approval of the TRA Parties, (i) payments under any other tax receivable agreement (or similar agreement) entered into by the Corporation, the LLC or their Subsidiaries after the date hereof shall be subordinate to all payments owed pursuant to this Agreement, and no such payments shall be made (x) for so long as the Corporation has any unpaid obligation pursuant to this Agreement and (y) with respect to any particular taxable period governed by such tax receivable agreement until payments with respect to such taxable period under this Agreement have been determined and (if any) paid and (ii) the Actual Tax Liability and Hypothetical Tax Liability under this Agreement shall be calculated by assuming that any tax attributes that are subject to a tax receivable agreement (or similar agreement) described in the preceding clause (i) (for the avoidance of doubt, other than this Agreement) did not exist.

 

Section 5.2             Late Payments by the Corporation. The amount of all or any portion of any Tax Benefit Payment, Early Termination Payment or other payment under this Agreement not made to the TRA Parties when due under the terms of this Agreement shall be payable together with any interest thereon, computed at the Default Rate and commencing from the date on which such Tax Benefit Payment, Early Termination Payment or other payment was due and payable.

 

ARTICLE VI.
TAX MATTERS; CONSISTENCY; COOPERATION

 

Section 6.1             Participation in the Corporation’s and the LLC’s Tax Matters. Except as otherwise provided herein, the Corporation shall have full responsibility for, and sole discretion over, all tax matters concerning the Corporation and the LLC and its Subsidiaries, including without limitation the preparation, filing or amending of any Tax Return and defending, contesting or settling any issue pertaining to taxes; provided, however, that the Corporation shall notify the TRA Parties of, and keep them reasonably informed with respect to, the portion of any audit of the Corporation, the LLC or any of their Subsidiaries the outcome of which is reasonably expected to adversely affect the rights and obligations of the TRA Parties under this Agreement in a material respect, and shall provide to the TRA Parties reasonable opportunity to provide information and other input to the Corporation, the LLC and their Subsidiaries concerning the conduct of any such portion of such audit, which information and other input the Corporation, the LLC and their Subsidiaries, as applicable, shall consider in good faith.

 

 

Section 6.2             Consistency. The Corporation, the LLC and the TRA Parties agree to report and cause to be reported for all purposes, including federal, state and local Tax purposes, all Tax-related items (including, without limitation, the Basis Adjustments and each Tax Benefit Payment) in a manner consistent with that specified in any Schedule finalized consistent with the terms of this Agreement, unless otherwise required by Law.

 

Section 6.3             Cooperation. Each of the Corporation, the LLC and the TRA Parties shall (a) furnish to the other parties in a timely manner such information, documents and other materials as the other party may reasonably request for purposes of making any determination or computation necessary or appropriate under this Agreement, completing any financial statement audit, preparing any Tax Return or defending any audit, examination or controversy with any Taxing Authority, (b) make itself available to the other party and its representatives to provide explanations of documents and material and such other information as the other party or its representatives may reasonably request in connection with any of the matters described in clause (a) above, and (c) reasonably cooperate in connection with any such matter, and the Corporation shall reimburse each TRA Party for any reasonable third-party costs and expenses incurred pursuant to this Section at the request of the Corporation or the LLC.

 

ARTICLE VII.
MISCELLANEOUS

 

Section 7.1             Notices. All notices, requests, consents and other communications hereunder shall be in writing and shall be given (and shall be deemed to have been duly given upon receipt) by delivery in person, by courier service, by fax, by electronic mail (delivery receipt requested) or by certified or registered mail (postage prepaid, return receipt requested) to the respective Parties at the following addresses (or at such other address for a Party as shall be as specified in a notice given in accordance with this Section 7.1). All notices hereunder shall be delivered as set forth below, or pursuant to such other instructions as may be designated in writing by the Party to receive such notice:

 

If to the Corporation or the LLC, to:

 

c/o Fluence Energy, Inc.

4601 Fairfax Drive, Suite 600

Arlington, VA 22203

Attention: Francis A. Fuselier

Email: frank.fuselier@fluenceenergy.com

 

with a copy (which shall not constitute notice to the Corporation or the LLC) to:

 

Latham & Watkins LLP
1271 Avenue of the Americas
New York, NY 10020

Attention: Senet S. Bischoff

    Matthew C. Dewitz

Facsimile No.: (212) 751-4864
E-mail: senet.bischoff@lw.com

     matthew.dewitz@lw.com

 

If to AES Grid Stability, LLC:

 

AES Grid Stability, LLC

4300 Wilson Boulevard

Suite 1100

Arlington, VA 22203

Attention: Paul Freedman, General Counsel of The AES Corporation

Email: paul.freedman @aes.com

 

 

with a copy (which shall not constitute notice to AES Grid Stability, LLC) to:

 

AES Grid Stability, LLC

4300 Wilson Boulevard

Suite 1100

Arlington, VA 22203

Attention: Chris Shelton, Senior Vice President,

Chief Product Officer and President, AES Next

Email: chris.shelton@aes.com

 

If to Siemens Industry, Inc.:

 

Siemens Industry, Inc.

4800 North Point Parkway

Alpharetta, GA 30005, USA

Attention: Craig Langley

Email: Langley.craig@siemens.com

 

Any Party may change its address, fax number or e-mail address by giving each of the other Parties written notice thereof in the manner set forth above.

 

Section 7.2             Counterparts; Electronic Signature. This Agreement may be executed in one or more counterparts, all of which shall be considered one and the same agreement and shall become effective when one or more counterparts have been signed by each of the Parties and delivered to the other Parties, it being understood that all Parties need not sign the same counterpart. Delivery of an executed signature page to this Agreement by facsimile transmission or electronic delivery (i.e. by email of a PDF signature page) shall be as effective as delivery of a manually signed counterpart of this Agreement and shall constitute and original for all purposes. The parties hereto hereby agree that this Agreement may be executed by way of electronic signatures and that the electronic signature has the same binding effect as a physical signature. For the avoidance of doubt, the parties hereto further agree that this Agreement, or any part thereof, shall not be denied legal effect, validity or enforceability solely on the ground that it is in the form of an electronic record.

 

Section 7.3             Entire Agreement; No Third Party Beneficiaries. This Agreement constitutes the entire agreement and supersedes all prior agreements and understandings, both written and oral, among the Parties with respect to the subject matter hereof. This Agreement shall be binding upon and inure solely to the benefit of each Party hereto and their respective successors and permitted assigns, and nothing in this Agreement, express or implied, is intended to or shall confer upon any other Person any right, benefit or remedy of any nature whatsoever under or by reason of this Agreement.

 

Section 7.4             Governing Law. This Agreement shall be governed by, and construed in accordance with, the law of the State of Delaware, without regard to the conflicts of laws principles thereof that would mandate the application of the laws of another jurisdiction.

 

Section 7.5             Severability. If any term or other provision of this Agreement is invalid, illegal or incapable of being enforced by any law or public policy, all other terms and provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the transactions contemplated hereby is not affected in any manner materially adverse to any Party. Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the Parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the Parties as closely as possible in an acceptable manner in order that the transactions contemplated hereby are consummated as originally contemplated to the greatest extent possible.

 

Section 7.6             Assignments; Amendments; Successors; No Waiver.

 

(a)            Assignment. No TRA Party may assign, sell, pledge, or otherwise alienate or transfer any interest in this Agreement, including the right to receive any Tax Benefit Payments under this Agreement, to any Person without (i) the prior written consent of the Governing Body (or any Person(s) to whom the Governing Body has delegated such authority) (such consent not to be unreasonably withheld) and (ii) such Person executing and delivering a Joinder agreeing to succeed to all or the applicable portion of such TRA Party’s interest in this Agreement and to become a Party for all purposes of this Agreement (the “Joinder Requirement”). For the avoidance of doubt, if a TRA Party transfers Units in accordance with the terms of the LLC Agreement but does not assign to the transferee of such Units its rights under this Agreement with respect to such transferred Units, such TRA Party shall continue to be entitled to receive the Tax Benefit Payments arising in respect of such Units (and any such transferred Units shall be separately identified, so as to facilitate the determination of Tax Benefit Payments hereunder). The Corporation may not assign any of its rights or obligations under this Agreement to any Person (other than any direct or indirect successor (whether by purchase, merger, consolidation or otherwise) to all or substantially all of the business or assets of the Corporation) without the prior written consent of each of TRA Parties (and any purported assignment without such consent shall be null and void).

 

 

(b)            Amendments. No provision of this Agreement may be amended unless such amendment is approved in writing by each of (i) the Governing Body (or any Person(s) to whom the Governing Body has delegated such authority); and (ii) the TRA Parties who collectively would be entitled to receive at least a majority of any Early Termination Payments that would be hypothetically payable to all TRA Parties (assuming all equity interests in the LLC that have redemption rights under the LLC Agreement are redeemed and exchanged for shares of Class A Common Stock at such time and using the Valuation Assumptions).

 

(c)            Successors. Except as provided in Section 7.6(a), all of the terms and provisions of this Agreement shall be binding upon, and shall inure to the benefit of and be enforceable by, the Parties hereto and their respective successors, assigns, heirs, executors, administrators and legal representatives. The Corporation shall require and cause any direct or indirect successor (whether by purchase, merger, consolidation or otherwise) to all or substantially all of the business or assets of the Corporation, by written agreement, expressly to assume and agree to perform this Agreement in the same manner and to the same extent that the Corporation would be required to perform if no such succession had taken place.

 

(d)            Waiver. No failure by any Party to insist upon the strict performance of any covenant, duty, agreement, or condition of this Agreement, or to exercise any right or remedy consequent upon a breach thereof, shall constitute a waiver of any such breach or any other covenant, duty, agreement, or condition.

 

Section 7.7             Titles and Subtitles. The titles of the sections and subsections of this Agreement are for convenience of reference only and are not to be considered in construing this Agreement.

 

Section 7.8             Resolution of Disputes.

 

(a)            Except for Reconciliation Disputes subject to Section 7.9, any and all disputes which cannot be settled amicably, including any ancillary claims of any party, arising out of, relating to or in connection with this Agreement (each a “Dispute”) shall be finally resolved by arbitration in accordance with the International Institute for Conflict Prevention and Resolution Rules for Administered Arbitration (the “Rules”) by three arbitrators, of which the Corporation shall appoint one arbitrator and the TRA Parties shall jointly appoint two arbitrators in accordance with the “screened” appointment procedure provided in Rule 5.4. The arbitration shall be governed by the Federal Arbitration Act, 9 U.S.C. §§ 1 et seq., and judgment upon the award rendered by the arbitrators may be entered by any court having jurisdiction thereof. The place of the arbitration shall be New York, New York.

 

(b)            Notwithstanding the provisions of paragraph (a), any party may bring an action or special proceeding in any court of competent jurisdiction for the purpose of compelling another party to arbitrate, seeking temporary or preliminary relief in aid of an arbitration hereunder, and/or enforcing an arbitration award and, for the purposes of this paragraph (b), each party (i) expressly consents to the application of paragraph (c) of this Section 7.8 to any such action or proceeding, and (ii) agrees that proof shall not be required that monetary damages for breach of the provisions of this Agreement would be difficult to calculate and that remedies at law would be inadequate. For the avoidance of doubt, this Section 7.8 shall not apply to Reconciliation Disputes to be settled in accordance with the procedures set forth in Section 7.9.

 

(c)            Each party irrevocably consents to service of process by means of notice in the manner provided for in Section 7.1. Nothing in this Agreement shall affect the right of any party to serve process in any other manner permitted by law.

 

(d)            WAIVER OF RIGHT TO TRIAL BY JURY. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).

 

(e)             In the event the parties are unable to agree whether a dispute between them is a Reconciliation Dispute subject to the dispute resolution procedure set forth in Section 7.9 or a Dispute subject to the dispute resolution procedure set forth in this Section 7.8, such disagreement shall be decided and resolved in accordance with the procedure set forth in this Section 7.8.

 

 

 

Section 7.9         Reconciliation. In the event that the Corporation and one or more TRA Parties are unable to resolve a disagreement with respect to a Schedule (a “Reconciliation Dispute”), the Reconciliation Dispute shall be submitted for determination to a nationally recognized expert (the “Expert”) in the particular area of disagreement mutually acceptable to such parties. The Expert shall be a partner or principal in a nationally recognized accounting firm, and unless the Corporation and such TRA Parties agree otherwise, the Expert shall not, and the firm that employs the Expert shall not, have any material relationship with the Corporation or such TRA Parties or other actual or potential conflict of interest. If the Corporation and such TRA Parties are unable to agree on an Expert within fifteen (15) calendar days of receipt by the respondent(s) of written notice of a Reconciliation Dispute, the selection of an Expert shall be treated as a Dispute subject to Section 7.8 and an arbitration panel shall pick an Expert from a nationally recognized accounting firm that does not have any material relationship with the Corporation or such TRA Parties or other actual or potential conflict of interest. The Expert shall resolve any matter relating to a Schedule or an amendment thereto as soon as reasonably practicable and in any event within thirty (30) calendar days after the matter has been submitted to the Expert for resolution. Notwithstanding the preceding sentence, if the matter is not resolved before any payment that is the subject of a disagreement would be due (in the absence of such disagreement) or any Tax Return reflecting the subject of a disagreement is due, the undisputed amount shall be paid on the date prescribed by this Agreement and such Tax Return may be filed as prepared by the Corporation, subject to adjustment or amendment upon resolution. The costs and expenses relating to the engagement of such Expert or amending any Tax Return shall be borne by the Corporation except as provided in the next sentence. The Corporation and the TRA Parties shall each bear their own costs and expenses of such proceeding, unless (i) the Expert entirely adopts the position of the TRA Parties, in which case the Corporation shall reimburse the TRA Parties for any reasonable and documented out-of-pocket costs and expenses in such proceeding, or (ii) the Expert entirely adopts the Corporation’s position, in which case whichever of the TRA Parties (or all of them) that disputed the position shall reimburse the Corporation for any reasonable and documented out-of-pocket costs and expenses in such proceeding. The Expert shall finally determine any Reconciliation Dispute and the determinations of the Expert pursuant to this Section 7.9 shall be binding on the Corporation and the TRA Parties and may be entered and enforced in any court having competent jurisdiction.

 

Section 7.10       Withholding. The Corporation and its affiliates and representatives shall be entitled to deduct and withhold from any payment that is payable to any TRA Party pursuant to this Agreement such amounts as are required to be deducted or withheld with respect to the making of such payment in accordance with the Code or any provision of U.S. state, local or foreign tax law (including for this purpose any withholding required by the Corporation or its affiliates that may be required in connection with a Redemption or a Direct Exchange). To the extent that amounts are so deducted or withheld and paid over to the appropriate Taxing Authority, such amounts shall be treated for all purposes of this Agreement as having been paid by the Corporation to the relevant TRA Party. Each TRA Party shall promptly provide the Corporation with any applicable tax forms and certifications reasonably requested by the Corporation in connection with determining whether any such deductions and withholdings are required under the Code or any provision of U.S. state, local or foreign tax law, including under Sections 1441, 1442, 1445 or 1446 of the Code. The Corporation will consider in good faith any applicable certificates, forms or documentation provided by a TRA Party that in such TRA Party’s reasonable determination reduce or eliminate any such withholding.

 

 

Section 7.11       Consolidated Group; Transfers of Corporate Assets.

 

(a)            The parties acknowledge that the Corporation is not currently a member of a Corporate Group, but may become a member of a Corporate Group in the future, and that in such event, the provisions of this Agreement shall be applied with respect to such Corporate Group (and any other affiliated or consolidated Tax group of which the Corporation becomes a part), and that Tax Benefit Payments, Early Termination Payments, and other applicable items hereunder shall be computed with reference to the consolidated taxable income of the group as a whole.

 

(b)            If the Corporation, its successors in interest or any member of a group described in Section 7.11(a) transfers one or more assets to a corporation (or a Person classified as a corporation for U.S. income tax purposes) with which the Corporation does not file a consolidated Tax Return for U.S. federal income Tax purposes (or if any entity that holds Reference Assets transfers any Reference Asset to a corporation (or a Person classified as a corporation for U.S. federal income tax purposes) with which the Corporation does not file a consolidated Tax Return for U.S. federal income Tax purposes), such entity, for purposes of calculating the amount of any Tax Benefit Payment or Early Termination Payment due hereunder, shall, unless otherwise agreed by the Corporation and each TRA Party, be treated as having disposed of such asset (or Reference Asset) in a fully taxable transaction on the date of such transfer. The consideration deemed to be received by such entity shall be equal to the fair market value of the transferred asset. For purposes of this Section 7.11 a transfer of a partnership interest shall be treated as a transfer of the transferring partner’s share of each of the assets and liabilities of that partnership. Notwithstanding anything to the contrary set forth herein, if the Corporation, its successor in interest or any member of a group described in Section 7.11(a), transfers its assets pursuant to a transaction that qualifies as a “reorganization” (within the meaning of Section 368(a) of the Code) in which such entity does not survive or pursuant to any other transaction to which Section 381(a) of the Code applies (other than any such reorganization or any such other transaction, in each case, pursuant to which such entity transfers assets to a corporation with which the Corporation, its successor in interest or any member of the group described in Section 7.11(a) (other than any such member being transferred in such reorganization or other transaction) does not file a consolidated Tax Return for U.S. federal income Tax purposes), the transfer will not cause such entity to be treated as having transferred any assets to a corporation (or a Person classified as a corporation for U.S. federal income tax purposes) pursuant to this Section 7.11(b) so long as the relevant successor is bound by the provisions of this Agreement.

 

Section 7.12       Confidentiality. Each TRA Party and its assignees acknowledges and agrees that the information of the Corporation and its Affiliates provided pursuant to this Agreement is confidential and, except in the course of performing any duties as necessary for the Corporation and its Affiliates, as required by law or legal process or to enforce the terms of this Agreement, such Person shall keep and retain in the strictest confidence and not disclose to any Person any confidential matters, acquired pursuant to this Agreement, of the Corporation and its Affiliates and successors, learned by any TRA Party heretofore or hereafter. This Section 7.12 shall not apply to (i) any information that has been made publicly available by the Corporation, becomes public knowledge (except as a result of an act of any TRA Party in violation of this Agreement) or is generally known to the business community, (ii) the disclosure of information to the extent necessary for a TRA Party to prosecute or defend claims arising under or relating to this Agreement, (iii) the disclosure of information to the extent necessary for a TRA Party to prepare and file its Tax Returns, to respond to any inquiries regarding the same from any Taxing Authority or to prosecute or defend any action, proceeding or audit by any Taxing Authority with respect to such Tax Returns, and (iv) the disclosure of information necessary to effect an assignment, sale, pledge, alienation or transfer of any interest in this Agreement pursuant to Section 7.6(a). If a TRA Party or an assignee commits a breach, or threatens to commit a breach, of any of the provisions of this Section 7.12, the Corporation shall have the right and remedy to have the provisions of this Section 7.12 specifically enforced by injunctive relief or otherwise by any court of competent jurisdiction without the need to post any bond or other security, it being acknowledged and agreed that any such breach or threatened breach shall cause irreparable injury to the Corporation or any of its Subsidiaries and that money damages alone shall not provide an adequate remedy to such Persons. Such rights and remedies shall be in addition to, and not in lieu of, any other rights and remedies available at law or in equity.

 

 

Section 7.13       Change in Law. Notwithstanding anything herein to the contrary, if, as a result of or, in connection with an actual or proposed change in Tax law, a TRA Party reasonably believes that the existence of this Agreement could have material adverse tax consequences to such TRA Party or any direct or indirect owner of such TRA Party, then at the written election of such TRA Party in its sole discretion (in an instrument signed by such TRA Party and delivered to the Corporation) and to the extent specified therein by such TRA Party, this Agreement shall cease to have further effect and shall not apply to an Exchange with respect to such TRA Party occurring after a date specified by such TRA Party, or may be amended by the Corporation in a manner reasonably acceptable to such TRA Party, provided that such amendment shall not result in an increase in any payments owed by the Corporation under this Agreement at any time as compared to the amounts and times of payments that would have been due in the absence of such amendment and provided, further, that such amendment shall not have any adverse effect on any other TRA Party.

 

Section 7.14        Interest Rate Limitation. Notwithstanding anything to the contrary contained herein, the interest paid or agreed to be paid hereunder with respect to amounts due to any TRA Party hereunder shall not exceed the maximum rate of non-usurious interest permitted by applicable law (the “Maximum Rate”). If any TRA Party shall receive interest in an amount that exceeds the Maximum Rate, the excess interest shall be applied to the Tax Benefit Payment, Advance Payment or Early Termination Payment, as applicable (but in each case exclusive of any component thereof comprising interest) or, if it exceeds such unpaid non-interest amount, refunded to the Corporation. In determining whether the interest contracted for, charged, or received by any TRA Party exceeds the Maximum Rate, such TRA Party may, to the extent permitted by applicable law, (a) characterize any payment that is not principal as an expense, fee, or premium rather than interest, (b) exclude voluntary prepayments and the effects thereof, and (c) amortize, prorate, allocate, and spread in equal or unequal parts the total amount of interest throughout the contemplated term of the payment obligations owed by the Corporation to such TRA Party hereunder. Notwithstanding the foregoing, it is the intention of the Parties to conform strictly to any applicable usury laws.

 

 

Section 7.15        Independent Nature of Rights and Obligations. The rights and obligations of each TRA Party hereunder are several and not joint with the rights and obligations of any other Person. A TRA Party shall not be responsible in any way for the performance of the obligations of any other Person hereunder, nor shall a TRA Party have the right to enforce the rights or obligations of any other Person hereunder (other than the Corporation). Nothing contained herein or in any other agreement or document delivered at any closing, and no action taken by any TRA Party pursuant hereto or thereto, shall be deemed to constitute the TRA Parties acting as a partnership, an association, a joint venture or any other kind of entity, or create a presumption that the TRA Parties are in any way acting in concert or as a group with respect to such rights or obligations or the transactions contemplated hereby, and the Corporation acknowledges that the TRA Party are not acting in concert or as a group and will not assert any such claim with respect to such rights or obligations or the transactions contemplated hereby.

 

Section 7.16        LLC Agreement. This Agreement shall be treated as part of the LLC Agreement as described in Section 761(c) of the Code and Sections 1.704-1(b)(2)(ii)(h) and 1.761-1(c) of the Treasury Regulations.

 

Section 7.17       Tax Characterization and Elections. The parties intend that (A) each Direct Exchange shall give rise to Basis Adjustments, (B) each Redemption using cash contributed to the LLC by the Corporation shall be treated as a direct purchase of Units from the applicable TRA Parties pursuant to Section 707(a)(2)(B) of the Code that shall give rise to Basis Adjustments and (C) payments pursuant to this Agreement with respect to an Exchange (except with respect to amounts that constitute Imputed Interest) shall be treated as consideration in respect of such Exchange that give rise to additional Basis Adjustments. The Corporation will ensure that, on and after the date hereof and continuing through the term of this Agreement, the LLC and each of its direct and indirect subsidiaries that they control and that is treated as a partnership for U.S. federal income tax purposes will have in effect an election under Section 754 of the Code.

 

Section 7.18        Payment Amounts. The Corporation and the TRA Parties agree that, as of the date of this Agreement and as of the date of any future Exchange that may be subject to this Agreement, the aggregate value of the Tax Benefit Payments cannot be reasonably ascertained for U.S. federal income tax purposes. Notwithstanding any provision of this Agreement to the contrary, any TRA Holder may elect with respect to any Exchange to limit the aggregate Tax Benefit Payments made to such TRA Holder in respect of that Exchange to a specified dollar amount, a specified percentage of the amount realized by the TRA Holder with respect to the Exchange, or a specified portion of the Basis Adjustment with respect to the Adjusted Assets as a result of the Exchange. The TRA Holder shall exercise its rights under the preceding sentence by including a notice of its desire to impose such a limit and the specified limitation and such other details as may be reasonably necessary (including whether such limitation includes the Additional Amounts in respect of any such Exchange) in the Exchange Notice delivered in accordance with the Exchange Agreement. For the avoidance of doubt, this Section 7.18 shall not limit any amounts payable in connection with an Early Termination Payment.

 

[Signature Page Follows This Page]

 

  

IN WITNESS WHEREOF, the undersigned have executed or caused to be executed on their behalf this Agreement as of the date first written above.

 

	CORPORATION:
		FLUENCE ENERGY, INC.

 

	By:
	Name:
	Title:

 

 

	THE LLC:
		FLUENCE ENERGY LLC

 

	By:
	Name:
	Title:

 

  

AES GRID STABILITY, LLC

 

	By:
	Name:
	Title:

  

SIEMENS INDUSTRY, INC.

 

	By:
	Name:
	Title:

 

	By:
	Name:
	Title:

 

 

Annex A

 

FORM OF JOINDER AGREEMENT

 

This JOINDER AGREEMENT, dated as of _________________ (this “Joinder”), is delivered pursuant to that certain Tax Receivable Agreement, dated as of [______] (as amended, restated, amended and restated, supplemented or otherwise modified from time to time, the “Tax Receivable Agreement”) by and among Fluence Energy, Inc., a Delaware corporation (the “Corporation”), Fluence Energy, LLC, a Delaware limited liability company (“the LLC”), and the other persons time to time party thereto. Capitalized terms used but not otherwise defined herein have the respective meanings set forth in the Tax Receivable Agreement.

 

1.

Joinder to the Tax Receivable Agreement. Upon the execution of this Joinder by the undersigned and delivery hereof to the Corporation, the undersigned hereby is and hereafter will be a TRA Party under the Tax Receivable Agreement and a Party thereto, with all the rights, privileges and responsibilities of a TRA Party thereunder. The undersigned hereby agrees that it shall comply with and be fully bound by the terms of the Tax Receivable Agreement as if it had been a signatory thereto as of the date thereof.

 

2.

Incorporation by Reference. All terms and conditions of the Tax Receivable Agreement are hereby incorporated by reference in this Joinder as if set forth herein in full.

 

3.

Address. All notices under the Tax Receivable Agreement to the undersigned shall be direct to:

 

[Name]
[Address]
[City, State, Zip Code]
Attn:
Facsimile:
E-mail:

 

IN WITNESS WHEREOF, the undersigned has duly executed and delivered this Joinder as of the day and year first above written.

 

	[NAME OF NEW PARTY]
	By:
	Name:
	Title:

 

 

 

Acknowledged and agreed

as of the date first set forth above:

 

FLUENCE ENERGY, INC.

 

By:

Name: 

Title:

 

 

Annex B

 

TRA Parties

 

1.	AES Grid Stability, LLC

2.	Siemens Industry, Inc.

 

 

 

 

Exhibit 10.2

 

THIRD AMENDED AND RESTATED

LIMITED LIABILITY COMPANY AGREEMENT

of

FLUENCE ENERGY, LLC

Dated as of [·], 2021

 

THE LIMITED LIABILITY COMPANY INTERESTS IN FLUENCE ENERGY, LLC HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT, THE SECURITIES LAWS OF ANY STATE, OR ANY OTHER APPLICABLE SECURITIES LAWS, AND HAVE BEEN OR ARE BEING ISSUED IN RELIANCE UPON EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND SUCH LAWS. SUCH INTERESTS MAY BE ACQUIRED FOR INVESTMENT ONLY AND MAY NOT BE OFFERED FOR SALE, PLEDGED, HYPOTHECATED, SOLD, ASSIGNED OR TRANSFERRED AT ANY TIME EXCEPT IN COMPLIANCE WITH (I) THE SECURITIES ACT, ANY APPLICABLE SECURITIES LAWS OF ANY STATE AND ANY OTHER APPLICABLE SECURITIES LAWS; (II) THE TERMS AND CONDITIONS OF THIS THIRD AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT; AND (III) ANY OTHER TERMS AND CONDITIONS AGREED TO IN WRITING BETWEEN THE MANAGING MEMBER AND ANY HOLDER OF SUCH INTERESTS.

 

 

TABLE OF CONTENTS

 

Page

 

Article I. DEFINITIONS AND USAGE		2
Section 1.01	Definitions	2
Section 1.02	Other Definitional and Interpretative Provisions	16
Article II. THE COMPANY		16
Section 2.01	Continuation of the Company	16
Section 2.02	Name	17
Section 2.03	Commencement and Term	17
Section 2.04	Principal Place of Business	17
Section 2.05	Registered Agent and Registered Office	17
Section 2.06	Purposes	17
Section 2.07	Powers of the Company	17
Section 2.08	Partnership Tax Status	17
Section 2.09	Regulation of Internal Affairs	17
Section 2.10	Ownership of Property	17
Article III. UNITS; MEMBERS; BOOKS AND RECORDS; REPORTS		18
Section 3.01	Units; Admission of Members	18
Section 3.02	Substitute Members and Additional Members	18
Section 3.03	Tax and Accounting Information	19
Section 3.04	Recapitalization; PubCo’s Capital Contribution; PubCo’s Purchase of Common Units; the IPO Unit Redemption	21
Section 3.05	Books and Records	21
Article IV. MANAGING MEMBER OWNERSHIP; RESTRICTIONS ON MANAGING MEMBER UNITS		21
Section 4.01	Managing Member Ownership	21
Section 4.02	Restrictions on Managing Member Units	22
Section 4.03	Equity Plans	23
Article V. CAPITAL CONTRIBUTIONS; CAPITAL ACCOUNTS; DISTRIBUTIONS; ALLOCATIONS		24
Section 5.01	Capital Contributions	24
Section 5.02	Capital Accounts	24
Section 5.03	Amounts and Priority of Distributions	26
Section 5.04	Allocations	28
Section 5.05	Other Allocation Rules	30
Section 5.06	Tax Withholding; Withholding Advances	31
Section 5.07	Tax Proceedings	33

 

 

Article VI. CERTAIN TAX MATTERS		33
Section 6.01	Company Representative	33
Section 6.02	Tax Elections	34
Article VII. MANAGEMENT OF THE COMPANY		34
Section 7.01	Management by the Managing Member	34
Section 7.02	Withdrawal of the Managing Member	35
Section 7.03	Decisions by the Members	35
Section 7.04	Fiduciary Duties	35
Section 7.05	Officers	36
Article VIII. TRANSFERS OF INTERESTS		37
Section 8.01	Restrictions on Transfers	37
Section 8.02	Certain Permitted Transfers	38
Section 8.03	Registration of Transfers	38
Section 8.04	Restricted Units Legend	38
Article IX. REDEMPTION AND EXCHANGE RIGHTS		39
Section 9.01	Redemption Right of a Member	39
Section 9.02	Reservation of Shares of Class A Common Stock; Listing; Certificate of PubCo, etc.	42
Section 9.03	Effect of Exercise of Redemption	42
Section 9.04	Tax Treatment	43
Section 9.05	Other Redemption Matters	43
Section 9.06	PubCo Change of Control; PubCo Approved Recap Transaction	44
Article X. LIMITATION ON LIABILITY, EXCULPATION AND INDEMNIFICATION		46
Section 10.01	Limitation on Liability	46
Section 10.02	Exculpation and Indemnification	46
Article XI. DISSOLUTION AND TERMINATION		48
Section 11.01	Dissolution	48
Section 11.02	Winding Up of the Company	49
Section 11.03	Termination	50
Section 11.04	Survival	50
Article XII. MISCELLANEOUS		50
Section 12.01	Expenses	50
Section 12.02	Further Assurances	50
Section 12.03	Notices	50
Section 12.04	Binding Effect; Benefit; Assignment	51
Section 12.05	Jurisdiction	51
Section 12.06	WAIVER OF JURY TRIAL	52

 

 

Section 12.07	Counterparts	52
Section 12.08	Entire Agreement	52
Section 12.09	Severability	52
Section 12.10	Amendment	53
Section 12.11	Confidentiality	53
Section 12.12	Governing Law	54
Section 12.13	No Presumption	54
Section 12.14	Attorney-In-Fact	54
Section 12.15	Immunity Waiver	54
Section 12.16	Specific Performance	55

 

Schedule A

Member Schedule

 

 

THIRD AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT (this “Agreement”) of FLUENCE ENERGY, LLC, a Delaware limited liability company (the “Company”), dated as of [·], 2021 (the “Restatement Date”), by and among the Company, FLUENCE ENERGY, INC., a Delaware corporation (“PubCo”, as the Managing Member as defined below), and the Members (as defined below).

 

W I T N E S E T H:

 

WHEREAS, the Company was formed as a limited liability company under the Act by the filing a Certificate of Formation with the Secretary of State of the State of Delaware on June 30, 2017;

 

WHEREAS, AES Grid Stability, LLC (“AES”), a limited liability company duly organized and validly existing under the laws of Delaware, and Siemens Industry, Inc. (“Siemens”), a corporation duly organized and validly existing under the laws of Delaware, executed the Amended and Restated Limited Liability Company Agreement of the Company on January 1, 2018 (the “A&RLLCA”), which was further amended by that certain Amendment No. 1 to the Amended and Restated Limited Liability Company Agreement, dated June 29, 2020 (“Amendment No. 1”) and that certain Amendment No. 2 to the Amended and Restated Limited Liability Company Agreement, dated December 27, 2020 (“Amendment No. 2”, and the A&RLLCA as amended by Amendment No. 1 and Amendment No. 2, the “Prior Agreement”);

 

WHEREAS, the Company amended and restated the Prior Agreement in its entirety, and entered into that certain Second Amended & Restated Limited Liability Company Agreement, dated as of June 9, 2021 (the “Second Restated Agreement”), pursuant to which AES and Siemens remained Class A Members, certain Persons were admitted as Class B Members and certain provisions regarding the rights, powers and interests of the Members with respect to the Company and their Membership Interests therein were revised, which the Class A Members and the Class B Members executed in their capacity as members (including pursuant to consents and joinders thereto) (collectively, the “Pre-IPO Members”);

 

WHEREAS, in connection with the IPO (as defined below), the Company is, substantially concurrently with the execution of this Agreement, a party to a series of reorganization transactions with PubCo (the “Transactions”) and various other parties pursuant to which, among other matters, (i) Fluence Energy Merger Sub, LLC a wholly-owned subsidiary of PubCo, merged with and into QIA Florence Holding LLC (“QIA Blocker”), with QIA Blocker surviving (the “Merger”), with shares of Class A Common Stock being issued to QIA Blocker’s sole member, Qatar Holding LLC, in consideration for the Merger and (ii) subsequently, QIA Blocker was merged with and into PubCo, with PubCo surviving, and PubCo was admitted as a Pre-IPO Member;

 

WHEREAS, in connection with the IPO, the Company, PubCo and the other Pre-IPO Members have authorized the conversion of certain of the Original Units (as defined below) into Common Units (as defined below), to be held by PubCo, AES and Siemens (collectively, the “Recapitalization”) as set forth herein;

 

 

WHEREAS, PubCo will sell shares of its Class A Common Stock to public investors in the IPO and will contribute the net proceeds received from the IPO (the “IPO Net Proceeds”) to the Company in exchange for newly issued Common Units pursuant to the IPO Common Unit Subscription Agreement and issue shares of its Class B Common Stock to AES and Siemens; and

 

WHEREAS, in connection with the foregoing matters, the Company and the Members desire to continue the Company without dissolution and amend and restate the Second Restated Agreement in its entirety as of the date hereof to reflect, among other things, (a) the Recapitalization, (b) the addition of PubCo as a Member and its designation as sole Managing Member of the Company and (c) the other rights and obligations of the Members, the Company and PubCo, in each case, as provided and agreed upon in the terms of this Agreement as of the date hereof, at which time the Second Restated Agreement shall be superseded entirely by this Agreement and shall be of no further force or effect.

 

NOW, THEREFORE, in consideration of the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Second Restated Agreement is hereby amended and restated in its entirety and the Company, PubCo and the other Members, each intending to be legally bound, each hereby agree as follows:

 

Article I.

DEFINITIONS AND USAGE

 

Section 1.01        Definitions.

 

(a)               The following terms shall have the following meanings for the purposes of this Agreement:

 

“Act” has the meaning set forth in Section 8.04.

 

“Additional Member” means any Person admitted as a Member of the Company pursuant to Section 3.02 in connection with the issuance of new Units to such Person after the Restatement Date.

 

“Adjusted Capital Account Deficit” means, with respect to any Member, the deficit balance, if any, in such Member’s Capital Account as of the end of the relevant Fiscal Year, after giving effect to the following adjustments:

 

(a)               credit to such Capital Account any amounts that such Member is deemed to be obligated to restore pursuant to the penultimate sentence in Treasury Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5); and

 

(b)               debit to such Capital Account the items described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5) and 1.704-1(b)(2)(ii)(d)(6).

 

 

The foregoing definition of “Adjusted Capital Account Deficit” is intended to comply with the provisions of Treasury Regulations Section 1.704-1(b)(2)(ii)(d) and shall be interpreted consistently therewith.

 

“AES” shall have the meaning assigned to such term in the recitals of this Agreement.

 

“AES Initial Member” means AES.

 

“AES Member” means collectively, the AES Initial Member and any Subsequent Transferee of the AES Initial Member (unless the AES Member notifies the Managing Member prior to any Transfer that such Subsequent Transferee shall not be an AES Member, in which case such Person shall be deemed a Member) and any Affiliate of the AES Member who becomes a Member in accordance with the provisions of this Agreement. In the event that the AES Member refers to multiple Persons, any action required or permitted to be taken or determination required or permitted to be made by the AES Member shall require the approval of one or more Persons holding a majority of the Common Units held by all AES Members.

 

“Affiliate” of any specified Person means any other Person directly or indirectly Controlling, Controlled by or under direct or indirect common Control with such first specified Person; provided, that for purposes of this Agreement, (i) no Member (or equityholder of such Member) shall be deemed to be an Affiliate of any other Member (or equityholder of such Member) solely by virtue of this Agreement and (ii) the Company, on the one hand, and each of the Members (and each equityholder of any such Member), on the other hand, shall not be deemed to be Affiliates of each other solely by virtue of this Agreement.

 

“Agreement” has the meaning set forth in the Preamble.

 

“Available Cash” means, as of a particular date, the amount of cash on hand which the Managing Member, in its reasonable discretion, deems available for distribution to the Members, taking into account all debts, liabilities and obligations of the Company then due and amounts that the Managing Member, in its reasonable discretion, deems necessary to expend or retain for working capital or to place into reserves for customary and usual claims with respect to the Company’s operations.

 

“Black-Out Period” means any “black-out” or similar period under PubCo’s policies covering trading in PubCo’s securities (including any Trading Policy) to which the applicable Redeeming Member is subject (or may be subject at such time as it owns Class A Common Stock), which period restricts the ability of such Redeeming Member to immediately resell shares of Class A Common Stock to be delivered to such Redeeming Member in connection with a Share Settlement.

 

“Business Day” means any day excluding Saturday, Sunday or any day on which commercial banks in New York, New York are authorized or required by Law or other governmental action to close.

 

“Capital Account” means the capital account established and maintained for each Member pursuant to Section 5.02.

 

 

“Capital Contribution” means, with respect to any Member, the amount of money and the initial Carrying Value of any Property (other than money) contributed to the Company with respect to any Units held or purchased by such Member.

 

“Carrying Value” means, with respect to any Property (other than money), such Property’s adjusted basis for U.S. federal income tax purposes, except as follows:

 

(a)               the initial Carrying Value of any such Property contributed by a Member to the Company shall be the fair market value of such Property, as determined by the Managing Member; and

 

(b)               the Carrying Values of all Properties may, as determined by the Managing Member, be adjusted to equal their respective fair market values in accordance with Section 5.02(c).

 

In the case of any Property that has a Carrying Value that differs from its adjusted basis for U.S. federal income tax purposes, the Carrying Value shall be adjusted by the Depreciation taken into account with respect to such asset for purposes of computing Net Income and Net Loss.

 

“Cash Settlement” means, with respect to any Redemption, immediately available funds in U.S. dollars in an amount equal to the number of Redeemed Units subject thereto, multiplied by the Common Unit Redemption Price.

 

“Certificate” means the Company’s Certificate of Formation as filed with the Secretary of State of the State of Delaware, as amended or amended and restated from time to time.

 

“Change of Control” means the occurrence of any of the following events:

 

(a)               any “person” or “group” (within the meaning of Sections 13(d) and 14(d) of the Exchange Act, but excluding any employee benefit plan of such person and its subsidiaries, and any person or entity acting in its capacity as trustee, agent or other fiduciary or administrator of any such plan) becomes the “beneficial owner” (within the meaning of Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of shares of Class A Common Stock, Class B Common Stock, preferred stock and/or any other class or classes of capital stock of PubCo (if any) representing in the aggregate more than fifty percent (50%) of the voting power of all of the outstanding shares of capital stock of PubCo entitled to vote;

 

(b)               the stockholders of PubCo approve a plan of complete liquidation or dissolution of PubCo or there is consummated an agreement or series of related agreements for the sale or other disposition, directly or indirectly, by PubCo of all or substantially all of PubCo’s assets (including a sale of all or substantially all of the assets of the Company);

 

(c)               there is consummated a merger or consolidation of PubCo with any other corporation or entity, and, immediately after the consummation of such merger or consolidation, the voting securities of PubCo immediately prior to such merger or consolidation do not continue to represent, or are not converted into, more than fifty percent (50%) of the combined voting power of the then outstanding voting securities of the Person resulting from such merger or consolidation or, if the surviving company is a Subsidiary, the ultimate parent thereof; or

 

 

(d)               PubCo ceases to be the sole Managing Member of the Company.

 

Notwithstanding the foregoing, a “Change of Control” shall not be deemed to have occurred by virtue of the consummation of any transaction or series of integrated transactions immediately following which the record holders of the Class A Common Stock, Class B Common Stock, preferred stock and/or any other class or classes of capital stock of PubCo immediately prior to such transaction or series of transactions continue to have substantially the same proportionate ownership in and voting control over, and own substantially all of the shares of, an entity which owns all or substantially all of the assets of PubCo immediately following such transaction or series of transactions.

 

“Change of Control Exchange Date” has the meaning set forth in Section 9.06(a).

 

“Class A Common Stock” means, as applicable, (a) Class A common stock, $0.00001 par value per share, of PubCo or (b) following any consolidation, merger, reclassification or other similar event involving PubCo, any shares or other securities of PubCo or any other Person or cash or other property that become payable in consideration for the Class A Common Stock or into which the Class A Common Stock is exchanged or converted as a result of such consolidation, merger, reclassification or other similar event.

 

“Class B Common Stock” means, as applicable, (a) Class B common stock, $0.00001 par value per share, of PubCo or (b) following any consolidation, merger, reclassification or other similar event involving PubCo, any shares or other securities of PubCo or any other Person or cash or other property that become payable in consideration for the Class B Common Stock or into which the Class B Common Stock is exchanged or converted as a result of such consolidation, merger, reclassification or other similar event.

 

“Code” means the Internal Revenue Code of 1986, as amended from time to time.

 

“Common Unit” means a limited liability company interest in the Company, designated herein as a “Common Unit.”

 

“Common Unit Redemption Price” means, with respect to any Redemption Date, the price for a share of Class A Common Stock on the Stock Exchange, as reported on bloomberg.com or such other reliable source as determined by the Managing Member in good faith, at the close of trading on the last full Trading Day immediately prior to the Redemption Date, subject to appropriate and equitable adjustment for any stock splits, reverse splits, stock dividends or similar events affecting the Class A Common Stock. In the event the shares of Class A Common Stock are not publicly traded at the time of a Redemption, then the Managing Member shall determine the Common Unit Redemption Price in good faith.

 

“Company” has the meaning set forth in the Preamble.

 

“Company Minimum Gain” means “partnership minimum gain,” as defined in Treasury Regulations Sections 1.704-2(b)(2) and 1.704-2(d).

 

 

“Company Representative” has, with respect to taxable periods beginning after December 31, 2017, the meaning assigned to the term “partnership representative” in Section 6223 of the Code and any Treasury Regulations or other administrative or judicial pronouncements promulgated thereunder and, with respect to taxable periods beginning on or before December 31, 2017, the meaning assigned to the term “tax matters partner” as defined in Code Section 6231(a)(7) prior to its amendment by Title XI of the Bipartisan Budget Act of 2015, in each case as appointed pursuant to Section 6.01(a).

 

“Confidential Information” has the meaning set forth in Section 12.11.

 

“Control” (including the terms “Controlling” and “Controlled”), with respect to the relationship between or among two or more Persons, means the possession, directly or indirectly, of the power to direct or cause the direction of the affairs or management of such subject Person, whether through the ownership of voting securities, as trustee or executor, by contract or otherwise.

 

“Controlled Entities” has the meaning set forth in Section 10.02(c)(ii).

 

“Covered Person” means (i) each Member or an Affiliate thereof, in each case in such capacity, (ii) each officer, director, equityholder, member, partner, employee, representative, agent or trustee of a Member or an Affiliate thereof, in each case in such capacity, and (iii) each officer, director, shareholder, member, partner, employee, representative, agent or trustee of the Managing Member, the Company or an Affiliate controlled thereby of, in each case in such capacity.

 

“Delaware Act” means the Delaware Limited Liability Company Act, as amended from time to time.

 

“Depreciation” means, for each Fiscal Year, an amount equal to the depreciation, amortization, or other cost recovery deduction allowable with respect to an asset for such Fiscal Year, except that if the Carrying Value of an asset differs from its adjusted basis for federal income tax purposes at the beginning of such Fiscal Year, Depreciation shall be an amount that bears the same ratio to such beginning Carrying Value as the federal income tax depreciation, amortization, or other cost recovery deduction for such Fiscal Year bears to such beginning adjusted tax basis; provided, however, that if the adjusted basis for federal income tax purposes of an asset at the beginning of such Fiscal Year is zero (0), Depreciation with respect to such asset shall be determined with reference to such beginning Carrying Value using any reasonable method selected by the Managing Member.

 

“DGCL” means the Delaware General Corporation Law, as amended from time to time.

 

“Direct Redemption” has the meaning set forth in Section 9.01(c).

 

“Dissolution Event” has the meaning set forth in Section 11.01(c).

 

“Election Notice” has the meaning set forth in Section 9.01(a).

 

 

“Equity Plan” means any stock or equity purchase plan, restricted stock or equity plan or other similar equity compensation plan now or hereafter adopted by PubCo.

 

“Equity Securities” means, as applicable, (a) any capital stock, membership interests or other share capital, (b) any securities directly or indirectly convertible into or exchangeable for any capital stock, membership interests or other share capital or containing any profit participation features, (c) any rights or options directly or indirectly to subscribe for or to purchase any capital stock, membership interests, other share capital or securities containing any profit participation features or to subscribe for or to purchase any securities directly or indirectly convertible into or exchangeable for any capital stock, membership interests, other share capital or securities containing any profit participation features, (d) any share appreciation rights, phantom share rights or other similar rights, or (e) any Equity Securities issued or issuable with respect to the securities referred to in clauses (a) through (d) above in connection with a combination of units (or shares), recapitalization, merger, consolidation or other reorganization.

 

“Event of Withdrawal” means the bankruptcy or dissolution of a Member or the occurrence of any other event that terminates the continued membership of a Member in the Company. “Event of Withdrawal” shall not include an event that (a) terminates the existence of a Member for income tax purposes (including, without limitation, (i) a change in entity classification of a Member under Treasury Regulations Section 301.7701-3, (ii) a sale of assets by, or liquidation of, a Member pursuant to an election under Code Sections 336 or 338, or (iii) merger, severance, or allocation within a trust or among sub-trusts of a trust that is a Member) but that (b) does not terminate the existence of such Member under applicable state law (or, in the case of a trust that is a Member, does not terminate the trusteeship of the fiduciaries under such trust with respect to all the Units of such trust that is a Member).

 

“Exchange Act” means the Exchange Act of 1934, as amended, and applicable rules and regulations thereunder, and any successor to such statute, rules or regulations. Any reference herein to a specific section, rule or regulation of the Exchange Act shall be deemed to include any corresponding provisions of future Law.

 

“Expenses” has the meaning set forth in Section 10.02(c)(ii).

 

“Fair Market Value” of a specific asset of the Company will mean the amount which the Company would receive in an all-cash sale of such asset in an arms-length transaction with a willing unaffiliated third party, with neither party having any compulsion to buy or sell, consummated on the day immediately preceding the date on which the event occurred which necessitated the determination of the Fair Market Value (and after giving effect to any transfer taxes payable in connection with such sale), as such amount is determined by the Managing Member (or, if pursuant to a Liquidation, the liquidators) in its good faith judgment using all factors, information and data it deems to be pertinent.

 

“Fiscal Year” means (i) the Company’s fiscal year, which shall initially be the twelve (12) month period ending on September 30 of each year and which may be changed from time to time as determined by the Managing Member; and, (ii) for purposes of the allocations described in Article V, any other tax period for which such allocations will be made.

 

 

 

“Governmental Authority” means any transnational, domestic or foreign federal, state or local governmental, regulatory or administrative authority, department, court, agency or official, including any political subdivision thereof and the SEC, any non-U.S. regulatory agency and any other regulatory authority or body (including any state or provincial securities authority and any self-regulatory organization) with jurisdiction over the Company or any of its Subsidiaries.

 

“Indemnification Sources” has the meaning set forth in Section 10.02(c)(ii).

 

“Indemnitee-Related Entities” has the meaning set forth in Section 10.02(c)(ii)(A).

 

“Initial Capital Account Balance” means, with respect to any Member, the positive Capital Account balance of such Member as of immediately following the execution hereof, the amount of which is set forth on the Member Schedule.

 

“IPO” means the initial underwritten public offering of shares of PubCo’s Class A Common Stock.

 

“IPO Common Unit Subscription” has the meaning set forth in Section 3.04(b).

 

“IPO Common Unit Subscription Agreement” means that certain Common Unit Subscription Agreement, dated as of or about the date of this Agreement, by and between PubCo and the Company.

 

“IPO Net Proceeds” has the meaning set forth in the Recitals.

 

“IPO Unit Redemption” has the meaning set forth in the Recitals.

 

“Jointly Indemnifiable Claims” has the meaning set forth in Section 10.02(c)(ii)(B).

 

“Law” means, with respect to any Person, any federal, state or local law (statutory, common or otherwise), constitution, treaty, convention, ordinance, code, rule, regulation, order, injunction, judgment, decree, ruling or other similar requirement enacted, adopted, promulgated or applied by a Governmental Authority that is binding upon or applicable to such Person or its assets, in each case, as amended unless expressly specified otherwise.

 

“Liquidation” means a liquidation or winding up of the Company.

 

“Managing Member” means (i) PubCo so long as PubCo has not withdrawn as the Managing Member pursuant to Section 7.02 and (ii) any successor thereof appointed as Managing Member in accordance with Section 7.02.

 

 

“Market Price” means, with respect to a share of Class A Common Stock as of a specified date, the last sale price per share of Class A Common Stock, regular way, or if no such sale took place on such day, the average of the closing bid and asked prices per share of Class A Common Stock, regular way, in either case as reported in the principal consolidated transaction reporting system with respect to securities listed or admitted to trading on the Stock Exchange or, if the Class A Common Stock is not listed or admitted to trading on the Stock Exchange, as reported on the principal consolidated transaction reporting system with respect to securities listed on the principal national securities exchange on which the Class A Common Stock is listed or admitted to trading or, if the Class A Common Stock is not listed or admitted to trading on any national securities exchange, the last quoted price, or, if not so quoted, the average of the high bid and low asked prices in the over-the-counter market, as reported by the National Association of Securities Dealers, Inc. Automated Quotation System or, if such system is no longer in use, the principal other automated quotation system that may then be in use or, if the Class A Common Stock is not quoted by any such system, the average of the closing bid and asked prices as furnished by a professional market maker making a market in shares of Class A Common Stock selected by the PubCo Board or, in the event that no trading price is available for the shares of Class A Common Stock, the fair market value of a share of Class A Common Stock, as determined in good faith by the PubCo Board.

 

“Member” means any Person named as a Member of the Company on Schedule A and the books and records of the Company, as the same may be amended from time to time to reflect any Person admitted as an Additional Member or a Substitute Member, for so long as such Person continues to be a Member of the Company.

 

“Member Nonrecourse Debt” has the same meaning as the term “partner nonrecourse debt” in Treasury Regulations Section 1.704-2(b)(4).

 

“Member Nonrecourse Debt Minimum Gain” means an amount with respect to each “partner nonrecourse debt” (as defined in Treasury Regulations Section 1.704-2(b)(4)) equal to the Company Minimum Gain that would result if such partner nonrecourse debt were treated as a nonrecourse liability (as defined in Treasury Regulations Section 1.752-1(a)(2)) determined in accordance with Treasury Regulations Section 1.704-2(i)(3).

 

“Member Nonrecourse Deductions” has the same meaning as the term “partner nonrecourse deductions” in Treasury Regulations Sections 1.704-2(i)(1) and 1.704-2(i)(2).

 

“Member Schedule” has the meaning set forth in Section 3.01(b).

 

“Net Income” and “Net Loss” means, for each Fiscal Year, an amount equal to the Company’s taxable income or loss for such Fiscal Year, determined in accordance with Section 703(a) of the Code (for this purpose, all items of income, gain, loss, or deduction required to be stated separately pursuant to Section 703(a)(1) of the Code shall be included in taxable income or loss), with the following adjustments (without duplication):

 

(a)               any income of the Company that is exempt from federal income tax and not otherwise taken into account in computing Net Income or Net Loss pursuant to this definition of “Net Income” and “Net Loss” shall be added to such taxable income or loss;

 

(b)               any expenditures of the Company described in Section 705(a)(2)(B) of the Code or treated as Section 705(a)(2)(B) of the Code expenditures pursuant to Treasury Regulations Section 1.704-1(b)(2)(iv)(i), and not otherwise taken into account in computing Net Income and Net Loss pursuant to this definition of “Net Income” and “Net Loss,” shall be subtracted from such taxable income or loss;

 

 

(c)               gain or loss resulting from any disposition of Property with respect to which gain or loss is recognized for federal income tax purposes shall be computed by reference to the Carrying Value of the Property disposed of, notwithstanding that the adjusted tax basis of such Property differs from its Carrying Value;

 

(d)               in lieu of the depreciation, amortization, and other cost recovery deductions taken into account in computing such taxable income or loss, there shall be taken into account Depreciation for such Fiscal Year, computed in accordance with the definition of Depreciation;

 

(e)               to the extent an adjustment to the adjusted tax basis of any Company asset pursuant to Section 734(b) of the Code is required, pursuant to Treasury Regulations Section 1.704-1(b)(2)(iv)(m)(4), to be taken into account in determining Capital Accounts as a result of a distribution other than in liquidation of a Member’s interest in the Company, the amount of such adjustment shall be treated as an item of gain (if the adjustment increases the basis of the asset) or loss (if the adjustment decreases such basis) from the disposition of such asset and shall be taken into account for purposes of computing Net Income or Net Loss;

 

(f)                if the Carrying Value of any Company asset is adjusted in accordance with clause (b) of the definition of Carrying Value, the amount of such adjustment shall be taken into account in the taxable year of such adjustment as gain or loss from the disposition of such asset for purposes of computing Net Income or Net Loss; and

 

(g)               notwithstanding any other provision of this definition, any items that are specially allocated pursuant to Section 5.04(b) shall not be taken into account in computing Net Income and Net Loss.

 

The amounts of the items of Company income, gain, loss, or deduction available to be specially allocated pursuant to Section 5.04(b) shall be determined by applying rules analogous to those set forth in subparagraphs (a) through (e) above.

 

“Nonrecourse Deductions” has the meaning set forth in Treasury Regulations Sections 1.704-2(b)(1) and 1.704-2(c).

 

“Officers” has the meaning set forth in Section 7.05(a).

 

“Original Units” means the (i) Class A Common Units of the Company as of immediately prior to the Recapitalization, (ii) Class A-1 Common Units of the Company as of immediately prior to the Recapitalization, and (iii) Class B Common Units as of immediately prior to the Recapitalization.

 

“Partnership Tax Audit Rules” means Sections 6221 through 6241 of the Code, as amended, together with any final or temporary Treasury Regulations, Revenue Rulings, and case law and other official guidance interpreting Sections 6221 through 6241 of the Code, as amended (and any analogous provision of state or local tax law).

 

“Percentage Interest” means, with respect to any Member, a fractional amount, expressed as a percentage: (i) the numerator of which is the aggregate number of Common Units owned of record thereby and (ii) the denominator of which is the aggregate number of Common Units issued and outstanding. The sum of the outstanding Percentage Interests of all Members shall at all times equal 100%.

 

 

“Permitted Transferees” means any person or entity to whom a Member is permitted to transfer such Common Units pursuant to Section 8.02 of this Agreement.

 

“Person” means any individual, firm, corporation, partnership, limited liability company, trust, estate, joint venture, Governmental Authority or other entity.

 

“Pre-IPO Members” has the meaning set forth in the Recitals.

 

“Prime Rate” means the rate of interest from time to time identified by The Wall Street Journal, as being the “prime” rate (or if The Wall Street Journal does not identify such a rate, the “prime” rate as identified by another newspaper of national circulation).

 

“Process Agent” has the meaning set forth in Section 12.05(a).

 

“Property” means an interest of any kind in any real or personal (or mixed) property, including cash, and any improvements thereto, and shall include both tangible and intangible property.

 

“PubCo” has the meaning set forth in the Preamble.

 

“PubCo Board” means the board of directors of PubCo.

 

“PubCo Approved Change of Control” means any Change of Control of PubCo that meets the following conditions: (i) such Change of Control was approved by the board of directors of PubCo prior to such Change of Control, (ii) such Change of Control results in an early termination of and acceleration of payments under the Tax Receivable Agreement, (iii) the terms of such Change of Control provide for the consideration for the Units in such Change of Control to consist solely of (A) freely and immediately tradeable common equity securities of an issuer listed on a national securities exchange and/or (B) cash and (iv) if such common equity securities would be Registrable Securities (as defined in the Registration Rights Agreement) of such issuer for any stockholder party to the Registration Rights Agreement, the issuer of such listed equity securities has become a party thereto as a successor to PubCo effective upon closing of such Change of Control.

 

“PubCo Approved Recap Transaction” has the meaning set forth in Section 9.06(b).

 

“PubCo Modified Distribution Amount” has the meaning set forth in Section 5.03(e)(ii).

 

“Recapitalization” has the meaning set forth in the Recitals.

 

“Redeemed Units” has the meaning set forth in Section 9.01(a).

 

“Redeeming Member” has the meaning set forth in Section 9.01(a).

 

 

“Redemption” has the meaning set forth in Section 9.01(a).

 

“Redemption Date” has the meaning set forth in Section 9.01(a).

 

“Redemption Notice” has the meaning set forth in Section 9.01(a).

 

“Redemption Right” has the meaning set forth in Section 9.01(a).

 

“Registration Rights Agreement” means that certain Registration Rights Agreement, dated on or about the date hereof, by and among PubCo, certain stockholders of PubCo and the Members (as it may be amended from time to time in accordance with its terms).

 

“Regulatory Allocations” has the meaning set forth in Section 5.04(c).

 

“Relative Percentage Interest” means, with respect to any Member relative to another Member or Members, a fractional amount, expressed as a percentage, the numerator of which is the Percentage Interest of such Member; and the denominator of which is (x) the Percentage Interest of such Member plus (y) the aggregate Percentage Interest of such other Member or Members.

 

“Restatement Date” has the meaning set forth in the Preamble.

 

“Restricted Person” has the meaning set forth in that certain letter agreement dated as of the date hereof by and among the Company, AES and Siemens.

 

“SEC” means the United States Securities and Exchange Commission.

 

“Securities Act” means the Securities Act of 1933, as amended, and applicable rules and regulations thereunder, and any successor to such statute, rules or regulations. Any reference herein to a specific section, rule or regulation of the Securities Act shall be deemed to include any corresponding provisions of future Law.

 

“Share Settlement” means, with respect to any applicable Redemption, a number of shares of Class A Common Stock equal to the number of Redeemed Units.

 

“Siemens” shall have the meaning assigned to such term in the recitals of this Agreement.

 

“Siemens Initial Member” means Siemens.

 

“Siemens Member” means collectively, the Siemens Initial Member and any Subsequent Transferee of the Siemens Initial Member (unless the Siemens Member notifies the Managing Member prior to any Transfer that such Subsequent Transferee shall not be a Siemens Member, in which case such Person shall be deemed a Member) and any Affiliate of the Siemens Member who becomes a Member in accordance with the provisions of this Agreement. In the event that the Siemens Member refers to multiple Persons, any action required or permitted to be taken or determination required or permitted to be made by the Siemens Member shall require the approval of one or more Persons holding a majority of the Common Units held by all Siemens Members.

 

 

“Specified Audit” has the meaning set forth in Section 5.07(b).

 

“Specified Covenants” has the meaning set forth in Section 10.02(a).

 

“Sponsor Members” means AES and Siemens, provided that such Persons are Members.

 

“Stock Exchange” means the Nasdaq Stock Market or such other securities exchange or interdealer quotation system on which shares of Class A Common Stock are then listed or quoted.

 

“Stockholders Agreement” means the Stockholders Agreement, dated as of the date hereof, by and among PubCo and the other persons party thereto or that may become parties thereto from time to time, as the same may be amended, restated, supplemented and/or otherwise modified, from time to time.

 

“Subsequent Transferees” means, with respect to any Member, each Person that becomes a Substitute Member of the Company by virtue of such Person’s receiving all or a portion of its Units from such Member or from such Member’s Subsequent Transferees, in each case, in accordance with this Agreement.

 

“Subsidiary” means, with respect to any Person, any corporation, limited liability company, partnership, association or business entity of which (a) if a corporation, a majority of the total voting power of shares of stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person or a combination thereof, or (b) if a limited liability company, partnership, association or other business entity (other than a corporation), a majority of partnership or other similar ownership interest thereof is at the time owned or controlled, directly or indirectly, by any Person or one or more Subsidiaries of that Person or a combination thereof. For purposes hereof, a Person or Persons shall be deemed to have a majority ownership interest in a limited liability company, partnership, association or other business entity (other than a corporation) if such Person or Persons shall be allocated a majority of limited liability company, partnership, association or other business entity gains or losses or shall be or control any managing member, general partner or analogous controlling Person of such limited liability company, partnership, association or other business entity. For purposes hereof, references to a “Subsidiary” of any Person shall be given effect only at such times that such Person has one or more Subsidiaries and, unless otherwise indicated, the term “Subsidiary” refers to a Subsidiary of the Company.

 

“Substitute Member” means any Person admitted as a Member of the Company pursuant to Section 3.02 in connection with the Transfer of then-existing Units to such Person.

 

“Tax Distribution” means a distribution made by the Company pursuant to Section 5.03(e)(i) or Section 5.03(e)(ii).

 

 

“Tax Distribution Amount” means, with respect to any Member, an amount equal to the excess of (i) the product of (A) the Tax Rate multiplied by (B) the estimated or actual cumulative taxable income or gain of the Company, as determined for U.S. federal income tax purposes, allocated to such Member for any Fiscal Year (or portion thereof) beginning on or after the Restatement Date (including, without duplication, the amount of any income required to be recognized by such Member pursuant to Section 951 of the Code, Section 951A of the Code or Section 956 of the Code, in each case, as a result of such Member’s ownership of interests in the Company), less prior taxable loss or deductions of the Company allocated to such Member for full or partial Fiscal Years commencing on or after the Restatement Date, in each case, as reasonably determined by the Managing Member over (ii) the cumulative distributions made to such Member after the Restatement Date pursuant to Section 5.03(e) with respect to Fiscal Years (including any portion thereof) beginning on or after the Restatement Date. The Tax Distribution Amount with respect to PubCo for a Fiscal Year shall in no event be less than an amount that will enable PubCo to meet its tax obligations and PubCo’s obligations pursuant to the Tax Receivable Agreement for the relevant Fiscal Year. The Tax Distribution Amounts of the Members shall be determined without taking into account the effects of Section 743(b) of the Code.

 

“Tax Rate” means the highest marginal tax rates for a corporation that is resident in the City of New York applicable to ordinary income, qualified dividend income or capital gains, as appropriate, taking into account the holding period of the assets disposed of and the year in which the taxable net income is recognized by the Company, and taking into account the deductibility of state and local income taxes as applicable at the time for federal income tax purposes and any limitations thereon including pursuant to Section 68 of the Code or Section 164 of the Code.

 

“Tax Receivable Agreement” means that certain Tax Receivable Agreement, dated as or around the date hereof, by and among PubCo, the Company and the other parties thereto.

 

“Trading Day” means a day on which the Stock Exchange or such other principal United States securities exchange on which the Class A Common Stock is listed or admitted to trading is open for the transaction of business (unless such trading shall have been suspended for the entire day).

 

“Trading Policy” means any exchange and/or insider trading policy that may be established by PubCo, as may be amended from time to time.

 

“Transfer” means the (a) sale or assignment of, offer to sell, contract or agreement to sell, hypothecate, pledge, grant of any option to purchase or otherwise dispose of or agreement to dispose of, directly or indirectly, or establishment or increase of a put equivalent position or liquidation with respect to or decrease of a call equivalent position within the meaning of Section 16 of the Exchange Act with respect to, any security, (b) entry into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any security, whether any such transaction is to be settled by delivery of such securities, in cash or otherwise, or (c) public announcement of any intention to effect any transaction specified in clause (a) or (b); provided, that “Transfer” shall be deemed not to include (a) any transfer of equity securities of an entity holding (directly or indirectly) Units of the Company that (A) was not formed for the purpose of investing in the Company or (B) is an “alternative investment vehicle” of an investment fund that was not formed for the purpose of investing in the Company, or (b) any pledge to any third-party pledgee in a bona fide transaction as collateral to secure obligations pursuant to lending or other arrangements, between such third parties (or their affiliates or designees) and a Member and/or its affiliates or any similar arrangement relating to a financing agreement for the benefit of a Member and/or its affiliates. The terms “Transferring” and “Transferred” when used as verbs shall have their correlative meanings.

 

 

“Transferor Member” has the meaning set forth in Section 5.02(b).

 

“Treasury Regulations” means the regulations promulgated under the Code, as amended from time to time, including temporary and (to the extent they can be relied upon) proposed regulations.

 

“Units” means Common Units or any other type, class or series of limited liability company interests in the Company designated by the Company after the date hereof in accordance with this Agreement; provided, that any type, class or series of Units shall have the designations, preferences and/or special rights set forth or referenced in this Agreement, and the limited liability company interests of the Company represented by such type, class or series of Units shall be determined in accordance with such designations, preferences and/or special rights.

 

“Unvested PubCo Shares” means shares of Class A Common Stock issuable pursuant to awards granted under any Equity Plan that are not Vested PubCo Shares.

 

“Value” means (a) for any stock option under any Equity Plan, the Market Price for the Trading Day immediately preceding the date of exercise of such stock option and (b) for any awards under any Equity Plan other than a stock option, the Market Price for the Trading Day immediately preceding the Vesting Date.

 

“Vested PubCo Shares” means the shares of Class A Common Stock issued pursuant to awards granted under any Equity Plan that are vested pursuant to the terms thereof or any award or similar agreement relating thereto.

 

“Vesting Date” means the date on which a Person’s rights with respect to all or a portion of Class A Common Stock subject to an Equity Plan may become fully vested.

 

“Withholding Advances” has the meaning set forth in Section 5.06(b).

 

 

(b)               Each of the following terms is defined in the Section set forth opposite such term:

 

Section 1.02             Other Definitional and Interpretative Provisions. The definitions in Section 1.01 shall apply equally to both the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. 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. The captions herein are included for convenience of reference only and shall be ignored in the construction or interpretation hereof. References to Articles, Sections and Schedules are to Articles, Sections and Schedules of this Agreement unless otherwise specified. All Schedules annexed hereto or referred to herein are hereby incorporated in and made a part of this Agreement as if set forth in full herein. Any capitalized terms used in any Schedule but not otherwise defined therein, shall have the meaning as defined in this Agreement. Any singular term in this Agreement shall be deemed to include the plural, and any plural term the singular. The terms “clause(s)” and “subparagraph(s)” shall be used herein interchangeably. Whenever the words “include”, “includes” or “including” are used in this Agreement, they shall be deemed to be followed by the words “without limitation”, whether or not they are in fact followed by those words or words of like import. “Writing”, “written” and comparable terms refer to printing, typing and other means of reproducing words (including electronic media) in a visible form. 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. Unless otherwise expressly provided herein, any agreement or instrument defined or referred to herein or in any agreement or instrument that is referred to herein means such agreement or instrument as from time to time amended, modified, supplemented or restated, including by waiver or consent, and references to all attachments thereto and instruments incorporated therein, but in the case of each of the foregoing, only to the extent that such amendment, modification, supplement, restatement, waiver or consent is effected in accordance with this Agreement. References to any Person include the successors and permitted assigns of that Person. References from or through any date mean, unless otherwise specified, from and including or through and including, respectively. Unless otherwise expressly provided herein, any statute defined or referred to herein or in any agreement or instrument that is referred to herein means such statute as from time to time amended, modified, supplemented or restated, including by succession of comparable successor statutes. Unless otherwise expressly provided herein, when any approval, consent or other matter requires any action or approval of any group of Members, including any holders of any class of Units, such approval, consent or other matter shall require the approval of a majority in interest of such group of Members. Except to the extent otherwise expressly provided herein, all references to any Member shall be deemed to refer solely to such Person in its capacity as such Member and not in any other capacity.

 

Article II.

THE COMPANY

 

Section 2.01        Continuation of the Company. The Company was originally formed on June 30, 2017, as a Delaware limited liability company by the filing of the Certificate with the Secretary of State of the State of Delaware (the filing of such certificate by an “authorized person” of the Company within the meaning of the Delaware Act, being hereby approved and ratified in all respects). The Persons listed on the Schedule of Members as of the date hereof hereby continue or are hereby admitted, as applicable, as the Members of the Company. This Agreement shall be effective on the Restatement Date. The Members as of the date hereof agree and acknowledge that this Agreement replaces the Second Restated Agreement, which is no longer in effect. The rights and obligations of the Members and the terms and conditions of the Company shall be governed by the Delaware Act and this Agreement. To the extent the Delaware Act and this Agreement are inconsistent with respect to any subject matter covered in this Agreement, this Agreement shall govern to the extent permitted by law. The Managing Member shall cause to be executed and filed on behalf of the Company all other instruments or documents, and shall do or cause to be done all such filing, recording, or other acts as may be necessary or appropriate from time to time to comply with the requirements of law for the continuation and operation of a limited liability company in Delaware and in the other states and jurisdictions in which the Company shall transact business.

 

 

Section 2.02        Name. The name of the Company shall be “Fluence Energy, LLC.” The name of the Company shall be the exclusive property of the Company, and no Member shall have any rights, commercial or otherwise, in the Company’s name or any derivation thereof. The Company’s name may be changed only by an amendment to the Certificate of the Company.

 

Section 2.03        Commencement and Term. The Company commenced on June 30, 2017 as a Delaware limited liability company and shall hereby continue until it is dissolved, its affairs are wound up and final liquidating distributions are made pursuant to this Agreement.

 

Section 2.04        Principal Place of Business. The principal place of business of the Company shall be at such place as the Managing Member may designate from time to time, which need not be in the State of Delaware. The Company may have such other offices (within or without the State of Delaware) as the Managing Member may designate from time to time.

 

Section 2.05        Registered Agent and Registered Office. The registered office of the Company required by the Delaware Act to be maintained in Delaware shall be the office identified in the Certificate, or such other office as the Managing Member may designate from time to time in the manner provided by law.

 

Section 2.06        Purposes. The purposes of the Company shall be to engage in any activity for which limited liability companies may be organized in the State of Delaware, all on the terms and conditions and subject to the limitations set forth in this Agreement. Subject to the Delaware Act and this Agreement, the Company shall operate in a manner similar to that of a Delaware corporation.

 

Section 2.07        Powers of the Company. The Company shall have the power and authority to take any and all actions necessary, appropriate or advisable to or for the furtherance of the purposes set forth in Section 2.06.

 

Section 2.08        Partnership Tax Status. The Members agree that the Company shall be classified as a partnership for U.S. federal and applicable state and local tax purposes, and the Members and the Company agree that they shall refrain from making any elections under the Treasury Regulations or other applicable Law, filing any tax returns or reports, and otherwise taking any actions, in each case, that are inconsistent with such classification. The Members intend that the Company not be a partnership (including, without limitation, a limited partnership) or joint venture, and that no Member be a partner or joint venturer of any other Member by virtue of this Agreement, for any purposes other than as set forth in the immediately preceding sentence.

 

Section 2.09        Regulation of Internal Affairs. The internal affairs of the Company and the conduct of its business shall be regulated by this Agreement, and to the extent not provided for herein, shall be determined by the Managing Member.

 

Section 2.10        Ownership of Property. Legal title to all Property conveyed to, or held by, the Company or its Subsidiaries shall reside in the Company or its Subsidiaries, as applicable, and shall be conveyed only in the name of the Company or its Subsidiaries, as applicable, and no Member or any other Person, individually, shall have any ownership of such Property.

 

 

Article III.

UNITS; MEMBERS; BOOKS AND RECORDS; REPORTS

 

Section 3.01        Units; Admission of Members.

 

(a)               (i) In connection with the Transactions, PubCo acquired Original Units (which will be converted into Common Units pursuant to the Recapitalization in accordance with Section 3.04) and was admitted as a Member and (ii) PubCo will acquire additional Common Units pursuant to the IPO Common Unit Subscription Agreement. Each Member’s ownership interest in the Company shall be represented by Units, which may be divided into one or more types, classes or series, or subseries of any type, class or series, with each type, class or series, or subseries thereof, having the rights and privileges, set forth in this Agreement.

 

(b)               The number and type of Units issued to each Member shall be set forth opposite such Member’s name on the schedule of Members of the Company held by the Company in its books and records (the “Member Schedule”). The Member Schedule shall be maintained by the Managing Member on behalf of the Company in accordance with this Agreement. When any Units or other Equity Securities of the Company are issued, repurchased, redeemed, converted or Transferred in accordance with this Agreement, the Member Schedule shall be amended by the Managing Member to reflect such issuance, repurchase, redemption or Transfer, the admission of Additional Members or Substitute Members and the resulting Percentage Interest of each Member. Following the date hereof, no Person shall be admitted as a Member and no additional Units shall be issued except as expressly provided herein.

 

(c)               No Member shall be required or, except as approved by the Managing Member and in accordance with the other provisions of this Agreement, permitted to (i) loan any money or property to the Company, (ii) borrow any money or property from the Company or (iii) make any additional Capital Contributions.

 

(d)               The Managing Member may cause the Company to authorize and issue from time to time such other Units or other Equity Securities of any type, class or series, in each case, having the designations, preferences and/or special rights as may be determined by the Managing Member. Such Units or other Equity Securities may be issued pursuant to such agreements as the Managing Member shall approve in its discretion. When any such other Units or other Equity Securities are authorized and issued, the Member Schedule and this Agreement shall be amended by the Managing Member to reflect such additional issuances.

 

(e)               Unless the Managing Member otherwise directs, Units will not be represented by certificates.

 

Section 3.02        Substitute Members and Additional Members.

 

(a)               No Transferee of any Units or Person to whom any Units are issued pursuant to this Agreement shall be admitted as a Member hereunder or acquire any rights hereunder, including any voting rights or the right to receive distributions and allocations in respect of the Transferred or issued Units, as applicable, unless (i) such Units are Transferred or issued in compliance with the provisions of this Agreement (including Article VIII) and (ii) such Transferee or recipient shall have executed and delivered to the Company such instruments as the Managing Member deems necessary or desirable, in its reasonable discretion, to effectuate the admission of such Transferee or recipient as a Member and to confirm the agreement of such Transferee or recipient to be bound by all the terms and provisions of this Agreement. Upon complying with the immediately preceding sentence, without the need for any further action of any Person, a Transferee or recipient shall be deemed admitted to the Company as a Member. A Substitute Member shall enjoy the same rights, and be subject to the same obligations, as the Transferor; provided, that such Transferor shall not be relieved of any obligation or liability hereunder arising prior to the consummation of such Transfer but shall, except as explicitly set forth herein, be relieved of all future obligations with respect to the Units so Transferred. As promptly as practicable after the admission of any Person as a Member, the books and records of the Company shall be changed to reflect such admission of a Substitute Member or Additional Member. In the event of any admission of a Substitute Member or Additional Member pursuant to this Section 3.02(a), this Agreement shall be deemed amended to reflect such admission, and any formal amendment of this Agreement (including Schedule A) in connection therewith shall only require execution by the Company and such Substitute Member or Additional Member, as applicable, to be effective.

 

 

(b)               If a Member shall Transfer all (but not less than all) of its Units, the Member shall thereupon cease to be a Member of the Company.

 

Section 3.03        Tax and Accounting Information.

 

(a)               Accounting Decisions and Reliance on Others. All decisions as to accounting matters, except as otherwise specifically set forth herein, shall be made by the Managing Member in accordance with Law and to the extent applicable with accounting methods followed for federal income tax purposes. In making such decisions, the Managing Member may rely upon the advice of the independent accountants of the Company.

 

(b)               Records and Accounting Maintained. For financial reporting purposes, unless otherwise determined by PubCo’s audit committee, the books and records of the Company shall be kept on the accrual method of accounting applied in a consistent manner and shall reflect all Company transactions. For tax purposes, the books and records of the Company shall be kept on the accrual method. The Fiscal Year of the Company shall be used for financial reporting and for federal income tax purposes to the extent permitted under applicable Law.

 

(c)               Financial Reports.

 

(i)                 The books and records of the Company shall be audited as of the end of each Fiscal Year by the same accounting firm that audits the books and records of PubCo (or, if such firm declines to perform such audit, by an accounting firm selected by the Managing Member).

 

 

(ii)              In the event that neither PubCo nor the Company is required to file an annual report on Form 10-K or quarterly report on Form 10-Q, the Company shall deliver, or cause to be delivered, the following to each Member:

 

(A)             not later than ninety (90) days after the end of each Fiscal Year of the Company, a copy of the audited consolidated balance sheet of the Company and its Subsidiaries as of the end of such Fiscal Year and the related statements of operations and cash flows for such Fiscal Year, setting forth in each case in comparative form the figures for the previous year, all in reasonable detail; and

 

(B)              not later than forty five (45) days or such later time as permitted under applicable securities law after the end of each of the first three fiscal quarters of each Fiscal Year, the unaudited consolidated balance sheet of the Company and its Subsidiaries, and the related statements of operations and cash flows for such quarter and for the period commencing on the first day of the Fiscal Year and ending on the last day of such quarter.

 

(d)               Tax Returns.

 

(i)                 The Company shall timely cause to be prepared all federal, state, local and foreign tax returns (including information returns) of the Company and its Subsidiaries, which may be required by a jurisdiction in which the Company and its Subsidiaries operate or conduct business for each year or period for which such returns are required to be filed and shall cause such returns to be timely filed. Upon request of any Member, the Company shall furnish to each Member a copy of such tax return.

 

(ii)              The Company shall furnish to each Member (a) as soon as reasonably practicable after the end of each Fiscal Year, information concerning the Company and its Subsidiaries reasonably required for the preparation of federal, state and local income tax returns of such Members (or any beneficial owner(s) of such Member), including a Schedule K-1 within one hundred fifty (150) days following the end of such Fiscal Year, indicating each Member’s share of the Company’s taxable income, gain, credits, losses and deductions for such year, in sufficient detail to enable such Member to prepare its federal, state and local income tax returns; provided, that the Managing Member shall use commercially reasonable efforts to provide estimates of such information believed by the Managing Member in good faith to be reasonable, (b) as soon as reasonably practicable after the close of the relevant fiscal period, such information concerning the Company as is required to enable such Member (or any beneficial owner of such Member) to pay estimated taxes (and, as soon as reasonably practicable but in no event later than five (5) business days prior to the applicable quarterly estimated tax payment due date, tax information necessary for the Members to make their quarterly estimated tax payments) and (c) as soon as reasonably practicable after a request by such Member, such other information concerning the Company and its Subsidiaries that is reasonably requested by such Member for compliance with its tax obligations (or the tax obligations of any beneficial owner(s) of such Member) or for tax planning purposes.

 

(e)               Inconsistent Positions. No Member shall take a position on its income tax return with respect to any item of Company income, gain, deduction, loss or credit that is different from the position taken on the Company’s income tax return with respect to such item unless such Member notifies the Company of the different position the Member desires to take and the Company’s regular tax advisors, after consulting with the Member, are unable to provide an opinion that (after taking into account all of the relevant facts and circumstances) the arguments in favor of the Company’s position outweigh the arguments in favor of the Member’s position. Nothing in this Section 3.03(e) shall limit the other provisions of this Agreement and the Tax Receivable Agreement specifically providing for the tax characterization of transactions contemplated thereby.

 

 

Section 3.04        Recapitalization; PubCo’s Capital Contribution; PubCo’s Purchase of Common Units; the IPO Unit Redemption.

 

(a)               In order to effect the Recapitalization, the number of Original Units that were issued and outstanding and held by the Pre-IPO Members prior to the date hereof as set forth opposite the respective Pre-IPO Member in Schedule A are hereby converted, as of the date hereof, and after giving effect to such conversion and the other transactions related to the Recapitalization, into the number of Common Units, as applicable, set forth opposite the name of the respective Member on the Schedule of Members attached hereto as Schedule A (provided, for the avoidance of doubt, that the number of Common Units set forth on Schedule A shall include the Common Units issued to PubCo pursuant to the IPO Common Unit Subscription Agreement), and such Common Units are hereby issued and outstanding as of the date hereof and the holders of such Common Units are Members hereunder. (b) Following the Recapitalization, the Company shall issue to PubCo, and PubCo will acquire [●] newly issued Common Units in exchange for a portion of the IPO Net Proceeds payable to the Company upon consummation of the IPO pursuant to the IPO Common Unit Subscription Agreement (the “IPO Common Unit Subscription”). For the avoidance of doubt, PubCo shall be admitted as a Member with respect to all Common Units it holds from time to time.

 

Section 3.05        Books and Records. The Company shall keep full and accurate books of account and other records of the Company at its principal place of business.

 

Article IV.

MANAGING MEMBER OWNERSHIP; RESTRICTIONS ON MANAGING MEMBER UNITS

 

Section 4.01        Managing Member Ownership.

 

(a)               Except as otherwise determined by the Managing Member, the Company and PubCo shall undertake all actions, including, without limitation, an issuance, reclassification, distribution, division or recapitalization, with respect to the Common Units and the Class A Common Stock to maintain at all times (i) a one-to-one ratio between the number of Common Units owned by PubCo and / or any wholly-owned Subsidiary of PubCo, in the aggregate, and the number of outstanding shares of Class A Common Stock, in the aggregate, and (ii) a one-to-one ratio between the number of Common Units owned by each Member (other than PubCo), directly or indirectly, and the number of outstanding shares of Class B Common Stock owned by such Member in each case, disregarding, for purposes of maintaining the one-to-one ratio contemplated by clause (i) and clause (ii) above, (A) Unvested PubCo Shares (to the extent the shares of Class A Common Stock underlying the applicable award are not actually issued and outstanding), (B) treasury stock, and (C) preferred stock or other debt or equity securities (including, without limitation, warrants, options or rights) issued by PubCo that are convertible into or exercisable or exchangeable for Class A Common Stock (except to the extent the net proceeds from such other securities, including any exercise or purchase price payable upon conversion, exercise or exchange thereof, have been contributed by PubCo to the equity capital of the Company). Except as otherwise determined by the Managing Member, in the event PubCo issues, transfers or delivers from treasury stock or repurchases or redeems PubCo’s preferred stock in a transaction not contemplated in this Agreement, the Managing Member and PubCo shall take all actions such that, after giving effect to all such issuances, transfers, deliveries, repurchases or redemptions, PubCo, directly or indirectly, holds (in the case of any issuance, transfer or delivery) or ceases to hold (in the case of any repurchase or redemption) equity interests in the Company which (in the good faith determination by the Managing Member) are in the aggregate substantially economically equivalent to the outstanding preferred stock of PubCo so issued, transferred, delivered, repurchased or redeemed. Except as otherwise determined by the Managing Member in its reasonable discretion, the Company and PubCo shall not undertake any subdivision (by any Common Unit split, stock split, Common Unit distribution, stock distribution, reclassification, division, recapitalization or similar event) or combination (by reverse Common Unit split, reverse stock split, reclassification, division, recapitalization or similar event) of the Common Units, Class A Common Stock or Class B Common Stock, as applicable, that is not accompanied by an identical subdivision or combination of Class A Common Stock, Class B Common Stock or Common Units, respectively, to maintain at all times (x) a one-to-one ratio between the number of Common Units owned by PubCo and / or any wholly-owned subsidiary of PubCo, in the aggregate, and the number of outstanding shares of Class A Common Stock, in the aggregate, or (y) a one-to-one ratio between the number of Common Units owned by each Member (other than PubCo), directly or indirectly, and the number of outstanding shares of Class B Common Stock owned by such Member, directly or indirectly, in each case, unless such action is necessary to maintain at all times a one-to-one ratio between the number of Common Units owned by PubCo and / or any wholly owned subsidiary of PubCo, in the aggregate, and the number of outstanding shares of Class A Common Stock, in the aggregate, or the number of Common Units owned by Members (other than PubCo), directly or indirectly, and the number of outstanding shares of Class B Common Stock, as contemplated by the first sentence of this Section 4.01(a).

 

 

(b)               The Company shall only be permitted to issue additional Common Units, and/or establish other classes or series of Units or other Equity Securities in the Company to the Persons and on the terms and conditions provided for in Section 3.01, this Section 4.01, Section 4.03 and Section 9.01. Subject to the foregoing, the Managing Member may cause the Company to issue additional Common Units authorized under this Agreement and/or establish other classes or series of Units or other Equity Securities in the Company at such times and upon such terms as the Managing Member shall determine and the Managing Member shall amend this Agreement as necessary in connection with the issuance of additional Common Units and admission of additional Members under this Section 4.01 without the requirement of any consent or acknowledgement of any other Member.

 

Section 4.02        Restrictions on Managing Member Units. Except as otherwise determined by the Managing Member in connection with the use of cash or other assets held by PubCo, if at any time, any shares of Class A Common Stock are repurchased or redeemed (whether by exercise of a put or call, automatically or by means of another arrangement) by PubCo for cash, then the Managing Member shall cause the Company, immediately prior to such repurchase or redemption of Class A Common Stock, to redeem a corresponding number of Common Units held (directly or indirectly) by PubCo, at an aggregate redemption price equal to the aggregate purchase or redemption price of the shares of Class A Common Stock being repurchased or redeemed by PubCo (plus any expenses related thereto) and upon such other terms as are the same for the shares of Class A Common Stock being repurchased or redeemed by PubCo; provided, if PubCo uses funds received from distributions from the Company or the net proceeds from an issuance of Class A Common Stock to fund such repurchase or redemption, then the Company shall cancel a corresponding number of Common Units held (directly or indirectly) by PubCo for no consideration. Notwithstanding any provision to the contrary contained in this Agreement, the Company shall not make any repurchase or redemption if such repurchase or redemption would violate any applicable Law.

 

 

Section 4.03        Equity Plans.

 

(a)               If at any time or from time to time, in connection with any Equity Plan, a stock option granted over shares of Class A Common Stock to a Person is duly exercised:

 

(i)                 PubCo shall, as soon as practicable after such exercise, make a Capital Contribution to the Company in an amount equal to the exercise price paid to PubCo by such exercising Person in connection with the exercise of such stock option.

 

(ii)              Notwithstanding the amount of the Capital Contribution actually made pursuant to Section 4.03(a)(i), PubCo shall be deemed to have contributed to the Company as a Capital Contribution, in lieu of the Capital Contribution actually made and in consideration of additional Common Units, an amount equal to the Value of a share of Class A Common Stock as of the date of such exercise multiplied by the number of shares of Class A Common Stock then being issued by PubCo in connection with the exercise of such stock option.

 

(iii)            PubCo shall receive in exchange for such Capital Contributions (as deemed made under Section 4.03(a)(ii)), a number of Common Units equal to the number of shares of Class A Common Stock for which such option was exercised.

 

(b)               If at any time or from time to time, in connection with any Equity Plan, any shares of Class A Common Stock are issued to a Person:

 

(i)                 PubCo shall issue such number of shares of Class A Common Stock as are to be issued to such Person in accordance with the Equity Plan;

 

(ii)              on the Vesting Date, the following events will be deemed to have occurred: (1) PubCo shall be deemed to have sold such shares of Class A Common Stock to the Company for a purchase price equal to the Value of such shares of Class A Common Stock, (2) the Company shall be deemed to have delivered such shares of Class A Common Stock to such Person, (3) PubCo shall be deemed to have contributed the purchase price for such shares of Class A Common Stock to the Company as a Capital Contribution, and (4) in the case where such Person is an employee of a Subsidiary, the Company shall be deemed to have contributed such amount to the capital of the Subsidiary; and

 

 

(iii)            the Company shall issue to PubCo on the Vesting Date a number of Common Units equal to the number of shares of Class A Common Stock issued under Section 4.03(b)(i) in consideration for a Capital Contribution that the Corporation is deemed to make to the Company pursuant to clause (3) of Section 4.03(b)(ii) above.

 

Article V.

CAPITAL CONTRIBUTIONS; CAPITAL ACCOUNTS;
DISTRIBUTIONS; ALLOCATIONS

 

Section 5.01        Capital Contributions.

 

(a)               From and after the date hereof, no Member shall have any obligation to the Company, to any other Member or to any creditor of the Company to make any further Capital Contribution, except as expressly provided in this Agreement.

 

(b)               Except as expressly provided herein or in the Act, no Member, in its capacity as a Member, shall have the right to receive any Property of the Company.

 

Section 5.02        Capital Accounts.

 

(a)               Maintenance of Capital Accounts. The Company shall maintain a Capital Account for each Member on the books of the Company in accordance with the provisions of Treasury Regulations Section 1.704-1(b)(2)(iv) and, to the extent consistent with such provisions, the following provisions:

 

(i)                 Each Member listed on the Member Schedule shall be credited with the Initial Capital Account Balance set forth on the Member Schedule. The Member Schedule shall be amended by the Managing Member from time to time to reflect adjustments to the Members’ Capital Accounts made in accordance with Sections 5.02(a)(ii), 5.02(a)(iii), 5.02(a)(iv), 5.02(c) or otherwise.

 

(ii)              To each Member’s Capital Account there shall be credited: (A) such Member’s Capital Contributions, (B) such Member’s distributive share of Net Income and any item in the nature of income or gain that is allocated pursuant to Section 5.04 and (C) the amount of any Company liabilities assumed by such Member or that are secured by any Property distributed to such Member.

 

(iii)            To each Member’s Capital Account there shall be debited: (A) the amount of money and the Carrying Value of any Property distributed to such Member pursuant to any provision of this Agreement, (B) such Member’s distributive share of Net Loss and any items in the nature of expenses or losses that are allocated to such Member pursuant to Section 5.04 and (C) the amount of any liabilities of such Member assumed by the Company or that are secured by any Property contributed by such Member to the Company.

 

 

(iv)             In determining the amount of any liability for purposes of subparagraphs (ii) and (iii) above there shall be taken into account Section 752(c) of the Code and any other applicable provisions of the Code and the Treasury Regulations.

 

The foregoing provisions and the other provisions of this Agreement relating to the maintenance of Capital Accounts are intended to comply with Treasury Regulations Section 1.704-1(b) and shall be interpreted and applied in a manner consistent with such Treasury Regulations. In the event that the Managing Member shall reasonably determine that it is necessary to modify the manner in which the Capital Accounts or any debits or credits thereto are maintained (including debits or credits relating to liabilities that are secured by contributed or distributed Property or that are assumed by the Company or the Members) to comply with the Code and Treasury Regulations, the Managing Member may (acting reasonably and in good faith) make such modification so long as such modification will not have any effect on the amounts distributed to any Person pursuant to Article XI upon the dissolution of the Company. The Managing Member also may (i) make any adjustments that are necessary or appropriate to maintain equality between Capital Accounts of the Members and the amount of capital reflected on the Company’s balance sheet, as computed for book purposes, in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(g), and (ii) make any appropriate modifications in the event unanticipated events might otherwise cause this Agreement not to comply with Treasury Regulations Section 1.704-1(b).

 

(b)               Succession to Capital Accounts. In the event any Person becomes a Substitute Member in accordance with the provisions of this Agreement, such Substitute Member shall succeed to the Capital Account of the former Member (the “Transferor Member”) to the extent such Capital Account relates to the Transferred Units.

 

(c)               Adjustments of Capital Accounts. The Company shall revalue the Capital Accounts of the Members in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(f) at the following times: (i) immediately prior to the contribution of more than a de minimis amount of money or other property to the Company by a new or existing Member as consideration for one or more Units; (ii) immediately prior to the distribution by the Company to a Member of more than a de minimis amount of property in respect of one or more Units; (iii) immediately prior to the liquidation of the Company within the meaning of Treasury Regulations Section 1.704-1(b)(2)(ii)(g); (iv) in connection with the issuance by the Company of more than a de minimis amount of Units as consideration for the provision of services to or for the benefit of the Company (as described in Treasury Regulations Section 1.704-1(b)(2)(iv)(f)(5)(iii)) and (v) at other times as determined by the Managing Member; provided, however, that adjustments pursuant to clauses (i), (ii) and (iv) above need not be made if the Managing Member reasonably determines that such adjustments are not necessary or appropriate to reflect the relative economic interests of the Members and that the absence of such adjustments does not adversely and disproportionately affect any Member. The Company shall be entitled to take all actions necessary (as determined by the Managing Member) to comply with the provisions of the Code and Treasury Regulations relating to non-compensatory options.

 

(d)               No Member shall be entitled to withdraw capital or receive distributions except as specifically provided herein. A Member shall have no obligation to the Company, to any other Member or to any creditor of the Company to restore any negative balance in the Capital Account of such Member. Except as expressly provided elsewhere herein, no interest shall be paid on the balance in any Member’s Capital Account.

 

 

(e)               Whenever it is necessary for purposes of this Agreement to determine a Member’s Capital Account on a per Unit basis, such amount shall be determined by dividing the Capital Account of such Member attributable to the applicable class of Units held of record by such Member by the number of Units of such class held of record by such Member, with appropriate adjustments if necessary to reflect the economic differences between Units.

 

Section 5.03        Amounts and Priority of Distributions.

 

(a)               Distributions Generally. Except as otherwise provided in Article XI, distributions shall be made to the Members as set forth in this Section 5.03, at such times and in such amounts as the Managing Member, in its sole discretion, shall determine.

 

(b)               Distributions to the Members. Subject to Section 5.03(e) at such times and in such amounts as the Managing Member, in its sole discretion, shall determine, distributions shall be made to the Members in proportion to their respective Percentage Interests.

 

(c)               PubCo Distributions. Notwithstanding the provisions of Section 5.03(b), the Managing Member, in its sole discretion, may authorize that (i) cash be paid to PubCo (which payment shall be made without pro rata distributions to the other Members) in exchange for the redemption, repurchase or other acquisition of Units held by PubCo to the extent that such cash payment is used to redeem, repurchase or otherwise acquire an equal number of corresponding Equity Securities of PubCo in accordance with Article IV, and (ii) to the extent that the Managing Member determines that expenses or other obligations of PubCo are related to its role as the Managing Member or the business and affairs of PubCo that are conducted through the Company or any of the Company’s direct or indirect Subsidiaries, cash (and, for the avoidance of doubt, only cash) distributions may be made to PubCo (which distributions shall be made without pro rata distributions to the other Members) in amounts required for PubCo to pay (w) operating, administrative and other similar costs incurred by PubCo, to the extent the proceeds are used or will be used by PubCo to pay expenses described in this clause (ii), and payments pursuant to any legal, tax, accounting and other professional fees and expenses (but, for the avoidance of doubt, excluding any tax liabilities of PubCo and any amounts that PubCo is required to pay pursuant to the Tax Receivables Agreement), (x) any judgments, settlements, penalties, fines or other costs and expenses in respect of any claims against, or any litigation or proceedings involving, PubCo, (y) fees and expenses (including any underwriters’ discounts and commissions) related to any securities offering, investment or acquisition transaction (whether or not successful) authorized by PubCo, as the Managing Member and (z) other fees and expenses in connection with the maintenance of the existence of PubCo. For the avoidance of doubt, distributions made under this Section 5.03(c) may not be used to pay or facilitate dividends or distributions on the common stock of PubCo and must be used solely for one of the express purposes set forth under clause (i) or (ii) of the immediately preceding sentence.

 

(d)               Distributions in Kind. Any distributions in kind shall be made at such times and in such amounts as the Managing Member, in its sole discretion, shall determine based on their Fair Market Value as determined by the Managing Member in the same proportions as if distributed in accordance with Section 5.03(b). If cash and property are to be distributed in kind simultaneously, the Company shall distribute such cash and property in kind in the same proportion to each Member.

 

 

(e)               Tax Distributions.

 

(i)                 Notwithstanding any other provision of this Section 5.03 to the contrary (but subject to Section 5.03(e)(ii)), to the extent permitted by Law and consistent with the Company’s obligations to its creditors as determined by the Managing Member, to the extent out of Available Cash, the Company shall make cash distributions pursuant to this Section 5.03(e)(i) to each Member at least two (2) Business Days prior to the date on which any U.S. federal corporate estimated tax payments are due (or at such other times as are necessary to permit the Members or their beneficial owners to discharge their U.S. federal, state and local estimated tax payment responsibilities, as reasonably determined by the Managing Member), in an amount equal to such Member’s Tax Distribution Amount (estimated on a quarterly basis by the Managing Member, taking into account estimated taxable income or loss of the Company through the end of the relevant quarterly period). A final accounting for Tax Distributions shall be made after the allocation of the Company’s actual net taxable income or loss has been determined for a fiscal year (or applicable portion thereof) and, unless otherwise determined by the Managing Member, any shortfall in the amount of Tax Distributions a Member received for such fiscal year based on such final accounting shall, to the extent permitted by law and consistent with the Company’s obligations to its creditors as determined by the Managing Member, be promptly distributed to such Member.

 

(ii)              To the extent a Member otherwise would be entitled to receive less than its Percentage Interest of the aggregate Tax Distributions to be paid pursuant to this Section 5.03(e) on any given date, then unless otherwise determined by the Managing Member and such Member acting reasonably and in good faith, the Tax Distributions to such Member shall be increased to ensure that all such Tax Distributions made pursuant to this Section 5.03(e) are made pro rata in accordance with the Members’ respective Percentage Interests. If, on a Tax Distribution date, there are insufficient funds on hand to distribute to the Members the full amount of the Tax Distributions to which such Members are otherwise entitled, Tax Distributions pursuant to this Section 5.03(e) shall be made to the Members to the extent of available funds in accordance with the Tax Distributions that would have been paid to them had no such limitation existed and the Company shall make future Tax Distributions (pro rata in accordance with the Tax Distributions that would have been paid to the Members had no applicable limitation existed) promptly after funds become available sufficient to pay the remaining portion of Tax Distributions to which such Members would have been entitled had sufficient funds been available. In addition, notwithstanding the foregoing, to the extent that a Tax Distribution that would be made to PubCo exceeds the PubCo Modified Distribution Amount, the Managing Member may reduce the Tax Distribution payable to PubCo in an amount up to the amount of such excess (and, if there are insufficient funds on hand to distribute to the Members other than PubCo the full amount of the Tax Distributions to which such other Members are otherwise entitled, then the Managing Member shall, pursuant to this sentence, reduce the Tax Distribution payable to PubCo in an amount equal to the lesser of (i) the amount of such excess or (ii) the aggregate amount required to permit the other Members to receive Tax Distributions equal to the amount they would have received under this Section 5.03(e) were sufficient cash available to make full Tax Distributions under such provision, with the amount of any such reduction being paid as Tax Distributions to the other Members pro rata in accordance with the Tax Distributions to which such other Members are otherwise entitled). For purposes of this clause (ii), the “PubCo Modified Distribution Amount” shall mean the Tax Distribution Amount of PubCo, adjusted as determined by the Managing Member to (w) reflect the marginal combined corporate income tax rates to which PubCo is subject, (x) reflect any adjustments with respect to PubCo pursuant to Section 743(b) of the Code, (y) include any amounts that PubCo is required to pay pursuant to the Tax Receivable Agreement and (z) take into account other reductions or modifications as determined by the Managing Member. Any distributions paid pursuant to Section 5.03(b) during a fiscal year shall, to the extent of Tax Distributions otherwise required to be paid during such fiscal year, be treated as Tax Distributions paid during such fiscal year.

 

 

 

(iii)            Tax Distributions with respect to income or gain allocations made for periods (or portions thereof) beginning on or after the Restatement Date shall be treated as advances of amounts otherwise distributable to any Member pursuant to this Section 5.03 (other than this Section 5.03(e)) or Section 11.02(b)(i), and accordingly shall be applied against and reduce (without duplication) the next amounts that would otherwise be payable to such Member pursuant to such provisions (provided, that in no event will the distributions payable to PubCo in respect of Units transferred to PubCo in connection with a Redemption or Direct Redemption be increased or reduced (as compared to Common Units held by PubCo as of the date hereof) as a result of Tax Distributions made (or not made) in respect of such Units prior to their transfer to PubCo in connection with the applicable Redemption or Direct Redemption).

 

Section 5.04        Allocations.

 

(a)               Net Income and Net Loss. Except as otherwise provided in this Agreement, and after giving effect to the special allocations set forth in Section 5.04(b), Section 5.04(c) and Section 5.04(d), Net Income and Net Loss (and, to the extent necessary, individual items of income, gain, loss, deduction or credit) of the Company shall be allocated among the Members in a manner such that the Capital Account of each Member, immediately after making such allocation, is, as nearly as possible, equal to (i) the distributions that would be made to such Member pursuant to Section 5.03(b) if the Company were dissolved, its affairs wound up and its assets sold for cash equal to their Carrying Value, all Company liabilities were satisfied (limited with respect to each nonrecourse liability to the Carrying Value of the assets securing such liability), and the net assets of the Company were distributed, in accordance with Section 5.03(b), to the Members immediately after making such allocation, minus (ii) such Member’s share of Company Minimum Gain and Member Nonrecourse Debt Minimum Gain, computed immediately prior to the hypothetical sale of assets.

 

(b)               Special Allocations. The following special allocations shall be made in the following order:

 

(i)                 Minimum Gain Chargeback. Except as otherwise provided in Treasury Regulations Section 1.704-2(f), notwithstanding any other provision of this Article V, if there is a net decrease in Company Minimum Gain during any Fiscal Year, each Member shall be specially allocated items of Company income and gain for such Fiscal Year (and, if necessary, subsequent Fiscal Years) in an amount equal to such Member’s share of the net decrease in Company Minimum Gain, determined in accordance with Treasury Regulations Section 1.704-2(g). Allocations pursuant to the immediately preceding sentence shall be made in proportion to the respective amounts required to be allocated to each Member pursuant thereto. The items to be so allocated shall be determined in accordance with Treasury Regulations Section 1.704-2(f)(6) and 1.704-2(j)(2). This Section 5.04(b)(i) is intended to comply with the minimum gain chargeback requirement in Treasury Regulations Section 1.704-2(f) and shall be interpreted consistently therewith.

 

 

(ii)              Member Minimum Gain Chargeback. Except as otherwise provided in Treasury Regulations Section 1.704-2(i)(4), notwithstanding any other provision of this Article V, if there is a net decrease in Member Nonrecourse Debt Minimum Gain attributable to a Member Nonrecourse Debt during any Fiscal Year, each Member who has a share of the Member Nonrecourse Debt Minimum Gain attributable to such Member Nonrecourse Debt, determined in accordance with Treasury Regulations Section 1.704-2(i)(5), shall be specially allocated items of Company income and gain for such Fiscal Year (and, if necessary, subsequent Fiscal Years) in an amount equal to such Member’s share of the net decrease in Member Nonrecourse Debt Minimum Gain attributable to such Member Nonrecourse Debt, determined in accordance with Treasury Regulations Section 1.704-2(i)(4). Allocations pursuant to the previous sentence shall be made in proportion to the respective amounts required to be allocated to each Member pursuant thereto. The items to be so allocated shall be determined in accordance with Treasury Regulations Sections 1.704-2(i)(4) and 1.704-2(j)(2). This Section 5.04(b)(ii) is intended to comply with the minimum gain chargeback requirement in Treasury Regulations Section 1.704-2(i)(4) and shall be interpreted consistently therewith.

 

(iii)            Qualified Income Offset. In the event any Member unexpectedly receives any adjustments, allocations, or distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5) or Section 1.704-1(b)(2)(ii)(d)(6), items of Company income and gain shall be specially allocated to such Member in an amount and manner sufficient to eliminate, to the extent required by the Treasury Regulations, the Adjusted Capital Account Deficit of the Member as promptly as possible; provided, that an allocation pursuant to this Section 5.04(b)(iii) shall be made only if and to the extent that the Member would have an Adjusted Capital Account Deficit after all other allocations provided for in this Article V have been tentatively made as if this Section 5.04(b)(iii) were not in the Agreement.

 

(iv)             Nonrecourse Deductions. Nonrecourse Deductions for any Fiscal Year shall be specially allocated to the Members in accordance with their relative Percentage Interests.

 

(v)               Member Nonrecourse Deductions. Any Member Nonrecourse Deductions for any Fiscal Year shall be specially allocated to the Member who bears the economic risk of loss with respect to the Member Nonrecourse Debt to which such Member Nonrecourse Deductions are attributable in accordance with Treasury Regulations Sections 1.704-2(i)(1) and 1.704-2(j)(1).

 

(vi)             Section 754 Adjustments. (A) To the extent an adjustment to the adjusted tax basis of any Company asset pursuant to Sections 734(b) or 743(b) of the Code is required pursuant to Treasury Regulations Section 1.704-1(b)(2)(iv)(m)(4) to be taken into account in determining Capital Accounts as a result of a distribution other than in liquidation of a Member’s interest in the Company, the amount of such adjustment shall be treated as an item of gain (if the adjustment increases the basis of such asset) or loss (if the adjustment decreases the basis of such asset) from the disposition of the asset and shall be taken into account for purposes of computing Net Income and Net Loss; and (B) to the extent an adjustment to the adjusted tax basis of any Company asset pursuant to Sections 734(b) or 743(b) of the Code is required, pursuant to Treasury Regulations Section 1.704-1(b)(2)(iv)(m)(2) or Section 1.704-1(b)(2)(iv)(m)(4), to be taken into account in determining Capital Accounts as the result of a distribution to a Member in complete liquidation of such Member’s interest in the Company, the amount of such adjustment to Capital Accounts shall be treated as an item of gain (if the adjustment increases the basis of the asset) or loss (if the adjustment decreases such basis) and such gain or loss shall be specially allocated to such Members in accordance with their interests in the Company in the event Treasury Regulations Section 1.704-1(b)(2)(iv)(m)(2) applies, or to the Member to whom such distribution was made in the event Treasury Regulations Section 1.704-1(b)(2)(iv)(m)(4) applies.

 

 

(c)               Curative Allocations. The allocations set forth in Section 5.04(b)(i) through Section 5.04(b)(iv) and Section 5.04(d) (the “Regulatory Allocations”) are intended to comply with certain requirements of the Treasury Regulations. It is the intent of the Members that, to the extent possible, all Regulatory Allocations shall be offset either with other Regulatory Allocations or with special allocations of other items of Company income, gain, loss, or deduction pursuant to this Section 5.04(c). Therefore, notwithstanding any other provision of this Article V (other than the Regulatory Allocations), the Managing Member shall make such offsetting special allocations of Company income, gain, loss, or deduction in whatever manner it determines appropriate so that, after such offsetting allocations are made, each Member’s Capital Account balance is, to the extent possible, equal to the Capital Account balance such Member would have had if the Regulatory Allocations were not part of the Agreement and all Company items were allocated pursuant to Section 5.04.

 

(d)               Loss Limitation. Net Loss (or individual items of loss or deduction) allocated pursuant to Section 5.04 hereof shall not exceed the maximum amount of Net Loss (or individual items of loss or deduction) that can be allocated without causing any Member to have an Adjusted Capital Account Deficit at the end of any Fiscal Year. In the event some but not all of the Members would have Adjusted Capital Account Deficits as a consequence of an allocation of Net Loss (or individual items of loss or deduction) pursuant to Section 5.04 hereof, the limitation set forth in this Section 5.04(d) shall be applied on a Member by Member basis and Net Loss (or individual items of loss or deduction) not allocable to any Member as a result of such limitation shall be allocated to the other Members in accordance with the positive balances in such Member’s Capital Accounts so as to allocate the maximum permissible Net Loss to each Member under Treasury Regulations Section 1.704-1(b)(2)(ii)(d). Any reallocation of Net Loss pursuant to this Section 5.04(d) shall be subject to chargeback pursuant to the curative allocation provision of Section 5.04(c).

 

Section 5.05        Other Allocation Rules.

 

(a)               Interim Allocations Due to Percentage Adjustment. If the Members’ interests in the Company change pursuant to the terms of the Agreement during any Fiscal Year, the amount of Net Income and Net Loss (or items thereof) to be allocated to the Members for such entire Fiscal Year shall be allocated to the portion of such Fiscal Year which precedes the date of such Transfer or change (and if there shall have been a prior Transfer or change in such Fiscal Year, which commences on the date of such prior Transfer or change) and to the portion of such Fiscal Year which occurs on and after the date of such Transfer or change (and if there shall be a subsequent Transfer or change in such Fiscal Year, which precedes the date of such subsequent Transfer or change), and the amounts of the items so allocated to each such portion shall be credited or charged to the Members in accordance with Section 5.04 as in effect during each such portion of the Fiscal Year in question. Such allocation shall be in accordance with Section 706 of the Code and the Treasury Regulations thereunder and made without regard to the date, amount or receipt of any distributions that may have been made with respect to the transferred interest to the extent consistent with Section 706 of the Code and the Treasury Regulations thereunder, and shall be made using any method permitted by Section 706 of the Code and such regulations as determined by the Managing Member. As of the date of such Transfer, the Transferee Member shall succeed to the Capital Account of the Transferor Member with respect to the transferred Units.

 

 

(b)               Tax Allocations: Code Section 704(c). In accordance with Section 704(c) of the Code and the Treasury Regulations thereunder, income, gain, loss, and deduction with respect to any Property contributed to the capital of the Company and with respect to reverse Code Section 704(c) allocations described in Treasury Regulations Section 1.704-3(a)(6) shall, solely for tax purposes, be allocated among the Members so as to take account of any variation between the adjusted basis of such Property to the Company for federal income tax purposes and its initial Carrying Value or its Carrying Value determined pursuant to Treasury Regulations Section 1.704-1(b)(2)(iv)(f) (computed in accordance with the definition of Carrying Value) using (unless otherwise determined by the Managing Member) the “traditional method”; provided, that with respect to the “forward” layer for any such Property contributed by any Pre-IPO Member, no method other than the “traditional method” described in Treasury Regulations Section 1.704-3(b) shall be used without the prior written consent of such Pre-IPO Member. Any elections or other decisions relating to such allocations shall be made by the Managing Member in any manner that reasonably reflects the purpose and intention of this Agreement. Allocations pursuant to this Section 5.05(b), Section 704(c) of the Code (and the principles thereof), and Treasury Regulations Section 1.704-1(b)(4)(i) are solely for purposes of federal, state, and local taxes and shall not affect, or in any way be taken into account in computing, any Member’s Capital Account or share of Net Income, Net Loss, other items, or distributions pursuant to any provision of this Agreement.

 

Section 5.06        Tax Withholding; Withholding Advances.

 

(a)               Tax Withholding.

 

(i)                 If requested by the Managing Member, each Member shall, if able to do so, deliver to the Managing Member: (A) an affidavit in form satisfactory to the Company that the applicable Member (or its partners, as the case may be) is not subject to withholding under the provisions of any federal, state, local, foreign or other Law; (B) any certificate that the Company may reasonably request with respect to any such Laws; and/or (C) any other form or instrument reasonably requested by the Company relating to any Member’s status under such Law. In the event that a Member fails or is unable to deliver to the Company an affidavit described in subclause (A) of this clause (i), for the avoidance of doubt, the Company may withhold amounts from such Member in accordance with Section 5.06(b).

 

 

(ii)              After receipt of a written request of any Member, the Company shall provide such information to such Member and take such other action as may be reasonably requested and necessary to assist such Member in making any necessary filings, applications or elections to obtain any available exemption from, or any available refund of, any withholding imposed by any taxing authority with respect to amounts distributable or items of income allocable to such Member hereunder, in each case, to the extent not adverse to the Company or any Member. In addition, the Company shall, at the request of any Member, make or cause to be made (or cause the Company to make) any such filings, applications or elections; provided, that any such requesting Member shall cooperate with the Company, with respect to any such filing, application or election to the extent reasonably determined by the Company and that any filing fees, taxes or other out-of-pocket expenses reasonably incurred and related thereto shall be paid and borne by such requesting Member or, if there is more than one requesting Member, by such requesting Members in accordance with their Relative Percentage Interests.

 

(b)               Withholding Advances. Subject to and without limitation of Section 5.06(e), to the extent PubCo or the Company is required by Law to withhold or to make tax payments on behalf of or with respect to any Member (e.g., in connection with the delivery of consideration in connection with a Redemption, backup withholding, Section 1445 of the Code, Section 1446 of the Code or any “imputed underpayment” within the meaning of the Code or, in each case, similar provisions of state, local or other tax Law) (“Withholding Advances”), PubCo or the Company, as the case may be, may withhold such amounts and make such tax payments as so required. The Managing Member shall reasonably determine the portion of any “imputed underpayment” within the meaning of the Code that is attributable to each Member (including a former Member and such former Member’s assignee(s) or transferee(s)).

 

(c)               Repayment of Withholding Advances. All Withholding Advances made on behalf of a Member, plus interest thereon at a rate equal to the Prime Rate as of the date of such Withholding Advances plus 2.0% per annum, shall (i) be paid on demand by the Member on whose behalf such Withholding Advances were made (it being understood that no such payment shall increase such Member’s Capital Account), or (ii) with the consent of the Managing Member be repaid by reducing the amount of the current or next succeeding distribution or distributions that would otherwise have been made to such Member or, if such distributions are not sufficient for that purpose, by so reducing the proceeds of liquidation otherwise payable to such Member. Whenever repayment of a Withholding Advance by a Member is made as described in clause (ii) of this Section 5.06(c), for all other purposes of this Agreement such Member shall be treated as having received all distributions (whether before or upon any Dissolution Event) unreduced by the amount of such Withholding Advance and interest thereon.

 

(d)               Withholding Advances — Reimbursement of Liabilities. Each Member hereby agrees to reimburse the Company for any liability with respect to Withholding Advances (including interest thereon) required or made on behalf of or with respect to such Member (including penalties imposed with respect thereto). The obligations of a Member with respect to the repayment and reimbursement of Withholding Advances will survive the termination, liquidation, winding up and dissolution of the Company and will survive the partial or complete transfer or redemption of a Member’s interests in the Company.

 

 

Section 5.07        Tax Proceedings.

 

(a)               In representing the Company before any taxing authorities and courts in tax matters affecting the Company and the Members in their capacity as such that the Managing Member determines are reasonably expected to be material to such Members, the Company Representative shall, to the extent practicable and permitted under the circumstances, keep the Members promptly informed with respect to any such administrative and judicial proceedings. For the avoidance of doubt, nothing in this Section 5.07 shall prevent the Company (or any of its Subsidiaries) from taking actions explicitly provided to be taken by the Company pursuant to this Agreement (including for this purpose making an election pursuant to Section 754 of the Code (or analogous provisions of state or local Law)).

 

(b)               Without limiting the foregoing, the Company Representative shall give prompt written notice to the Sponsor Members of the commencement of any material audit or proceeding of the Company or any of its Subsidiaries with respect to U.S. income taxes, to the extent that such income taxes would “pass through” to the Sponsor Members for the applicable U.S. income tax purposes and are reasonably expected to have a disproportionate and material adverse impact on the Sponsor Members (a “Specified Audit”). The Company Representative shall (i) keep the Sponsor Members reasonably informed of the material developments and status of any such Specified Audit, (ii) permit each Sponsor Member (or its designee) to participate (including using separate counsel), in each case at the Sponsor Members’ sole cost and expense, in any such Specified Audit, and (iii) promptly notify each Sponsor Members of receipt of a notice of a final partnership adjustment (or equivalent under applicable Laws) or a final decision of a court or IRS Appeals panel (or equivalent body under applicable Laws) with respect to such Specified Audit. The Company Representative or the Company shall promptly provide the Sponsor Members with copies of all material correspondence between the Company Representative or the Company (as applicable) and any Governmental Authority in connection with such Specified Audit and shall give the Sponsor Members a reasonable opportunity to review and comment on any material correspondence, submission (including settlement or compromise offers) or filing in connection with any such Specified Audit, which the Company Representative shall consider in good faith. The Company Representative shall obtain the prior written consent of each Sponsor Member (which consent shall not be unreasonably withheld, conditioned or delayed) before making an election under Section 6226(a) of the Code (or any analogous provision of U.S. state or local tax Law) with respect to any period ending on or before the Restatement Date.

 

Article VI.

CERTAIN TAX MATTERS

 

Section 6.01        Company Representative.

 

(a)               The Managing Member is specially authorized and appointed to act as the Company Representative and in any similar capacity under state or local Law; provided, that the Managing Member may appoint and replace the Company Representative. The Company Representative may also designate a “designated individual” in accordance with Treasury Regulations Section 301.6223-1(b)(3)(i). The Company and the Members (including any Member designated as the Company Representative prior to the date hereof) shall cooperate fully with each other and shall use reasonable best efforts to cause the Managing Member (or any Person subsequently designated) to become the Company Representative with respect to any taxable period of the Company with respect to which the statute of limitations has not yet expired, including (as applicable) by filing certifications pursuant to Treasury Regulations Section 301.6231(a)(7)-1(d).

 

 

(b)               The Company Representative may retain, at the Company’s expense, such outside counsel, accountants and other professional consultants as it may reasonably deem necessary in the course of fulfilling its obligations as the Company Representative. Subject to the other terms of this Agreement, the Company Representative is authorized to take such actions and execute and file all statements and forms on behalf of the Company that are approved by the Managing Member and are permitted or required by the applicable provisions of the Partnership Tax Audit Rules. Each Member agrees to reasonably cooperate with the Company Representative and to use commercially reasonable efforts to do or refrain from doing any or all things requested by the Company Representative (including paying any and all resulting taxes, additions to tax, penalties and interest in a timely fashion) in connection with any examination of the Company’s affairs by any federal, state, or local tax authorities, including resulting administrative and judicial proceedings.

 

Section 6.02        Tax Elections. Except as otherwise provided in this Agreement, the Managing Member and the Company Representative shall be entitled to cause the Company to make (or not make) any tax elections under applicable law; provided, that the Company shall make and maintain in effect an election under Section 754 of the Code for the taxable year that includes the Restatement Date and for subsequent years.

 

Article VII.

MANAGEMENT OF THE COMPANY

 

Section 7.01        Management by the Managing Member. Except as otherwise specifically set forth in this Agreement, the Managing Member shall be deemed to be a “manager” for purposes of the Delaware Act. Except as expressly provided in this Agreement or the Delaware Act, the day-to-day business and affairs of the Company and its Subsidiaries shall be managed, operated and controlled exclusively by the Managing Member in accordance with the terms of this Agreement, and no other Members shall have management authority or rights over the Company or its Subsidiaries. The Managing Member is, to the extent of its rights and powers set forth in this Agreement, an agent of the Company for the purpose of the Company’s and its Subsidiaries’ business, and the actions of the Managing Member taken in accordance with such rights and powers, shall bind the Company (and no other Members shall have such right). Except as expressly provided in this Agreement, the Managing Member shall have all necessary powers to carry out the purposes, business, and objectives of the Company and its Subsidiaries. The Managing Member may delegate to Members, employees, officers or agents of the Company or any Subsidiary in its discretion the authority to sign agreements and other documents on behalf of the Company or any Subsidiary. The Managing Member shall have the exclusive power and authority, on behalf of the Company and its Subsidiaries to take such actions not inconsistent with this Agreement as the Managing Member deems necessary or appropriate to carry on the business and purposes of the Company and its Subsidiaries.

 

 

Section 7.02        Withdrawal of the Managing Member. PubCo may withdraw as the Managing Member and appoint as its successor at any time upon written notice to the Company (i) any wholly-owned Subsidiary of PubCo, (ii) any Person into which PubCo is merged or consolidated or (iii) any transferee of all or substantially all of the assets of PubCo, which withdrawal and replacement shall be effective upon the delivery of such notice. No appointment of a Person as Managing Member shall be effective unless PubCo and the new Managing Member provide all other Members with contractual rights, directly enforceable by such other Members against the new Managing Member, to cause the new Managing Member to comply with all the Managing Member’s obligations under this Agreement.

 

Section 7.03        Decisions by the Members.

 

(a)               Other than the Managing Member, the Members shall take no part in the management of the Company’s business, shall transact no business for the Company and shall have no power to act for or to bind the Company; provided, however, that the Company may engage any Member or principal, partner, member, shareholder or interest holder thereof as an employee, independent contractor or consultant to the Company, in which event the duties and liabilities of such Person with respect to the Company as an employee, independent contractor or consultant, as applicable, shall be governed by the terms of such engagement with the Company.

 

(b)               Except as otherwise expressly provided herein in the Stockholders Agreement, no Member shall have the power or authority to vote, approve or consent to any matter or action taken by the Company (or by PubCo, as Managing Member).

 

Section 7.04        Fiduciary Duties.

 

(a)               This Agreement is not intended to, and does not, create or impose any duty (including any fiduciary duty) on any of the Members (including without limitation, the Managing Member) hereto or on their respective Affiliates. Further, notwithstanding any other provision of this Agreement or any duty otherwise existing at law or in equity, the parties hereto agree that no Member or Managing Member shall, to the fullest extent permitted by law, have duties (including fiduciary duties) to any other Member or to the Company, and in doing so, recognize, acknowledge and agree that their duties and obligations to one another and to the Company are only as expressly set forth in this Agreement; provided, however, that each Member shall have the duty to act in accordance with the implied contractual covenant of good faith and fair dealing.

 

(b)               To the extent that, at law or in equity, any Member (including without limitation, the Managing Member) has duties (including fiduciary duties) and liabilities relating thereto to the Company, to another Member or to another Person who is a party to or is otherwise bound by this Agreement, the Members (including without limitation, the Managing Member) acting under this Agreement will not be liable to the Company, to any such other Member or to any such other Person who is a party to or is otherwise bound by this Agreement, for their good faith reliance on the provisions of this Agreement. The provisions of this Agreement, to the extent that they restrict or eliminate the duties and liabilities relating thereto of any Member (including without limitation, the Managing Member) otherwise existing at law or in equity, are agreed by the Members to replace to that extent such other duties and liabilities of the Members relating thereto (including without limitation, the Managing Member).

 

 

(c)               The Managing Member may consult with legal counsel, accountants and financial or other advisors selected by it, and any act or omission taken by the Managing Member on behalf of the Company or in furtherance of the interests of the Company in good faith in reliance upon and in accordance with the advice of such Person as to matters the Managing Member reasonably believes to be within such Person’s professional or expert competence shall be conclusively presumed to have been done or omitted in good faith and in accordance with such opinion or advice, and the Managing Member will be fully protected in so acting or omitting to act so long as such counsel or accountants or financial or other advisors were selected with reasonable care.

 

(d)               Notwithstanding any other provision of this Agreement or otherwise applicable provision of law or equity, whenever in this Agreement the Managing Member is permitted or required to make a decision (i) in its “sole discretion” or “discretion” or under a grant of similar authority or latitude, such Managing Member shall be entitled to consider only such interests and factors as it desires, including its own interests, and shall, to the fullest extent permitted by applicable Law, have no duty or obligation to give any consideration to any interest of or factors affecting the Company or the Members, or (ii) in its “good faith” or under another expressed standard, such Managing Member shall act under such express standard and shall not be subject to any other or different standards.

 

Section 7.05        Officers.

 

(a)               Appointment of Officers. The Managing Member may appoint individuals as officers (“Officers”) of the Company, which may include such officers as the Managing Member determines are necessary or appropriate. No Officer need be a Member. An individual may be appointed to more than one office.

 

(b)               Authority of Officers. The Officers shall have the duties, rights, powers and authority as may be prescribed by the Managing Member from time to time.

 

(c)               Removal, Resignation and Filling of Vacancy of Officers. Unless otherwise set forth in the employment agreement of the applicable Officer, the Managing Member may remove any Officer, for any reason or for no reason, at any time. Any Officer may resign at any time by giving written notice to the Company, and such resignation shall take effect at the date of the receipt of that notice or any later time specified in that notice; provided, that, unless otherwise specified in that notice, the acceptance of the resignation shall not be necessary to make it effective. Any such resignation shall be without prejudice to the rights, if any, of the Company or such Officer under this Agreement. A vacancy in any office because of death, resignation, removal or otherwise shall be filled by the Managing Member.

 

 

Article VIII.

 

TRANSFERS OF INTERESTS

 

Section 8.01        Restrictions on Transfers.

 

(a)               Except as expressly permitted by Section 8.02, and subject to Section 8.01(b), Section 8.01(c) and Section 8.01(d) and/or any other agreement between such Member and the Company, PubCo or any of their respective controlled Affiliates, without the prior written approval of the Managing Member, no Member shall directly or indirectly Transfer all or any part of its Units or any right or economic interest pertaining thereto, including the right to vote or consent on any matter or to receive or have any economic interest in distributions or advances from the Company pursuant thereto. Any such Transfer which is not in compliance with the provisions of this Agreement shall be deemed a Transfer by such Member of Units in violation of this Agreement (and a breach of this Agreement by such Member) and shall be null and void ab initio.

 

(b)               Except as otherwise expressly provided herein, it shall be a condition precedent to any Transfer otherwise permitted or approved pursuant to this Article VIII that:

 

(i)                 the Transferor shall have provided to the Company prior notice of such Transfer;

 

(ii)              the Transferee shall agree in writing to be bound by this Agreement by signing and delivering to the Company a joinder substantially in a form acceptable to the Company;

 

(iii)            the Transfer shall comply with all applicable Laws;

 

(iv)             to the knowledge of the Transferee and Transferor after reasonable inquiry of the Company, the Transfer shall not impose material liability or material reporting obligations on the Company or any Member thereof in any jurisdiction, whether domestic or foreign, or result in the Company or any Member thereof becoming subject to the jurisdiction of any Governmental Authority anywhere, other than the Governmental Authorities in which the Company is then subject to such liability, reporting obligation or jurisdiction; and

 

(v)               such Transfer shall comply with Article IX (to the extent Article IX governs such Transfer of Units).

 

(c)               Notwithstanding any other provision of this Agreement to the contrary, no Member shall Transfer all or any part of its Units or any right or economic interest pertaining thereto if such Transfer, in the reasonable discretion of the Managing Member, would cause the Company to (i) be classified as a “publicly traded partnership” as that term is defined in Section 7704 of the Code and Regulations promulgated thereunder or (ii) fail to qualify for the safe harbor contained in Treasury Regulations Section 1.7704-1(h) or for other safe harbor treatment under Section 7704 of the Code on which the Company intends to rely (as determined by the Managing Member).

 

 

 

(d)               Any Transfer of Units pursuant to this Agreement, including this Article VIII, shall be subject to the provisions of Section 3.01 and Section 3.02.

 

Section 8.02        Certain Permitted Transfers. Subject to compliance with Sections 8.01(b) through (d), following the Restatement Date (unless such time restriction is waived by the Managing Member in its sole discretion with respect to any proposed Transfer(s)), the following Transfers shall be permitted:

 

(a)               any Transfer pursuant to the terms of Article IX;

 

(b)               any Transfer contemplated by Section 9.06 in connection with a PubCo Approved Change of Control or PubCo Approved Recap Transaction;

 

(c)               in the case of the AES Member or the Siemens Member, any Transfer of all (but not less than all) of its respective Units to any Person other than a Restricted Person; and

 

(d)             any Transfer to an Affiliate of the applicable Member.

 

Section 8.03        Registration of Transfers. When any Units are validly Transferred in accordance with the terms of this Agreement, the Company shall cause such Transfer to be registered on the books of the Company.

 

Section 8.04        Restricted Units Legend. The Units have not been registered under the Securities Act and, therefore, in addition to the other restrictions on Transfer contained in this Agreement, cannot be sold unless subsequently registered under the Securities Act or an exemption from such registration is then available. To the extent such Units have been certificated, each certificate evidencing Units and each certificate issued in exchange for or upon the Transfer of any Units (if such securities remain Units as defined herein after such Transfer) shall be stamped or otherwise imprinted with a legend in substantially the following form:

 

“THE SECURITIES REPRESENTED BY THIS CERTIFICATE WERE ISSUED ON _________ _____________, 2021, AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), AND MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR AN EXEMPTION FROM REGISTRATION THEREUNDER. THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE ALSO SUBJECT TO ADDITIONAL RESTRICTIONS ON TRANSFER SPECIFIED IN THE THIRD AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT OF FLUENCE ENERGY, LLC, AS MAY BE AMENDED AND MODIFIED FROM TIME TO TIME, AND FLUENCE ENERGY, LLC RESERVES THE RIGHT TO REFUSE THE TRANSFER OF SUCH SECURITIES UNTIL SUCH CONDITIONS HAVE BEEN FULFILLED WITH RESPECT TO ANY TRANSFER. A COPY OF SUCH CONDITIONS SHALL BE FURNISHED BY FLUENCE ENERGY, LLC TO THE HOLDER HEREOF UPON WRITTEN REQUEST AND WITHOUT CHARGE.”

 

The Company shall imprint such legend on certificates (if any) evidencing Units. The legend set forth above shall be removed from the certificates (if any) evidencing any units which cease to be Units in accordance with the definition thereof.

 

 

Article IX.

 

REDEMPTION AND EXCHANGE RIGHTS

 

Section 9.01        Redemption Right of a Member.

 

(a)               Each Member (other than PubCo) shall be entitled to cause the Company to redeem (a “Redemption”) its Common Units (excluding any Common Units that are subject to vesting conditions or subject to Transfer limitations pursuant to this Agreement) in whole or in part (the “Redemption Right”) at any time and from time to time. A Member desiring to exercise its Redemption Right (a “Redeeming Member”) shall exercise such right by giving written notice (the “Redemption Notice”) to the Company, with a copy to PubCo. The Redemption Notice shall specify the number of Common Units (the “Redeemed Units”) that the Redeeming Member intends to have the Company redeem and a date, not less than two (2) Business Days nor more than ten (10) Business Days after delivery of such Redemption Notice (unless and to the extent that the Managing Member in its sole discretion agrees in writing to waive such time periods), on which exercise of the Redemption Right shall be completed (the “Redemption Date”); provided, that the Redemption Notice may specify that the Redemption is to be contingent (including as to the timing) upon the consummation of a purchase by another Person (whether in a tender or exchange offer, an underwritten offering or otherwise) of the Share Settlement into which the Redeemed Units are exchangeable, or contingent (including as to timing) upon the closing of an announced merger, consolidation or other transaction or event in which the Share Settlement would be exchanged or converted or become exchangeable for or convertible into cash or other securities or property; provided, further that the Redeeming Member may withdraw or amend a Redemption Notice, in whole or in part, prior to the effectiveness of the Redemption, at any time prior to 5:00 p.m. New York City time, on the Business Day immediately preceding the Redemption Date (or any such later time as may be required by Law) by delivery of a written notice of withdrawal to the Company (with a copy to PubCo), specifying (1) the number of withdrawn Units, (2) if any, the number of Units as to which the Redemption Notice remains in effect and (3) if the Redeeming Member so determines, a new Redemption Date or any other new or revised information permitted in the Redemption Notice. Following receipt of the Redemption Notice, and in any event at least one (1) Business Days prior to the Redemption Date, PubCo shall deliver to the Redeeming Member a notice, specifying whether it elects (which shall be determined solely by the independent directors of PubCo (within the meaning of the rules of the Nasdaq Stock Market) who are disinterested) to settle the Redemption with a Share Settlement or a Cash Settlement (an “Election Notice”). If the Election Notice specifies a Cash Settlement, then on the Redemption Date (to be effective immediately prior to the close of business on the Redemption Date):

 

(i)                 PubCo shall contribute the proceeds of the Cash Settlement to the Company in exchange for a number of Common Units equal to the number of Redeemed Units (and for the avoidance of doubt, PubCo shall be permitted to elect a Cash Settlement only if such Cash Settlement is fully paid with cash proceeds from the issuance and sale by PubCo of a number of shares of Class A Common Stock equal to the number of Redeemed Units to be redeemed with such Cash Settlement, which amount is contributed to the Company by PubCo substantially contemporaneously with the payment of such Cash Settlement); provided, that notwithstanding anything to the contrary in this Agreement, (x) PubCo shall be obligated to contribute to the Company only an amount in respect of such Cash Settlement equal to the net proceeds (after deduction of any underwriters’ discounts or commissions and brokers’ fees or commissions) from such issuance and sale by PubCo of such shares of Class A Common Stock and (y) PubCo’s Capital Account shall be increased by an amount that includes any such underwriters’ discounts or commissions and brokers’ fees or commissions relating to such issuance and sale of shares of Class A Common Stock by PubCo;

 

 

(ii)              the Redeeming Member shall Transfer and surrender, free and clear of all liens and encumbrances (x) the Redeemed Units to the Company, and (y) an equal number of shares of Class B Common Stock to PubCo;

 

(iii)            the Company shall (x) cancel the Redeemed Units, (y) pay to the Redeeming Member the applicable Cash Settlement, and (z) if the Units are certificated, issue to the Redeeming Member a certificate for a number of Common Units equal to the difference (if any) between the number of Common Units evidenced by the certificate surrendered by the Redeeming Member pursuant to clause (i) of this Section 9.01(a) and the Redeemed Units; and

 

(iv)             PubCo shall cancel and retire for no consideration the shares of Class B Common Stock that were Transferred to PubCo pursuant to Section 9.01(a)(ii)(y) above.

 

(b)               If the Election Notice specifies a Share Settlement, a Redeeming Member shall be entitled to revoke its Redemption Notice or delay the consummation of a Redemption if any of the following conditions exists:

 

(i)                 any registration statement pursuant to which the resale of the Class A Common Stock to be registered for such Redeeming Member at or immediately following the consummation of the Redemption shall have ceased to be effective pursuant to any action or inaction by the SEC or no such resale registration statement has yet become effective;

 

(ii)              PubCo shall have failed to cause any related prospectus to be supplemented by any required prospectus supplement necessary to effect such Redemption;

 

(iii)            PubCo shall have exercised its right to defer, delay or suspend the filing or effectiveness of a registration statement and such deferral, delay or suspension shall affect the ability of such Redeeming Member to have its Class A Common Stock registered at or immediately following the consummation of the Redemption;

 

(iv)             PubCo shall have disclosed in good faith to such Redeeming Member any material non-public information concerning PubCo, the receipt of which results in such Redeeming Member being prohibited or restricted from selling Class A Common Stock at or immediately following the Redemption without disclosure of such information (and PubCo does not permit such disclosure);

 

(v)               any stop order relating to the registration statement pursuant to which the Class A Common Stock was to be registered by such Redeeming Member at or immediately following the Redemption shall have been issued by the SEC;

 

 

(vi)             there shall have occurred a material disruption in the securities markets generally or in the market or markets in which the Class A Common Stock is then traded;

 

(vii)          there shall be in effect an injunction, a restraining order or a decree of any nature of any Governmental Authority that restrains or prohibits the Redemption; or

 

(viii)        PubCo shall have failed to comply in all material respects with its obligations under the Registration Rights Agreement, and such failure shall have affected the ability of such Redeeming Member to consummate the resale of Class A Common Stock to be received upon such Redemption pursuant to an effective registration statement; or

 

(ix)             the Redemption Date would occur three (3) Business Days or less prior to, or during, a Black-Out Period.

 

(c)               If the Election Notice specifies a Share Settlement, unless the Redeeming Member has revoked the applicable Redemption as provided in Section 9.01(b), PubCo shall settle such Redemption on the Redemption Date by Transferring the Share Settlement directly to the Redeeming Member in exchange for the Redeemed Units (a “Direct Redemption”). In connection with a Direct Redemption, on the Redemption Date (to be effective immediately prior to the close of business on the Redemption Date), (1) the Redeeming Member shall Transfer and surrender, free and clear of all liens and encumbrances the Redeemed Units and an equal number of shares of Class B Common Stock to PubCo; (2) PubCo shall Transfer to the Redeeming Member (or other Person(s) whose name or names in which the Share Settlement is to be issued) the Share Settlement; (3) PubCo shall cancel and retire for no consideration such shares of Class B Common Stock and (4) the Company shall register PubCo as the owner of the Redeemed Units and, if the Redeemed Units are certificated, shall issue to the Redeeming Member a certificate for a number of Common Units equal to the difference (if any) between the number of Common Units evidenced by the certificate surrendered by the Redeeming Member pursuant to clause (1) of this Section 9.01(c) and the Redeemed Units. In furtherance of the foregoing, each of the Company, and the Redeeming Member shall take all actions reasonably requested by PubCo to effect the transactions contemplated by this Section 9.01(c), including executing and delivering any document reasonably requested by PubCo in connection therewith.

 

(d)               The number of shares of Class A Common Stock applicable to any Share Settlement or Cash Settlement shall not be adjusted on account of dividends previously paid with respect to Class A Common Stock or cash or cash equivalents held by PubCo or on account of Tax Distributions previously paid by the Company in respect of the Redeemed Units; provided, however, that if a Redeeming Member causes the Company to redeem Redeemed Units and the Redemption Date occurs subsequent to the record date for any distribution with respect to the Redeemed Units but prior to payment of such distribution, the Redeeming Member shall be entitled to receive such distribution with respect to the Redeemed Units on the date that it is made notwithstanding that the Redeeming Member Transferred and surrendered the Redeemed Units to the Company prior to such date; provided, further, however, that a Redeeming Member shall be entitled to receive any and all Tax Distributions that such Redeeming Member otherwise would have received in respect of income allocated to such Member for the portion of any Fiscal Year irrespective of whether such Tax Distribution(s) are declared or made after the Redemption Date.

 

 

(e)               In the case of a Share Settlement, in the event a reclassification or other similar transaction occurs following delivery of a Redemption Notice, but prior to the Redemption Date, as a result of which shares of Class A Common Stock are converted into another security, then a Redeeming Member shall be entitled to receive the amount of such other security that the Redeeming Member would have received if such Redemption Right had been exercised and the Redemption Date had occurred immediately prior to the record date of such reclassification or other similar transaction.

 

Section 9.02        Reservation of Shares of Class A Common Stock; Listing; Certificate of PubCo, etc.

 

(a)               At all times PubCo shall reserve and keep available out of its authorized but unissued Class A Common Stock, solely for the purpose of issuance upon a Share Settlement in a Redemption such number of shares of Class A Common Stock as shall be issuable upon any such Redemption; provided, that nothing contained herein shall be construed to preclude PubCo from satisfying its obligations in respect of any such Redemption by delivery of purchased Class A Common Stock (which may or may not be held in the treasury of PubCo). PubCo shall deliver Class A Common Stock that has been registered under the Securities Act with respect to any Redemption in which a Share Settlement is made, to the extent a registration statement is effective and available for such shares. PubCo shall use its commercially reasonable efforts to list the Class A Common Stock required to be delivered upon any such Redemption prior to such delivery upon each national securities exchange upon which the outstanding shares of Class A Common Stock are listed at the time of such Redemption (it being understood that any such shares may be subject to transfer restrictions under applicable securities Laws). PubCo covenants that all Class A Common Stock issued upon a Redemption in which a Share Settlement is made will, upon issuance, be validly issued, fully paid and non-assessable. The provisions of this Article IX shall be interpreted and applied in a manner consistent with any corresponding provisions of PubCo’s certificate of incorporation (if any).

 

(b)               Subject to the terms of the Registration Rights Agreement, PubCo covenants and agrees to deliver shares of the Share Settlement, if requested, pursuant to an effective registration statement under the Securities Act with respect to any Redemption to the extent that a registration statement is effective and available for such shares. In the event that any Redemption in accordance with this Agreement is to be effected at a time when any required registration has not become effective or otherwise is unavailable, upon the request and with the reasonable cooperation of the Redeeming Member requesting such Redemption, PubCo and the Company shall use reasonable best efforts to promptly facilitate such Redemption pursuant to an available exemption from such registration requirements.

 

(c)               PubCo agrees that it has taken all or will take such steps as may be required to cause to qualify for exemption under Rule 16b-3(d) or (e), as applicable, under the Exchange Act, and to be exempt for purposes of Section 16(b) under the Exchange Act, any acquisitions from, or dispositions to, PubCo of equity securities of PubCo (including derivative securities with respect thereto) and any securities that may be deemed to be equity securities or derivative securities of PubCo for such purposes that result from the transactions contemplated by this Agreement, by each officer or director of PubCo. The authorizing resolutions shall be approved by the PubCo Board.

 

Section 9.03        Effect of Exercise of Redemption. This Agreement shall continue notwithstanding the consummation of a Redemption and all other rights set forth herein shall be exercised by the remaining Members and the Redeeming Member (to the extent of such Redeeming Member’s remaining interest in the Company). No Redemption shall relieve such Redeeming Member of any prior breach of this Agreement.

 

 

Section 9.04        Tax Treatment. Unless otherwise required by Law, the parties hereto acknowledge and agree that any Redemption (whether effected with a Cash Settlement or a Share Settlement) shall be treated as a direct exchange between PubCo and the Redeeming Member for U.S. federal and applicable state and local income tax purposes.

 

Section 9.05        Other Redemption Matters.

 

(a)               Each Redemption shall be deemed to be effective immediately prior to the close of business on the Redemption Date, and, in the case of a Share Settlement, the Redeeming Member (or other Person(s) whose name or names in which the Share Settlement is to be issued) shall be deemed to be a holder of the Equity Securities issued in such Share Settlement, from and after that time, until such Equity Securities have been disposed of. As promptly as practicable on or after the Redemption Date, PubCo shall deliver or cause to be delivered to the Redeeming Member (or other Person(s) whose name or names in which the Share Settlement is to be issued) the number of the Share Settlement deliverable upon such Redemption, registered in the name of such Redeeming Member (or other Person(s) whose name or names in which the Share Settlement is to be issued). To the extent the Share Settlement is settled through the facilities of The Depository Trust Company, PubCo will, upon the written instruction of a Redeeming Member, deliver or cause to be delivered the shares of the Share Settlement deliverable to such Redeeming Member (or other Person(s) whose name or names in which the Share Settlement is to be issued), through the facilities of The Depository Trust Company, to the account of the participant of The Depository Trust Company designated by such Redeeming Member.

 

(b)               The shares of Share Settlement issued upon a Redemption shall bear a legend in substantially the following form:

 

THE TRANSFER OF THESE SECURITIES HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER THE SECURITIES LAWS OF ANY OTHER JURISDICTION, AND MAY NOT BE SOLD OR TRANSFERRED OTHER THAN IN ACCORDANCE WITH THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OF 1933, AS AMENDED (OR OTHER APPLICABLE LAW), OR AN EXEMPTION THEREFROM.

 

(c)               If (i) any shares of the Share Settlement may be sold pursuant to a registration statement that has been declared effective by the Securities and Exchange Commission, (ii) all of the applicable conditions of Rule 144 are met, or (iii) the legend (or a portion thereof) otherwise ceases to be applicable, PubCo, upon the written request of the Redeeming Member thereof shall promptly provide such Redeeming Member or its respective transferees, without any expense to such Persons (other than applicable transfer taxes and similar governmental charges, if any) with new certificates (or evidence of book-entry share) for securities of like tenor not bearing the provisions of the legend with respect to which the restriction has terminated. In connection therewith, such Redeeming Member shall provide PubCo with such information in its possession as PubCo may reasonably request in connection with the removal of any such legend.

 

 

(d)               PubCo shall bear all of its own expenses in connection with the consummation of any Redemption, whether or not any such Redemption is ultimately consummated, including any transfer taxes, stamp taxes or duties, or other similar taxes in connection with, or arising by reason of, any Redemption; provided, however, that if any of the Share Settlement is to be delivered in a name other than that of the Redeeming Member that requested the Redemption (or The Depository Trust Company or its nominee for the account of a participant of The Depository Trust Company that will hold the shares for the account of such Redeeming Member), then such Redeeming Member and/or the Person in whose name such shares are to be delivered shall pay to PubCo the amount of any transfer taxes, stamp taxes or duties, or other similar taxes in connection with, or arising by reason of, such Redemption or shall establish to the reasonable satisfaction of PubCo that such tax has been paid or is not payable. The Redeeming Member shall bear all of its own expenses in connection with the consummation of any Redemption (including, for the avoidance of doubt, expenses incurred by such Redeeming Member in connection with any Redemption that are invoiced to the Company).

 

Section 9.06        PubCo Change of Control; PubCo Approved Recap Transaction.

 

(a)               In connection with a PubCo Approved Change of Control, PubCo shall have the right, in its sole discretion, to require each Member (other than the AES Member or the Siemens Member, in each case, to the extent the Percentage Interest of such Member at the time in question is at least fifteen percent (15%)) to effect a Redemption of all or a portion of such Member’s and all other Members’ Units together with an equal number of shares of Class B Common Stock, pursuant to which such Units and such shares of Class B Common Stock will be exchanged for shares of Class A Common Stock (or economically equivalent cash and securities of a successor entity that would be received by holders of shares of Class A Common Stock), mutatis mutandis, in accordance with the Redemption provisions of this Article IX (applied for this purpose as if PubCo had delivered an Election Notice that specified a Share Settlement with respect to such exchanges) and otherwise in accordance with this Section 9.06. Any such exchange pursuant to this Section 9.06(a) shall be effective immediately prior to the consummation of the PubCo Approved Change of Control (and, for the avoidance of doubt, shall not be effective if such PubCo Approved Change of Control is not consummated) (the date of such exchange, the “Change of Control Exchange Date”). From and after the Change of Control Exchange Date, (i) the Units and any shares of Class B Common Stock subject to such exchange shall be deemed to be transferred to PubCo on the Change of Control Exchange Date and (ii) each such Member shall cease to have any rights with respect to the Units and any shares of Class B Common Stock subject to such exchange (other than the right to receive shares of Class A Common Stock (or economically equivalent cash or equity securities in a successor entity) pursuant to such exchange, and without limiting any rights in respect of the Tax Receivable Agreement). PubCo shall provide written notice of an expected PubCo Approved Change of Control to all Members within the earlier of (x) five (5) Business Days following the execution of an agreement with respect to such PubCo Approved Change of Control and (y) ten (10) Business Days before the proposed date upon which the contemplated PubCo Approved Change of Control is to be effected, including in such notice such information as may reasonably describe the PubCo Approved Change of Control transaction, subject to Law, including the date of execution of such agreement or such proposed effective date, as applicable, the amount and types of consideration to be paid for shares of Class A Common Stock in the PubCo Approved Change of Control, any election with respect to types of consideration that a holder of shares of Class A Common Stock, as applicable, shall be entitled to make in connection with such PubCo Approved Change of Control (which election shall be available to each Member on the same terms as holders of shares of Class A Common Stock). Following delivery of such notice and on or prior to the Change of Control Exchange Date, the participating Members shall take all actions reasonably requested by PubCo to effect such exchange, including taking any action and delivering any document required pursuant to this Section 9.06 to effect such exchange. In the case of any PubCo Approved Change of Control that was initially proposed by PubCo, PubCo shall use reasonable best efforts to enable and permit the Members to participate in such transaction to the same extent or on an economically equivalent basis as the holders of shares of Class A Common Stock, and to enable such Members to participate in such transaction without being required to exchange Units or shares of Class B Common Stock in connection therewith.

 

 

(b)               In the event that a tender offer, share exchange offer, issuer bid, take-over bid, recapitalization or similar transaction with respect to all or any portion of shares of PubCo’s issued and outstanding Class A Common Stock is proposed by PubCo or PubCo’s stockholders and approved by the PubCo Board, or is otherwise consented to or approved by the PubCo board of directors (a “PubCo Approved Recap Transaction”), PubCo shall provide written notice of the PubCo Approved Recap Transaction to all Members within the earlier of (i) five (5) Business Days following the execution of an agreement (if applicable) with respect to, or the commencement of (if applicable), such PubCo Approved Recap Transaction and (ii) ten (10) Business Days before the proposed date upon which the PubCo Approved Recap Transaction is to be effected, including in such notice such information as may reasonably describe the PubCo Approved Recap Transaction, subject to Law, including the date of execution of such agreement (if applicable) or of such commencement (if applicable), the material terms of such PubCo Approved Recap Transaction, including the amount and types of consideration to be received by holders of shares of Class A Common Stock in the PubCo Approved Recap Transaction, any election with respect to types of consideration that a holder of shares of Class A Common Stock, as applicable, shall be entitled to make in connection with such PubCo Approved Recap Transaction, and the number of Units (and the corresponding shares of Class B Common Stock) held by such Member that is applicable to such PubCo Approved Recap Transaction. The Members (other than PubCo) shall be permitted to participate in such offer by delivering a written notice of participation that is effective immediately prior to the consummation of such offer (and that is contingent upon consummation of such offer), and shall include such information necessary for consummation of such offer as requested by PubCo. In the case of any PubCo Approved Recap Transaction that was initially proposed by PubCo, PubCo shall use its reasonable best efforts to enable and permit the Members to participate in such transaction to the same extent or on an economically equivalent basis as the holders of shares of Class A Common Stock, and to enable such Members to participate in such transaction without being required to exchange Units or shares of Class B Common Stock in connection therewith.

 

 

Article X.

 

LIMITATION ON LIABILITY, EXCULPATION
AND INDEMNIFICATION

 

Section 10.01    Limitation on Liability. The debts, obligations and liabilities of the Company, whether arising in contract, tort or otherwise, shall be solely the debts, obligations and liabilities of the Company, and no Covered Person shall be obligated personally for any such debt, obligation or liability of the Company; provided, that the foregoing shall not alter a Member’s obligation to return funds wrongfully distributed to it.

 

Section 10.02    Exculpation and Indemnification.

 

(a)               Subject to the duties of the Managing Member and the Officers set forth in Section 7.04 and any employment agreement and/or restrictive covenants agreement with the Company as in effect from time to time (collectively, the “Specified Covenants”), neither the Managing Member nor any other Covered Person shall be liable, including under any legal or equitable theory of fiduciary duty or other theory of liability, to the Company or to any other Covered Person for any losses, claims, damages or liabilities incurred by reason of any act or omission performed or omitted by such Covered Person in good faith on behalf of the Company. There shall be, and each Covered Person shall be entitled to, a presumption that such Covered Person acted in good faith.

 

(b)               A Covered Person shall be fully protected in relying in good faith upon the records of the Company and upon such information, opinions, reports or statements presented to the Company by any Person as to matters the Covered Person reasonably believes are within such Person’s professional or expert competence.

 

(c)               (i) The Company shall indemnify, defend and hold harmless each Covered Person against any losses, claims, damages, liabilities, expenses (including all reasonable fees and expenses of counsel), judgments, fines, settlements and other amounts arising from any and all claims, demands, actions, suits or proceedings, in which such Covered Person may be involved or become subject to, in connection with any matter arising out of or in connection with the Company’s business or affairs, or this Agreement or any related document, unless such loss, claim, damage, liability, expense, judgment, fine, settlement or other amount is as a result of a Covered Person not acting in good faith on behalf of the Company or arose as a result of the willful commission by such Covered Person of any act that is dishonest and materially injurious to the Company or (ii) results from its contractual obligations under any Transaction Document to be performed in a capacity other than as a Covered Person or results from a breach by such Covered Person of a Specified Covenant. If any Covered Person becomes involved in any capacity in any action, suit, proceeding or investigation in connection with any matter arising out of or in connection with the Company’s business or affairs, or this Agreement or any related document (other than any Transaction Document), other than (x) by reason of any act or omission performed or omitted by such Covered Person that was not in good faith on behalf of the Company or constituted a willful commission by such Covered Person of an act that is dishonest and materially injurious to the Company, or (y) as a result of any breach by such Covered Person of a Specified Covenant, the Company shall reimburse such Covered Person for its reasonable legal and other reasonable out-of-pocket expenses (including the cost of any investigation and preparation) as they are incurred in connection therewith; provided, that such Covered Person shall promptly repay to the Company the amount of any such reimbursed expenses paid to it if it shall be finally judicially determined that such Covered Person was not entitled to indemnification by, or contribution from, the Company in connection with such action, suit, proceeding or investigation. If for any reason (other than the bad faith of a Covered Person or the willful commission by such Covered Person of an act that is dishonest and materially injurious to the Company) the foregoing indemnification is unavailable to such Covered Person, or insufficient to hold it harmless, then the Company shall contribute to the amount paid or payable by such Covered Person as a result of such loss, claim, damage, liability, expense, judgment, fine, settlement or other amount in such proportion as is appropriate to reflect any relevant equitable considerations. There shall be, and each Covered Person shall be entitled to, a rebuttable presumption that such Covered Person acted in good faith.

 

 

(i)                 The obligations of the Company under this Section 10.02(c) shall be satisfied solely out of and to the extent of the Company’s assets, and no Covered Person shall have any personal liability on account thereof.

 

(ii)              Given that certain Jointly Indemnifiable Claims may arise by reason of the service of a Covered Person to the Company and/or as a director, trustee, officer, partner, member, manager, employee, consultant, fiduciary or agent of other corporations, limited liability companies, partnerships, joint ventures, trusts, employee benefit plans or other enterprises controlled by the Company (collectively, the “Controlled Entities”), or by reason of any action alleged to have been taken or omitted in any such capacity, the Company acknowledges and agrees that the Company shall, and to the extent applicable shall cause the Controlled Entities to, be fully and primarily responsible for the payment to the Covered Person in respect of indemnification or advancement of all out-of-pocket costs of any type or nature whatsoever (including, without limitation, all attorneys’ fees and related disbursements) in each case, actually and reasonably incurred by or on behalf of a Covered Person in connection with either the investigation, defense or appeal of a claim, demand, action, suit or proceeding or establishing or enforcing a right to indemnification under this Agreement or otherwise incurred in connection with a claim that is indemnifiable hereunder (collectively, “Expenses”) in connection with any such Jointly Indemnifiable Claim, pursuant to and in accordance with (as applicable) the terms of (A) the Delaware Act, (B) this Agreement, (C) any other agreement between the Company or any Controlled Entity and the Covered Person pursuant to which the Covered Person is indemnified, (D) the Laws of the jurisdiction of incorporation or organization of any Controlled Entity and/or (E) the certificate of incorporation, certificate of organization, bylaws, partnership agreement, operating agreement, certificate of formation, certificate of limited partnership, certificate of qualification or other organizational or governing documents of any Controlled Entity ((A) through (E) collectively, the “Indemnification Sources”), irrespective of any right of recovery the Covered Person may have from the Indemnitee-Related Entities. Under no circumstance shall the Company or any Controlled Entity be entitled to any right of subrogation or contribution by the Indemnitee-Related Entities and no right of advancement or recovery the Covered Person may have from the Indemnitee-Related Entities shall reduce or otherwise alter the rights of the Covered Person or the obligations of the Company or any Controlled Entity under the Indemnification Sources. In the event that any of the Indemnitee-Related Entities shall make any payment to the Covered Person in respect of indemnification or advancement of Expenses with respect to any Jointly Indemnifiable Claim, (x) the Company shall, and to the extent applicable shall cause the Controlled Entities to, reimburse the Indemnitee-Related Entity making such payment to the extent of such payment promptly upon written demand from such Indemnitee-Related Entity, (y) to the extent not previously and fully reimbursed by the Company and/or any Controlled Entity pursuant to clause (x), the Indemnitee-Related Entity making such payment shall be subrogated to the extent of the outstanding balance of such payment to all of the rights of recovery of the Covered Person against the Company and/or any Controlled Entity, as applicable, and (z) the Covered Person shall execute all papers reasonably required and shall do all things that may be reasonably necessary to secure such rights, including the execution of such documents as may be necessary to enable the Indemnitee-Related Entities effectively to bring suit to enforce such rights. The Company and the Covered Person agree that each of the Indemnitee-Related Entities shall be third-party beneficiaries with respect to this Section 10.02(c), entitled to enforce this Section 10.02(c) as though each such Indemnitee-Related Entity were a party to this Agreement. The Company shall cause each of the Controlled Entities to perform the terms and obligations of this Section 10.02(c) as though each such Controlled Entity was the “Company” under this Agreement. For purposes of this Section 10.02(c), the following terms shall have the following meanings:

 

 

(A)             The term “Indemnitee-Related Entities” means any corporation, limited liability company, partnership, joint venture, trust, employee benefit plan or other enterprise (other than the Company, any Controlled Entity or the insurer under and pursuant to an insurance policy of the Company or any Controlled Entity) from whom a Covered Person may be entitled to indemnification or advancement of Expenses with respect to which, in whole or in part, the Company or any Controlled Entity may also have an indemnification or advancement obligation.

 

(B)              The term “Jointly Indemnifiable Claims” shall be broadly construed and shall include, without limitation, any claim, demand, action, suit or proceeding for which the Covered Person shall be entitled to indemnification or advancement of Expenses from both (i) the Company and/or any Controlled Entity pursuant to the Indemnification Sources, on the one hand, and (ii) any Indemnitee-Related Entity pursuant to any other agreement between any Indemnitee-Related Entity and the Covered Person pursuant to which the Covered Person is indemnified, the Laws of the jurisdiction of incorporation or organization of any Indemnitee-Related Entity and/or the certificate of incorporation, certificate of organization, bylaws, partnership agreement, operating agreement, certificate of formation, certificate of limited partnership or other organizational or governing documents of any Indemnitee-Related Entity, on the other hand.

 

Article XI.

DISSOLUTION AND TERMINATION

 

Section 11.01    Dissolution.

 

(a)               The Company shall not be dissolved by the admission of Additional Members or Substitute Members pursuant to Section 3.02.

 

 

(b)               No Member shall (i) resign from the Company prior to the dissolution and winding up of the Company except in connection with a Transfer of Units pursuant to and in accordance with the terms of this Agreement or (ii) take any action to dissolve, terminate or liquidate the Company or to require apportionment, appraisal or partition of the Company or any of its assets, or to file a bill for an accounting, except as specifically provided in this Agreement, and each Member, to the fullest extent permitted by Law, hereby waives any rights to take any such actions under Law, including any right to petition a court for judicial dissolution under Section 18-802 of the Delaware Act.

 

(c)               The Company shall be dissolved and its business wound up only upon the earliest to occur of any one of the following events (each a “Dissolution Event”):

 

(i)                 the expiration of forty-five (45) days after the sale or other disposition of all or substantially all the assets of the Company;

 

(ii)              the decision of the Managing Member, together with any written approval of the AES Member and the Siemens Member required pursuant to the Stockholders Agreement, to dissolve the Company; or

 

(iii)            the entry of a decree of judicial dissolution under Section 18-802 of the Delaware Act, in contravention of this Agreement.

 

Except as otherwise set forth in this Article XI, the Company is intended to have perpetual existence. An Event of Withdrawal shall not in and of itself cause a dissolution of the Company and the Company shall continue in existence subject to the terms and conditions of this Agreement. The Members hereby agree that the Company shall not dissolve prior to the occurrence of a Dissolution Event and that no Member shall seek a dissolution of the Company, under Section 18-802 of the Delaware Act or otherwise, other than based on the matters set forth in subsections (i), (ii) and (iii) above. If it is determined by a court of competent jurisdiction that the Company has dissolved prior to the occurrence of a Dissolution Event, the Members hereby agree to continue the business of the Company without a Liquidation.

 

(d)               The death, retirement, resignation, expulsion, bankruptcy, insolvency or dissolution of a Member or the occurrence of any other event that terminates the continued membership of a Member of the Company shall not in and of itself cause dissolution of the Company.

 

Section 11.02    Winding Up of the Company.

 

(a)               The Managing Member shall promptly notify the other Members of any Dissolution Event. Upon dissolution, the Company’s business shall be liquidated in an orderly manner. The Managing Member shall appoint a liquidating trustee to wind up the affairs of the Company pursuant to this Agreement. In performing its duties, the liquidating trustee is authorized to sell, distribute, exchange or otherwise dispose of the assets of the Company in accordance with the Delaware Act and in any reasonable manner that the liquidating trustee shall determine to be in the best interest of the Members.

 

 

(b)               The proceeds of the liquidation of the Company shall be distributed in the following order and priority:

 

(i)                 first, to the creditors (including any Members or their respective Affiliates that are creditors) of the Company in satisfaction of all of the Company’s liabilities (whether by payment or by making reasonable provision for payment thereof, including the setting up of any reserves which are, in the judgment of the liquidating trustee, reasonably necessary therefor); and

 

(ii)              second, to the Members in the same manner as distributions under Section 5.03(b).

 

(a)               Distribution of Property. In the event it becomes necessary in connection with the Liquidation to make a distribution of Property in-kind, subject to the priority set forth in Section 11.02(b), the liquidating trustee shall have the right to compel each Member, treating each such Member in a substantially similar manner, to accept a distribution of any Property in-kind (with such Property, as a percentage of the total liquidating distributions to such Member), corresponding as nearly as possible to the distributions such Member would receive under Section 11.02(b) with such distribution being based upon the amount of cash that would be distributed to such Members if such Property were sold for an amount of cash equal to the fair market value of such Property, as determined by the liquidating trustee in good faith.

 

Section 11.03    Termination. The Company shall terminate when all of the assets of the Company, after payment of or reasonable provision for the payment of all debts and liabilities of the Company, shall have been distributed to the Members in the manner provided for in this Article XI, and the Certificate shall have been cancelled in the manner required by the Delaware Act.

 

Section 11.04    Survival. Termination, dissolution or Liquidation of the Company for any reason shall not release any party from any liability which at the time of such termination, dissolution or Liquidation already had accrued to any other party or which thereafter may accrue in respect to any act or omission prior to such termination, dissolution or Liquidation.

 

Article XII.

MISCELLANEOUS

 

Section 12.01    Expenses. All costs and expenses incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring such cost or expense.

 

Section 12.02    Further Assurances. Each Member agrees to execute, acknowledge, deliver, file and record such further certificates, amendments, instruments and documents, and to do all such other acts and things, as may be required by Law or as, in the reasonable judgment of the Managing Member, may be necessary or advisable to carry out the intent and purposes of this Agreement.

 

Section 12.03    Notices. All notices, requests and other communications to any party hereunder shall be in writing (including facsimile transmission and electronic mail (“e-mail”) transmission, so long as a receipt of such e-mail is requested and received) and shall be given to such party at the address, facsimile number or e-mail address specified for such party on the Member Schedule hereto or to such other address or facsimile number as such party may hereafter specify for the purpose by notice to the other parties hereto. All such notices, requests and other communications shall be deemed received on the date of receipt by the recipient thereof if received prior to 5:00 p.m. on a Business Day in the place of receipt. Otherwise, any such notice, request or communication shall be deemed to have been received on the next succeeding Business Day in the place of receipt.

 

 

Section 12.04    Binding Effect; Benefit; Assignment.

 

(a)               The provisions of this Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors and assigns. No provision of this Agreement is intended to confer any rights, benefits, remedies, obligations or liabilities hereunder upon any Person other than the parties hereto and their respective successors and assigns.

 

(b)               Except as provided in Article VIII, no Member may assign, delegate or otherwise transfer any of its rights or obligations under this Agreement without the prior written consent of the Managing Member.

 

Section 12.05    Jurisdiction.

 

(a)               The parties hereto agree that any suit, action or proceeding seeking to enforce any provision of, or based on any matter arising out of or in connection with, this Agreement or the transactions contemplated hereby (whether brought by any party or any of its Affiliates or against any party or any of its Affiliates) shall be brought in the Delaware Chancery Court or, if such court shall not have jurisdiction, any federal court located in the State of Delaware or other Delaware state court, and each of the parties hereby irrevocably consents to the jurisdiction of such courts (and of the appropriate appellate courts therefrom) in any such suit, action or proceeding and irrevocably waives, to the fullest extent permitted by Law, any objection that it may now or hereafter have to the laying of the venue of any such suit, action or proceeding in any such court or that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum. Process in any such suit, action or proceeding may be served on any party anywhere in the world, whether within or without the jurisdiction of any such court. Without limiting the foregoing, each party agrees that service of process on such party as provided in Section 12.03 shall be deemed effective service of process on such party.

 

(b)               EACH OF THE COMPANY AND THE MEMBERS HEREBY IRREVOCABLY DESIGNATES CORPORATION SERVICE COMPANY (IN SUCH CAPACITY, THE “Process Agent”), WITH AN OFFICE AT 251 Little Falls Drive, Wilmington, DELAWARE 19808, AS ITS DESIGNEE, APPOINTEE AND AGENT TO RECEIVE, FOR AND ON ITS BEHALF SERVICE OF PROCESS IN SUCH JURISDICTION IN ANY LEGAL ACTION OR PROCEEDINGS WITH RESPECT TO THIS AGREEMENT OR ANY OTHER AGREEMENT EXECUTED IN CONNECTION WITH THIS AGREEMENT, AND SUCH SERVICE SHALL BE DEEMED COMPLETE UPON DELIVERY THEREOF TO THE PROCESS AGENT; PROVIDED THAT IN THE CASE OF ANY SUCH SERVICE UPON THE PROCESS AGENT, THE PARTY EFFECTING SUCH SERVICE SHALL ALSO DELIVER A COPY THEREOF TO EACH OTHER SUCH PARTY IN THE MANNER PROVIDED IN SECTION 12.03 OF THIS AGREEMENT. EACH PARTY SHALL TAKE ALL SUCH ACTION AS MAY BE NECESSARY TO CONTINUE SAID APPOINTMENT IN FULL FORCE AND EFFECT OR TO APPOINT ANOTHER AGENT SO THAT SUCH PARTY SHALL AT ALL TIMES HAVE AN AGENT FOR SERVICE OF PROCESS FOR THE ABOVE PURPOSES IN WILMINGTON, DELAWARE. NOTHING HEREIN SHALL AFFECT THE RIGHT OF ANY PARTY TO SERVE PROCESS IN ANY MANNER PERMITTED BY APPLICABLE LAW. EACH PARTY EXPRESSLY ACKNOWLEDGES THAT THE FOREGOING WAIVER IS INTENDED TO BE IRREVOCABLE UNDER THE LAWS OF THE STATE OF DELAWARE AND OF THE UNITED STATES OF AMERICA.

 

 

Section 12.06    WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

 

Section 12.07    Counterparts. This Agreement may be signed in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. Until and unless each party has received a counterpart hereof signed by the other party hereto, this Agreement shall have no effect and no party shall have any right or obligation hereunder (whether by virtue of any other oral or written agreement or other communication).

 

Section 12.08    Entire Agreement. This Agreement constitutes the entire agreement between the parties with respect to the subject matter of this Agreement and supersede all prior agreements and understandings, both oral and written, between the parties with respect to the subject matter of this Agreement. Nothing in this Agreement shall create any third-party beneficiary rights in favor of any Person or other party, except to the extent provided herein with respect to Indemnitee-Related Entities, each of whom are intended third-party beneficiaries of those provisions that specifically relate to them with the right to enforce such provisions as if they were a party hereto.

 

Section 12.09    Severability. If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction or other Governmental Authority to be invalid, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions of this Agreement shall remain in full force and effect and shall in no way be affected, impaired or invalidated so long as the economic or legal substance of the transactions contemplated hereby is not affected in any manner materially adverse to any party. Upon such a determination, the parties shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in an acceptable manner in order that the transactions contemplated hereby are consummated as originally contemplated to the fullest extent possible.

 

 

Section 12.10    Amendment.

 

(a)               This Agreement can be amended at any time and from time to time by the written consent of the Managing Member; provided, however, that any proposed amendment that adversely modifies in any material respect the Common Units (or the rights, preferences or privileges of the Common Units) then held by any Members in any materially disproportionate manner to those then held by any other Members will require the prior written consent of a majority in interest of such disproportionately affected Member or Members; provided further, that notwithstanding the foregoing, no amendment, including any amendment effected by way of merger, consolidation or transfer of all or substantially all the assets of the Company, may adversely affect the rights in any material respect of (i) the AES Member without the consent of the AES Member or (ii) the Siemens Member without the consent of the Siemens Member. For the avoidance of doubt, the Managing Member, acting alone, may amend this Agreement, including the Schedule of Members, to reflect to reflect the admission of new Members or Transfers of Units, each as provided by and in accordance with, the terms of this Agreement.

 

(b)               No waiver of any provision or default under, nor consent to any exception to, the terms of this Agreement or any agreement contemplated hereby shall be effective unless in writing and signed by the party to be bound and then only to the specific purpose, extent and instance so provided.

 

Section 12.11    Confidentiality.

 

(a)               Each of the Members (other than PubCo) agrees to hold the Company’s Confidential Information in confidence and may not disclose or use such information except as otherwise authorized separately in writing by the Managing Member. “Confidential Information” as used herein includes all non-public information concerning the Company or its Subsidiaries including, but not limited to, ideas, financial product structuring, business strategies, innovations and materials, all aspects of the Company’s business plan, proposed operation and products, corporate structure, financial and organizational information, analyses, proposed partners, software code and system and product designs, employees and their identities, equity ownership, the methods and means by which the Company plans to conduct its business, all trade secrets, trademarks, tradenames and all intellectual property associated with the Company’s business. With respect to each Member to which these provisions apply, Confidential Information does not include information or material that: (a) is rightfully in the possession of such Member at the time of disclosure by the Company; (b) before or after it has been disclosed to such Member by the Company, becomes part of public knowledge, not as a result of any action or inaction of such Member in violation of this Agreement; (c) is approved for release by written authorization of the Chief Executive Officer, Chief Financial Officer or General Counsel of the Company or of PubCo, or any other Officer designated by the Managing Member; (d) is disclosed to such Member or their representatives by a third party not, to the knowledge of such Member, in violation of any obligation of confidentiality owed to the Company with respect to such information; or (e) is or becomes independently developed by such Member or their respective representatives without use of or reference to the Confidential Information.

 

(b)               Solely to the extent it is reasonably necessary or appropriate to fulfill its obligations or to exercise its rights under this Agreement, each of the Members may disclose Confidential Information to its Subsidiaries, Affiliates, partners, directors, officers, employees, counsel, advisers, consultants, outside contractors and other agents, on the condition that such Persons keep the Confidential Information confidential to the same extent as such Member is required to keep the Confidential Information confidential; provided, that such Member shall remain liable with respect to any breach of this Section 12.11 by any such Subsidiaries, Affiliates, partners, directors, officers, employees, counsel, advisers, consultants, outside contractors and other agents (as if such Persons were party to this Agreement for purposes of this Section 12.11).

 

 

(c)               Notwithstanding Section 12.11(a) or Section 12.11(b), each of the Members may disclose Confidential Information (i) to the extent that such Member is required by Law (by oral questions, interrogatories, request for information or documents, subpoena, civil investigative demand or similar process) to disclose any of the Confidential Information, (ii) for purposes of reporting to its stockholders and direct and indirect equity holders (each of whom are bound by customary confidentiality obligations) the performance of the Company and its Subsidiaries and for purposes of including applicable information in its financial statements to the extent required by applicable Law or applicable accounting standards; or (iii) to any bona fide prospective purchaser of the equity or assets of a Member, or the Common Units held by such Member (provided, in each case, that such Member determines in good faith that such prospective purchaser would be a Permitted Transferee), or a prospective merger partner of such Member (provided, that such Persons will be informed by such Member of the confidential nature of such information and shall agree in writing to keep such information confidential in accordance with the contents of this Agreement). Notwithstanding any of the foregoing, nothing in this Section 12.11 will restrict in any manner the ability of PubCo to comply with its disclosure obligations under Law, and the extent to which any Confidential Information is necessary or desirable to disclose.

 

Section 12.12    Governing Law. This Agreement shall be governed by and construed in accordance with the Laws of the State of Delaware, without regard to the conflicts of law rules of such State that would result in the application of the Laws of any other State.

 

Section 12.13    No Presumption. With regard to each and every term and condition of this Agreement, the parties hereto understand and agree that the same have or has been mutually negotiated, prepared and drafted, and if at any time the parties hereto desire or are required to interpret or construe any such term or condition, no consideration will be given to the issue of which party hereto actually prepared, drafted or requested any term or condition of this Agreement.

 

Section 12.14    Attorney-In-Fact. Each Member (other than any Member that is entitled to appoint a director to the PubCo Board) hereby appoints the Company as such Member’s attorney-in-fact (with full power of substitution) and hereby authorizes the Company to the execute and deliver in such Member’s name and on its behalf any amendment of this Agreement or other document relating hereto in furtherance of such Member’s rights and obligations pursuant to this Agreement. Each such Member hereby acknowledges and agrees that such proxy is coupled with an interest and shall not terminate upon any bankruptcy, dissolution, liquidation, death or incapacity of such Member.

 

Section 12.15    Immunity Waiver. Each Member acknowledges that it is a commercial entity and is a separate entity distinct from its ultimate shareholders and/or the executive organs of the government of any state and is capable of suing and being sued. The entry by each Member into this Agreement constitutes, and the exercise by each Member of its respective rights and performance of its respective obligations hereunder will constitute, private and commercial acts performed for private and commercial purposes that shall not be deemed as being entered into in the exercise of any public function.

 

 

Section 12.16    Specific Performance. It is hereby agreed and acknowledged that it will be impossible to measure in money the damages that would be suffered if the parties fail to comply with any of the obligations herein imposed on them and that, in the event of any such failure, an aggrieved Member or other party or third-party beneficiary specified in Section 12.08 will be irreparably damaged and will not have an adequate remedy at Law. Any such Person shall, therefore, be entitled (in addition to any other remedy to which such party may be entitled at Law or in equity) to injunctive relief, including specific performance, to enforce such obligations, without the posting of any bond and if any action should be brought in equity to enforce any of the provisions of this Agreement, none of the Company or Members shall raise the defense that there is an adequate remedy at Law.

 

[signature pages follow]

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Third Amended and Restated Limited Liability Company Agreement to be duly executed as of the day and year first written above.

 

	FLUENCE ENERGY, LLC
	By:
	Name:
	Title:
	FLUENCE ENERGY, INC.
	By:
	Name:
	Title:
	AES GRID STABILITY, LLC
	By:
	Name:
	Title:
	SIEMENS INDUSTRY, INC.
	By:
	Name:
	Title:
	By:
	Name:
	Title:
	QIA FLORENCE HOLDING LLC.
	By:
	Name:
	Title:

 

[Signature Page to the Third Amended and Restated
Limited Liability Company Agreement of Fluence Energy, LLC]

 

 

Schedule A

 

SCHEDULE OF MEMBERS

 

Name and Address of Member	Number of Original Units	Number of Common Units
AES Grid Stability, LLC 4300 Wilson Boulevard Suite 1100 Arlington, VA 22203 Attention: Paul Freedman, General Counsel of The AES Corporation Email: paul.freedman@aes.com	3,960,000 Class A Units	[●]
Siemens Industry, Inc. 4800 North Point Parkway Alpharetta, GA 30005 Attention: Craig Langley Email: langley.craig@siemens.com	3,960,000 Class A Units	[●]
Fluence Energy, Inc. 4601 N. Fairfax Drive, Suite 600 Arlington, VA 22203 Attention: Manuel Perez Dubuc Email: manuel.perez@fluenceenergy.com	1,250,000 Class B Units	[●]

 

 

Exhibit 10.3

 

STOCKHOLDERS AGREEMENT OF
FLUENCE ENERGY, INC.

 

This STOCKHOLDERS AGREEMENT (as the same may be amended from time to time in accordance with its terms, the “Agreement”) is entered into as of [•], 2021, by and among (i) Fluence Energy, Inc., a Delaware corporation (the “Corporation”); (ii) AES Grid Stability, LLC (“AES”), a limited liability company duly organized and validly existing under the laws of Delaware; (iii) Siemens Industry, Inc. (“Siemens”), a corporation duly organized and validly existing under the laws of Delaware, (iv) Qatar Holding LLC (“QIA”), and (v) any other Person who becomes a party hereto pursuant to Section 11 (each a “Stockholder” and, collectively, the “Stockholders”). Certain terms used in this Agreement are defined in Section 7.

 

RECITALS

 

WHEREAS, each of Fluence Energy, Inc., AES and Siemens owns, directly or indirectly, outstanding membership interests in Fluence Energy, LLC, a Delaware limited liability company (“Fluence LLC”), which membership interests constitute and are defined as “Common Units” pursuant to the Third Amended and Restated Limited Liability Company Agreement of Fluence LLC, dated as of [•], 2021, as such agreement may be further amended, restated, amended and restated, supplemented or otherwise modified from time to time (the “LLC Agreement” and such membership interests, the “Common Units”);

 

WHEREAS, the Corporation is contemplating an offering and sale of the shares of Class A common stock, par value $0.00001 per share, of the Corporation (the “Class A Common Stock”) in an underwritten initial public offering (the “IPO”) and using a portion of the net proceeds received from the IPO to purchase Common Units;

 

WHEREAS, pursuant to that certain Common Unit Subscription Agreement by and between the Corporation and Fluence LLC, dated as of [•], 2021 (the “Common Unit Subscription Agreement”), the Corporation will hold Common Units;

 

WHEREAS, upon consummation of the transactions contemplated by the Common Unit Subscription Agreement, it is contemplated that the Corporation will be admitted as a member, and appointed as the sole managing member, of Fluence LLC;

 

WHEREAS, in connection with, and prior to, the issuance of Class A Common Stock of the Corporation to the underwriters in its initial public offering, it is anticipated that (a) AES, Siemens and the Corporation will enter into a series of related transactions pursuant to which AES and Siemens will become holders of the Corporation’s Class B-1 Common Stock, par value $0.00001 per share (together with any Class B-2 Common Stock, the “Class B Stock”) and (b) QIA shall, through the recapitalization of Fluence LLC contemplated by the LLC Agreement and certain related transactions, become a holder of shares of Class A Common Stock;

 

WHEREAS, immediately following the issuance of Class A Common Stock of the Corporation to the underwriters in its initial public offering, AES (together with its Permitted Transferees, in such capacity, the “AES Related Parties”) will be the record holder of shares of Class B Stock;

 

 

WHEREAS, immediately following the issuance of Class A Common Stock of the Corporation to the underwriters in its initial public offering, Siemens (and together with its Permitted Transferees, in such capacity, the “Siemens Related Parties”) will be the record holders of shares of Class B Stock;

 

WHEREAS, immediately following the issuance of Class A Common Stock of the Corporation to the underwriters in its initial public offering, QIA (and together with its Permitted Transferees, in such capacity, the “QIA Related Parties”) will be the record holders of shares of Class A Common Stock; and

 

WHEREAS, in order to induce AES and Siemens (x) to approve the sale and issuance of Common Units by Fluence LLC to the Corporation and the appointment of the Corporation as the sole managing member of Fluence LLC in connection with the IPO and (y) to take certain other actions as shall be necessary to effectuate the transactions contemplated by the IPO, the parties hereto desire to set forth their agreement with respect to the matters set forth herein in connection with their respective investments in the Corporation.

 

NOW, THEREFORE, in consideration of the covenants and agreements contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Corporation, AES, Siemens and QIA agree as follows:

 

AGREEMENT

 

Section 1.               Election of the Board of Directors.

 

(a)           Subject to this Section 1(a), the AES Related Parties shall be entitled to designate for nomination by the Board up to three (3) Directors from time to time (any Director designated by the AES Related Parties, a “AES Director”). The right of the AES Related Parties to designate for nomination the AES Directors as set forth in this Section 1(a) shall be subject to the following: (i) if at any time the AES Related Parties Beneficially Own, directly or indirectly, in the aggregate twenty percent (20%) or more of all issued and outstanding shares of Class A Common Stock (including for this purpose the Underlying Class A Shares), the AES Related Parties shall be entitled to designate for nomination three (3) AES Directors, (ii) if at any time the AES Related Parties Beneficially Own, directly or indirectly, in the aggregate less than twenty percent (20%) but at least ten percent (10%) or more of all issued and outstanding shares of Class A Common Stock (including for this purpose the Underlying Class A Shares), the AES Related Parties shall only be entitled to designate for nomination two (2) AES Directors, and (iii) if at any time the AES Related Parties Beneficially Own, directly or indirectly, in the aggregate less than ten percent (10%) but at least five percent (5%) or more of all issued and outstanding shares of Class A Common Stock (including for this purpose the Underlying Class A Shares), the AES Related Parties shall only be entitled to designate for nomination one (1) AES Director. The AES Related Parties shall not be entitled to designate for nomination any AES Directors in accordance with this Section 1(a) if at any time the AES Related Parties Beneficially Own, directly or indirectly, in the aggregate less than five percent (5%) of all issued and outstanding shares of Class A Common Stock (including for this purpose the Underlying Class A Shares).

 

 

(b)           Subject to this Section 1(b), the Siemens Related Parties shall be entitled to designate for nomination by the Board up to three (3) Directors from time to time (any Director designated by the Siemens Related Parties, a “Siemens Director”). The right of the Siemens Related Parties to designate for nomination the Siemens Directors as set forth in this Section 1(b) shall be subject to the following: (i) if at any time the Siemens Related Parties Beneficially Own, directly or indirectly, in the aggregate twenty percent (20%) or more of all issued and outstanding shares of Class A Common Stock (including for this purpose the Underlying Class A Shares), the Siemens Related Parties shall be entitled to designate for nomination three (3) Siemens Directors, (ii) if at any time the Siemens Related Parties Beneficially Own, directly or indirectly, in the aggregate less than twenty percent (20%) but at least ten percent (10%) or more of all issued and outstanding shares of Class A Common Stock (including for this purpose the Underlying Class A Shares), the Siemens Related Parties shall only be entitled to designate for nomination two (2) Siemens Directors and (iii) if at any time the Siemens Related Parties Beneficially Own, directly or indirectly, in the aggregate less than ten percent (10%) but at least five percent (5%) or more of all issued and outstanding shares of Class A Common Stock (including for this purpose the Underlying Class A Shares), the Siemens Related Parties shall only be entitled to designate for nomination one (1) Siemens Director. The Siemens Related Parties shall not be entitled to designate for nomination any Siemens Directors in accordance with this Section 1(b) if at any time the Siemens Related Parties Beneficially Own, directly or indirectly, in the aggregate less than five percent (5%) of all issued and outstanding shares of Class A Common Stock (including for this purpose the Underlying Class A Shares).

 

(c)           Subject to this Section 1(c), the QIA Related Parties shall be entitled to designate for nomination by the Board one (1) Director from time to time (any Director designated by the QIA Related Parties, a “QIA Director”) if at any time the QIA Related Parties Beneficially Own, directly or indirectly, in the aggregate five percent (5%) or more of all issued and outstanding shares of Class A Common Stock (including for this purpose the Underlying Class A Shares). The QIA Related Parties shall not be entitled to designate for nomination a QIA Director in accordance with this Section 1(c) if at any time the QIA Related Parties Beneficially Own, directly or indirectly, in the aggregate less than five percent (5%) of all issued and outstanding shares of Class A Common Stock (including for this purpose the Underlying Class A Shares).

 

(d)           Subject to Section 1(a), Section 1(b) and Section 1(c), as of the date hereof, each of AES, Siemens and QIA hereby agree to vote, or cause to be voted, all outstanding shares of Class A Common Stock and Class B Stock, as applicable, held by the AES Related Parties, Siemens Related Parties and QIA Related Parties as of the date hereof, at any annual or special meeting of stockholders of the Corporation at which Directors of the Corporation are to be elected or removed, or to take all Necessary Action to cause the election or removal of the AES Directors, Siemens Directors and QIA Director as a Director, as provided herein and to implement and enforce the provisions set forth in Section 3.

 

(e)           So long as the Corporation qualifies as a “controlled company” for purposes of Stock Exchange rules, the Corporation may elect to be a “controlled company” for purposes of Stock Exchange rules, and will disclose in its annual meeting proxy statement that it is a “controlled company” and the basis for that determination. If the Corporation ceases to qualify as a “controlled company” for purposes of Stock Exchange rules, each Stockholder and the Corporation will take whatever Necessary Action may be reasonably necessary in relation to such party, if any, to cause the Corporation to comply with Stock Exchange rules as then in effect within the timeframe for compliance available under such rules.

 

 

Section 2.              Vacancies and Replacements.

 

(a)            If the number of Directors that the AES Related Parties, Siemens Related Parties or the QIA Related Parties have the right to designate for nomination to the Board is decreased pursuant to Section 1(a), Section 1(b) or Section 1(c) (each such occurrence, a “Decrease in Designation Rights”), then:

 

(i)            unless a majority of Directors (with the affected party’s Board designees abstaining) agree in writing that a Director or Directors shall not resign as a result of a Decrease in Designation Rights, each of the AES Related Parties, Siemens Related Parties or the QIA Related Parties, as applicable, shall use its reasonable best efforts to cause each of (x) the appropriate number of AES Directors that the AES Related Parties cease to have the right to designate for nomination to serve as a AES Director, (y) the appropriate number of Siemens Directors that the Siemens Related Parties cease to have the right to designate for nomination to serve as a Siemens Director or (y) the QIA Director that the QIA Related Parties cease to have the right to designate for nomination to serve as the QIA Director, respectively, to offer to tender his, her or their resignation(s), and each of such AES Directors, Siemens Directors or QIA Director so tendering a resignation, as applicable, shall resign within thirty (30) days from the date that the AES Related Parties, Siemens Related Parties and/or the QIA Related Parties, as applicable, incurs a Decrease in Designation Rights. In the event any such AES Director, Siemens Director or QIA Director, as applicable, does not resign as a Director by such time as is required by the foregoing, the AES Related Parties, Siemens Related Parties and the QIA Related Parties, as holders of Class A Common Stock and Class B Stock, the Corporation and the Board, to the fullest extent permitted by law and, with respect to the Board, subject to its fiduciary duties, shall thereafter take all Necessary Action, including voting in accordance with Section 1(d), to cause the removal of such individual as a Director; and

 

(ii)           the vacancy or vacancies created by such resignation(s) and/or removal(s) shall be filled with one or more Directors, as applicable, designated by the Board upon the recommendation of the Nominating and Corporate Governance Committee (with the affected party’s Board designees abstaining), so long as it is established; provided, that the Board, upon the recommendation of the Nominating and Corporate Governance Committee (with the affected party’s Board designees abstaining), may decline to fill such vacancy or vacancies and elect instead to reduce the total number of Directors constituting the full Board correspondingly; provided in no event shall the total number of Directors constituting the full Board be fewer than nine (9).

 

 

(b)          Each of the AES Related Parties, Siemens Related Parties and the QIA Related Parties shall have the sole right to request that one or more of their respective designated Directors, as applicable, tender their resignations as Directors of the Board (each, a “Removal Right”), in each case, with or without cause at any time, by sending a written notice to such Director and the Corporation’s Secretary stating the name of the Director or Directors whose resignation from the Board is requested (the “Removal Notice”). If the Director subject to such Removal Notice does not resign within thirty (30) days from receipt thereof by such Director, the AES Related Parties, Siemens Related Parties and the QIA Related Parties, as holders of Class A Common Stock and Class B Stock, the Corporation and the Board, to the fullest extent permitted by law and, with respect to the Board, subject to its fiduciary duties to the Corporation’s stockholders, shall thereafter take all Necessary Action, including voting in accordance with Section 1(d) to cause the removal of such Director from the Board (and such Director shall only be removed by the parties to this Agreement in such manner as provided herein).

 

(c)           Except with respect to a Decrease in Designation Rights subject to Section 2(a), each of the AES Related Parties, Siemens Related Parties and the QIA Related Parties, as applicable, shall have the exclusive right to designate for nomination a replacement Director for nomination or election by the Board to fill vacancies created as a result of not designating their respective Directors initially or by death, disability, retirement, resignation, removal (with or without cause) of their respective Directors, or otherwise by designating a successor for nomination or election by the Board to fill the vacancy of their respective Directors created thereby on the terms and subject to the conditions of Section 1 whereupon the Corporation and the Board, to the fullest extent permitted by law and, with respect to the Board, subject to its fiduciary duties, shall take all Necessary Action to cause such designee to be elected or appointed by the Board to fill such vacancy.

 

Section 3.              Initial Directors and Corporate Governance.

 

(a)           Initial Directors. The initial AES Directors pursuant to Section 1(a) shall initially be Julian Nebreda, Lisa Krueger and John Shelton. The initial Siemens Directors pursuant to Section 1(b) shall initially be Axel Meier, Barbara Humpton and Emma Falck. The initial QIA Director pursuant to Section 1(c) shall initially be Simon James Smith. Herman Bulls shall serve as the initial Chairperson of the Board (as defined in the Bylaws) for the initial term, in accordance with this Agreement and the Bylaws, after which the Chairperson of the Board shall be determined in accordance with this Agreement and the Bylaws.

 

(b)           Nominating Committee. For so long as the AES Related Parties have the ability pursuant to Section 1(a) to designate for nomination at least one (1) Director, the AES Related Parties shall have, to the fullest extent permitted by applicable law, subject to the Stock Exchange rules and in compliance with other applicable laws, rules and regulations, and subject to the requirements of the charter for the Nominating and Corporate Governance Committee, the right, but not the obligation, to designate one (1) member of the Nominating and Corporate Governance Committee. For so long as the Siemens Related Parties have the ability pursuant to Section 1(b) to designate for nomination at least one (1) Director, the Siemens Related Parties shall have, to the fullest extent permitted by applicable law, subject to the Stock Exchange rules and in compliance with other applicable laws, rules and regulations, and subject to the requirements of the charter for the Nominating and Corporate Governance Committee, the right, but not the obligation, to designate one (1) member of the Nominating and Corporate Governance Committee.

 

 

(c)           Chief Executive Officer. Immediately following the consummation of the IPO, the Chief Executive Officer of the Corporation shall be Manuel Perez Dubuc.

 

(d)           Other Rights of AES Directors, Siemens Directors and QIA Directors.

 

(i)           Each AES Director, Siemens Director and QIA Director serving on the Board shall be entitled to the same rights and privileges applicable to all other members of the Board generally or to which all such members of the Board are entitled. In furtherance of the foregoing, the Corporation shall indemnify, exculpate, and reimburse fees and expenses of each AES Director, Siemens Director and QIA Director (including by entering into an indemnification agreement in a form substantially similar to the Corporation’s form director indemnification agreement) and provide each AES Director, Siemens Director and QIA Director with director and officer insurance to the same extent it indemnifies, exculpates, reimburses and provides insurance for the other members of the Board pursuant to the certificate of incorporation or bylaws of the Corporation, applicable law or otherwise.

 

(ii)          The AES Directors and Siemens Directors shall, each respectively, have the right to review and to approve the Corporation’s annual business plan and annual capital expenditure and operating budget (collectively, the “Budget”) prior to the implementation by the Corporation of the Budget. In the event that the Board of Directors fails to approve a Budget for any Fiscal Year prior to the first day of such Fiscal Year, (i) any items of the proposed Budget that have been approved will become operative, and (ii) the approved Budget for the immediately preceding Fiscal Year shall continue in effect after giving effect to any dispositions or other material changes to the business, subject to a fifteen percent (15%) year-over-year increase with respect to overhead and fixed costs.

 

Section 4.              Rights of the AES, Siemens and QIA Stockholders.

 

(a)            In addition to any voting requirements contained in the organizational documents of the Corporation or any of its Subsidiaries, the Corporation shall not take, and shall cause Fluence LLC and its Subsidiaries not to take, any of the following actions (whether by merger, consolidation or otherwise) without the prior written approval of (i) the AES Related Parties as long as they Beneficially Own, directly or indirectly, in the aggregate ten percent (10%) or more of all issued and outstanding shares of Class A Common Stock (including for these purposes the Underlying Class A Shares) and (ii) the Siemens Related Parties for as long as they Beneficially Own, directly or indirectly, in the aggregate ten percent (10%) or more of all issued and outstanding shares of Class A Common Stock (including for these purposes the Underlying Class A Shares):

 

(i)            any buyback, purchase, repurchase, redemption or other acquisition by the Corporation or Fluence LLC of any of the securities of the Corporation, Fluence LLC or any of their respective Subsidiaries, other than repurchases made pursuant to any incentive plan adopted by the Board and stockholders of the Corporation, or in connection with any redemption or exchange of Common Units as set forth in the LLC Agreement, or other than in connection with buybacks, purchases, repurchases, redemptions or other acquisitions by the Corporation or Fluence LLC of any of the securities of the Corporation, Fluence LLC or any of their respective Subsidiaries that are available to all equity holders of such entity pro rata to their then-existing equity holdings in such entity;

 

 

(ii)            the creation of a new class or series of capital stock or equity securities of the Corporation, Fluence LLC or any of their respective Subsidiaries; provided that this clause shall not prohibit Fluence LLC from causing any of its direct or indirect wholly-owned Subsidiaries from revising the capitalization of such direct or indirect wholly-owned Subsidiaries in the ordinary course of business and that such new class or series of equity securities is held by Fluence LLC or its wholly-owned Subsidiaries; or

 

(iii)          any issuance of additional shares of Class A Common Stock, Class B Stock, or other equity securities of the Corporation, Fluence LLC or any of their respective Subsidiaries after the date hereof, other than (1) any issuance of additional shares of Class A Common Stock or other equity securities of the Corporation or its Subsidiaries (i) under any stock option or other equity compensation plan of the Corporation or any of its Subsidiaries approved by the Board or the compensation committee of the Board or (ii) in connection with any redemption of Common Units as set forth in the LLC Agreement; or (2) any issuance of equity securities by the direct or indirect wholly-owned Subsidiaries of Fluence LLC to Fluence LLC or to other wholly-owned Subsidiaries of Fluence LLC.

 

Notwithstanding anything in the organizational documents of the Corporation to the contrary, each of (i) the Siemens Related Parties for as long as the Siemens Related Parties Beneficially Own, directly or indirectly, in the aggregate ten percent (10%) or more of all issued and outstanding shares of Class A Common Stock (including for these purposes the Underlying Class A Shares) and (ii) the AES Related Parties for as long as the AES Related Parties Beneficially Own, directly or indirectly, in the aggregate ten percent (10%) or more of all issued and outstanding shares of Class A Common Stock (including for these purposes the Underlying Class A Shares), shall have the right to call a special meeting of stockholders of the Corporation for any purpose.

 

(b)          In addition to any voting requirements contained in the organizational documents of the Corporation or any of its Subsidiaries, the Corporation shall not take, and shall cause Fluence LLC and its Subsidiaries not to take, any of the following actions (whether by merger, consolidation or otherwise) without the prior written approval of (i) the AES Related Parties as long as they Beneficially Own, directly or indirectly, in the aggregate five percent (5%) or more of all issued and outstanding shares of Class A Common Stock (including for these purposes the Underlying Class A Shares) and (ii) the Siemens Related Parties for as long as they Beneficially Own, directly or indirectly, in the aggregate of five percent (5%) or more of all issued and outstanding shares of Class A Common Stock (including for these purposes the Underlying Class A Shares):

 

(i)           the appointment of the Company Representative under (and as defined in) the LLC Agreement, the making of any tax election outside the ordinary course of business, or any change or revocation of any material tax election, or any election to classify Fluence LLC or any Subsidiary thereof as a corporation for federal income tax purposes; or

 

 

(ii)           the (x) resignation, replacement or removal of the Corporation as the sole manager of Fluence LLC or (y) appointment of any additional Person as a manager of Fluence LLC.

 

(c)          In addition to any voting requirements contained in the organizational documents of the Corporation or any of its Subsidiaries, the Corporation shall not take, and shall cause Fluence LLC and its Subsidiaries not to take, any of the following actions (whether by merger, consolidation or otherwise) without the prior written approval of (i) the AES Related Parties as long as they Beneficially Own, directly or indirectly, in the aggregate five percent (5%) or more of all issued and outstanding shares of Class A Common Stock (including for these purposes the Underlying Class A Shares), (ii) the Siemens Related Parties for as long as they Beneficially Own, directly or indirectly, in the aggregate of five percent (5%) or more of all issued and outstanding shares of Class A Common Stock (including for these purposes the Underlying Class A Shares) and (iii) the QIA Related Parties for as long as they Beneficially Own, directly or indirectly, in the aggregate five percent (5%) or more of all issued and outstanding shares of Class A Common Stock (including for this purpose the Underlying Class A Shares):

 

(i)            any increase or decrease of the size of the Board;

 

(ii)           the reorganization, recapitalization, voluntary bankruptcy, liquidation, dissolution or winding-up of the Corporation, Fluence LLC or any of their respective Subsidiaries; or

 

(iii)          any amendment or modification of this Agreement or the organizational documents of the Corporation, Fluence LLC or any Subsidiary that would adversely modify the rights, preferences or privileges of any of AES, Siemens or QIA in a materially disproportionate manner to the non-affected stockholders among AES, Siemens or QIA.

 

(d)          Tag-Along Rights. If during the three (3) year period commencing on the date of this Agreement:

 

(i)           either the AES Related Parties or the Siemens Related Parties (each in such capacity, an “Initiating Stockholder”) (x) desires to Transfer (as defined in the LLC Agreement) to any Person (other than their respective Affiliates or to the Corporation) (a “Third Party”) one hundred percent (100%) of its shares of Class A Common Stock, if any, and Common Units (in the case of Common Units, together with the applicable shares of Class B Stock) and (y) such shares of Class A Common Stock and Common Units being sold to such Third Party (the “Subject Securities”) represent less than twenty percent (20%) of the aggregate issued and outstanding shares of Class A Common Stock (including for this purpose the Underlying Class A Shares), then (A) the Initiating Stockholder may sell such Subject Securities to the Third Party, (B) the Initiating Stockholder is not permitted to assign or transfer any of its rights under this Agreement to such Third Party and (C) the QIA Related Parties shall not have any right to participate in such sale to such Third Party pursuant to this Section 4(d)(i);

 

 

(ii)          either Initiating Stockholder desires to Transfer (as defined in the LLC Agreement) to a Third Party, one hundred percent (100%) of its Subject Securities and such Subject Securities represent twenty percent (20%) or more of the aggregate issued and outstanding shares of Class A Common Stock (including for this purpose the Underlying Class A Shares), then the Initiating Stockholder may, in its sole discretion, (1) elect to (x) Transfer its Subject Securities and (y) transfer or assign its rights under this Agreement to such Third Party, provided that in connection with such Transfer, such Initiating Stockholders shall provide the QIA Related Parties with the right to participate in the sale of such Subject Securities and sell one hundred percent (100%) of their shares of Class A Common Stock pursuant to Sections 4(d)(v), (vi) and (vii) (the rights of the QIA Related Parties to participate in any Transfer of Subject Securities under this Section 4(d) shall be referred to as the “Tag Along Rights”) or (2) Transfer the Subject Securities to the Third Party without transferring or assigning its rights under this Agreement, in which case the QIA Related Parties will not have any Tag Along Rights. In respect of clause (1) herein, the applicable Initiating Stockholder shall use its reasonable best efforts to cause the Third Party purchaser to acquire the applicable shares of Class A Common Stock of the QIA Related Parties pursuant to the terms of this Section 4(d); provided that, if such Third Party elects not to acquire such shares of Class A Common Stock of the QIA Related Parties, (A) the applicable Initiating Stockholder shall not be permitted to transfer or assign its rights under this Agreement to such Third Party and (B) the QIA Related Parties will not have any Tag Along Rights;

 

(iii)         both Initiating Stockholders desire collectively to Transfer (as defined in the LLC Agreement) to a Third Party a number of their Subject Securities representing (x) less than one hundred percent (100%) of such Initiating Stockholder’s Subject Securities and (y) thirty percent (30%) or greater of the aggregate issued and outstanding shares of Class A Common Stock (including for this purpose the Underlying Class A Shares), then (1) the Initiating Stockholders shall not be permitted to assign their rights under this Agreement to the Third Party, and (2) the QIA Related Parties shall have the Tag Along Rights with respect to a sale of a pro rata portion of their Class A Common in the sale of such Subject Securities pursuant to the terms of this Section 4(d);

 

(iv)        both Initiating Stockholders desire collectively to Transfer (as defined in the LLC Agreement) to a Third Party one hundred percent (100%) of their Subject Securities and such Subject Securities represent thirty percent (30%) or greater of the aggregate issued and outstanding shares of Class A Common Stock (including for this purpose the Underlying Class A Shares), then the Initiating Stockholders (x) may Transfer their collective Subject Securities to the Third Party and (y) may assign their respective rights under this Agreement to such Third Party and (z) shall provide the QIA Related Parties with the Tag Along Rights and the ability to participate in the sale of such Subject Securities and sell one hundred percent (100%) of their shares of Class A Common Stock pursuant to the terms of this Section 4(d);

 

(v)          Prior to any proposed sale of the Subject Securities by the Initiating Stockholders to a Third Party to which Tag Along Rights apply as set forth in Section 4(d)(ii) through Section 4(d)(iv), the applicable Initiating Stockholder shall provide the QIA Related Parties with a written notice (the “Tag Along Notice”), which shall include (i) the identity of the prospective purchaser (the “Prospective Purchaser”), (ii) the number of the Subject Securities proposed to be sold by the Initiating Stockholders, (iii) the per share consideration and the material terms and conditions upon which the proposed sale is to be made, and (iv) the number of the Subject Securities held by the applicable Initiating Stockholders to be included in such Tag Along Transfer, expressed as a percentage of their aggregate holdings (the “Tag Percentage”);

 

 

(vi)         Following receipt of a Tag Along Notice hereunder, the QIA Related Parties, in their sole discretion, will have ten (10) business days to exercise, by delivery of written notice to the Initiating Stockholders (the “Tag Election”), the right to sell to the Prospective Purchaser a number of shares of Class A Common Stock up to the product of the total number of Class A Common Stock held by the QIA Related Parties multiplied by the Tag Percentage set forth in the Tag Along Notice (for clarity, in such a joint sale by the AES Related Parties and the Siemens Related Parties where the number of the Subject Securities being included in such sale by one party is different from that of the other party, the QIA Related Parties may use the greater of the two individual Tag Percentages in calculating the number of its pro rata portion of the applicable Subject Securities) (any of the QIA Related Parties exercising such right, a “Tagging Stockholder” and any such shares of Class A Common Stock designated for sale by a Tagging Stockholder, collectively, the “Tag Along Securities”). For purposes of this Section 4(d), Subject Securities will be counted as follows: (A) each share of Class A Common Stock will be counted as one (1) Subject Security and (B) each share of Class B Common Stock and Common Unit together will be counted as one (1) Subject Security. Any such exercise of the Tag Along Rights by a Tagging Stockholder shall be irrevocable. If the QIA Related Parties have not delivered a Tag Election within such ten (10) business day period, the Initiating Stockholders shall have the right to freely Transfer to the Prospective Purchaser all, but not less than all, of the Subject Securities proposed to be sold as set forth in the Tag Along Notice for a period not to exceed one hundred and eighty (180) days following the end of such ten (10) day period, subject to extension to allow pending applicable governmental consents and approvals; provided, that such Transfer is otherwise on the same or substantially similar or less preferable (to the Initiating Stockholders) terms and conditions as those set forth in the Tag Along Notice. If, at the end of such one hundred and eighty (180) day period (as extended to permit pending governmental consents and approvals), the Initiating Stockholders have not completed the Tag Along Transfer in accordance with the terms and conditions of the Tag Along Notice, all the restrictions on a Transfer contained in this Section 4(d) with respect to the Subject Securities owned by the Initiating Stockholders shall again be in effect; and

 

(vii)       The Tag Along Securities will be included in the relevant Transfer on the same terms and subject to the same conditions set forth in the Tag Along Notice and applicable to the Subject Securities that the Initiating Stockholders are selling (except that governmental consents and approvals shall be obtained by each Tagging Stockholder as required under applicable law, even if different from those required from the Initiating Stockholders in connection with the Tag Along Transfer). Each Tagging Stockholder agrees that it will take such actions and execute such other agreements as the Initiating Stockholders may reasonably request in connection with the consummation of the Tag Along Transfer and the transactions contemplated thereby, including any purchase agreement, proxies, custody agreements, powers of attorney, written consents in lieu of meetings or waiver of appraisal rights.

 

 

(e)            Drag-Along Rights.

 

(i)            Notwithstanding the provisions of Section 4(d) above, in the event that AES and Siemens collectively Transfer (as defined in the LLC Agreement) to a Third Party one hundred percent (100%) of their respective Subject Securities (a “Drag-Along Transaction”) and (A) as a result of such Drag-Along Transaction, such Third Party acquires at least sixty percent (60%) (in the aggregate) of the issued and outstanding shares of Class A Common Stock (including for these purposes the Underlying Class A Shares) and (B) the purchase price set forth in the bona fide offer from the Third Party purchaser represents at least a thirty percent (30%) increase on the 30-day average trading price for the shares of Class A Common Stock (a “Drag Offer”), then AES and Siemens may, at their option, require the QIA Related Parties to sell one hundred percent (100%) of their shares of Class A Common Stock to the third party by giving written notice (the “Drag Notice”) to the QIA Related Parties not less than thirty (30) days prior to the date stated in the Drag Offer for consummation of the sale contemplated by the Drag Offer (the “Approved Sale”). The Drag Notice shall contain written notice of the exercise of AES and Siemens’ rights pursuant to this Section 4(e), and shall set forth the consideration to be paid by the third party and the other material terms and conditions of the Drag Offer.

 

(ii)          The purchase of shares of Class A Common Stock from the QIA Related Parties pursuant to this Section 4(e) shall be on substantially the same terms and conditions and for the same type of consideration payable to AES and Siemens.

 

(iii)         If AES and Siemens exercise their rights pursuant to this Section 4(e), the QIA Related Parties shall sell, exchange or otherwise dispose to such Third Party one hundred percent (100%) of their shares of Class A Common Stock.

 

(iv)         In connection with the consummation of any Approved Sale, QIA acknowledges and agrees that it shall:

 

a.

consent to and raise no objections against any such Approved Sale; and

 

b.

not exercise any rights of appraisal, dissenters’ rights or similar rights, all of which are hereby waived.

 

Section 5.               Covenants of the Corporation.

 

(a)            The Corporation agrees to take all Necessary Action to (i) cause the Board to be comprised of at least nine (9) Directors or such other number of Directors as the Board may determine, subject to the terms of this Agreement, the Charter or the Bylaws of the Corporation; (ii) cause the individuals designated for nomination in accordance with Section 1 to be included in the slate of nominees to be elected to the Board at the next annual or special meeting of stockholders of the Corporation at which Directors are to be elected, in accordance with the Bylaws, Charter and General Corporation Law of the State of Delaware and at each annual meeting of stockholders of the Corporation thereafter at which such Director’s term expires; (iii) cause the individuals designated for nomination in accordance with Section 2(c) to fill the applicable vacancies on the Board, in accordance with the Bylaws, Charter, Securities Laws, General Corporation Law of the State of Delaware and the New York Stock Exchange rules and (iv) to adhere to, implement and enforce the provisions set forth in Section 4.

 

 

(b)          The AES Related Parties, the Siemens Related Parties and the QIA Related Parties shall comply with the requirements of the Charter and Bylaws when designating and nominating individuals as Directors, in each case, to the extent such requirements are applicable to Directors generally. Notwithstanding anything to the contrary set forth herein, in the event that the Board determines, within sixty (60) days after compliance with the first sentence of this Section 5(b), in good faith, after consultation with outside legal counsel, that its nomination, appointment or election of a particular Director designated for nomination in accordance with Section 1 or Section 2, as applicable, would constitute a breach of its fiduciary duties or does not otherwise comply with any requirements of the Charter or Bylaws, then the Board shall inform the AES Related Parties, Siemens Related Parties and/or the QIA Related Parties, as applicable, of such determination in writing and explain in reasonable detail the basis for such determination and shall, to the fullest extent permitted by law, nominate, appoint or elect another individual designated for nomination, election or appointment to the Board by the AES Related Parties, Siemens Related Parties and/or the QIA Related Parties, as applicable (subject in each case to this Section 5(b)). The Board and the Corporation shall, to the fullest extent permitted by law, take all Necessary Action required by this Section 5 with respect to the election of such substitute designees to the Board.

 

(c)          In addition to any voting requirements contained in this Agreement or the organizational documents of the Corporation or any of its Subsidiaries, the Corporation shall not, directly or indirectly, enter into or conduct business or operations or hold or acquire assets in its own name or otherwise other than through Fluence LLC and its Subsidiaries without the prior written approval of (i) AES for as long as the AES Related Parties Beneficially Own, directly or indirectly any of the issued and outstanding Common Units and (ii) Siemens for as long as the Siemens Related Parties Beneficially Own, directly or indirectly any of the issued and outstanding Common Units; provided, however, that nothing in this clause (c) shall be deemed to prohibit the Corporation from, and no consent of AES, Siemens or any other Person shall be required for the Corporation to engage in, (i) holding or using cash received by the Corporation as a result of the Corporation’s investment in Fluence LLC or (ii) re-investing cash into Fluence LLC (whether by way of intercompany loan, investment or otherwise).

 

(d)          Upon the request of either the AES Related Parties or the Siemens Related Parties that wish to (x) pledge, hypothecate or grant security interests in any or all of the shares of Common Stock held by it including to banks or financial institutions as collateral or security for loans, advances or extensions of credit or (y) transfer all (but not less than all) of the shares of Common Stock and/or Common Units held by it, including to a third party transferee, in a transfer not prohibited by the LLC Agreement, each of the Corporation and Fluence LLC agrees to cooperate with the AES Related Parties or the Siemens Related Parties, as the case may be, in taking any action reasonably necessary to consummate any such pledge, hypothecation, grant or transfer, including without limitation, delivery of letter agreements to lenders in form and substance reasonably satisfactory to such lenders (which may include agreements by the Corporation and Fluence LLC in respect of the exercise of remedies by such lenders), instructing the transfer agent to transfer any such shares of Common Stock subject to the pledge, hypothecation or grant into the facilities of The Depository Trust Company without restricted legends and cooperating in diligence or other matters as may reasonably requested by either AES Related Parties or the Siemens Related Parties in connection therewith.

 

 

(e)            In the event that the Corporation effects the separation of any portion of its business into one or more entities (each, a “NewCo”), whether existing or newly formed, including without limitation by way of spin-off, split-off, carve-out, demerger, recapitalization, reorganization or similar transaction, and any Stockholder will receive equity interests in any such NewCo as part of such separation, the Corporation shall cause any such NewCo to enter into a Stockholders agreement with the Stockholders that provides AES, Siemens and QIA with rights vis-á-vis such NewCo that are substantially identical to those set forth in this Agreement.

 

Section 6.              Termination.

 

This Agreement shall terminate upon the earliest to occur of any one of the following events:

 

(a)           each of (i) the AES Related Parties, (ii) the Siemens Related Parties and (iii) the QIA Related Parties ceasing to own any shares of Class A Common Stock (including for these purposes any Underlying Class A Shares) or Class B Stock;

 

(b)           each of (i) the AES Related Parties, (ii) the Siemens Related Parties and (iii) the QIA Related Parties ceasing to have any Director designation rights under Section 1; and

 

(c)          the unanimous written consent of the parties hereto; provided, however, that notwithstanding any of the foregoing in this Section 6, the QIA Related Parties shall have the option to terminate, at their sole discretion and solely with respect to such QIA Related Parties, this Agreement and their rights and obligations hereunder if at any time (i)(A) the Board no longer has a QIA Director and (B) the QIA Related Parties beneficially own, directly or indirectly, in the aggregate less than five percent (5%) of all issued and outstanding shares of Class A Common Stock (including for this purpose the Underlying Class A Shares) or (ii) following a Transfer to a Third Party by the AES Related Parties or the Siemens Related Parties of its shares of Class A Common Stock and/or Common Units (in the case of Common Units, together with the applicable shares of Class B Stock) and the associated right to designate for nomination one or more Directors, the QIA Related Parties determine that they would not be able to vote (or cause to be voted) for any director candidate nominated by such Third Party.

 

For the avoidance of doubt, the rights and obligations (i) of the AES Related Parties under this Agreement shall terminate upon the AES Related Parties ceasing to own any shares of Class A Common Stock (including for these purposes the Underlying Class A Shares), or Class B Stock, (ii) of the Siemens Related Parties under this Agreement shall terminate upon the Siemens Related Parties ceasing to own any shares of Class A Common Stock (including for these purposes any Underlying Class A Shares) or Class B Stock, or (iii) of the QIA Related Parties under this Agreement shall terminate upon the QIA Related Parties ceasing to own any shares of Class A Common Stock. Notwithstanding the foregoing, nothing in this Agreement shall modify, limit or otherwise affect, in any way, any and all rights to indemnification, exculpation and/or contribution owed by any of the parties hereto, to the extent arising out of or relating to events occurring prior to the date of termination of this Agreement or the date the rights and obligations of such party under this Agreement terminates in accordance with this Section 6.

 

 

Section 7.               Definitions.

 

As used in this Agreement, any term that it is not defined herein, shall have the following meanings:

 

“Affiliate” has the meaning ascribed thereto in Rule 12b-2 promulgated under the Exchange Act, as in effect on the date hereof

 

“Beneficially Own” has the meaning set forth in Rule 13d-3 promulgated under the Exchange Act; provided that for purposes of this Agreement, a Stockholder shall not be deemed to Beneficially Own any shares of Class A Common Stock (including any Underlying Class A Shares) in which such Stockholder does not have a direct or indirect pecuniary interest.

 

“Board” means the board of directors of the Corporation.

 

“Bylaws” means the amended and restated bylaws of the Corporation, dated as of the date hereof, as the same may be further amended, restated, amended and restated or otherwise modified from time to time.

 

“Combined Voting Power” means the combined voting power of all classes and series of Voting Securities, according to each class’ or series’ respective votes per share, voting together as a single class.

 

“Charter” means the amended and restated certificate of incorporation of the Corporation, effective as of the date hereof, as the same may be further amended, restated, amended and restated or otherwise modified from time to time.

 

“Director” means a member of the Board.

 

“Necessary Action” means, with respect to a specified result, all commercially reasonable actions required to cause such result that are within the power of a specified Person, including (i) voting or providing a written consent or proxy with respect to the equity securities owned by the Person obligated to undertake the necessary action, (ii) voting in favor of the adoption of stockholders’ resolutions and amendments to the organizational documents of the Corporation, (iii) executing agreements and instruments, and (iv) making, or causing to be made, with governmental, administrative or regulatory authorities, all filings, registrations or similar actions that are required to achieve such result.

 

“Nominating and Corporate Governance Committee” means the nominating and corporate governance committee of the Board or any committee of the Board authorized to perform the function of recommending to the Board the nominees for election as Directors or nominating the nominees for election as Directors.

 

“Permitted Transferees” has the meaning set forth in the Charter or, in relation to a Stockholder’s Common Units in Fluence LLC, in the LLC Agreement.

 

 

“Person” means any individual, corporation, limited liability company, partnership, trust, joint stock company, business trust, unincorporated association, joint venture, governmental authority or other entity or organization, including a government or any subdivision or agency thereof.

 

“Pro Rata Percentage” means the percentage obtained by dividing (i) the aggregate number of Subject Securities being sold pursuant to Section 4(d), by (ii) the aggregate number of Subject Securities owned by the AES Related Parties and Siemens Related Parties immediately preceding the transactions contemplated by Section 4(d).

 

“Related Parties” means, collectively, the AES Related Parties, the Siemens Related Parties and the QIA Related Parties.

 

“Securities Laws” means the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended, and the rules promulgated thereunder.

 

“Stock Exchange” means the Nasdaq Global Market or such other securities exchange or interdealer quotation system on which shares of Class A Common Stock are then listed or quoted.

 

“Subsidiary” means with respect to any Person, any corporation, limited liability company, partnership, association, trust or other form of legal entity, of which (a) such first Person directly or indirectly owns or controls at least a majority of the securities or other interests having by their terms voting power to elect a majority of the board of directors or others performing similar functions, or (b) such first Person is a general partner or managing member (excluding partnerships in which such Person or any Subsidiary thereof does not have a majority of the voting interests in such partnership).

 

“Underlying Class A Shares” means all shares of Class A Common Stock issuable upon redemption of Common Units, assuming all such Common Units are redeemed for Class A Common Stock on a one-for-one basis (excluding, for clarity, Common Units held directly or indirectly by the Corporation).

 

“Voting Securities” means, at any time, outstanding shares of any class of Common Stock of the Corporation, which are then entitled to vote generally in the election of directors.

 

Unless the context of this Agreement otherwise requires, (i) words of any gender include each other gender; (ii) words using the singular or plural number also include the plural or singular number, respectively; (iii) the terms “hereof,” “herein,” “hereby” and derivative or similar words refer to this entire Agreement; (iv) the terms “Article” or “Section” refer to the specified Article or Section of this Agreement; (v) the word “including” shall mean “including, without limitation”; (vi) each defined term has its defined meaning throughout this Agreement, whether the definition of such term appears before or after such term is used; and (vii) the word “or” shall be disjunctive but not exclusive. References to agreements and other documents shall be deemed to include all subsequent amendments and other modifications thereto. References to statutes shall include all regulations promulgated thereunder and references to statutes or regulations (including rules of any Stock Exchange) shall be construed as including all statutory and regulatory provisions consolidating, amending or replacing the statute or regulation.

 

 

Section 8.              Information.

 

(a)          The Corporation shall, and shall cause its Subsidiaries to, keep proper books, records and accounts, in which full and correct entries shall be made of all financial transactions and the assets and business of the Corporation and each of its Subsidiaries in accordance with generally accepted accounting principles. The Corporation shall, and shall cause its Subsidiaries to, (i) permit the Stockholders and their respective designated representatives (or other designees), at reasonable times and upon reasonable prior notice to the Corporation, to review the books and records of the Corporation or any of such Subsidiaries and to discuss the affairs, finances and condition of the Corporation or any of such Subsidiaries with the officers of the Corporation or any such Subsidiary and (ii) unless and until a Stockholder notifies the Corporation in writing that it no longer desires to receive information under this clause (ii), provide such Stockholder all information of a type, at such times and in such manner as is consistent with the Corporation’s past practice or that is otherwise reasonably requested by such Stockholder from time to time (all such information so furnished pursuant to this Section 8(a), the “Information”). Subject to Section 8(c) any Stockholder (and any party receiving Information from a Stockholder) who shall receive Information shall maintain the confidentiality of such Information. Notwithstanding the foregoing, that the Corporation shall not be required to disclose any privileged Information of the Corporation so long as the Corporation has used commercially reasonable efforts to enter into an arrangement pursuant to which it may provide such information to the Stockholders without the loss of any such privilege.

 

(b)            The Corporation shall deliver or cause to be delivered to the Stockholders, at their request:

 

(i)            to the extent otherwise prepared by the Corporation, operating and capital expenditure budgets and periodic information packages relating to the operations and cash flows of the Corporation and its Subsidiaries; and

 

(ii)          to the extent otherwise prepared by the Corporation, such other reports and information as may be reasonably requested by the Stockholders; provided, however, that the Corporation shall not be required to disclose any privileged information of the Corporation so long as the Corporation has used commercially reasonable efforts to enter into an arrangement pursuant to which it may provide such information to the Stockholders without the loss of any such privilege.

 

(c)           Each Stockholder agrees that it will, and will direct its designated representatives to, keep confidential and not disclose any Confidential Information; provided, however, that such Stockholder and its designated representatives may disclose Confidential Information to the other Stockholders, to their respective Related Parties and to (a) its Affiliates and its Affiliates’ attorneys, accountants, consultants, insurers, financing sources and other advisors in connection with such Stockholder’s investment in the Corporation, (b) any Person, including a prospective purchaser of Common Stock, as long as such Person has agreed, in writing, to maintain the confidentiality of such Confidential Information, (c) any of such Stockholder’s or its respective Affiliates’ partners, members, stockholders, directors, officers, employees or agents in the ordinary course of business (the Persons referenced in clauses (a), (b) and (c), a Stockholder’s “designated representatives”) or (d) as the Corporation may otherwise consent in writing; provided, further, however, that each Stockholder agrees to be responsible for any breaches of this Section 8(c) by such Stockholder’s designated representatives.

 

 

(d)          Each party hereto acknowledges and agrees that the Related Parties may share any information concerning the Corporation and its Subsidiaries received by them from or on behalf of the Corporation or its designated representatives with each Stockholder and its designated representatives (subject to such Stockholder’s obligation to maintain the confidentiality of Confidential Information in accordance with Section 8(c)).

 

Section 9.             Choice of Law and Venue; Waiver of Right to Jury Trial.

 

(a)           THIS AGREEMENT SHALL BE GOVERNED BY, CONSTRUED, APPLIED AND ENFORCED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF DELAWARE. EACH OF THE PARTIES HERETO ACKNOWLEDGES AND AGREES THAT IN THE EVENT OF ANY BREACH OF THIS AGREEMENT, THE NON-BREACHING PARTY WOULD BE IRREPARABLY HARMED AND COULD NOT BE MADE WHOLE BY MONETARY DAMAGES, AND THAT, IN ADDITION TO ANY OTHER REMEDY TO WHICH THEY MAY BE ENTITLED AT LAW OR IN EQUITY, THE PARTIES SHALL BE ENTITLED TO SUCH EQUITABLE OR INJUNCTIVE RELIEF AS MAY BE APPROPRIATE. THE CHOICE OF FORUM SET FORTH IN THIS SECTION SHALL NOT BE DEEMED TO PRECLUDE THE ENFORCEMENT OF ANY JUDGMENT OF A DELAWARE FEDERAL OR STATE COURT, OR THE TAKING OF ANY ACTION UNDER THIS AGREEMENT TO ENFORCE SUCH A JUDGMENT, IN ANY OTHER APPROPRIATE JURISDICTION.

 

(b)           IN THE EVENT ANY PARTY TO THIS AGREEMENT COMMENCES ANY LITIGATION, PROCEEDING OR OTHER LEGAL ACTION IN CONNECTION WITH OR RELATING TO THIS AGREEMENT, ANY RELATED AGREEMENT OR ANY MATTERS DESCRIBED OR CONTEMPLATED HEREIN OR THEREIN, THE PARTIES TO THIS AGREEMENT HEREBY (1) AGREE UNDER ALL CIRCUMSTANCES ABSOLUTELY AND IRREVOCABLY TO SUBMIT TO THE EXCLUSIVE JURISDICTION OF THE COURT OF CHANCERY OF THE STATE OF DELAWARE, OR IF (AND ONLY IF) SUCH COURT FINDS IT LACKS SUBJECT MATTER JURISDICTION, THE SUPERIOR COURT OF THE STATE OF DELAWARE (COMPLEX COMMERCIAL DIVISION), OR IF UNDER APPLICABLE LAW, SUBJECT MATTER JURISDICTION OVER THE MATTER THAT IS THE SUBJECT OF THE ACTION OR PROCEEDING IS VESTED EXCLUSIVELY IN THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA, THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DELAWARE, AND APPELLATE COURTS FROM ANY THEREOF, WITH RESPECT TO ALL ACTIONS AND PROCEEDINGS ARISING OUT OF OR RELATING TO THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREBY; (2) AGREE THAT IN THE EVENT OF ANY SUCH LITIGATION, PROCEEDING OR ACTION, SUCH PARTIES WILL CONSENT AND SUBMIT TO THE PERSONAL JURISDICTION OF ANY SUCH COURT DESCRIBED IN CLAUSE (1) OF THIS SECTION 9(B) AND TO SERVICE OF PROCESS UPON THEM IN ACCORDANCE WITH THE RULES AND STATUTES GOVERNING SERVICE OF PROCESS; (3) AGREE TO WAIVE TO THE FULL EXTENT PERMITTED BY LAW ANY OBJECTION THAT THEY MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH LITIGATION, PROCEEDING OR ACTION IN ANY SUCH COURT OR THAT ANY SUCH LITIGATION, PROCEEDING OR ACTION WAS BROUGHT IN ANY INCONVENIENT FORUM; (4) AGREE TO WAIVE ANY RIGHTS TO A JURY TRIAL TO RESOLVE ANY DISPUTES OR CLAIMS RELATING TO THIS AGREEMENT; (5) AGREE TO SERVICE OF PROCESS IN ANY LEGAL PROCEEDING BY MAILING OF COPIES THEREOF TO SUCH PARTY AT ITS ADDRESS SET FORTH HEREIN FOR COMMUNICATIONS TO SUCH PARTY; (6) AGREE THAT ANY SERVICE MADE AS PROVIDED HEREIN SHALL BE EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT; AND (7) AGREE THAT NOTHING HEREIN SHALL AFFECT THE RIGHTS OF ANY PARTY TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER PERMITTED BY LAW.

 

 

Section 10.            Notices.

 

Any notice, request, claim, demand, document and other communication hereunder to any party shall be effective upon receipt (or refusal of receipt) and shall be in writing and delivered personally or sent by facsimile, or by electronic mail, or first class mail, or by Federal Express or other similar courier or other similar means of communication, as follows:

 

(a)            If to AES Grid Stability, LLC, addressed as follows:

 

AES Grid Stability, LLC 

4300 Wilson Boulevard 

Suite 1100 

Arlington, VA 22203 

Attention: Paul Freedman, General Counsel of The AES Corporation 

Email: paul.freedman @aes.com

 

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

 

AES Grid Stability, LLC 

4300 Wilson Boulevard 

Suite 1100 

Arlington, VA 22203 

Attention: Chris Shelton, Senior Vice President, Chief Product Officer and

President, AES Next 

Email: chris.shelton@aes.com

 

(b)          If to Siemens Industry, Inc., addressed as follows:

 

Siemens Industry, Inc. 

4800 North Point Parkway 

Alpharetta, GA 30005, USA 

Attention: Craig Langley 

Email: Langley.craig@siemens.com

 

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

 

Siemens Corporation
527 Madison Avenue
New York, New York 10022
Attention: Kenneth R. Meyers
Email: kenneth.meyers@siemens.com

 

 

(c)            If to Qatar Holding LLC, addressed as follows:

 

Qatar Holding LLC 

Ooredoo Tower (Building 14) 

Al Dafna Street (Street 801) 

Al Dafna (Zone 61) 

Doha, Qatar 

Email: notices.legal@qia.qa; notices_industrials@qia.qa

 

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

 

Cleary Gottlieb Steen & Hamilton LLP 

One Liberty Plaza 

New York, NY 10006 

Attn: Paul Shim; Kimberly Spoerri 

Facsimle: 212.225.3999 

Email: pshim@cgsh.com; kspoerri@cgsh.com

 

(d)           If to the Corporation, addressed as follows:

 

Fluence Energy, Inc. 

c/o Manuel Perez Dubuc, Chief Executive Officer 

4601 N. Fairfax Drive, Suite 600 

Arlington, VA 22203 

Email: manuel.perez@fluenceenergy.com

 

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

 

Dennis Fehr, CFO

Email: dennis.fehr@fluenceenergy.com

 

and

 

Francis Fuselier, General Counsel and Secretary 

Email: frank.fuselier@fluenceenergy.com

 

or, in each case, to such other address or email address as such party may designate in writing to each party by written notice given in the manner specified herein. All such communications shall be deemed to have been given, delivered or made when so delivered by hand or sent by facsimile (with confirmed transmission), on the next business day if sent by overnight courier service (with confirmed delivery) or when received if sent by first class mail, or in the case of notice by electronic mail, when the relevant email enters the recipient’s server.

 

 

Section 11.           Assignment.

 

Except as otherwise provided herein, all of the terms and provisions of this Agreement shall be binding upon, shall inure to the benefit of and shall be enforceable by the respective successors and permitted assigns of the parties hereto. This Agreement may not be assigned (by operation of law or otherwise) without the express prior written consent of the other parties hereto, and any attempted assignment, without such consents, will be null and void; provided, however, that each of AES, Siemens and QIA is permitted to assign this Agreement to their respective Permitted Transferees, so long as such Permitted Transferee agrees to become a party to this Agreement; and provided further, that each of AES, Siemens and QIA is permitted, without the consent of the Corporation or any other Person, to assign its rights and obligations under this Agreement to a transferee of all (but not less than all) of its respective Common Stock and/or Common Units, as applicable, in a transfer not prohibited by the LLC Agreement, so long as such transferee, if not already a party to this Agreement, agrees to become party to, and be bound by all of the provisions of this Agreement as a “Stockholder” and an “AES Related Party,” “Siemens Related Party” or “QIA Related Party,” as applicable, whereupon such transferee shall be deemed a “Stockholder” and an “AES Related Party,” “Siemens Related Party” or “QIA Related Party,” as applicable, hereunder. This Agreement will inure to the benefit of and be binding on the parties hereto and their respective successors and permitted assigns.

 

Section 12.           Amendment and Modification; Waiver of Compliance.

 

This Agreement may not be amended, modified, altered or supplemented except by means of a written instrument executed on behalf of each of the parties hereto. For clarity, each Stockholder may without the consent of any other Person waive or terminate its respective rights to designate directors for nomination to the Board at any time by written notice to the Corporation. Except as otherwise provided in this Agreement, any failure of any of the parties to comply with any obligation, covenant, agreement or condition herein may be waived by the party or parties entitled to the benefits thereof only by a written instrument signed by the party or parties granting such waiver, but such waiver or failure to insist upon strict compliance with such obligation, covenant, agreement or condition shall not operate as a waiver of, or estoppel with respect to, any subsequent or other failure.

 

Section 13.           Waiver.

 

No failure on the part of either party hereto to exercise any power, right, privilege or remedy under this Agreement, and no delay on the part of either party hereto in exercising any power, right, privilege or remedy under this Agreement, shall operate as a waiver thereof; and no single or partial exercise of any such power, right, privilege or remedy shall preclude any other or further exercise thereof or of any other power, right, privilege or remedy.

 

Section 14.            Severability.

 

If any provision of this Agreement, or the application of such provision to any Person or circumstance or in any jurisdiction, shall be held to be invalid or unenforceable to any extent, (i) the remainder of this Agreement shall not be affected thereby, and each other provision hereof shall be valid and enforceable to the fullest extent permitted by law, (ii) as to such Person or circumstance or in such jurisdiction such provision shall be reformed to be valid and enforceable to the fullest extent permitted by law and (iii) the application of such provision to other Persons or circumstances or in other jurisdictions shall not be affected thereby.

 

 

Section 15.             Counterparts.

 

This Agreement may be executed in any number of counterparts and signatures may be delivered by facsimile, each of which may be executed by less than all parties, each of which shall be enforceable against the parties actually executing such counterparts, and all of which together shall constitute one instrument.

 

Section 16.             Further Assurances.

 

At any time or from time to time after the date hereof, the parties hereto agree to cooperate with each other, and at the request of any other party, to execute and deliver any further instruments or documents and to take all such further action as any other party may reasonably request in order to evidence or effectuate the provisions of this Agreement and to otherwise carry out the intent of the parties hereunder.

 

Section 17.           Titles and Subtitles.

 

The descriptive headings of this Agreement are inserted for convenience only and do not constitute a part of this Agreement.

 

Section 18.            No Third Party Beneficiaries.

 

This Agreement shall be binding upon and inure solely to the benefit of the parties hereto and their permitted assigns and successors, and nothing herein, express or implied, is intended to or shall confer upon any other Person or entity, any legal or equitable right, benefit or remedy of any nature whatsoever under or by reason of this Agreement.

 

Section 19.            Recapitalizations; Exchanges, Etc.

 

The provisions of this Agreement shall apply to the full extent set forth herein with respect to any and all shares of capital stock of the Corporation or any successor or assign of the Corporation (whether by merger, consolidation, sale of assets or otherwise) which may be issued in respect of, in exchange for, or in substitution of such shares of capital stock, by reason of a stock dividend, stock split, stock issuance, reverse stock split, combination, recapitalization, reclassification, merger, consolidation or otherwise.

 

Section 20.             Representations and Warranties.

 

(a)            Each of AES, Siemens, QIA and each Person who becomes a party to this Agreement after the date hereof, severally and not jointly and solely with respect to itself, represents and warrants to the Corporation as of the time such party becomes a party to this Agreement that (a) if applicable, it is duly authorized to execute, deliver and perform this Agreement; (b) this Agreement has been duly executed by such party and is a valid and binding agreement of such party, enforceable against such party in accordance with its terms; and (c) the execution, delivery and performance by such party of this Agreement does not violate or conflict with or result in a breach of or constitute (or with notice or lapse of time or both constitute) a default under any agreement to which such party is a party or, if applicable, the organizational documents of such party.

 

(b)            The Corporation represents and warrants to each other party hereto that (a) the Corporation is duly authorized to execute, deliver and perform this Agreement; (b) this Agreement has been duly authorized, executed and delivered by the Corporation and is a valid and binding agreement of the Corporation, enforceable against the Corporation in accordance with its terms; and (c) the execution, delivery and performance by the Corporation of this Agreement does not violate or conflict with or result in a breach by the Corporation of or constitute (or with notice or lapse of time or both constitute) a default by the Corporation under the Charter or Bylaws, any existing applicable law, rule, regulation, judgment, order, or decree of any governmental authority exercising any statutory or regulatory authority of any of the foregoing, domestic or foreign, having jurisdiction over the Corporation or any of its Subsidiaries or any of their respective properties or assets, or any agreement or instrument to which the Corporation or any of its Subsidiaries is a party or by which the Corporation or any of its Subsidiaries or any of their respective properties or assets may be bound.

 

 

Section 21.              Interpretative Provisions.

 

This Agreement shall be deemed to be collectively prepared by the parties hereto, and no ambiguity herein shall be construed for or against any party based upon the identity of the author of this Agreement or any provision hereof.

 

Section 22.            No Recourse.

 

This Agreement may only be enforced against, and any claims or cause of action that may be based upon, arise out of or relate to this Agreement, or the negotiation, execution or performance of this Agreement, the transactions contemplated hereby or the subject matter hereof may only be made against the parties hereto and no past, present or future Affiliate, director, officer, employee, incorporator, member, manager, partner, stockholder, agent, attorney or representative of any party hereto or any past, present or future Affiliate, director, officer, employee, incorporator, member, manager, partner, stockholder, agent, attorney or representative of any of the foregoing (each, a “Non-Recourse Party”) shall have any liability for any obligations or liabilities of the parties to this Agreement or for any claim based on, in respect of, or by reason of, the transactions contemplated hereby. Without limiting the rights of any party against the other parties hereto, in no event shall any party or any of its Affiliates seek to enforce this Agreement against, make any claims for breach of this Agreement against, or seek to recover monetary damages from, any Non-Recourse Party.

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed on the day and year first above written.

 

	FLUENCE ENERGY, INC.
	By:
	Name:	Manuel Perez Dubuc
	Title:	Chief Executive Officer
	FLUENCE ENERGY, LLC
	By: Fluence Energy, Inc., as managing member
	By:
	Name:	Manuel Perez Dubuc
	Title:	Chief Executive Officer
	AES GRID STABILITY, LLC.
	By:
	Name:
	Title:	Authorized Person
	SIEMENS INDUSTRY, INC.
	By:
	Name:
	Title:
	By:
	Name:
	Title:
	QATAR HOLDING LLC
	By:
	its
	By:
	Name:
	Title:	Authorized Person

 

[Signature Page to Stockholders Agreement]

 

 

 

 

Exhibit 10.4

 

REGISTRATION RIGHTS AGREEMENT

 

This REGISTRATION RIGHTS AGREEMENT (this “Agreement”) is made as of October [●], 2021 by and among Fluence Energy, Inc., a Delaware corporation (the “Corporation”), and each Person identified on the Schedule of Holders attached hereto as of the date hereof (such Persons, collectively, the “Original Equity Owners”).

 

RECITALS

 

WHEREAS, the Corporation is contemplating an offer and sale of its shares of Class A common stock, par value $0.00001 per share (the “Class A Common Stock” and, such shares, the “Shares”), to the public in an underwritten initial public offering (the “IPO”);

 

WHEREAS, the Corporation desires to use a portion of the net proceeds from the IPO to purchase LLC Interests (as defined below) of Fluence Energy, LLC, a Delaware limited liability company (the “Company”), and the Company desires to issue its LLC Interests to the Corporation in exchange for such portion of the net proceeds from the IPO;

 

WHEREAS, immediately prior to or simultaneous with the purchase by the Corporation of the LLC Interests, the Corporation, the Company and the Original Equity Owners will enter into that certain Third Amended and Restated Limited Liability Company Agreement of the Company (such agreement, as it may be amended, restated, amended and restated, supplemented or otherwise modified form time to time, the “LLC Agreement”);

 

WHEREAS, in connection with the closing of the IPO, (i) the Corporation will become the sole managing member of the Company, (ii) under the LLC Agreement, the equity interests in the Company held by the Original Equity Owners prior to such time will be converted into common units (the “LLC Interests”) of the Company, (iii) each Person identified on the Schedule of Holders attached hereto as a “Former LLC Equity Owner” (such Persons, collectively, the “Former LLC Equity Owners”) will, through merger or otherwise, exchange their direct and indirect interests in the LLC Interests for shares of Class A Common Stock, (iv) each Person identified on the Schedule of Holders attached hereto as a “Continuing Equity Owner” (such Persons, collectively, the “Continuing Equity Owners”) will become non-managing members of the Company, but otherwise continue to hold LLC Interests in the Company and will receive newly issued shares of Class B-1 common stock of the Corporation, and (v) in consideration of the Corporation acquiring the LLC Interests and becoming the managing member of the Company and for other good consideration, the Company has provided the Continuing Equity Owners with a redemption right pursuant to which the Continuing Equity Owners can have their LLC interests redeemed for, at the Corporation’s option, shares of Class A Common Stock or cash with the proceeds of a new issuance of Class A Common Stock on the terms set forth in the LLC Agreement; and

 

WHEREAS, in connection with the IPO and the transactions described above, the Corporation has agreed to grant to the Holders (as defined below) certain rights with respect to the registration of the Registrable Securities (as defined below) on the terms and conditions set forth herein.

 

 

NOW, THEREFORE, in consideration of the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties to this Agreement hereby agree as follows:

 

Section 1.      Definitions. For purposes of this Agreement, the following terms shall have the meanings specified in this Section 1:

 

“Adverse Disclosure” means public disclosure of material, non-public information, which disclosure, in the good faith judgment of the Chief Executive Officer or the Chief Financial Officer of the Corporation, after consultation with external counsel to the Corporation, (i) would be required to be made in any Registration Statement or prospectus filed with the SEC by the Corporation so that such Registration Statement or prospectus would not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements contained therein (in the case of any prospectus and any preliminary prospectus, in light of the circumstances under which they were made) not misleading and would not be required to be made at such time but for the filing of such Registration Statement, prospectus or preliminary prospectus; and (ii) the Corporation has a bona fide business purpose for not disclosing such information publicly.

 

“Affiliate” of any Person means any other Person controlled by, controlling or under common control with such Person; provided that the Corporation and its Subsidiaries shall not be deemed to be Affiliates of any Holder. As used in this definition, “control” (including, with its correlative meanings, “controlling,” “controlled by” and “under common control with”) shall mean possession, directly or indirectly, of power to direct or cause the direction of management or policies (whether through ownership of securities, by contract or otherwise).

 

“Agreement” has the meaning set forth in the recitals.

 

“Business Day” means any day of the year on which national banking institutions in New York are open to the public for conducting business and are not required or authorized to close. With respect to any circumstances where actions are required by Qatar Holding LLC or any Affiliate of Qatar Holding LLC under this Agreement, “Business Day” shall not include Friday, Saturday, Sunday or any other day on which commercial banks in New York, New York or Doha, Qatar are authorized or required by law to close.

 

“Capital Stock” means (i) with respect to any Person that is a corporation, any and all shares, interests or equivalents in capital stock of such corporation (whether voting or nonvoting and whether common or preferred), (ii) with respect to any Person that is not a corporation, individual or governmental entity, any and all partnership, membership, limited liability company or other equity interests of such Person that confer on the holder thereof the right to receive a share of the profits and losses of, or the distribution of assets of the issuing Person, and (iii) any and all warrants, rights (including conversion and exchange rights) and options to purchase any security described in the clause (i) or (ii) above.

 

“Class A Common Stock” has the meaning set forth in the recitals.

 

“Class B Common Stock” means the Corporation’s Class B-1 and/or B-2 common stock, par value $0.00001 per share.

 

 

“Company” has the meaning set forth in the recitals.

 

“Continuing Equity Owners” has the meaning set forth in the recitals, and shall be deemed to include their respective Affiliates, immediate family members, heirs, successors and assigns who may succeed to such Person as a Holder hereunder.

 

“Corporation” has the meaning set forth in the recitals.

 

“Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended from time to time, or any successor federal law then in force, together with all rules and regulations promulgated thereunder.

 

“FINRA” means the Financial Industry Regulatory Authority.

 

“Former LLC Equity Owners” has the meaning set forth in the recitals, and shall be deemed to include their respective Affiliates, immediate family members, heirs, successors and assigns who may succeed to such Person as a Holder hereunder.

 

“Form S-3” means such form under the Securities Act as in effect on the date hereof or any successor form under the Securities Act that permits significant incorporation by reference of the Corporation’s subsequent public filings under the Exchange Act

 

“Free Writing Prospectus” means a free-writing prospectus, as defined in Rule 405.

 

“Holder” means any Person that is a party to this Agreement from time to time, as set forth on the signature pages hereto (or pursuant to a Joinder hereto), so long as such Person continues to hold Registrable Securities.

 

“Initiating Holder” has the meaning set forth in subsection 2(b).

 

“IPO” has the meaning set forth in the recitals.

 

“Joinder” has the meaning set forth in Section 15.

 

“LLC Agreement” has the meaning set forth in the recitals.

 

“LLC Interests” has the meaning set forth in the recitals.

 

“MNPI” means material non-public information within the meaning of Regulation FD promulgated under the Exchange Act.

 

“Opt-Out Request” has the meaning set forth in Section 16(b).

 

“Original Equity Owners” has the meaning set forth in the recitals, and shall be deemed to include their respective Affiliates, immediate family members, heirs, successors and assigns who may succeed to such Person as a Holder hereunder.

 

 

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

 

“Policies” has the meaning set forth in Section 16.

 

“Public Offering” means any sale or distribution to the public of Capital Stock of the Corporation pursuant to an offering registered under the Securities Act, whether by the Corporation, by Holders and/or by any other holders of the Corporation’s Capital Stock.

 

“register,” “registered,” and “registration” refer to a registration effected by preparing and filing a registration statement or similar document in compliance with the Securities Act, and the declaration or ordering of effectiveness of such registration statement or document.

 

“Registrable Securities” means (i) any Class A Common Stock (A) issued by the Corporation in connection with the IPO in exchange for the LLC Interests of the Former LLC Equity Owners, (B) issued by the Corporation in a Share Settlement in connection with (x) the redemption by the Company of LLC Interests owned by any Continuing Equity Owners or (y) at the election of the Corporation, in a direct exchange for LLC Interests owned by any Continuing Equity Owners, in each case in accordance with the terms of the LLC Agreement, (ii) any Capital Stock of the Corporation or of any Subsidiary of the Corporation issued or issuable with respect to the securities referred to in clause (i) above by way of dividend, distribution, split or combination of securities, or any recapitalization, merger, consolidation or other reorganization, and (iii) any other Shares owned, directly or indirectly, by Holders from time to time. As to any particular Registrable Securities owned by any Person, such securities shall cease to be Registrable Securities on the date such securities (a) have been sold or distributed pursuant to a Public Offering, (b) have been sold in compliance with Rule 144 following the consummation of the IPO so that all transfer restrictions, and restrictive legends with respect thereto, if any, are removed upon the consummation of such sale, (c) have been repurchased by the Corporation or a Subsidiary of the Corporation, or (d) have been sold or transferred sold by a person in a transaction in which his or her rights under this Agreements are not assigned. For purposes of this Agreement, a Person shall be deemed to be a Holder, and the Registrable Securities shall be deemed to be in existence, whenever such Person has the right to acquire, directly or indirectly, such Registrable Securities (upon conversion or exercise in connection with a transfer of securities or otherwise, but disregarding any restrictions or limitations upon the exercise of such right), whether or not such acquisition has actually been effected, and such Person shall be entitled to exercise the rights of a holder of Registrable Securities hereunder; provided a holder of Registrable Securities may only request that Registrable Securities in the form of Capital Stock of the Corporation that is registered or to be registered as a class under Section 12 of the Exchange Act be registered pursuant to this Agreement. For the avoidance of doubt, while LLC Interests and shares of Class B Common Stock may constitute Registrable Securities, under no circumstances shall the Corporation be obligated to register LLC Interests or shares of Class B Common Stock, and only Shares issuable upon redemption, exchange or conversion of LLC Interests will be registered.

 

“Registrable Securities then outstanding” shall be determined by the number of shares of Class A Common Stock then outstanding (assuming the exchange of all membership interests of the Company (other than membership interests held by the Corporation) for a corresponding number of shares of Class A Common Stock in accordance with the LLC Agreement), and including all shares of Class A Common Stock issuable upon such exchange, which are Registrable Securities.

 

 

“Rule 144,” “Rule 158,” “Rule 405” and “Rule 415” mean, in each case, such rule promulgated under the Securities Act (or any successor provision) by the Securities and Exchange Commission, as the same shall be amended from time to time, or any successor rule then in force.

 

“SEC” means the Securities and Exchange Commission

 

“Schedule of Holders” means the schedule attached to this Agreement entitled “Schedule of Holders,” which shall reflect each Holder from time to time party to this Agreement.

 

“Securities Act” means the U.S. Securities Act of 1933, as amended from time to time, or any successor federal law then in force, together with all rules and regulations promulgated thereunder.

 

“Share Settlement” means “Share Settlement” as defined in the LLC Agreement.

 

“Shares” has the meaning set forth in the recitals.

 

“Shelf Registration” has the meaning set forth in Section 2(a).

 

“Shelf Registration Statement” means a registration statement of the Corporation filed with the SEC on Form S-3 (or any other appropriate form under the Securities Act) for an offering to be made on a continuous basis pursuant to Rule 415 (or any successor provision) under the Securities Act covering all or any portion of the Registrable Securities, as applicable. To the extent that the Corporation is a WKSI, a “Shelf Registration Statement” shall be deemed to refer to an “automatic shelf registration statement,” as such term is defined in Rule 405 (or any successor or similar rule) of the Securities Act.

 

“Subsidiary” means, with respect to the Corporation, any corporation, limited liability company, partnership, association or other business entity of which (i) if a corporation, a majority of the total voting power of Capital Stock of such Person entitled (without regard to the occurrence of any contingency) to vote in the election of directors is at the time owned or controlled, directly or indirectly, by the Corporation, or (ii) if a limited liability company, partnership, association or other business entity, either (x) a majority of the Capital Stock of such Person entitled (without regard to the occurrence of any contingency) to vote in the election of managers, general partners or other oversight board vested with the authority to direct management of such Person is at the time owned or controlled, directly or indirectly, by the Corporation or (y) the Corporation or one of its Subsidiaries is the sole manager or general partner of such Person.

 

“Suspension Event” has the meaning set forth in Section 2(c).

 

“Violation” has the meaning set forth in Section 10(a).

 

“WKSI” means a “well-known seasoned issuer” as defined under Rule 405.

 

 

Section 2.      Request for Registration.

 

(a)            Subject to the terms and conditions of this Agreement, if the Corporation shall receive at any time following one hundred eighty (180) days after the effective date of the registration of the IPO, a written request from the Holders of at least ten percent (10%) of the Registrable Securities then outstanding that the Corporation file a registration statement under the Securities Act covering the registration of at least ten percent (10%) of the Registrable Securities then outstanding, then the Corporation shall, within 10 days of the receipt thereof, give written notice of such request to all Holders and shall, subject to the limitations of subsection 2(b), use its reasonable best efforts to effect, as soon as practicable following the receipt of, and in any event within sixty (60) days of the receipt of, such request, such registration (including, without limitation, filing post-effective amendments, appropriate qualifications under applicable blue sky or other state securities laws, and appropriate compliance with the Securities Act) as would permit or facilitate the sale and distribution of all Registrable Securities which the Holders request to be registered within 20 days of the mailing of such notice by the Corporation; provided, however, that the Corporation shall not be obligated to effect any such registration, qualification or compliance pursuant to this Section 2 in any particular jurisdiction in which the Corporation would be required to qualify to do business or to execute a general consent to service of process in effecting such registration, qualification or compliance, unless the Corporation is already subject to service in such jurisdiction and except as may be required by the Securities Act.

 

(b)            If the Holders initiating the registration request under subsection 2(a) (each, an “Initiating Holder”) intend to distribute the Registrable Securities covered by their request by means of an underwriting, they shall so advise the Corporation as a part of their request made pursuant to this Section 2 and the Corporation shall include such information in the written notice referred to in subsection 2(a). The underwriter will be selected by the Corporation and shall be reasonably acceptable to a majority in interest of the Initiating Holders. In such event, the right of any Holder to include his Registrable Securities in such registration shall be conditioned upon such Holder’s participation in such underwriting (unless otherwise mutually agreed by a majority in interest of the Initiating Holders and such Holder) to the extent provided herein. All Holders proposing to distribute their securities through such underwriting shall (together with the Corporation as provided in subsection 5(f)) enter into an underwriting agreement in customary form with the underwriter or underwriters selected for such underwriting. Notwithstanding any other provision of this Section 2, if the underwriter advises the Corporation in writing that marketing factors require a limitation of the number of equity interests to be underwritten, then the Corporation shall so advise all Holders of Registrable Securities which would otherwise be underwritten pursuant hereto, and the number of Registrable Securities that may be included in the underwriting shall be allocated among all participating Holders thereof, including the Initiating Holders, in proportion (as nearly as practicable) to the amount of Registrable Securities of the Corporation owned by each participating Holder; provided, however, that the number of Registrable Securities to be included in such underwriting shall not be reduced unless all other securities are first entirely excluded from the underwriting.

 

(c)            Notwithstanding the foregoing, if the Corporation shall furnish to the Initiating Holders a certificate signed by the Chief Executive Officer of the Corporation stating that in the good faith judgment of the Board of Directors of the Corporation, it would be materially detrimental to the Corporation and its Members for such registration statement contemplated by subsection 2(a) to be filed and it is therefore essential to defer the filing of such registration statement, because such action would require the Corporation to make an Adverse Disclosure (such event, a “Suspension Event”), upon giving prompt written notice to the Members, the Corporation shall have the right to defer such filing for a period of time determined in good faith by the Board to be necessary for such purpose and in no event longer than ninety (90) days after receipt of the request of the Initiating Holders, as applicable, and any time periods with respect to filing or effectiveness thereof shall be tolled correspondingly; provided, however, that the Corporation may not utilize this right more than once in any twelve-month period. In the event that the Corporation exercises its right under the preceding sentence, the Corporation shall promptly give the Holders written notice thereof and shall use its reasonable best efforts to cause such registration statement to become effective or to amend or supplement such registration statement on a post-effective basis or to take such action as is necessary to permit resumed use of such registration statement or filing thereof as soon as reasonably practicable following the conclusion of the applicable Suspension Event and its effect. The Corporation shall promptly give the Holders written notice of the conclusion of any Suspension Event and its effect.

 

 

(d)            In addition, the Corporation shall not be obligated to effect, or to take any action to effect, any registration pursuant to this Section 2:

 

(i)            After the Corporation has effected three (3) registrations on behalf of the Initiating Holders pursuant to this Section 2 and such registrations have been declared or ordered effective; provided, however, that a registration pursuant to this Section 2 shall only count for the purposes of this clause (i) if at least seventy five percent (75%) of the Registrable Securities which Holders request to be sold are sold in such requested registration;

 

(ii)            Prior to 180 days after the effective date of the IPO registration statement; or

 

(iii)            If the Initiating Holders propose to dispose of Registrable Securities that may be immediately registered on Form S-3 pursuant to a request made pursuant to Section 4.

 

Section 3.      Corporation Registration. If (but without any obligation to do so) the Corporation proposes to register (including for this purpose a registration effected by the Corporation for persons other than the Holders) any of its equity interests under the Securities Act in connection with the public offering of such securities solely for cash (other than (i) a registration statement on Form S-4 or any successor form thereto, (ii) a registration in which the only equity interests being registered are equity interests issuable upon conversion of debt securities which are also being registered, (iii) a registration on Form S-8 or (iv) a registration related to a dividend reinvestment plan (each, a “Special Registration Statement”)), the Corporation shall, at such time, promptly give each Holder written notice of such registration. Upon the written request of each Holder given within 20 days after mailing of such notice by the Corporation, the Corporation shall, subject to the provisions of Section 8, cause to be registered under the Securities Act all of the Registrable Securities that each such Holder has requested to be registered. If a Holder decides not to include all of its Registrable Securities in any registration statement thereafter filed by the Corporation, such Holder shall nevertheless continue to have the right to include any Registrable Securities in any subsequent registration statement or registration statements as may be filed by the Corporation with respect to offerings of its securities, all upon the terms and conditions set forth herein.

 

 

Section 4.      Shelf Registration.

 

(a)            After the IPO, at any time when the Corporation qualifies to use a Form S-3, the Holders of at least ten percent (10%) of the Registrable Securities then outstanding of the Corporation may make a written request (a “Shelf Notice”) to the Corporation to file with the SEC a Shelf Registration Statement, which Shelf Notice shall specify the aggregate amount of Registrable Securities of such Holder to be registered therein and the intended methods of distribution thereof (any such requested Shelf Registration Statement, a “Shelf Registration”). Following the delivery of a Shelf Notice, the Corporation (i) shall file promptly (and, in any event, within thirty (30) days following delivery of such Shelf Notice) with the SEC such Shelf Registration Statement (which shall be an automatic Shelf Registration Statement if the Corporation qualifies at such time to file such a Shelf Registration Statement) relating to the offer and sale of all Registrable Securities by the applicable Holder from time to time in accordance with the methods of distribution elected by such Holder and set forth in the Shelf Registration Statement and (ii) shall use its reasonable best efforts to cause such Shelf Registration Statement promptly to become effective under the Securities Act. Registrations effected pursuant to subsection 4(a) shall not be counted as demands for registration or registrations effected pursuant to Sections 2 or 3, respectively.

 

(b)            The Corporation shall not be obligated to effect any such registration pursuant to subsection 4(a): (i) if Form S-3 is not available for such offering by the Holders; (ii) if the Corporation shall furnish to the Holders a certificate signed by the Chief Executive Officer of the Corporation stating that in the good faith judgment of the Board of Directors of the Corporation, it would be materially detrimental to the Corporation and its Members for such Shelf Registration to be effected at such time, or to delay or suspend the effectiveness thereof, because of an applicable Suspension Event, in which event the Corporation shall have the right to defer the filing of such Shelf Registration statement for a period of time determined in good faith by the Board to be necessary for such purpose and in no event longer than 90 days after receipt of the request of the Holder or Holders under subsection 4(a); provided, however, that the Corporation shall not utilize this right more than once in any 12-month period; (iii) in any particular jurisdiction in which the Corporation would be required to qualify to do business or to execute a general consent to service of process in effecting such registration, qualification or compliance, unless the Corporation is already subject to service in such jurisdiction and except as may be required by the Securities Act; (iv) during the applicable lock-up period ending after the effective date of a registration statement subject to Section 3 (v) if the Corporation has, within the twelve-month period preceding the date of such request, already effected two (2) registrations on Form S-3 for the Holders, or (vi) if the aggregate price to the public (net of any underwriters’ discounts or commissions) is less than $5,000,000. In the event that the Corporation exercises its suspension right under this subsection 4(b), the Corporation shall promptly give the Holders written notice thereof and shall use its reasonable best efforts to cause such registration statement to become effective or to amend or supplement such registration statement on a post-effective basis or to take such action as is necessary to permit resumed use of such registration statement or filing thereof as soon as reasonably practicable following the conclusion of the applicable Suspension Event and its effect. The Corporation shall promptly give the Holders written notice of the conclusion of any Suspension Event and its effect.

 

 

(c)            The Corporation shall use its reasonable best efforts to keep a Shelf Registration Statement continuously effective under the Securities Act in order to permit a prospectus forming a part thereof to be usable in connection with any Shelf Take- Down until the earliest of (i) the date as of which all Registrable Securities held by the selling Holder have been sold pursuant to the Shelf Registration Statement or another registration statement filed under the Securities Act (but in no event prior to the applicable period referred to in Section 4(a)(3) of the Securities Act and Rule 174 thereunder) or otherwise cease to be Registrable Securities; (ii) the termination of this Agreement; and (iii) such shorter period as the applicable Holder shall agree in writing (such period of effectiveness, the “Shelf Period”) and to re-file such Shelf Registration Statement upon its expiration. The Corporation shall not be deemed to have used its reasonable best efforts to keep the Shelf Registration Statement effective during the Shelf Period if the Corporation voluntarily takes any action (or omits to take any action), without the consent of the applicable Holder, that would result in such Holder not being able to offer and sell any Registrable Securities pursuant to such Shelf Registration Statement during the Shelf Period, unless such action (or omission) is (x) reasonably necessary for the Corporation to avoid being required to make an Adverse Disclosure or (y) required by applicable law, rule or regulation.

 

(d)            Promptly upon delivery of any Shelf Notice pursuant to subsection 4(a) (but in no event more than five (5) Business Days after delivery of the Shelf Notice), the Corporation shall deliver a written notice of such Shelf Notice to all Members other than the selling Holder that delivered the Shelf Notice, and the Corporation shall include in such Shelf Registration all such Registrable Securities of such Holders which the Corporation has received written requests for inclusion therein within five (5) Business Days after such written notice is delivered to such Holders (each such Holder delivering such a request, together with such selling Holder, a “Shelf Holder”).

 

(e)            Shelf Take-Downs.

 

(i)

Subject to subsection 4(b), an offering or sale of Registrable Securities pursuant to a Shelf Registration Statement (each, a “Shelf Take-Down”) may be initiated at any time by any selling Holder.

 

(ii)            If such selling Holder elects by written request to the Corporation, a Shelf Take-Down shall be in the form of an underwritten offering (such written request, an “Underwritten Shelf Take-Down Notice”) and the Corporation shall amend or supplement the Shelf Registration Statement for such purpose as soon as practicable. The Corporation shall have the right to select the managing underwriter or underwriters to administer such offering; provided that such managing underwriter or underwriters shall be reasonably acceptable to such Selling Holder.

 

(iii)            Promptly upon delivery of such Underwritten Shelf Take-Down Notice (but in no event more than two (2) Business Days thereafter), the Corporation shall promptly deliver a written notice (a “Underwritten Shelf Take-Down Corporation Notice”) of such Shelf Take-Down to all Shelf Holders (other than the selling Holder that delivered the Underwritten Shelf Take-Down Notice), and the Corporation shall include in such Shelf Take-Down all such Registrable Securities of such Shelf Holders that are Registered on such Shelf Registration Statement for which the Corporation has received written requests, which requests must specify the aggregate amount of such Registrable Securities of such Holders to be offered and sold pursuant to such Shelf Take-Down, for inclusion therein within two (2) Business Days after the date that such Underwritten Shelf Take-Down Notice has been delivered.

 

 

(iv)            If the managing underwriter or underwriters of any proposed underwritten offering of Registrable Securities included in a Shelf Take-Down informs the Members or the Corporation in writing that, in its or their opinion, the number of securities requested to be included in such Shelf Take-Down exceeds the number that can be sold in such offering without being likely to have a significant adverse effect on the price, timing or distribution of the securities offered or the market for the securities offered, the securities to be included in such Shelf Take-Down shall be allocated (i) first, pro rata among the Shelf Holders that have requested to participate in such Shelf Take-Down based on the relative number of Registrable Securities then held by each such Shelf Holder; provided that any securities thereby allocated to a Shelf Holder that exceed such Shelf Holder’s request shall be reallocated among the remaining requesting Shelf Holders in like manner; (ii) second, and only if all the Registrable Securities referred to in clause (i) have been included in such Shelf Take-Down, to the Corporation up to the number of securities that the Corporation proposes to include in such Shelf Take-Down that, in the opinion of the managing underwriter or underwriters, can be sold without having such adverse effect; and (iii) third, and only if all of the securities referred to in clause (ii) have been included in such Shelf Take-Down, to those Persons holding any other securities eligible for inclusion in such Shelf Take- Down, up to the number of securities that in the opinion of the managing underwriter or underwriters, can be sold without having such adverse effect. For purposes of this subsection 4(e)(iv) concerning apportionment, for any Shelf Holder that is a partnership, limited liability Corporation, or corporation, the partners, members, retired partners, retired members, stockholders, and Affiliates of such Shelf Holder shall be deemed to be a single “selling Shelf Holder,” and any pro rata reduction with respect to such selling Shelf Holder shall be based upon the aggregate number of Registrable Securities owned by all Persons included in such “selling Shelf Holder,” as defined in this sentence.

 

Section 5.      Obligations of the Corporation. Whenever required under this Agreement to effect the registration of any Registrable Securities, the Corporation shall, as expeditiously as reasonably possible:

 

(a)            Prepare and file with the SEC a registration statement with respect to such Registrable Securities and use its reasonable best efforts to cause such registration statement to become effective and keep such registration statement effective for (i) up to 120 days or until the distribution described in such registration statement is completed, if earlier or (ii) in the case of any registration under Section 4, until all the Registrable Securities are sold; provided, however, that, the Corporation shall provide each participating Holder and its counsel reasonable opportunity to participate in the preparation of such registration statement.

 

 

(b) Prepare and file with the SEC such amendments and supplements to such registration statement and the prospectus used in connection with such registration statement as may be necessary to comply with the provisions of the Securities Act with respect to the disposition of all securities covered by such registration statement for (i) up to 120 days or until the distribution described in such registration statement is completed, if earlier, or (ii) in the case of any registration under Section 4, until all the Registrable Securities are sold and, in connection with any registration on Form S-3 pursuant to Section 4, timely file all reports required under the Exchange Act in order to maintain the right to continue to use such Form and to maintain such registration in effect; provided, however, that, the Corporation shall provide each Holder and its counsel reasonable opportunity to participate in the preparation of such amendments, supplements and prospectus.

 

(c) Before filing any Free Writing Prospectus relating to an offer of Registrable Securities or any amendments or supplements thereto, furnish to the underwriters, if any, and the Holders, if any, copies of such documents, which documents shall be subject to the review of such underwriters and any Holders and their respective counsel.

 

(d)            Furnish to the Holders, without charge, such numbers of copies of a prospectus, including a preliminary prospectus, in conformity with the requirements of the Securities Act, and such other documents as they may reasonably request in order to facilitate the disposition of Registrable Securities owned by them.

 

(e)            Use its reasonable best efforts to register and qualify the securities covered by such registration statement under such other securities or blue sky laws of such jurisdictions as shall be reasonably requested by the Holders; provided that the Corporation shall not be required in connection therewith or as a condition thereto to qualify to do business or to file a general consent to service of process in any such states or jurisdictions, unless the Corporation is already subject to service in such jurisdiction and except as may be required by the Securities Act.

 

(f)            In the event of any underwritten public offering, enter into and perform its obligations under an underwriting agreement, in usual and customary form, with the managing underwriter(s) of such offering. Each Holder participating in such underwriting shall also enter into and perform its obligations under such an agreement.

 

(g)            Promptly make available for inspection by the Holder, any managing underwriter(s) participating in any disposition pursuant to such registration statement, and any attorney or accountant or other agent retained by any such underwriter or selected by the Holders, all information reasonably requested by any such seller, underwriter, attorney, accountant, or agent, in each case, as necessary or advisable to verify the accuracy of the information in such registration statement and to conduct customary due diligence in connection therewith.

 

 

(B)            Promptly notify each Holder of Registrable Securities covered by such registration statement at any time when a prospectus relating thereto is required to be delivered under the Securities Act of the existence of any fact of which the Corporation is aware or the happening of any event which has resulted in (A) the registration statement, as then in effect, containing an untrue statement of a material fact or omitting to state a material fact required to be stated therein or necessary to make any statements therein not misleading or (B) containing an untrue statement of a material fact or omitting to state a material fact required to be stated therein or necessary to make any statements therein, in the light of the circumstances under which they were made, not misleading.

 

(i)            Promptly notify each selling Holder covered by such registration statement at any time when a prospectus relating thereto is required to be delivered under the Securities Act, (A) of the issuance by the SEC of any stop order suspending the effectiveness of the registration statement or the initiation or threat of any proceedings for that purpose, or any request by the SEC for any amendment or supplement to, or additional information in connection with, any registration statement, prospectus or prospectus supplement related to any of them, (B) of any delisting or pending delisting of equity securities of the Corporation by any national securities exchange or market on which such equity securities are then listed or quoted or (C) of the receipt by the Corporation of any notification with respect to the suspension of the qualification of any Registrable Securities under the securities or blue sky laws of any jurisdiction or the initiation of any proceeding for such purpose.

 

(j)            Use its reasonable best efforts to prevent the issuance of any order suspending the effectiveness of registration statement covering any Registrable Securities, and, if any order suspending the effectiveness of any such registration statement is issued, shall promptly use its reasonable best efforts to obtain the withdrawal of such order.

 

(k)            In the event of any event or occurrence giving rise to an obligation of the Corporation to send to the selling Members any notice pursuant to subsection 5(j), promptly, and in no event later than twenty (20) days after the date of such event or occurrence, prepare and file with the SEC, and furnish to the selling Members a reasonable number of copies of, a supplement or post-effective amendment to such registration statement or related prospectus or any document incorporated therein by reference or file any other required document, and shall use its reasonable best efforts to have such supplement or amendment declared effective, if required, as soon as possible after filing, so that (i) such registration statement shall not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading and (ii) as thereafter delivered to the purchasers of the Registrable Securities being sold thereunder, such prospectus shall not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.

 

 

(l)            Promptly notify each selling Holder, promptly after the Corporation receives notice thereof, of the time when such registration statement has been declared effective or a supplement to any prospectus forming a part of such registration statement has been filed.

 

(a)            After such registration statement becomes effective, promptly notify each selling Holder of any request by the SEC that the Corporation amend or supplement such registration statement or prospectus.

 

(b)            Cause all such Registrable Securities registered pursuant hereunder to be listed on each securities exchange on which similar securities issued by the Corporation are then listed.

 

(o)            Provide a transfer agent and registrar for all Registrable Securities registered pursuant hereunder and a CUSIP number for all such Registrable Securities, in each case not later than the effective date of such registration.

 

(p)            Furnish, at the request of any Holder requesting registration of Registrable Securities pursuant to Agreement, on the date that such Registrable Securities are delivered to the underwriters for sale in connection with a registration pursuant to this Agreement, if such securities are being sold through underwriters, (i) an opinion, dated such date, of the counsel representing the Corporation for the purposes of such registration, in form and substance as is customarily given to underwriters in an underwritten public offering, including without limitation any letter or opinion as to the absence of material misstatements or omissions in the registration statement or prospectus, addressed to the underwriters and (ii) a letter dated such date (and another letter dated the date the underwriting agreement is signed), from the independent certified public accountants of the Corporation, in form and substance as is customarily given by independent certified public accountants to underwriters in an underwritten public offering, addressed to the underwriters.

 

(q) [RESERVED];

 

(r)            Cooperate with each seller of Registrable Securities and each underwriter or agent participating in the disposition of such Registrable Securities and their respective counsel in connection with any filings required to be made with FINRA.

 

(s)            Have appropriate officers of the Corporation prepare and make presentations at a reasonable number of “road shows” and before analysts and rating agencies, as the case may be, and other information meetings reasonably organized by the underwriters and otherwise use its reasonable best efforts to cooperate as reasonably requested by the Holders and the underwriters in the offering, marketing or selling of the Registrable Securities.

 

 

Section 6.      Furnish Information. The Corporation may require that any selling Holder shall furnish to the Corporation such information regarding itself, the Registrable Securities held by it, and the intended method of disposition of such securities as shall be reasonably required to effect the registration of such Holder’s Registrable Securities. The Corporation shall have no obligation with respect to any registration requested pursuant to Section 2 or Section 4 if, as a result of the application of the preceding sentence, the number of equity interests, or the anticipated aggregate offering price of the Registrable Securities to be included in the registration does not equal or exceed the number of equity interests or the anticipated aggregate offering price required to originally trigger the Corporation’s obligation to initiate such registration as specified in subsection 4(a).

 

Section 7.      Expenses of Registration.

 

(a)            Demand Registration. All expenses (other than underwriting discounts and commissions) incurred in connection with a registration requested under Section 2 (which right may be assigned as provided in Section 1), filings or qualifications pursuant to Section 2, including (without limitation) all registration, filing and qualification fees, printers’ and accounting fees, fees and disbursements of counsel for the Corporation, and the reasonable fees and disbursements of one counsel for the selling Holders selected by Holders of a majority of the Registrable Securities to be registered, shall be borne by the Corporation; provided, however, that the Corporation shall not be required to pay for any expenses of any registration proceeding begun pursuant to Section 2 if the registration request is subsequently withdrawn at the request of the Holders of a majority of the Registrable Securities to be registered (in which case all participating Holders shall bear such expenses pro rata based upon the number of Registrable Securities that were to be included in the withdrawn registration); provided further, however, that if at the time of such withdrawal, the selling Holders have (i) learned of a material adverse change in the condition, business, or prospects of the Corporation from that known to the selling Holders at the time of their request or have been advised by the underwriter that the registration should be withdrawn (either a “Withdrawal Event”) and (ii) have withdrawn the request with reasonable promptness following the occurrence of such Withdrawal Event, then the selling Holders shall not be required to pay any of such expenses and shall retain their rights pursuant to Section 2. If the Holders are required to pay any expenses, such expenses shall be borne by the holders of the securities (including Registrable Securities) requesting such registration in proportion to the number of securities for which registration was requested. If the Corporation is required to pay the expenses due to a Withdrawal Event, then the Holders shall not forfeit their rights to a demand registration.

 

(b)            Corporation Registration. All expenses (other than underwriting discounts and commissions) incurred in connection with registrations, filings or qualifications of Registrable Securities pursuant to Section 3 for each Holder (which right may be assigned as provided in Section 15), including (without limitation) all registration, filing, and qualification fees, printers’ and accounting fees, fees and disbursements of counsel for the Corporation and the reasonable fees and disbursements of one counsel for the selling Holder or Holders selected by Holders of a majority of the Registrable Securities to be registered shall be borne by the Corporation.

 

 

(c)            Shelf Registration. All expenses (other than underwriting discounts and commissions) incurred in connection with registrations, filings or qualifications of Registrable Securities pursuant to Section 4 for each Holder (which right may be assigned as provided in Section 15), including (without limitation) all registration, filing, and qualification fees, printers’ and accounting fees, fees and disbursements of counsel for the Corporation and the reasonable fees and disbursements of one counsel for the selling Holder or Holders selected by Holders of a majority of the Registrable Securities to be included in a registration or Shelf Takedown pursuant to Section 4 shall be borne by the Corporation.

 

Section 8.      Underwriting Requirements.

 

(i)            In connection with any offering involving an underwriting of equity interests of the Corporation described in Section 3, the Corporation shall not be required under Section 3 to include any of the Holders’ securities in such underwriting unless they accept the terms of the underwriting as agreed upon between the Corporation and the underwriters selected by it (or by other persons entitled to select the underwriters), and then only in such quantity as the underwriters determine in their sole discretion will not jeopardize the success of the offering by the Corporation. If the total amount of securities, including Registrable Securities, requested by Members to be included in such offering exceeds the amount of securities sold other than by the Corporation that the underwriters determine in their sole discretion is compatible with the success of the offering, then the Corporation shall be required to include in the offering only that number of such securities, including Registrable Securities, which the underwriters determine in their sole discretion will not jeopardize the success of the offering (the securities so included to be apportioned pro rata among the selling Holders pro rata among them based on the relative number of Registrable Securities then held by each such participating Holder or in such other proportions as shall mutually be agreed to by such selling Holders) but in no event shall (i) the amount of securities of the selling Holders included in the offering be reduced below twenty-five percent (25%) of the total amount of securities included in such offering or (ii) any securities held by a person who is not a Holder of Registrable Securities be included if any securities held by any selling Holder are excluded. For purposes of the preceding parenthetical concerning apportionment, for any selling Holder which is a holder of Registrable Securities and which is a partnership or corporation, the partners, retired partners and equity owners of such holder shall be deemed to be a single “selling Holder,” and any pro-rata reduction with respect to such “selling Holder” shall be based upon the aggregate amount of equity interests carrying registration rights owned by all entities and individuals included in such “selling Holder,” as defined in this sentence.

 

Section 9.      Delay of Registration. No Holder shall have any right to obtain or seek an injunction restraining or otherwise delaying any such registration as the result of any controversy that might arise with respect to the interpretation or implementation of this Agreement.

 

 

 

Section 10.     Indemnification and Contribution.

 

(a)            The Corporation will indemnify and hold harmless each Holder, any underwriter (as defined in the Securities Act) for such Holder and each person, if any, who controls such Holder or underwriter within the meaning of the Securities Act or the Exchange Act, and each partner, director, officer, member, manager, employee and agent of any of the foregoing, against any losses, claims, damages, or liabilities (or actions in respect thereof) to which they may become subject under the Securities Act, the Exchange Act or other federal, state or common law, insofar as such losses, claims, damages, or liabilities (or actions in respect thereof) arise out of or are based upon any of the following statements, alleged statements, omissions, alleged omissions or violations or alleged violations (collectively a “Violation”): (i) any untrue statement or alleged untrue statement of a material fact contained in such registration statement, including any preliminary prospectus or final prospectus contained therein or any amendments or supplements thereto, or in any Free Writing Prospectus that the Corporation has filed, or is required to file, under Rule 433(d) under the Securities Act, or any amendment or supplement thereof (ii) the omission or alleged omission to state therein a material fact required to be stated therein, or necessary to make the statements therein not misleading (in the case of any prospectus or amendment or supplement thereto, in light of the circumstances under which they are made), or (iii) any violation or alleged violation by the Corporation of the Securities Act, the Exchange Act, any state securities law or any rule or regulation promulgated under the Securities Act, the Exchange Act or any state securities law; and the Corporation will pay to each such Holder, underwriter or controlling person and each other person entitled to indemnification pursuant to this subsection 10(a), as incurred, any legal or other expenses reasonably incurred by them in connection with investigating or defending any such loss, claim, damage, liability, or action; provided, however, that the indemnity agreement contained in this subsection 10(a) shall not apply to amounts paid in settlement of any such loss, claim, damage, liability, or action if such settlement is effected without the consent of the Corporation (which consent shall not be unreasonably withheld, conditioned or delayed), nor shall the Corporation be liable to any Holder, underwriter or controlling person for any such loss, claim, damage, liability, or action to the extent that it arises out of or is based upon a Violation which occurs as a result of, in reliance upon and in conformity with written information furnished expressly for use in such registration statement by any such Holder, underwriter or controlling person.

 

(b)            To the fullest extent permitted by law, each selling Holder, severally and not jointly, will indemnify and hold harmless the Corporation, each of its directors, each of its officers who has signed the registration statement, each Person, if any, who controls the Corporation within the meaning of the Securities Act, any underwriter, any other Holder selling securities in such registration statement, and any controlling Person of any such other Holder against any losses, claims, damages, or liabilities to which any of the foregoing persons may become subject, under the Securities Act, the Exchange Act or other federal or state law, insofar as such losses, claims, damages, or liabilities (or actions in respect thereto) arise out of or are based upon any Violation, that occurs as a result of, in reliance upon and in conformity with written information furnished by or on behalf of such Holder expressly for use in such registration statement; and each such Holder will pay, as incurred, any legal or other expenses reasonably incurred by any person intended to be indemnified pursuant to this subsection 10(b), in connection with investigating or defending any such loss, claim, damage, liability, or action; provided, however, that the indemnity agreement contained in this subsection 10(b) shall not apply to amounts paid in settlement of any such loss, claim, damage, liability or action if such settlement is effected without the consent of the Holder, which consent shall not be unreasonably withheld, conditioned or delayed; provided, that in no event shall the aggregate amounts payable by any Holder by way of indemnity under this subsection 10(b) exceed the net proceeds from the offering received by such Holder.

 

 

(c)            Promptly after receipt by an indemnified party under this Section 10 of notice of the commencement of any action (including any governmental action) for which a party may be entitled to indemnification hereunder, such indemnified party will, if a claim in respect thereof is to be made against any indemnifying party under this Section 10, deliver to the indemnifying party a written notice of the commencement thereof and the indemnifying party shall have the right to participate in such action, and, to the extent the indemnifying party so desires, participate jointly with any other indemnifying party similarly noticed, to assume the defense thereof with counsel mutually satisfactory to the parties; provided, however, that an indemnified party (together with all other indemnified parties which may be represented without conflict by one (1) counsel) shall have the right to retain one (1) separate counsel, with the reasonable fees and expenses to be paid by the indemnifying party, if representation of such indemnified party by the counsel retained by the indemnifying party would be inappropriate due to actual or potential differing interests between such indemnified party and any other party represented by such counsel in such proceeding. The failure to deliver written notice to the indemnifying party within a reasonable time of the commencement of any such action, but only if materially prejudicial to its ability to defend such action, shall relieve such indemnifying party of any liability to the indemnified party under this Section 10, but the omission so to deliver written notice to the indemnifying party will not relieve it of any liability that it may have to any indemnified party otherwise than under this Section 10. No indemnifying party, in the defense of any such claim or litigation, shall, except with the consent of each indemnified party, consent to entry of any judgment or enter into any settlement that (x) does not include as an unconditional term thereof the giving by the claimant or plaintiff to such indemnified party of a release, in form and substance reasonably satisfactory to the indemnified party, from all liability in respect to such claim or litigation, (y) includes a statement about or an admission of fault, culpability or a failure to act by or on behalf of the indemnified party or (z) involves the imposition of equitable remedies or the imposition of any obligations on the indemnified party or adversely affects the indemnified party other than as a result of financial obligations for which such indemnified party would be entitled to indemnification hereunder.

 

(d)            If the indemnification provided for in this Section 10 is held by a court of competent jurisdiction to be unavailable to an indemnified party with respect to any loss, liability, claim, damage or expense referred to therein, then the indemnifying party, in lieu of indemnifying such indemnified party hereunder, shall contribute to the amount paid or payable by such indemnified party as a result of such loss, liability, claim, damage, or expense in such proportion as is appropriate to reflect the relative fault of the indemnifying party, on the one hand, and of the indemnified party, on the other, in connection with the statements or omissions that resulted in such loss, liability, claim, damage or expense as well as any other relevant equitable considerations; provided, that in no event shall, (x) any contribution by a Holder under this subsection 10(d) exceed the net proceeds from the offering received by such Holder, except in the case of willful fraud by such Holder and (y) no person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) will be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The relative fault of the indemnifying party and of the indemnified party shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the indemnifying party or by the indemnified party and the parties’ relative intent, knowledge, access to information, and opportunity to correct or prevent such statement or omission.

 

 

(e)             Notwithstanding the foregoing, to the extent that the provisions on indemnification and contribution contained in the underwriting agreement entered into in connection with the underwritten public offering are in conflict with the foregoing provisions, the provisions in the underwriting agreement shall control; provided, however, that that to the extent the underwriting agreement does not address a matter addressed by this Agreement, the failure to address such matter shall not be deemed a conflict between the provisions of this Agreement and the underwriting agreement.

 

(f)             Unless otherwise superseded by an underwriting agreement entered into in connection with the underwritten public offering, the obligations of the Corporation and Holders under this Section 10 shall survive the completion of any offering of Registrable Securities in a registration statement under this Agreement, and otherwise shall survive the termination of this Agreement.

 

Section 11.            Reports Under the Exchange Act. With a view to making available to the Holders the benefits of Rule 144 promulgated under the Securities Act and any other rule or regulation of the SEC that may at any time permit a Holder to sell securities of the Corporation to the public without registration or pursuant to a registration on Form S-3, the Corporation shall, following the consummation of the IPO:

 

(a)            make and keep public information available, as those terms are understood and defined in SEC Rule 144, at all times after the effective date of the registration statement filed by the Corporation for the IPO;

 

(b)            take such action, including the voluntary registration of its equity interests under Section 12 of the Exchange Act, as is necessary to enable the Holders to utilize Form S-3 for the sale of their Registrable Securities, such action to be taken as soon as practicable after the end of the fiscal year in which the first registration statement filed by the Corporation for the offering of its securities to the general public is declared effective;

 

 

(c)            file with the SEC in a timely manner all reports and other documents required of the Corporation under the Securities Act and the Exchange Act; and

 

(d)            furnish to any Holder upon request, so long as the Holder owns any Registrable Securities, forthwith upon request (i) a written statement by the Corporation that it has complied with the reporting requirements of SEC Rule 144, the Securities Act and the Exchange Act (at any time after ninety (90) days after the effective date of the registration statement filed by the Corporation for the IPO), or that it qualifies as a registrant whose securities may be resold pursuant to Form S-3 (at any time after it so qualifies), (ii) a copy of the most recent annual or quarterly report of the Corporation and such other reports and documents so filed by the Corporation, and (iii) such other information as may be reasonably requested in availing any Holder of any rule or regulation of the SEC which permits the selling of any such securities without registration or pursuant to such form (at any time after the Corporation has become subject to the reporting requirements under the Exchange Act) or pursuant to Form S-3 (at any time after the Corporation so qualifies to use such form).

 

Section 12.            Limitations on Subsequent Registration Rights. The Corporation shall not, without the prior written consent of the Holders of a majority of the outstanding Registrable Securities, enter into any agreement with any holder or prospective holder of any securities of the Corporation which would (a) allow such holder or prospective holder to include such securities in any registration filed under Section 2 or Section 3, unless under the terms of such agreement, such holder or prospective holder may include such securities in any such registration only to the extent that the inclusion of his securities will not reduce the amount of the Registrable Securities of the Holders which is included,(b) allow such holder or prospective holder to make a demand registration which could result in such registration statement being declared effective within 120 days of the effective date of any registration effected pursuant to Section 2 or (c) otherwise conflict with the rights of Holders under this Agreement; provided, however, except as set forth in clause (c) above, this Section 12 shall not limit the rights of the Corporation with respect to Special Registration Statements.

 

Section 13.            Lock-Up Agreements.

 

(a)            In connection with the IPO, each Holder (each a “Lock-Up Party”) has entered into a customary lock-up agreement with J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC, as representatives (the “Representatives”) of the several underwriters, pursuant to which each Lock-Up Party has agreed to certain restrictions relating to the shares of Capital Stock and certain other securities held by them (collectively, the “Lock-Up Restrictions”). The Corporation may impose stop-transfer instructions with respect to the shares of Capital Stock and other securities subject to the Lock-Up Restrictions.

 

 

(b)            In connection with (i) any offering involving an underwriting of equity interests of the Corporation described in Section 3 or (ii) any other underwritten offering in which Holders have an opportunity to participate under this Agreement and upon request of the underwriters managing such offering, each Holder agrees not to sell, make any short sale of, loan, grant any option for the purchase of, or otherwise dispose of any securities of the Corporation, however or whenever acquired (other than those included in the registration) or engage in any swap or derivative transactions involving the Corporation’s securities (the “Lock-Up Restrictions”), in each case as provided in an agreement with such managing underwriters, without the prior written consent of such managing underwriters, for such period of time as may be requested by such managing underwriters (commencing as of the effective date of such registration or pricing date of such offering as the case may be and ending no later than 90 days thereafter or the lesser of such period and any shorter period agreed to by the managing underwriters) and to execute an agreement reflecting the foregoing as may be requested by the managing underwriters at the time of such offering; provided that (i) no Holder will be required to agree to any Lock-Up Restrictions which do not apply to each other Holder and (ii) any waiver of a Lock-Up Restriction by the underwriter for the benefit of one Holder shall apply to all other Holders.

 

(c)            The obligations described in subsection 13(b) shall apply only if all officers and directors of the Corporation, and all holders of Registrable Securities holding at least five percent (5%) of the Corporation’s voting securities, enter into similar agreements, and shall not apply to a registration relating solely to participants in the Corporation’s equity plans or a transaction covered by Rule 145 under the Securities Act.

 

(d)            In order to enforce the foregoing covenants, the Corporation may impose stop-transfer instructions with respect to the securities of each Holder (and the securities of every other person subject to the restrictions in subsection 13(a) and subsection 13(b)).

 

Section 14.            Subsidiary Public Offering. If, after an initial public offering of the Capital Stock of one of its Subsidiaries (including the Company), the Corporation distributes securities of such Subsidiary to its equityholders, then the rights and obligations of the Corporation pursuant to this Agreement shall apply, mutatis mutandis, to such Subsidiary, and the Corporation shall cause such Subsidiary to comply with such Subsidiary’s obligations under this Agreement.

 

Section 15.           Transfer of Registrable Securities. Notwithstanding anything to the contrary contained herein, except in the case of (i) a transfer to the Corporation, (ii) a transfer by any Original Equity Owner to any of its Affiliates or to their respective equityholders, (iii) a Public Offering, (iv) a sale pursuant to Rule 144 after the completion of the IPO or (v) a transfer in connection with a sale of the Corporation, prior to transferring any Registrable Securities to any Person (including, without limitation, by operation of law), the transferring Holder shall cause the prospective transferee to execute and deliver to the Corporation a joinder agreement in the form attached as Exhibit A hereto (a “Joinder”) agreeing to be bound by the terms of this Agreement whereupon such transferee shall be a “Holder” for purposes of this Agreement. The Corporation agrees to countersign any Joinder executed by Affiliate of an Original Equity Owner to whom Registrable Securities have been transferred. Any transfer or attempted transfer of any Registrable Securities in violation of any provision of this Agreement shall be void, and the Corporation shall not record such transfer on its books or treat any purported transferee of such Registrable Securities as the owner thereof for any purpose.

 

 

Section 16.            MNPI Provisions.

 

(a)            Each Holder acknowledges that the provisions of this Agreement that require communications by the Corporation or other Holders to such Holder may result in such Holder and its directors, officers, employees, agents, attorneys, affiliates and financial and other advisors acquiring MNPI (which may include, solely by way of illustration, the fact that an offering of the Corporation’s securities is pending or the number of Corporation securities or the identity of the selling Holders).

 

(b)            Each Holder shall have the right, at any time and from time to time (including after receiving information regarding any potential Public Offering), to elect to not receive any notice that the Corporation or any other Holders otherwise are required to deliver pursuant to this Agreement by delivering to the Corporation a written statement signed by such Holder that it does not want to receive any notices hereunder (an “Opt-Out Request”); in which case and notwithstanding anything to the contrary in this Agreement the Corporation and other Holders shall not be required to, and shall not, deliver any notice or other information required to be provided to Holders hereunder to the extent that the Corporation or such other Holders reasonably expect would result in a Holder acquiring MNPI. An Opt-Out Request may state a date on which it expires or, if no such date is specified, shall remain in effect indefinitely. A Holder who previously has given the Corporation an Opt-Out Request may revoke such request at any time, and there shall be no limit on the ability of a Holder to issue and revoke subsequent Opt-Out Requests; provided that each Holder shall use commercially reasonable efforts to minimize the administrative burden on the Corporation arising in connection with any such Opt-Out Requests.

 

(c)             Each Holder agrees that it will maintain the confidentiality of such MNPI and, to the extent such Holder is not a natural person, such confidential treatment shall be in accordance with procedures adopted by it in good faith to protect confidential information of third parties delivered to such Holder (“Policies”); provided that a holder may deliver or disclose MNPI to (i) its directors, officers, employees, agents, attorneys, affiliates and financial and other advisors, but solely to the extent such disclosure reasonably relates to its evaluation of exercise of its rights under this Agreement and the sale of any Registrable Securities in connection with the subject of the notice, (ii) any federal or state regulatory authority having jurisdiction over such Holder, (iii) any Person if necessary to effect compliance with any law, rule, regulation or order applicable to such Holder, (iv) in response to any subpoena or other legal process, or (v) in connection with any litigation to which such Holder is a party; provided further, that in the case of clause (i), the recipients of such MNPI are subject to the Policies or agree to hold confidential the MNPI in a manner substantially consistent with the terms of this Section 16 and that in the case of clauses (ii) through (v), such disclosure is required by law and such Holder shall promptly notify the Corporation of such disclosure to the extent such Holder is legally permitted to give such notice.

 

 

Section 17.            General Provisions.

 

(a)            Amendments and Waivers. Except as otherwise provided herein, the provisions of this Agreement may be amended, modified, terminated or waived only with the prior written consent of the Corporation and each affected Holder. The failure or delay of any Person to enforce any of the provisions of this Agreement shall in no way be construed as a waiver of such provisions and shall not affect the right of such Person thereafter to enforce each and every provision of this Agreement in accordance with its terms. A waiver or consent to or of any breach or default by any Person in the performance by that Person of his, her or its obligations under this Agreement shall not be deemed to be a consent or waiver to or of any other breach or default in the performance by that Person of the same or any other obligations of that Person under this Agreement.

 

(b)            Remedies. The parties to this Agreement shall be entitled to enforce their rights under this Agreement specifically (without posting a bond or other security), to recover damages caused by reason of any breach of any provision of this Agreement and to exercise all other rights existing in their favor. The parties hereto agree and acknowledge that a breach of this Agreement would cause irreparable harm and money damages would not be an adequate remedy for any such breach and that, in addition to any other rights and remedies existing hereunder, any party shall be entitled to specific performance and/or other injunctive relief from any court of law or equity of competent jurisdiction (without posting any bond or other security) in order to enforce or prevent violation of the provisions of this Agreement.

 

(c)            Severability. Whenever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be prohibited, invalid, illegal or unenforceable in any respect under any applicable law or regulation in any jurisdiction, such prohibition, invalidity, illegality or unenforceability shall not affect the validity, legality or enforceability of any other provision of this Agreement in such jurisdiction or in any other jurisdiction, but this Agreement shall be reformed, construed and enforced in such jurisdiction as if such prohibited, invalid, illegal or unenforceable provision had never been contained herein.

 

(d)            Entire Agreement. Except as otherwise provided herein, this Agreement contains the complete agreement and understanding among the parties hereto with respect to the subject matter hereof and supersedes and preempts any prior understandings, agreements or representations by or among the parties hereto, written or oral, which may have related to the subject matter hereof in any way.

 

(e)            Successors and Assigns. This Agreement shall bind and inure to the benefit and be enforceable by the Corporation and its successors and assigns and the Holders and their respective successors and assigns (whether so expressed or not). In addition, whether or not any express assignment has been made, the provisions of this Agreement which are for the benefit Holders are also for the benefit of, and enforceable by, any subsequent or successor Holder.

 

 

(f)             Notices. Any notice, demand or other communication to be given under or by reason of the provisions of this Agreement shall be in writing and shall be deemed to have been given (i) when delivered personally to the recipient, (ii) when sent by confirmed electronic mail f sent during normal business hours of the recipient but, if not, then on the next Business Day, (iii) one Business Day after it is sent to the recipient by reputable overnight courier service (charges prepaid) or (iv) three Business Days after it is mailed to the recipient by first class mail, return receipt requested. Such notices, demands and other communications shall be sent to the Corporation at the address specified below and to any Original Equity Owner or to any other party subject to this Agreement at such address as indicated on the Schedule of Holders, or at such address or to the attention of such other Person as the recipient party has specified by prior written notice to the sending party. Any party may change such party’s address for receipt of notice by providing prior written notice of the change to the sending party as provided herein. The Corporation’s address is:

 

Fluence Energy, Inc.

4601 Fairfax Drive, Suite 600

Arlington, Virginia 22203

Attn: General Counsel

Email: frank.fuselier@fluenceenergy.com

 

With a copy to:

 

Fluence Energy, Inc.

4601 Fairfax Drive, Suite 600

Arlington, Virginia 22203

Attn: Chief Financial Officer

 

Email: dennis.fehr@fluenceenergy.com

 

With a copy to (which shall not serve as notice):

Latham & Watkins LLP

1271 Avenue of the Americas

New York, New York 10020

Attn: Senet S. Bischoff, Esq.

Facsimile: (212) 751-4864

 

or to such other address or to the attention of such other Person as the recipient party has specified by prior written notice to the sending party.

 

(g)            Business Days. If any time period for giving notice or taking action hereunder expires on a day that is not a Business Day, the time period shall automatically be extended to the immediately following Business Day.

 

(h)            Governing Law. The corporate law of the State of Delaware shall govern all issues and questions concerning the relative rights of the Corporation and its stockholders. All other issues and questions concerning the construction, validity, interpretation and enforcement of this Agreement and the exhibits and schedules hereto shall be governed by, and construed in accordance with, the laws of the State of New York, without giving effect to any choice of law or conflict of law rules or provisions (whether of the State of New York or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of New York.

 

 

(i)             MUTUAL WAIVER OF JURY TRIAL. AS A SPECIFICALLY BARGAINED FOR INDUCEMENT FOR EACH OF THE PARTIES HERETO TO ENTER INTO THIS AGREEMENT (AFTER HAVING THE OPPORTUNITY TO CONSULT WITH COUNSEL), EACH PARTY HERETO EXPRESSLY WAIVES THE RIGHT TO TRIAL BY JURY IN ANY LAWSUIT OR PROCEEDING RELATING TO OR ARISING IN ANY WAY FROM THIS AGREEMENT OR THE MATTERS CONTEMPLATED HEREBY.

 

(j)              CONSENT TO JURISDICTION AND SERVICE OF PROCESS. EACH OF THE PARTIES IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA LOCATED IN THE CITY AND COUNTY OF NEW YORK BOROUGH OF MANHATTAN, FOR THE PURPOSES OF ANY SUIT, ACTION OR OTHER PROCEEDING ARISING OUT OF THIS AGREEMENT, ANY RELATED AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY OR THEREBY. EACH OF THE PARTIES HERETO FURTHER AGREES THAT SERVICE OF ANY PROCESS, SUMMONS, NOTICE OR DOCUMENT BY U.S. REGISTERED MAIL TO SUCH PARTY’S RESPECTIVE ADDRESS SET FORTH ABOVE SHALL BE EFFECTIVE SERVICE OF PROCESS FOR ANY ACTION, SUIT OR PROCEEDING WITH RESPECT TO ANY MATTERS TO WHICH IT HAS SUBMITTED TO JURISDICTION IN THIS PARAGRAPH. EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY OBJECTION TO THE LAYING OF VENUE OF ANY ACTION, SUIT OR PROCEEDING ARISING OUT OF THIS AGREEMENT, ANY RELATED DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY AND THEREBY IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DELAWARE, AND HEREBY AND THEREBY FURTHER IRREVOCABLY AND UNCONDITIONALLY WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH ACTION, SUIT OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.

 

(k)            No Recourse. Notwithstanding anything to the contrary in this Agreement, the Corporation and each Holder agrees and acknowledges that no recourse under this Agreement or any documents or instruments delivered in connection with this Agreement, shall be had against any current or future director, officer, employee, general or limited partner or member of any Holder or of any Affiliate or assignee thereof, whether by the enforcement of any assessment or by any legal or equitable proceeding, or by virtue of any statute, regulation or other applicable law, it being expressly agreed and acknowledged that no personal liability whatsoever shall attach to, be imposed on or otherwise be incurred by any current or future officer, agent or employee of any Holder or any current or future member of any Holder or any current or future director, officer, employee, partner or member of any Holder or of any Affiliate or assignee thereof, as such for any obligation of any Holder under this Agreement or any documents or instruments delivered in connection with this Agreement for any claim based on, in respect of or by reason of such obligations or their creation.

 

(l)             Descriptive Headings; Interpretation. The descriptive headings of this Agreement are inserted for convenience only and do not constitute a part of this Agreement. The use of the word “including” in this Agreement shall be by way of example rather than by limitation.

 

(m)           No Strict Construction. The language used in this Agreement shall be deemed to be the language chosen by the parties hereto to express their mutual intent, and no rule of strict construction shall be applied against any party.

 

 

(n)            Counterparts. This Agreement may be executed in multiple counterparts, any one of which need not contain the signature of more than one party, but all such counterparts taken together shall constitute one and the same agreement.

 

(o)            Electronic Delivery. This Agreement, the agreements referred to herein, and each other agreement or instrument entered into in connection herewith or therewith or contemplated hereby or thereby, and any amendments hereto or thereto, to the extent executed and delivered by means of a photographic, photostatic, or similar reproduction of such signed writing using electronic mail shall be treated in all manner and respects as an original agreement or instrument and shall be considered to have the same binding legal effect as if it were the original signed version thereof delivered in person. At the request of any party hereto or to any such agreement or instrument, each other party hereto or thereto shall re-execute original forms thereof and deliver them to all other parties. No party hereto or to any such agreement or instrument shall raise the use of electronic mail to deliver a signature or the fact that any signature or agreement or instrument was transmitted or communicated through the use of electronic mail as a defense to the formation or enforceability of a contract and each such party forever waives any such defense.

 

(p)            Further Assurances. In connection with this Agreement and the transactions contemplated hereby, each Holder shall execute and deliver any additional documents and instruments and perform any additional acts that may be necessary or appropriate to effectuate and perform the provisions of this Agreement and the transactions contemplated hereby.

 

(q)            No Inconsistent Agreements. The Corporation shall not hereafter enter into any agreement with respect to its securities which is inconsistent with or violates the rights granted to the Holders in this Agreement.

 

(r)             Termination. Qatar Holding LLC shall have the option to terminate, at their sole discretion and solely with respect to Qatar Holding LLC and any of its Affiliates or assignees who have delivered (or have the right to deliver) a Joinder or who otherwise have rights or obligations under this Agreement, this Agreement and their rights and obligations hereunder (other than rights and obligations under Sections 10, 16 and 17 of this Agreement) if at any time (A) the Board no longer has a QIA Director and (B) the QIA Related Parties beneficially own, directly or indirectly, in the aggregate less than ten percent (10%) of all issued and outstanding shares of Class A Common Stock (including for this purpose the Underlying Class A Shares). Defined terms included in this subsection (r), other than “Affiliates”, “Agreement” and “Joinder” shall have the meanings set forth in the Stockholders Agreement of Fluence Energy, Inc. dated as of [ ● ], 2021.

 

* * * * *

 

 

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

 

	FLUENCE ENERGY, INC.
	By:
	Name:	Manuel Perez Dubuc
	Title:	Chief Executive Officer
	By:
	Name:	Dennis Fehr
	Title:	Chief Financial Officer

 

[Signature Page to Registration Rights Agreement]

 

 

	AES Grid Stability, LLC
	By: [ ● ],
	its [ ● ]
	By:
	Name:
	Title:

 

[Signature Page to Registration Rights Agreement]

 

 

	SIEMENS INDUSTRY, INC.
	By:
	Name:
	Title:
	By:
	Name:
	Title:

 

[Signature Page to Registration Rights Agreement]

 

 

	QATAR HOLDING LLC
	By: [ ● ],
	its [ ● ]
	By:
	Name:
	Title:

 

[Signature Page to Registration Rights Agreement]

 

 

SCHEDULE OF HOLDERS

 

Holder		Continuing Equity Owner/ Former LLC Equity Owner
AES Grid Stability, LLC		Continuing Equity Owner
Siemens Industry, Inc.		Continuing Equity Owner
Qatar Holding LLC		Former LLC Equity Owner

 

 

EXHIBIT A

 

REGISTRATION RIGHTS AGREEMENT JOINDER

 

The undersigned is executing and delivering this Joinder pursuant to the Registration Rights Agreement dated as of October [ ● ], 2021 (as the same may hereafter be amended, the “Registration Rights Agreement”), among Fluence Energy, Inc., a Delaware corporation (the “Corporation”), and the other person named as parties therein.

 

By executing and delivering this Joinder to the Corporation, and upon acceptance hereof by the Corporation upon the execution of a counterpart hereof, the undersigned hereby agrees to become a party to, to be bound by, and to comply with the provisions of the Registration Rights Agreement as a Holder of Registrable Securities in the same manner as if the undersigned were an original signatory to the Registration Rights Agreement, and the undersigned’s shares of Class A Common Stock shall be included as Registrable Securities under the Registration Rights Agreement to the extent provided therein. The Corporation is directed to add the address below the undersigned’s signature on this Joinder to the Schedule of Holders attached to the Registration Rights Agreement.

 

Accordingly, the undersigned has executed and delivered this Joinder as of the day of _______________, 20__.

 

	Signature of Stockholder
	Print Name of Stockholder
	Its:
	Address:

 

Agreed and Accepted as of _______________, 20__

 

Fluence Energy, Inc.
By:
Name:
Its:

 

 

 

Exhibit 10.5

 

 

FLUENCE ENERGY, INC.
2021 INCENTIVE AWARD PLAN

 

 

ARTICLE I.
Purpose

 

The Plan’s purpose is to enhance the Company’s ability to attract, retain and motivate persons who make (or are expected to make) important contributions to the Company by providing these individuals with equity ownership opportunities. Capitalized terms used in the Plan are defined in Article XI.

 

ARTICLE II.
Eligibility

 

Service Providers are eligible to be granted Awards under the Plan, subject to the limitations described herein.

 

ARTICLE III.
Administration and Delegation

 

3.1               Administration. The Plan is administered by the Administrator. The Administrator has authority to determine which Service Providers receive Awards, grant Awards and set Award terms and conditions, subject to the conditions and limitations in the Plan. The Administrator also has the authority to take all actions and make all determinations under the Plan, to interpret the Plan and Award Agreements and to adopt, amend and repeal Plan administrative rules, guidelines and practices as it deems advisable. The Administrator may correct defects and ambiguities, supply omissions and reconcile inconsistencies in the Plan or any Award as it deems necessary or appropriate to administer the Plan and any Awards. The Administrator’s determinations under the Plan are in its sole discretion and will be final and binding on all persons having or claiming any interest in the Plan or any Award.

 

3.2               Appointment of Committees. To the extent Applicable Laws permit, the Board may delegate any or all of its powers under the Plan to one or more Committees. The Board may abolish any Committee or re-vest in itself any previously delegated authority at any time.

 

ARTICLE IV.
Stock Available for Awards

 

4.1               Number of Shares. Subject to adjustment under Article VIII and the terms of this Article IV, Awards may be made under the Plan covering up to the Overall Share Limit. Shares issued under the Plan may consist of authorized but unissued Shares, Shares purchased on the open market or treasury Shares.

 

4.2               Share Recycling. If all or any part of an Award expires, lapses or is terminated, exchanged for cash, surrendered, repurchased, canceled without having been fully exercised or forfeited, in any case, in a manner that results in the Company acquiring Shares at a price not greater than the price (as adjusted to reflect any Equity Restructuring) paid by the Participant for such Shares or not issuing any Shares covered by the Award, the unused Shares covered by the Award will, as applicable, become or again be available for Award grants under the Plan. Further, Shares delivered (either by actual delivery or attestation) to the Company by a Participant to satisfy the applicable exercise or purchase price of an Award and/or to satisfy any applicable tax withholding obligation (including Shares retained by the Company from the Award being exercised or purchased and/or creating the tax obligation) will not, as applicable, become or again be available for Award grants under the Plan. The payment of Dividend Equivalents in cash in conjunction with any outstanding Awards shall not count against the Overall Share Limit.

 

 

4.3               Incentive Stock Option Limitations. Notwithstanding anything to the contrary herein, no more than 9,500,000 Shares may be issued pursuant to the exercise of Incentive Stock Options.

 

4.4               Substitute Awards. In connection with an entity’s merger or consolidation with the Company or the Company’s acquisition of an entity’s property or stock, the Administrator may grant Substitute Awards in respect of any options or other stock or stock-based awards granted before such merger or consolidation by such entity or its affiliate in accordance with Applicable Laws. Substitute Awards may be granted on such terms as the Administrator deems appropriate, notwithstanding limitations on Awards in the Plan. Substitute Awards will not count against the Overall Share Limit (nor shall Shares subject to a Substitute Award be added back to the Shares available for Awards under the Plan as provided in Section 4.2 above), except that Shares acquired by exercise of substitute Incentive Stock Options will count against the maximum number of Shares that may be issued pursuant to the exercise of Incentive Stock Options under the Plan. Additionally, in the event that a company acquired by the Company or any Affiliate or with which the Company or any Affiliate combines has shares available under a pre-existing plan approved by stockholders and not adopted in contemplation of such acquisition or combination, the shares available for grant pursuant to the terms of such pre-existing plan (as adjusted, to the extent appropriate, using the exchange ratio or other adjustment or valuation ratio or formula used in such acquisition or combination to determine the consideration payable to the holders of common stock of the entities party to such acquisition or combination) may be used for Awards under the Plan and shall not count against the Overall Share Limit (and Shares subject to such Awards shall not be added to the Shares available for Awards under the Plan as provided above in Section 4.2); provided that Awards using such available shares shall not be made after the date awards or grants could have been made under the terms of the pre-existing plan, absent the acquisition or combination, and shall only be made to individuals who were not Employees or Directors prior to such acquisition or combination.

 

4.5               Non-Employee Director Compensation. Notwithstanding any provision to the contrary in the Plan, the Administrator may establish compensation for non-employee Directors from time to time, subject to the limitations in the Plan. The Administrator will from time to time determine the terms, conditions and amounts of all such non-employee Director compensation in its discretion and pursuant to the exercise of its business judgment, taking into account such factors, circumstances and considerations as it shall deem relevant from time to time, provided that the sum of any cash compensation, or other compensation, and the value (determined as of the grant date in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718, or any successor thereto) of Awards granted to a non-employee Director as compensation for services as a non-employee Director during any fiscal year of the Company may not exceed $500,000, increased to $750,000 for a non-employee Director’s initial fiscal year of service as a non-employee Director. The Administrator may make exceptions to these limits for individual non-employee Directors in extraordinary circumstances, as the Administrator may determine in its discretion, provided that the non-employee Director receiving such additional compensation may not participate in the decision to award such compensation or in other contemporaneous compensation decisions involving non-employee Directors.

 

ARTICLE V.
Stock Options and Stock Appreciation Rights

 

5.1               General. The Administrator may grant Options or Stock Appreciation Rights to Service Providers subject to the limitations in the Plan, including any limitations in the Plan that apply to Incentive Stock Options. The Administrator will determine the number of Shares covered by each Option and Stock Appreciation Right, the exercise price of each Option and Stock Appreciation Right and the conditions and limitations applicable to the exercise of each Option and Stock Appreciation Right. A Stock Appreciation Right will entitle the Participant (or other person entitled to exercise the Stock Appreciation Right) to receive from the Company upon exercise of the exercisable portion of the Stock Appreciation Right an amount determined by multiplying the excess, if any, of the Fair Market Value of one Share on the date of exercise over the exercise price per Share of the Stock Appreciation Right by the number of Shares with respect to which the Stock Appreciation Right is exercised, subject to any limitations of the Plan or that the Administrator may impose and payable in cash, Shares valued at such Fair Market Value or a combination of the two as the Administrator may determine or provide in the Award Agreement.

 

 

5.2               Exercise Price. The Administrator will establish each Option’s and Stock Appreciation Right’s exercise price and specify the exercise price in the Award Agreement. Unless otherwise determined by the Administrator, the exercise price will not be less than 100% of the Fair Market Value of a Share on the grant date of the Option or Stock Appreciation Right.

 

5.3               Duration. Each Option or Stock Appreciation Right will be exercisable at such times and as specified in the Award Agreement, provided that, unless otherwise determined by the Administrator in accordance with Applicable Laws, the term of an Option or Stock Appreciation Right will not exceed ten years. Notwithstanding the foregoing, if the Participant, prior to the end of the term of an Option or Stock Appreciation Right, violates the non-competition, non-solicitation, confidentiality or other similar restrictive covenant provisions of any employment contract, confidentiality and nondisclosure agreement or other agreement between the Participant and the Company or any Affiliate, the right of the Participant and the Participant’s transferees to exercise any Option or Stock Appreciation Right issued to the Participant shall terminate immediately upon such violation unless the Administrator otherwise determines.

 

5.4               Exercise. Options and Stock Appreciation Rights may be exercised by delivering to the Company a written notice of exercise, in a form the Administrator approves (which may be electronic), signed by the person authorized to exercise the Option or Stock Appreciation Right, together with, as applicable, payment in full (i) as specified in Section 5.5 for the number of Shares for which the Award is exercised and (ii) as specified in Section 9.5 for any applicable taxes. Unless the Administrator otherwise determines, an Option or Stock Appreciation Right may not be exercised for a fraction of a Share.

 

5.5               Payment Upon Exercise. Subject to Section 10.8, any Company insider trading policy (including blackout periods) and Applicable Laws, the exercise price of an Option must be paid by:

 

(a)                cash, wire transfer of immediately available funds or by check payable to the order of the Company, provided that the Company may limit the use of one of the foregoing payment forms if one or more of the payment forms below is permitted;

 

(b)                if there is a public market for Shares at the time of exercise, unless the Company otherwise determines, (A) delivery (including telephonically to the extent permitted by the Company) of an irrevocable and unconditional undertaking by a broker acceptable to the Company to deliver promptly to the Company sufficient funds to pay the exercise price, or (B) the Participant’s delivery to the Company of a copy of irrevocable and unconditional instructions to a broker acceptable to the Company to deliver promptly to the Company cash or a check sufficient to pay the exercise price; provided that such amount is paid to the Company at such time as may be required by the Administrator;

 

(c)                to the extent permitted by the Administrator, delivery (either by actual delivery or attestation) of Shares owned by the Participant valued at their Fair Market Value;

 

 

(d)                to the extent permitted by the Administrator, surrendering Shares then issuable upon the Option’s exercise valued at their Fair Market Value on the exercise date;

 

(e)                to the extent permitted by the Administrator, delivery of any other property that the Administrator determines is good and valuable consideration; or

 

(f)                 to the extent permitted by the Company, any combination of the above payment forms approved by the Administrator.

 

ARTICLE VI.
Restricted Stock; Restricted Stock Units

 

6.1               General. The Administrator may grant Restricted Stock, or the right to purchase Restricted Stock, to any Service Provider, subject to the Company’s right to repurchase all or part of such shares at their issue price or other stated or formula price from the Participant (or to require forfeiture of such shares) if conditions the Administrator specifies in the Award Agreement are not satisfied before the end of the applicable restriction period or periods that the Administrator establishes for such Award. In addition, the Administrator may grant to Service Providers Restricted Stock Units, which may be subject to vesting and forfeiture conditions during the applicable restriction period or periods, as set forth in an Award Agreement. The Administrator will determine and set forth in the Award Agreement the terms and conditions for each Restricted Stock and Restricted Stock Unit Award, subject to the conditions and limitations contained in the Plan.

 

6.2               Restricted Stock.

 

(a)                Dividends. Participants holding shares of Restricted Stock will be entitled to all ordinary cash dividends paid with respect to such Shares, unless the Administrator provides otherwise in the Award Agreement. In addition, unless the Administrator provides otherwise, if any dividends or distributions are paid in Shares, or consist of a dividend or distribution to holders of Common Stock of property other than an ordinary cash dividend, the Shares or other property will be subject to the same restrictions on transferability and forfeitability as the shares of Restricted Stock with respect to which they were paid.

 

(b)                Stock Certificates. The Company may require that the Participant deposit in escrow with the Company (or its designee) any stock certificates issued in respect of shares of Restricted Stock, together with a stock power endorsed in blank.

 

(c)                Section 83(b) Election. If a Participant makes an election under Section 83(b) of the Code to be taxed with respect to the Restricted Stock as of the date of transfer of the Restricted Stock rather than as of the date or dates upon which such Participant would otherwise be taxable under Section 83(a) of the Code, such Participant shall be required to deliver a copy of such election to the Company promptly after filing such election with the Internal Revenue Service along with proof of the timely filing thereof.

 

6.3               Restricted Stock Units.

 

(a)                Settlement. The Administrator may provide that settlement of Restricted Stock Units will occur upon or as soon as reasonably practicable after the Restricted Stock Units vest or will instead be deferred, on a mandatory basis or at the Participant’s election, in a manner intended to comply with Section 409A.

 

 

(b)                Stockholder Rights. A Participant will have no rights of a stockholder with respect to Shares subject to any Restricted Stock Unit unless and until the Shares are delivered in settlement of the Restricted Stock Unit.

 

(c)                Dividend Equivalents. If the Administrator provides, a grant of Restricted Stock Units may provide a Participant with the right to receive Dividend Equivalents. Dividend Equivalents may be paid currently or credited to an account for the Participant, settled in cash or Shares and subject to the same restrictions on transferability and forfeitability as the Restricted Stock Units with respect to which the Dividend Equivalents are granted and subject to other terms and conditions as set forth in the Award Agreement.

 

ARTICLE VII.
Other Stock or Cash Based Awards

 

7.1               Other Stock or Cash Based Awards may be granted to Participants, including Awards entitling Participants to receive Shares to be delivered in the future and including annual or other periodic or long-term cash bonus awards (whether based on specified Performance Criteria or otherwise), in each case subject to any conditions and limitations in the Plan. Such Other Stock or Cash Based Awards will also be available as a payment form in the settlement of other Awards, as standalone payments and as payment in lieu of compensation to which a Participant is otherwise entitled. Other Stock or Cash Based Awards may be paid in Shares, cash or other property, as the Administrator determines. Subject to the provisions of the Plan, the Administrator will determine the terms and conditions of each Other Stock or Cash Based Award, including any purchase price, performance goal (which may be based on the Performance Criteria), transfer restrictions, and vesting conditions, which will be set forth in the applicable Award Agreement.

 

ARTICLE VIII.
Adjustments for Changes in Common Stock and Certain Other Events

 

8.1               Equity Restructuring(a). In connection with any Equity Restructuring, notwithstanding anything to the contrary in this Article VIII, the Administrator will equitably adjust each outstanding Award as it deems appropriate to reflect the Equity Restructuring, which may include adjusting the number and type of securities subject to each outstanding Award and/or the Award’s exercise price or grant price (if applicable), granting new Awards to Participants, and making a cash payment to Participants. The adjustments provided under this Section 8.1 will be nondiscretionary and final and binding on the affected Participant and the Company; provided that the Administrator will determine whether an adjustment is equitable.

 

8.2               Corporate Transactions. In the event of any dividend or other distribution (whether in the form of cash, Common Stock, other securities, or other property), reorganization, merger, consolidation, combination, amalgamation, repurchase, recapitalization, liquidation, dissolution, or sale, transfer, exchange or other disposition of all or substantially all of the assets of the Company, or sale or exchange of Common Stock or other securities of the Company, Change in Control, issuance of warrants or other rights to purchase Common Stock or other securities of the Company, other similar corporate transaction or event, other unusual or nonrecurring transaction or event affecting the Company or its financial statements or any change in any Applicable Laws or accounting principles, the Administrator, on such terms and conditions as it deems appropriate, either by the terms of the Award or by action taken prior to the occurrence of such transaction or event (except that action to give effect to a change in Applicable Law or accounting principles may be made within a reasonable period of time after such change) and either automatically or upon the Participant’s request, is hereby authorized to take any one or more of the following actions whenever the Administrator determines that such action is appropriate in order to (x) prevent dilution or enlargement of the benefits or potential benefits intended by the Company to be made available under the Plan or with respect to any Award granted or issued under the Plan, (y) to facilitate such transaction or event or (z) give effect to such changes in Applicable Laws or accounting principles:

 

 

(a)                To provide for the cancellation of any such Award in exchange for either an amount of cash or other property with a value equal to the amount that could have been obtained upon the exercise or settlement of the vested portion of such Award or realization of the Participant’s rights under the vested portion of such Award, as applicable; provided that, if the amount that could have been obtained upon the exercise or settlement of the vested portion of such Award or realization of the Participant’s rights, in any case, is equal to or less than zero, then the Award may be terminated without payment;

 

(b)                To provide that such Award shall vest and, to the extent applicable, be exercisable as to all shares covered thereby, notwithstanding anything to the contrary in the Plan or the provisions of such Award;

 

(c)                To provide that such Award be assumed by the successor or survivor corporation, or a parent or subsidiary thereof, or shall be substituted for by awards covering the stock of the successor or survivor corporation, or a parent or subsidiary thereof, with appropriate adjustments as to the number and kind of shares and/or applicable exercise or purchase price, in all cases, as determined by the Administrator;

 

(d)                To make adjustments in the number and type of shares of Common Stock (or other securities or property) subject to outstanding Awards and/or with respect to which Awards may be granted under the Plan (including, but not limited to, adjustments of the limitations in Article IV hereof on the maximum number and kind of shares which may be issued) and/or in the terms and conditions of (including the grant or exercise price), and the criteria included in, outstanding Awards;

 

(e)                To replace such Award with other rights or property selected by the Administrator; and/or

 

(f)                 To provide that the Award will terminate and cannot vest, be exercised or become payable after the applicable event.

 

8.3               Administrative Stand Still. In the event of any pending stock dividend, stock split, combination or exchange of shares, merger, consolidation or other distribution (other than normal cash dividends) of Company assets to stockholders, or any other extraordinary transaction or change affecting the Shares or the share price of Common Stock, including any Equity Restructuring or any securities offering or other similar transaction, for administrative convenience, the Administrator may refuse to permit the exercise of any Award for up to sixty days before or after such transaction.

 

8.4               General. Except as expressly provided in the Plan or the Administrator’s action under the Plan, no Participant will have any rights due to any subdivision or consolidation of Shares of any class, dividend payment, increase or decrease in the number of Shares of any class or dissolution, liquidation, merger, or consolidation of the Company or other corporation. Except as expressly provided with respect to an Equity Restructuring under Section 8.1 above or the Administrator’s action under the Plan, no issuance by the Company of Shares of any class, or securities convertible into Shares of any class, will affect, and no adjustment will be made regarding, the number of Shares subject to an Award or the Award’s grant price or exercise price (if applicable). The existence of the Plan, any Award Agreements and the Awards granted hereunder will not affect or restrict in any way the Company’s right or power to make or authorize (i) any adjustment, recapitalization, reorganization or other change in the Company’s capital structure or its business, (ii) any merger, consolidation dissolution or liquidation of the Company or sale of Company assets or (iii) any sale or issuance of securities, including securities with rights superior to those of the Shares or securities convertible into or exchangeable for Shares. The Administrator may treat Participants and Awards (or portions thereof) differently under this Article VIII.

 

 

ARTICLE IX.
General Provisions Applicable to Awards

 

9.1               Transferability. Except as the Administrator may determine or provide in an Award Agreement or otherwise for Awards other than Incentive Stock Options, Awards may not be sold, assigned, transferred, pledged or otherwise encumbered, either voluntarily or by operation of law, except by will or the laws of descent and distribution, or, subject to the Administrator’s consent, pursuant to a domestic relations order, and, during the life of the Participant, will be exercisable only by the Participant. References to a Participant, to the extent relevant in the context, will include references to a Participant’s authorized transferee that the Administrator specifically approves.

 

9.2               Documentation. Each Award will be evidenced in an Award Agreement, which may be written or electronic, as the Administrator determines. Each Award may contain terms and conditions in addition to those set forth in the Plan.

 

9.3               Discretion. Except as the Plan otherwise provides, each Award may be made alone or in addition or in relation to any other Award. The terms of each Award to a Participant need not be identical, and the Administrator need not treat Participants or Awards (or portions thereof) uniformly.

 

9.4               Termination of Service; Change in Status. The Administrator will determine, in its sole discretion, the effect of all matters and questions relating to any Termination of Service, including, without limitation, whether a Termination of Service has occurred, whether a Termination of Service resulted from a discharge for Cause and all questions of whether a particular leave of absence constitutes a Termination of Service or whether any other change or purported change in a Participant’s Service Provider status affects an Award and the extent to which, and the period during which, the Participant, the Participant’s legal representative, conservator, guardian or Designated Beneficiary may exercise rights under the Award, if applicable.

 

9.5               Withholding. Each Participant must pay the Company, or make provision satisfactory to the Administrator for payment of, any taxes required by Applicable Law to be withheld in connection with such Participant’s Awards by the date of the event creating the tax liability. The Company may deduct an amount sufficient to satisfy such tax obligations based on the applicable statutory withholding rates (or such other rate as may be determined by the Company after considering any accounting consequences or costs) from any payment of any kind otherwise due to a Participant. Subject to Section 10.8 and any Company insider trading policy (including blackout periods), Participants may satisfy such tax obligations (i) in cash, by wire transfer of immediately available funds, or by check made payable to the order of the Company, provided that the Company may limit the use of one of the foregoing payment forms if one or more of the payment forms below is permitted, (ii) to the extent permitted by the Administrator, in whole or in part by delivery of Shares, including Shares retained from the Award creating the tax obligation, valued at their Fair Market Value, (iii) if there is a public market for Shares at the time the tax obligations are to be satisfied, unless the Company otherwise determines, (A) delivery (including telephonically to the extent permitted by the Company) of an irrevocable and unconditional undertaking by a broker acceptable to the Company to deliver promptly to the Company sufficient funds to satisfy the tax obligations, or (B) delivery by the Participant to the Company of a copy of irrevocable and unconditional instructions to a broker acceptable to the Company to deliver promptly to the Company cash or a check sufficient to satisfy the tax withholding; provided that such amount is paid to the Company at such time as may be required by the Administrator, or (iv) to the extent permitted by the Company, any combination of the foregoing payment forms approved by the Administrator. If any tax withholding obligation will be satisfied under clause (ii) of the immediately preceding sentence by the Company’s retention of Shares from the Award creating the tax obligation and there is a public market for Shares at the time the tax obligation is satisfied, the Company may elect to instruct any brokerage firm determined acceptable to the Company for such purpose to sell on the applicable Participant’s behalf some or all of the Shares retained and to remit the proceeds of the sale to the Company or its designee, and each Participant’s acceptance of an Award under the Plan will constitute the Participant’s authorization to the Company and instruction and authorization to such brokerage firm to complete the transactions described in this sentence.

 

 

9.6               Amendment of Award; Repricing. The Administrator may amend, modify or terminate any outstanding Award, including by substituting another Award of the same or a different type, changing the exercise or settlement date, and converting an Incentive Stock Option to a Non-Qualified Stock Option. The Participant’s consent to such action will be required unless (i) the action, taking into account any related action, does not materially and adversely affect the Participant’s rights under the Award, or (ii) the change is permitted under Article VIII or pursuant to Section 10.6. Notwithstanding the foregoing or anything in the Plan to the contrary, the Administrator may not, without the approval of the stockholders of the Company, (i) reduce the exercise price per share of outstanding Options or Stock Appreciation Rights (ii) cancel outstanding Options or Stock Appreciation Rights in exchange for Options or Stock Appreciation Rights with an exercise price per share that is less than the exercise price per share of the original Options or Stock Appreciation Rights, or (iii) cancel outstanding underwater Options or Stock Appreciation Rights in exchange for cash or other Awards.

 

9.7               Conditions on Delivery of Stock. The Company will not be obligated to deliver any Shares under the Plan or remove restrictions from Shares previously delivered under the Plan until (i) all Award conditions have been met or removed to the Company’s satisfaction, (ii) as determined by the Company, all other legal matters regarding the issuance and delivery of such Shares have been satisfied, including any applicable securities laws and stock exchange or stock market rules and regulations, and (iii) the Participant has executed and delivered to the Company such representations or agreements as the Administrator deems necessary or appropriate to satisfy any Applicable Laws. The Company’s inability to obtain authority from any regulatory body having jurisdiction, which the Administrator determines is necessary to the lawful issuance and sale of any securities, will relieve the Company of any liability for failing to issue or sell such Shares as to which such requisite authority has not been obtained.

 

9.8               Acceleration. The Administrator may at any time provide that any Award will become immediately vested and fully or partially exercisable, free of some or all restrictions or conditions, or otherwise fully or partially realizable.

 

9.9               Additional Terms of Incentive Stock Options. The Administrator may grant Incentive Stock Options only to employees of the Company, any of its present or future parent or subsidiary corporations, as defined in Sections 424(e) or (f) of the Code, respectively, and any other entities the employees of which are eligible to receive Incentive Stock Options under the Code. If an Incentive Stock Option is granted to a Greater Than 10% Stockholder, the exercise price will not be less than 110% of the Fair Market Value of a Share on the Option’s grant date, and the term of the Option will not exceed five years. All Incentive Stock Options will be subject to and construed consistently with Section 422 of the Code. By accepting an Incentive Stock Option, the Participant agrees if requested by the Company to give prompt notice to the Company of dispositions or other transfers (other than in connection with a Change in Control) of Shares acquired under the Option made within (i) two years from the grant date of the Option or (ii) one year after the transfer of such Shares to the Participant, specifying the date of the disposition or other transfer and the amount the Participant realized, in cash, other property, assumption of indebtedness or other consideration, in such disposition or other transfer. Neither the Company nor the Administrator will be liable to a Participant, or any other party, if an Incentive Stock Option fails or ceases to qualify as an “incentive stock option” under Section 422 of the Code. Any Incentive Stock Option or portion thereof that fails to qualify as an “incentive stock option” under Section 422 of the Code for any reason, including becoming exercisable with respect to Shares having a fair market value exceeding the $100,000 limitation under Treasury Regulation Section 1.422-4, will be a Non-Qualified Stock Option.

 

 

 

ARTICLE X.
Miscellaneous

 

10.1           No Right to Employment or Other Status. No person will have any claim or right to be granted an Award, and the grant of an Award will not be construed as giving a Participant the right to continued employment or any other relationship with the Company or any Affiliate. The Company expressly reserves the right at any time to dismiss or otherwise terminate its relationship with a Participant free from any liability or claim under the Plan or any Award, except as expressly provided in an Award Agreement.

 

10.2           No Rights as Stockholder; Certificates. Subject to the Award Agreement, no Participant or Designated Beneficiary will have any rights as a stockholder with respect to any Shares to be distributed under an Award until becoming the record holder of such Shares. Notwithstanding any other provision of the Plan, unless the Administrator otherwise determines or Applicable Laws require, the Company will not be required to deliver to any Participant certificates evidencing Shares issued in connection with any Award and instead such Shares may be recorded in the books of the Company (or, as applicable, its transfer agent or stock plan administrator). The Company may place legends on stock certificates issued under the Plan that the Administrator deems necessary or appropriate to comply with Applicable Laws.

 

10.3           Effective Date and Term of Plan. The Plan will become effective on the Pricing Date and, unless earlier terminated by the Board, will remain in effect until the earlier of (i) the earliest date as of which all Awards granted under the Plan have been satisfied in full or terminated and no Shares approved for issuance under the Plan remain available to be granted under new Awards or (ii) the earlier of the tenth anniversary of (A) the date the Plan was adopted by the Board or (B) the date the Plan was approved by the Company’s stockholders, but Awards previously granted may extend beyond that date in accordance with the Plan. If the Plan is not approved by the Company’s stockholders, the Plan will not become effective and no Awards will be granted under the Plan.

 

10.4           Amendment of Plan. The Administrator may amend, suspend or terminate the Plan at any time; provided that no amendment, other than an increase to the Overall Share Limit, may materially and adversely affect any Award outstanding at the time of such amendment in a manner disproportionate to other similarly-situated Awards without the affected Participant’s consent. No Awards may be granted under the Plan during any suspension period or after Plan termination. Awards outstanding at the time of any Plan suspension or termination will continue to be governed by the Plan and the Award Agreement, as in effect before such suspension or termination. The Company will obtain stockholder approval of any Plan amendment to the extent necessary to comply with Applicable Laws.

 

10.5           Provisions for Foreign Participants. The Administrator may modify Awards granted to Participants who are foreign nationals or employed outside the United States or establish subplans or procedures under the Plan to address differences in laws, rules, regulations or customs of such foreign jurisdictions with respect to tax, securities, currency, employee benefit or other matters.

 

 

10.6           Section 409A.

 

(a)                General. The Company intends that all Awards be structured to comply with, or be exempt from, Section 409A, such that no adverse tax consequences, interest, or penalties under Section 409A apply. Notwithstanding anything in the Plan or any Award Agreement to the contrary, the Administrator may, without a Participant’s consent, amend this Plan or Awards, adopt policies and procedures, or take any other actions (including amendments, policies, procedures and retroactive actions) as are necessary or appropriate to preserve the intended tax treatment of Awards, including any such actions intended to (A) exempt this Plan or any Award from Section 409A, or (B) comply with Section 409A, including regulations, guidance, compliance programs and other interpretative authority that may be issued after an Award’s grant date. The Company makes no representations or warranties as to an Award’s tax treatment under Section 409A or otherwise. The Company will have no obligation under this Section 10.6 or otherwise to avoid the taxes, penalties or interest under Section 409A with respect to any Award and will have no liability to any Participant or any other person if any Award, compensation or other benefits under the Plan are determined to constitute noncompliant “nonqualified deferred compensation” subject to taxes, penalties or interest under Section 409A.

 

(b)                Separation from Service. If an Award constitutes “nonqualified deferred compensation” under Section 409A, any payment or settlement of such Award upon a termination of a Participant’s Service Provider relationship will, to the extent necessary to avoid taxes under Section 409A, be made only upon the Participant’s “separation from service” (within the meaning of Section 409A), whether such “separation from service” occurs upon or after the Termination of Service of a Participant. For purposes of this Plan or any Award Agreement relating to any such payments or benefits, references to a “termination,” “termination of employment,” Termination of Service or like terms means a “separation from service.”

 

(c)                Payments to Specified Employees. Notwithstanding any contrary provision in the Plan or any Award Agreement, any payment(s) of “nonqualified deferred compensation” required to be made under an Award to a “specified employee” (as defined under Section 409A and as the Administrator determines) due to his or her “separation from service” will, to the extent necessary to avoid taxes under Section 409A(a)(2)(B)(i) of the Code, be delayed for the six-month period immediately following such “separation from service” (or, if earlier, until the specified employee’s death) and will instead be paid (as set forth in the Award Agreement) on the day immediately following such six-month period or as soon as administratively practicable thereafter (without interest). Any payments of “nonqualified deferred compensation” under such Award payable more than six months following the Participant’s “separation from service” will be paid at the time or times the payments are otherwise scheduled to be made.

 

10.7           Limitations on Liability. Notwithstanding any other provisions of the Plan, no individual acting as a director, officer, other employee or agent of the Company or any Affiliate will be liable to any Participant, former Participant, spouse, beneficiary, or any other person for any claim, loss, liability, or expense incurred in connection with the Plan or any Award, and such individual will not be personally liable with respect to the Plan because of any contract or other instrument executed in his or her capacity as an Administrator, director, officer, other employee or agent of the Company or any Affiliate. The Company will indemnify and hold harmless each director, officer, other employee and agent of the Company or any Affiliate that has been or will be granted or delegated any duty or power relating to the Plan’s administration or interpretation, against any cost or expense (including attorneys’ fees) or liability (including any sum paid in settlement of a claim with the Administrator’s approval) arising from any act or omission concerning this Plan unless arising from such person’s own fraud or bad faith.

 

 

10.8           Lock-Up Period. The Company may, at the request of any underwriter representative or otherwise, in connection with registering the offering of any Company securities under the Securities Act, prohibit Participants from, directly or indirectly, selling or otherwise transferring any Shares or other Company securities during a period of up to one hundred eighty days following the effective date of a Company registration statement filed under the Securities Act, or such longer period as determined appropriate by the underwriter or the Administrator.

 

10.9           Data Privacy. As a condition for receiving any Award, each Participant explicitly and unambiguously consents to the collection, use and transfer, in electronic or other form, of personal data as described in this section by and among the Company and any Affiliate exclusively for implementing, administering and managing the Participant’s participation in the Plan. The Company and the Affiliates may hold certain personal information about a Participant, including the Participant’s name, address and telephone number; birthdate; social security, insurance number or other identification number; salary; nationality; job title(s); any Shares held in the Company or any Affiliate; and Award details, to implement, manage and administer the Plan and Awards (the “Data”). The Company and the Affiliates may transfer the Data amongst themselves as necessary to implement, administer and manage a Participant’s participation in the Plan, and the Company and the Affiliates may transfer the Data to third parties assisting the Company with Plan implementation, administration and management. These recipients may be located in the Participant’s country, or elsewhere, and the Participant’s country may have different data privacy laws and protections than the recipients’ country. By accepting an Award, each Participant authorizes such recipients to receive, possess, use, retain and transfer the Data, in electronic or other form, to implement, administer and manage the Participant’s participation in the Plan, including any required Data transfer to a broker or other third party with whom the Company or the Participant may elect to deposit any Shares. The Data related to a Participant will be held only as long as necessary to implement, administer, and manage the Participant’s participation in the Plan. A Participant may, at any time, view the Data that the Company holds regarding such Participant, request additional information about the storage and processing of the Data regarding such Participant, recommend any necessary corrections to the Data regarding the Participant or refuse or withdraw the consents in this Section 10.9 in writing, without cost, by contacting the local human resources representative. The Company may cancel Participant’s ability to participate in the Plan and, in the Administrator’s discretion, the Participant may forfeit any outstanding Awards if the Participant refuses or withdraws the consents in this Section 10.9. For more information on the consequences of refusing or withdrawing consent, Participants may contact their local human resources representative.

 

10.10        Severability. If any portion of the Plan or any action taken under it is held illegal or invalid for any reason, the illegality or invalidity will not affect the remaining parts of the Plan, and the Plan will be construed and enforced as if the illegal or invalid provisions had been excluded, and the illegal or invalid action will be null and void.

 

10.11        Governing Documents. If any contradiction occurs between the Plan and any Award Agreement or other written agreement between a Participant and the Company (or any Affiliate) that the Administrator has approved, the Plan will govern, unless it is expressly specified in such Award Agreement or other written agreement that a specific provision of the Plan will not apply.

 

10.12        Governing Law. The Plan and all Awards will be governed by and interpreted in accordance with the laws of the State of Delaware, disregarding any state’s choice-of-law principles requiring the application of a jurisdiction’s laws other than the State of Delaware.

 

 

10.13        Claw-back Provisions. All Awards (including any proceeds, gains or other economic benefit the Participant actually or constructively receives upon receipt or exercise of any Award or the receipt or resale of any Shares underlying the Award) will be subject to any Company claw-back policy as in effect from time to time, including any claw-back policy adopted to comply with Applicable Laws (including the Dodd-Frank Wall Street Reform and Consumer Protection Act and any rules or regulations promulgated thereunder).

 

10.14        Titles and Headings. The titles and headings in the Plan are for convenience of reference only and, if any conflict, the Plan’s text, rather than such titles or headings, will control.

 

10.15        Conformity to Securities Laws. Participant acknowledges that the Plan is intended to conform to the extent necessary with Applicable Laws. Notwithstanding anything herein to the contrary, the Plan and all Awards will be administered only in conformance with Applicable Laws. To the extent Applicable Laws permit, the Plan and all Award Agreements will be deemed amended as necessary to conform to Applicable Laws.

 

10.16        Relationship to Other Benefits. No payment under the Plan will be taken into account in determining any benefits under any pension, retirement, savings, profit sharing, group insurance, welfare or other benefit plan of the Company or any Affiliate except as expressly provided in writing in such other plan or an agreement thereunder.

 

10.17        Broker-Assisted Sales. In the event of a broker-assisted sale of Shares in connection with the payment of amounts owed by a Participant under or with respect to the Plan or Awards, including amounts to be paid under the final sentence of Section 9.5: (a) any Shares to be sold through the broker-assisted sale will be sold on the day the payment first becomes due, or as soon thereafter as practicable; (b) such Shares may be sold as part of a block trade with other Participants in the Plan in which all participants receive an average price; (c) the applicable Participant will be responsible for all broker’s fees and other costs of sale, and by accepting an Award, each Participant agrees to indemnify and hold the Company harmless from any losses, costs, damages, or expenses relating to any such sale; (d) to the extent the Company or its designee receives proceeds of such sale that exceed the amount owed, the Company will pay such excess in cash to the applicable Participant as soon as reasonably practicable; (e) the Company and its designees are under no obligation to arrange for such sale at any particular price; and (f) in the event the proceeds of such sale are insufficient to satisfy the Participant’s applicable obligation, the Participant may be required to pay immediately upon demand to the Company or its designee an amount in cash sufficient to satisfy any remaining portion of the Participant’s obligation.

 

ARTICLE XI.
Definitions

 

As used in the Plan, the following words and phrases will have the following meanings:

 

11.1           “Administrator” means the Board or a Committee to the extent that the Board’s powers or authority under the Plan have been delegated to such Committee.

 

11.2           “Affiliate” means (i) any Subsidiary and (ii) any other person or entity that directly or indirectly controls, is controlled by or is under common control with the Company or Fluence Energy, LLC. The term “control” (including, with correlative meaning, the terms “controlled by” and “under common control with”), as applied to any person or entity, means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such person or entity, whether through the ownership of voting or other securities, by contract or otherwise. For the avoidance of doubt, AES or Siemens are not Affiliates.

 

 

11.3           “Applicable Laws” means the requirements relating to the administration of equity incentive plans under U.S. federal and state securities, tax and other applicable laws, rules and regulations, the applicable rules of any stock exchange or quotation system on which the Common Stock is listed or quoted and the applicable laws and rules of any foreign country or other jurisdiction where Awards are granted.

 

11.4           “Award” means, individually or collectively, a grant under the Plan of Options, Stock Appreciation Rights, Restricted Stock, Restricted Stock Units or Other Stock or Cash Based Awards.

 

11.5           “Award Agreement” means a written agreement evidencing an Award, which may be electronic, that contains such terms and conditions as the Administrator determines, consistent with and subject to the terms and conditions of the Plan.

 

11.6           “Board” means the Board of Directors of the Company.

 

11.7           “Cause” means (i) if a Participant is a party to a written employment, severance or consulting agreement with the Company or any of its Affiliates or an Award Agreement in which the term “cause” is defined (a “Relevant Agreement”), “cause” as defined in the Relevant Agreement, and (ii) if no Relevant Agreement exists, (A) a material breach by the Participant of any of his or her obligations set forth in any written agreement with the Company or any of its Affiliates as the same may then be in effect; (B) fraud, embezzlement, theft or other material dishonesty by the Participant in connection with services to or otherwise with respect to the Company or any of its Affiliates; (C) the Participant’s commission of any act or omission that results in or could reasonably be expected to result in any material damage or harm to the business, property or reputation of the Company or any of its Affiliates; (D) the Participant’s commission of, indictment for, or a plea of nolo contendere to, any felony under any state, federal or foreign law or any crime involving moral turpitude or dishonesty; (E) the Participant’s unlawful use (including being under the influence) or possession of illegal drugs, or repeated intoxication with alcohol, at the premises of the Company or any of its Affiliates or otherwise while performing (or holding himself or herself as performing) services for or on behalf of the Company or any of its Affiliates; (vi) Participant’s prolonged and unexcused absence from work (other than by reason of Disability); or (F) refusal or failure by the Participant to attempt in good faith to follow or carry out the reasonable instructions of the Board or the Participant’s supervisor which failure, if curable, does not cease within fifteen (15) days after written notice of such failure is given to the Participant by the Company or any Affiliate.

 

11.8           “Change in Control” means and includes each of the following:

 

(a)                A transaction or series of transactions (other than an offering of Common Stock (including an acquisition by underwriters for intended resale) to the general public through a registration statement filed with the Securities and Exchange Commission or a transaction or series of transactions that meets the requirements of clauses (i) and (ii) of subsection (c) below) whereby any “person” or related “group” of “persons” (as such terms are used in Sections 13(d) and 14(d)(2) of the Exchange Act) (other than one or more underwriters purchasing shares in an offering with the intent of reselling them to the general public, the Company, any of its Affiliates, an employee benefit plan maintained by the Company or any of its Affiliates, or a “person” or “group” of “persons” (as such terms are used in Sections 13(d) and 14(d)(2) of the Exchange Act) that, prior to such transaction, directly or indirectly controls, is controlled by, or is under common control with, the Company, Siemens AG or any of its subsidiaries or affiliates (“Siemens”), The AES Corporation or any of its subsidiaries or affiliates (“AES”), or any “group” of “persons” (as such terms are used in Sections 13(d) and 14(d)(2) of the Exchange Act) of which AES or Siemens is a member so long as AES and/or Siemens (individually or in the aggregate) directly or indirectly has beneficial ownership (within the meaning of Rule 13d-3 under the Exchange Act) of a greater percentage of the combined voting power of the Company’s securities outstanding immediately after such acquisition than any other member of such “group”) directly or indirectly acquires beneficial ownership (within the meaning of Rule 13d-3 under the Exchange Act) of securities of the Company possessing more than 50 % of the total combined voting power of the Company’s securities outstanding immediately after such acquisition; or

 

 

(b)                During any period of two consecutive years, individuals who constitute the Board at the beginning of such period, together with any new Director(s) whose election or nomination for election was (a) previously so approved by a vote of at least 75% of the other Directors, or (b) was made by The AES Corporation, Siemens Industry, Inc. or Qatar Holding LLC or their respective successors pursuant to the terms of the Stockholders Agreement of contemporaneous date herewith, cease for any reason to constitute a majority of the Board; or

 

(c)                The consummation by the Company (whether directly involving the Company or indirectly involving the Company through one or more intermediaries) of (x) a merger, consolidation, reorganization, or business combination or (y) a sale or other disposition of all or substantially all of the Company’s assets in any single transaction or series of related transactions or (z) the acquisition of assets or stock of another entity, in each case other than a transaction:

 

(i)                 which results in the Company’s voting securities outstanding immediately before the transaction continuing to represent (either by remaining outstanding or by being converted into voting securities of the Company or the person that, as a result of the transaction, controls, directly or indirectly, the Company or owns, directly or indirectly, all or substantially all of the Company’s assets or otherwise succeeds to the business of the Company (the Company or such person, the “Successor Entity”)) directly or indirectly, at least a majority of the combined voting power of the Successor Entity’s outstanding voting securities immediately after the transaction, and

 

(ii)               after which no person or group beneficially owns voting securities representing 50% or more of the combined voting power of the Successor Entity; provided, however, that no person or group shall be treated for purposes of this clause (ii) as beneficially owning 50% or more of the combined voting power of the Successor Entity solely as a result of the voting power held in the Company prior to the consummation of the transaction.

 

Notwithstanding the foregoing, if a Change in Control constitutes a payment event with respect to any Award (or portion of any Award) that provides for the deferral of compensation that is subject to Section 409A, to the extent required to avoid the imposition of additional taxes under Section 409A, the transaction or event described in subsection (a), (b) or (c) with respect to such Award (or portion thereof) shall only constitute a Change in Control for purposes of the payment timing of such Award if such transaction also constitutes a “change in control event,” as defined in Treasury Regulation Section 1.409A-3(i)(5).

 

The Administrator shall have full and final authority, which shall be exercised in its discretion, to determine conclusively whether a Change in Control has occurred pursuant to the above definition, the date of the occurrence of such Change in Control and any incidental matters relating thereto; provided that any exercise of authority in conjunction with a determination of whether a Change in Control is a “change in control event” as defined in Treasury Regulation Section 1.409A-3(i)(5) shall be consistent with such regulation.

 

11.9           “Code” means the Internal Revenue Code of 1986, as amended, and the regulations issued thereunder.

 

 

11.10        “Committee” means one or more committees or subcommittees of the Board, which may include one or more Directors or executive officers of the Company, or one or more committees consisting of executive officers of the Company, in each case, to the extent Applicable Laws permit. To the extent required to comply with the provisions of Rule 16b-3, it is intended that each member of the Committee will be, at the time the Committee takes any action with respect to an Award that is subject to Rule 16b-3, a “non-employee director” within the meaning of Rule 16b-3; however, a Committee member’s failure to qualify as a “non-employee director” within the meaning of Rule 16b-3 will not invalidate any Award granted by the Committee that is otherwise validly granted under the Plan.

 

11.11        “Common Stock” means the Class A common stock, par value $0.00001 per share, of the Company.

 

11.12        “Company” means Fluence Energy, Inc., a Delaware corporation, or any successor.

 

11.13        “Consultant” means any person, including any adviser, engaged by the Company or its parent or Affiliate to render services to such entity if the consultant or adviser: (i) renders bona fide services to the Company; (ii) renders services not in connection with the offer or sale of securities in a capital-raising transaction and does not directly or indirectly promote or maintain a market for the Company’s securities; and (iii) is a natural person.

 

11.14        “Designated Beneficiary” means the beneficiary or beneficiaries the Participant designates, in a manner the Administrator determines, to receive amounts due or exercise the Participant’s rights if the Participant dies or becomes incapacitated. Without a Participant’s effective designation, “Designated Beneficiary” will mean the Participant’s estate.

 

11.15        “Director” means a Board member.

 

11.16        “Disability” means the Board has made a good faith determination that the Participant has become physically or mentally incapacitated or disabled such that the Participant is unable to perform for the Company substantially the same services, with or without accommodation, as the Participant performed prior to incurring such incapacity or disability, and such incapacity or disability exists for an aggregate of three (3) calendar months in any twelve (12) month period. In connection with making such determination, the Company, at its option and expense, shall be entitled to select and retain a physician to confirm the existence of such incapacity or disability, and the determination made by such physician shall be binding on the parties for the purposes of this Plan and any Award Agreements.

 

11.17        “Dividend Equivalents” means a right granted to a Participant under the Plan to receive the equivalent value (in cash or Shares) of dividends paid on Shares.

 

11.18        “Employee” means any employee of the Company or any of its Affiliates.

 

11.19        “Equity Restructuring” means a nonreciprocal transaction between the Company and its stockholders, such as a stock dividend, stock split, spin-off or recapitalization through a large, nonrecurring cash dividend, that affects the number or kind of Shares (or other Company securities) or the share price of Common Stock (or other Company securities) and causes a change in the per share value of the Common Stock underlying outstanding Awards.

 

11.20        “Exchange Act” means the Securities Exchange Act of 1934, as amended.

 

11.21        “Fair Market Value” means, as of any date, the value of Common Stock determined as follows: (i) if the Common Stock is listed on any established stock exchange, its Fair Market Value will be the closing sales price for such Common Stock as quoted on such exchange for such date, or if no sale occurred on such date, the last day preceding such date during which a sale occurred, as reported in The Wall Street Journal or another source the Administrator deems reliable; (ii) if the Common Stock is not traded on a stock exchange but is quoted on a national market or other quotation system, the closing sales price on such date, or if no sales occurred on such date, then on the last date preceding such date during which a sale occurred, as reported in The Wall Street Journal or another source the Administrator deems reliable; or (iii) in any case the Administrator may determine the Fair Market Value in its discretion to the extent such determination does not constitute a “material revision” to the Plan under applicable stock exchange or stock market rules and regulations (or otherwise require stockholder approval).

 

 

11.22        “Greater Than 10% Stockholder” means an individual then owning (within the meaning of Section 424(d) of the Code) more than 10% of the total combined voting power of all classes of stock of the Company or its parent or subsidiary corporation, as defined in Section 424(e) and (f) of the Code, respectively.

 

11.23        “Incentive Stock Option” means an Option intended to qualify as an “incentive stock option” as defined in Section 422 of the Code.

 

11.24        “Non-Qualified Stock Option” means an Option not intended or not qualifying as an Incentive Stock Option.

 

11.25        “Option” means an option to purchase Shares.

 

11.26        “Other Stock or Cash Based Awards” means cash awards, awards of Shares, and other awards valued wholly or partially by referring to, or are otherwise based on, Shares or other property.

 

11.27        “Overall Share Limit” means the 9,500,000 Shares.

 

11.28        “Participant” means a Service Provider who has been granted an Award.

 

11.29        “Performance Criteria” mean the criteria (and adjustments) that the Administrator may select for an Award to establish performance goals for a performance period, which may include the following: net earnings or losses (either before or after one or more of interest, taxes, depreciation, amortization, and non-cash equity-based compensation expense); gross or net sales or revenue or sales or revenue growth; net income (either before or after taxes) or adjusted net income; profits (including but not limited to gross profits, net profits, profit growth, net operation profit or economic profit), profit return ratios or operating margin; budget or operating earnings (either before or after taxes or before or after allocation of corporate overhead and bonus); cash flow (including operating cash flow and free cash flow or cash flow return on capital); return on assets; return on capital or invested capital; cost of capital; return on stockholders’ equity; total stockholder return; return on sales; costs, reductions in costs and cost control measures; expenses; working capital; earnings or loss per share; adjusted earnings or loss per share; price per share or dividends per share (or appreciation in or maintenance of such price or dividends); regulatory achievements or compliance; implementation, completion or attainment of objectives relating to research, development, regulatory, commercial, or strategic milestones or developments; market share; economic value or economic value added models; division, group or corporate financial goals; customer satisfaction/growth; customer service; employee satisfaction; recruitment and maintenance of personnel; human resources management; supervision of litigation and other legal matters; strategic partnerships and transactions; financial ratios (including those measuring liquidity, activity, profitability or leverage); debt levels or reductions; sales-related goals; business development goals; financing and other capital raising transactions; cash on hand; acquisition activity; investment sourcing activity; marketing initiatives; ESG initiatives or goals; and other measures of performance selected by the Board or Committee whether or not listed herein, any of which may be measured in absolute terms, as compared to any incremental increase or decrease or qualitatively in the Board or Committee’s sole discretion. Such performance goals also may be based solely by reference to the Company’s performance or the performance of an Affiliate, division, business segment or business unit of the Company or an Affiliate, or based upon performance relative to performance of other companies or upon comparisons of any of the indicators of performance relative to performance of other companies. The Committee may provide for exclusion of the impact of an event or occurrence which the Committee determines should appropriately be excluded, including (a) restructurings, discontinued operations, extraordinary items, and other unusual, infrequently occurring or non-recurring charges or events, (b) asset write-downs, (c) litigation or claim judgments or settlements, (d) acquisitions or divestitures, (e) reorganization or change in the corporate structure or capital structure of the Company, (f) an event either not directly related to the operations of the Company, an Affiliate, division, business segment or business unit or not within the reasonable control of management, (g) foreign exchange gains and losses, (h) a change in the fiscal year of the Company, (i) the refinancing or repurchase of bank loans or debt securities, (j) unbudgeted capital expenditures, (k) the issuance or repurchase of equity securities and other changes in the number of outstanding shares, (l) conversion of some or all of convertible securities to Common Stock, (m) any business interruption event (n) the cumulative effects of tax or accounting changes in accordance with U.S. generally accepted accounting principles, or (o) the effect of changes in other laws or regulatory rules affecting reported results.

 

 

11.30        “Plan” means this 2021 Incentive Award Plan, as may be amended from time to time.

 

11.31        “Pricing Date” means the date upon which the Company’s Registration Statement on Form S-1 filed with the Securities and Exchange Commission relating to the registered underwritten public offering of shares of Common Stock becomes effective.

 

11.32        “Restricted Stock” means Shares awarded to a Participant under Article VI subject to certain vesting conditions and other restrictions.

 

11.33        “Restricted Stock Unit” means an unfunded, unsecured right to receive, on the applicable settlement date, one or more Shares or an amount in cash or other consideration determined by the Administrator to be of equal value as of such settlement date, subject to certain vesting conditions and other restrictions.

 

11.34        “Rule 16b-3” means Rule 16b-3 promulgated under the Exchange Act.

 

11.35        “Section 409A” means Section 409A of the Code and all regulations, guidance, compliance programs and other interpretative authority thereunder.

 

11.36        “Securities Act” means the Securities Act of 1933, as amended.

 

11.37        “Service Provider” means an Employee, Consultant or Director.

 

11.38        “Shares” means shares of Common Stock.

 

11.39        “Stock Appreciation Right” means a stock appreciation right granted under Article V.

 

11.40        “Subsidiary” means any entity (other than the Company), whether domestic or foreign, in an unbroken chain of entities beginning with the Company if each of the entities other than the last entity in the unbroken chain beneficially owns, at the time of the determination, securities or interests representing at least 50% of the total combined voting power of all classes of securities or interests in one of the other entities in such chain.

 

 

11.41        “Substitute Awards” shall mean Awards granted or Shares issued by the Company in assumption of, or in substitution or exchange for, awards previously granted, or the right or obligation to make future awards, in each case by a company acquired by the Company or any Affiliate or with which the Company or any Affiliate combines.

 

11.42        “Termination of Service” means the date the Participant ceases to be a Service Provider.

 

* * * * *

 

 

 

Exhibit 10.6.1

 

FLUENCE ENERGY, INC. 2021 INCENTIVE AWARD PLAN

 

RESTRICTED STOCK Unit Grant Notice

 

Capitalized terms not specifically defined in this Restricted Stock Unit Grant Notice (the “Grant Notice”) have the meanings given to them in the 2021 Incentive Award Plan (as amended from time to time, the “Plan”) of Fluence Energy, Inc. (the “Company”).

 

The Company has granted to the participant listed below (“Participant”) the Restricted Stock Units described in this Grant Notice (the “RSUs”), subject to the terms and conditions of the Plan and the Restricted Stock Unit Agreement attached as Exhibit A (the “Agreement”), both of which are incorporated into this Grant Notice by reference.

 

Participant:
Grant Date:
Number of RSUs:
Vesting Commencement Date:
Vesting Schedule:	[To be specified in individual grant notices]

 

[Withholding Tax Election: By accepting this Award electronically through the Plan service provider’s online grant acceptance policy, the Participant understands and agrees that as a condition of the grant of the RSUs hereunder, the Participant is required to, and hereby affirmatively elects to (the “Sell to Cover Election”), (1) sell that number of Shares determined in accordance with Section 3.2 of the Agreement as may be necessary to satisfy all applicable withholding obligations with respect to any taxable event arising in connection with the RSUs, and (2) to allow the Agent (as defined in the Agreement) to remit the cash proceeds of such sale(s) to the Company. Furthermore, the Participant directs the Company to make a cash payment equal to the required tax withholding from the cash proceeds of such sale(s) directly to the appropriate taxing authorities. The Participant has carefully reviewed Section 3.2 of the Agreement and the Participant hereby represents and warrants that on the date hereof he or she is not aware of any material, nonpublic information with respect to the Company or any securities of the Company, is not subject to any legal, regulatory or contractual restriction that would prevent the Agent from conducting sales, does not have, and will not attempt to exercise, authority, influence or control over any sales of Shares effected by the Agent pursuant to the Agreement, and is entering into the Agreement and this election to “sell to cover” in good faith and not as part of a plan or scheme to evade the prohibitions of Rule 10b5-1 (regarding trading of the Company’s securities on the basis of material nonpublic information) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). It is the Participant’s intent that this election to “sell to cover” comply with the requirements of Rule 10b5-1(c)(1)(i)(B) under the Exchange Act and be interpreted to comply with the requirements of Rule 10b5-1(c) under the Exchange Act.]

 

By Participant’s signature below, Participant agrees to be bound by the terms of this Grant Notice, the Plan and the Agreement. Participant has reviewed the Plan, this Grant Notice and the Agreement in their entirety, has had an opportunity to obtain the advice of counsel prior to executing this Grant Notice and fully understands all provisions of the Plan, this Grant Notice and the Agreement. Participant hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Administrator upon any questions arising under the Plan, this Grant Notice or the Agreement.

 

 

FLUENCE ENERGY, INC.			PARTICIPANT
By:
Name:			[Participant Name]
Title:

 

 

Exhibit A

 

RESTRICTED STOCK UNIT AGREEMENT

 

Capitalized terms not specifically defined in this Agreement have the meanings specified in the Grant Notice or, if not defined in the Grant Notice, in the Plan.

 

Article I.
general

 

1.1           Award of RSUs.

 

(a)                The Company has granted the RSUs to Participant effective as of the grant date set forth in the Grant Notice (the “Grant Date”). Each RSU represents the right to receive one Share or, at the option of the Company, an amount of cash, in either case, as set forth in this Agreement. Participant will have no right to the distribution of any Shares or payment of any cash until the time (if ever) the RSUs have vested.

 

1.2           Incorporation of Terms of Plan. The RSUs are subject to the terms and conditions set forth in this Agreement and the Plan, which is incorporated herein by reference. In the event of any inconsistency between the Plan and this Agreement, the terms of the Plan will control.

 

1.3            Unsecured Promise. The RSUs will at all times prior to settlement represent an unsecured Company obligation payable only from the Company’s general assets.

 

Article II.
VESTING; forfeiture AND SETTLEMENT

 

2.1           Vesting; Forfeiture. The RSUs will vest according to the vesting schedule in the Grant Notice except that any fraction of an RSU that would otherwise be vested will be accumulated and will vest only when a whole RSU has accumulated. In the event of Participant’s Termination of Service for any reason, all unvested RSUs will immediately and automatically be cancelled and forfeited, except as otherwise determined by the Administrator or provided in a binding written agreement between Participant and the Company.

 

2.2           Settlement.

 

(a)                RSUs will be paid in Shares or cash, at the Company’s option, as soon as administratively practicable after the vesting of the applicable RSU, but in no event more than sixty (60) days after the RSU’s vesting date. Notwithstanding the foregoing, the Company may delay any payment under this Agreement that the Company reasonably determines would violate Applicable Law until the earliest date the Company reasonably determines the making of the payment will not cause such a violation (in accordance with Treasury Regulation Section 1.409A-2(b)(7)(ii)), provided the Company reasonably believes the delay will not result in the imposition of excise taxes under Section 409A.

 

 

(b)                If an RSU is paid in cash, the amount of cash paid with respect to the RSU will equal the Fair Market Value of a Share on the day immediately preceding the payment date.

 

Article III.
TAXATION AND TAX WITHHOLDING

 

3.1          Representation. Participant represents to the Company that Participant has reviewed with Participant’s own tax advisors the tax consequences of this Award and the transactions contemplated by the Grant Notice and this Agreement. Participant is relying solely on such advisors and not on any statements or representations of the Company or any of its agents.

 

3.2           Tax Withholding. Notwithstanding any other provision of this Agreement:

 

(a)                [As set forth in Section 9.5 of the Plan, the Company shall have the authority and the right to deduct or withhold, or to require the Participant to remit to the Company, an amount sufficient to satisfy all applicable federal, state and local taxes required by law to be withheld with respect to any taxable event arising in connection with the RSUs. In satisfaction of such tax withholding obligations and in accordance with the Sell to Cover Election included in the Grant Notice, the Participant has irrevocably elected to sell the portion of the Shares to be delivered under the RSUs necessary so as to satisfy the tax withholding obligations and shall execute any letter of instruction or agreement required by the Company’s transfer agent (together with any other party the Company determines necessary to execute the Sell to Cover Election, the “Agent”) to cause the Agent to irrevocably commit to forward the proceeds necessary to satisfy the tax withholding obligations directly to the Company and/or its Affiliates. Notwithstanding any other provision of this Agreement, the Company shall not be obligated to deliver any new certificate representing Shares to the Participant or the Participant’s legal representative or enter such Shares in book entry form unless and until the Participant or the Participant’s legal representative shall have paid or otherwise satisfied in full the amount of all federal, state and local taxes applicable to the taxable income of the Participant resulting from the grant or vesting of the RSUs or the issuance of Shares. In accordance with Participant’s Sell to Cover Election pursuant to the Grant Notice, the Participant hereby acknowledges and agrees:

 

(i)           The Participant hereby appoints the Agent as the Participant’s agent and authorizes the Agent to (1) sell on the open market at the then prevailing market price(s), on the Participant’s behalf, as soon as practicable on or after the Shares are issued upon the vesting of the RSUs, that number (rounded up to the next whole number) of the Shares so issued necessary to generate proceeds to cover (x) any tax withholding obligations incurred with respect to such vesting or issuance and (y) all applicable fees and commissions due to, or required to be collected by, the Agent with respect thereto and (2) apply any remaining funds to the Participant’s federal tax withholding.

 

(ii)         The Participant hereby authorizes the Company and the Agent to cooperate and communicate with one another to determine the number of Shares that must be sold pursuant to subsection (i) above.

 

 

(iii)       The Participant understands that the Agent may effect sales as provided in subsection (i) above in one or more sales and that the average price for executions resulting from bunched orders will be assigned to the Participant’s account. In addition, the Participant acknowledges that it may not be possible to sell Shares as provided by subsection (i) above due to (1) a legal or contractual restriction applicable to the Participant or the Agent, (2) a market disruption, or (3) rules governing order execution priority on the national exchange where the Shares may be traded. The Participant further agrees and acknowledges that in the event the sale of Shares would result in material adverse harm to the Company, as determined by the Company in its sole discretion, the Company may instruct the Agent not to sell Shares as provided by subsection (i) above. In the event of the Agent’s inability to sell Shares, the Participant will continue to be responsible for the timely payment to the Company and/or its Affiliates of all federal, state, local and foreign taxes that are required by applicable laws and regulations to be withheld, including but not limited to those amounts specified in subsection (i) above.

 

(iv)        The Participant acknowledges that regardless of any other term or condition of this Section 3.2(a), the Agent will not be liable to the Participant for (1) special, indirect, punitive, exemplary, or consequential damages, or incidental losses or damages of any kind, or (2) any failure to perform or for any delay in performance that results from a cause or circumstance that is beyond its reasonable control.

 

(v)          The Participant hereby agrees to execute and deliver to the Agent any other agreements or documents as the Agent reasonably deems necessary or appropriate to carry out the purposes and intent of this Section 3.2(a). The Agent is a third-party beneficiary of this Section 3.2(a).

 

(vi)        This Section 3.2(a) shall terminate not later than the date on which all tax withholding obligations arising in connection with the vesting or settlement of the Award have been satisfied.

 

(b)                The Company shall not be obligated to deliver any certificate representing Shares issuable with respect to the RSUs to, or to cause any such Shares to be held in book-entry form by, Participant or his or her legal representative unless and until Participant or his or her legal representative shall have paid or otherwise satisfied in full the amount of all federal, state, local and foreign taxes applicable with respect to the taxable income of Participant resulting from the vesting or settlement of the RSUs or any other taxable event related to the RSUs.

 

(c)                Participant is ultimately liable and responsible for all taxes owed in connection with the RSUs, regardless of any action the Company or any Affiliate takes with respect to any tax withholding obligations that arise in connection with the RSUs. Neither the Company or any Affiliate makes any representation or undertaking regarding the treatment of any tax withholding in connection with the awarding, vesting or settlement of the RSUs or the subsequent sale of Shares. The Company or any Affiliate does not commit and are under no obligation to structure the RSUs to reduce or eliminate Participant’s tax liability.]

 

(a)                [The Company and its Affiliates have the authority to deduct or withhold, or require Participant to remit to the Company or any Affiliate, an amount sufficient to satisfy any applicable federal, state, local and foreign taxes (including the employee portion of any FICA obligation) required by Applicable Law to be withheld with respect to any taxable event arising pursuant to this Agreement. The Company or any of its Affiliates may withhold or Participant may make such payment in one or more of the forms specified below:

 

 

(i)           by cash or check made payable to the Company or any of its Affiliates with respect to which the withholding obligation arises;

 

(ii)         by the deduction of such amount from other compensation payable to Participant;

 

(iii)       with respect to any withholding taxes arising in connection with the vesting or settlement of the RSUs, with the consent of the Administrator, by requesting that the Company withhold a net number of vested shares of Stock otherwise issuable pursuant to the RSUs having a then current Fair Market Value not exceeding the amount necessary to satisfy the withholding obligation of the Company or any of its Affiliates based on the maximum statutory withholding rates in Participant’s applicable jurisdictions for federal, state, local and foreign income tax and payroll tax purposes that are applicable to such taxable income;

 

(iv)        with respect to any withholding taxes arising in connection with the vesting or settlement of the RSUs, with the consent of the Administrator, by tendering to the Company vested shares of Stock having a then current Fair Market Value not exceeding the amount necessary to satisfy the withholding obligation of the Company or any of its Affiliates based on the maximum statutory withholding rates in Participant’s applicable jurisdictions for federal, state, local and foreign income tax and payroll tax purposes that are applicable to such taxable income;

 

(v)          with respect to any withholding taxes arising in connection with the vesting or settlement of the RSUs, through the delivery of a notice that Participant has placed a market sell order with a broker acceptable to the Company with respect to shares of Stock then issuable to Participant pursuant to the RSUs, and that the broker has been directed to pay a sufficient portion of the net proceeds of the sale to the Company or any of its Affiliates with respect to which the withholding obligation arises in satisfaction of such withholding taxes; provided that payment of such proceeds is then made to the applicable Company or any of its Affiliates at such time as may be required by the Administrator, but in any event not later than the settlement of such sale; or

 

(vi)        in any combination of the foregoing.

 

(b)                With respect to any withholding taxes arising in connection with the RSUs, in the event Participant fails to provide timely payment of all sums required pursuant to Section 3.2(a), the Company shall have the right and option, but not the obligation, to treat such failure as an election by Participant to satisfy all or any portion of Participant’s required payment obligation pursuant to Section 3.2(a)(ii) or Section 3.2(a)(iii) above, or any combination of the foregoing as the Company may determine to be appropriate. The Company shall not be obligated to deliver any certificate representing shares of Stock issuable with respect to the RSUs to Participant or his or her legal representative unless and until Participant or his or her legal representative shall have paid or otherwise satisfied in full the amount of all federal, state, local and foreign taxes applicable with respect to the taxable income of Participant resulting from the vesting or settlement of the RSUs or any other taxable event related to the RSUs.

 

 

(c)                In the event any tax withholding obligation arising in connection with the RSUs will be satisfied under Section 3.2(a)(iii), then the Company may elect to instruct any brokerage firm determined acceptable to the Company for such purpose to sell on Participant’s behalf a whole number of shares from those shares of Stock then issuable to Participant pursuant to the RSUs as the Company determines to be appropriate to generate cash proceeds sufficient to satisfy the tax withholding obligation and to remit the proceeds of such sale to the Participating Company with respect to which the withholding obligation arises. Participant’s acceptance of this Award constitutes Participant’s instruction and authorization to the Company and such brokerage firm to complete the transactions described in this Section 3.2(c), including the transactions described in the previous sentence, as applicable. The Company may refuse to issue any shares of Stock in settlement of the RSUs to Participant until the foregoing tax withholding obligations are satisfied, provided that no payment shall be delayed under this Section 2.5(c) if such delay will result in a violation of Section 409A of the Code.

 

(d)                Participant is ultimately liable and responsible for all taxes owed in connection with the RSUs, regardless of any action Company or any of its Affiliates takes with respect to any tax withholding obligations that arise in connection with the RSUs. Neither Company or any of its Affiliates makes any representation or undertaking regarding the treatment of any tax withholding in connection with the awarding, vesting or payment of the RSUs or the subsequent sale of Shares. The Company or any of its Affiliates does not commit and are under no obligation to structure the RSUs to reduce or eliminate Participant’s tax liability.]

 

Article IV.
other provisions

 

4.1          Adjustments. Participant acknowledges that the RSUs, the Shares subject to the RSUs are subject to adjustment, modification and termination in certain events as provided in this Agreement and the Plan.

 

4.2           Notices. Any notice to be given under the terms of this Agreement to the Company must be in writing and addressed to the Company in care of the Company’s Secretary at the Company’s principal office or the Secretary’s then-current email address or facsimile number. Any notice to be given under the terms of this Agreement to Participant must be in writing and addressed to Participant at Participant’s last known mailing address, email address or facsimile number in the Company’s personnel files. By a notice given pursuant to this Section, either party may designate a different address for notices to be given to that party. Any notice will be deemed duly given when actually received, when sent by email, when sent by certified mail (return receipt requested) and deposited with postage prepaid in a post office or branch post office regularly maintained by the United States Postal Service, when delivered by a nationally recognized express shipping company or upon receipt of a facsimile transmission confirmation.

 

4.3           Titles. Titles are provided herein for convenience only and are not to serve as a basis for interpretation or construction of this Agreement.

 

4.4           Conformity to Securities Laws. Participant acknowledges that the Plan, the Grant Notice and this Agreement are intended to conform to the extent necessary with all Applicable Laws and, to the extent Applicable Laws permit, will be deemed amended as necessary to conform to Applicable Laws.

 

4.5           Successors and Assigns. The Company may assign any of its rights under this Agreement to single or multiple assignees, and this Agreement will inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer set forth in the Plan, this Agreement will be binding upon and inure to the benefit of the heirs, legatees, legal representatives, successors and assigns of the parties hereto.

 

 

4.6           Limitations Applicable to Section 16 Persons. Notwithstanding any other provision of the Plan or this Agreement, if Participant is subject to Section 16 of the Exchange Act, the Plan, the Grant Notice, this Agreement, the RSUs and the Dividend Equivalents will be subject to any additional limitations set forth in any applicable exemptive rule under Section 16 of the Exchange Act (including any amendment to Rule 16b-3) that are requirements for the application of such exemptive rule. To the extent Applicable Laws permit, this Agreement will be deemed amended as necessary to conform to such applicable exemptive rule.

 

4.7           Entire Agreement. The Plan, the Grant Notice and this Agreement (including any exhibit hereto) constitute the entire agreement of the parties and supersede in their entirety all prior undertakings and agreements of the Company and Participant with respect to the subject matter hereof.

 

4.8           Agreement Severable. In the event that any provision of the Grant Notice or this Agreement is held illegal or invalid, the provision will be severable from, and the illegality or invalidity of the provision will not be construed to have any effect on, the remaining provisions of the Grant Notice or this Agreement.

 

4.9           Limitation on Participant’s Rights. Participation in the Plan confers no rights or interests other than as herein provided. This Agreement creates only a contractual obligation on the part of the Company as to amounts payable and may not be construed as creating a trust. Neither the Plan nor any underlying program, in and of itself, has any assets. Participant will have only the rights of a general unsecured creditor of the Company with respect to amounts credited and benefits payable, if any, with respect to the RSUs, and rights no greater than the right to receive cash or the Shares as a general unsecured creditor with respect to the RSUs, as and when settled pursuant to the terms of this Agreement.

 

4.10         Not a Contract of Employment. Nothing in the Plan, the Grant Notice or this Agreement confers upon Participant any right to continue in the employ or service of the Company or any Affiliate or interferes with or restricts in any way the rights of the Company and its Subsidiaries, which rights are hereby expressly reserved, to discharge or terminate the services of Participant at any time for any reason whatsoever, with or without Cause, except to the extent expressly provided otherwise in a written agreement between the Company or an Affiliate and Participant.

 

4.11         Counterparts. The Grant Notice may be executed in one or more counterparts, including by way of any electronic signature, subject to Applicable Law, each of which will be deemed an original and all of which together will constitute one instrument.

 

4.12         Electronic Signature and Delivery. By accepting this Agreement, the Participant consents to the electronic delivery of prospectuses, annual reports and other information required to be delivered by the U.S. Securities and Exchange Commission rules. Without limiting the foregoing, the Company may, in its sole discretion, decide to deliver any documents related to current or future participation in the Plan by electronic means. The Participant hereby consents to receive such documents by electronic delivery and agrees to participate in the Plan through an online or electronic system established and maintained by the Company or a third party designated by the Company.

 

4.13          Section 409A. The RSUs are intended to be exempt from, or compliant with, Section 409A of the Code. Notwithstanding the foregoing or any provision of the Plan or this Agreement, if any provision of the Plan or this Agreement contravenes Section 409A of the Code or could cause the Participant to incur any tax, interest or penalties under Section 409A of the Code, the Administrator may, in its sole discretion and without the Participant’s consent, modify such provision to (i) comply with, or avoid being subject to, Section 409A of the Code, or to avoid the incurrence of taxes, interest and penalties under Section 409A of the Code, and/or (iii) maintain, to the maximum extent practicable, the original interest and economic benefit to the Participant of the applicable provision without materially increasing the cost to the Company or contravening the provisions of Section 409A of the Code. This Section 4.13 does not create an obligation on the part of the Company to modify the Plan or this Agreement and does not guarantee that the RSUs will not be subject to interest and penalties under Section 409A of the Code.

 

 

4.14         Clawback. The RSUs shall at all times be subject to any clawback or similar policy or program established by the Company, as may be amended from time to time (a “Clawback Policy”). In addition (and without limiting the Company’s rights and the Participant’s obligations under any Clawback Policy), to the extent required by applicable law or the rules and regulations of the Nasdaq Global Market or any other securities exchange or interdealer quotation on which the Common Stock is listed or quote, the RSUs shall be subject (including on a retroactive basis) to clawback, forfeiture or similar requirements (and such requirements shall be deemed incorporated by reference into this Agreement).

 

* * * * *

 

 

Exhibit 10.6.2

 

FLUENCE ENERGY, INC. 2021 INCENTIVE AWARD PLAN

 

RESTRICTED STOCK Unit Grant Notice

 

Capitalized terms not specifically defined in this Restricted Stock Unit Grant Notice (the “Grant Notice”) have the meanings given to them in the 2021 Incentive Award Plan (as amended from time to time, the “Plan”) of Fluence Energy, Inc. (the “Company”).

 

The Company has granted to the participant listed below (“Participant”) the Restricted Stock Units described in this Grant Notice (the “RSUs”), subject to the terms and conditions of the Plan and the Restricted Stock Unit Agreement attached as Exhibit A (the “Agreement”), both of which are incorporated into this Grant Notice by reference.

 

Participant:
Grant Date:
Number of RSUs:
Vesting Commencement Date:
Vesting Schedule:

By Participant’s signature below, Participant agrees to be bound by the terms of this Grant Notice, the Plan and the Agreement. Participant has reviewed the Plan, this Grant Notice and the Agreement in their entirety, has had an opportunity to obtain the advice of counsel prior to executing this Grant Notice and fully understands all provisions of the Plan, this Grant Notice and the Agreement. Participant hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Administrator upon any questions arising under the Plan, this Grant Notice or the Agreement.

 

 

FLUENCE ENERGY, INC.			PARTICIPANT
By:
Name:			[Participant Name]
Title:

 

 

Exhibit A

 

RESTRICTED STOCK UNIT AGREEMENT

 

Capitalized terms not specifically defined in this Agreement have the meanings specified in the Grant Notice or, if not defined in the Grant Notice, in the Plan.

 

Article I.
general

 

1.1               Award of RSUs.

 

(a)               The Company has granted the RSUs to Participant effective as of the grant date set forth in the Grant Notice (the “Grant Date”). Each RSU represents the right to receive one Share or, at the option of the Company, an amount of cash, in either case, as set forth in this Agreement. Participant will have no right to the distribution of any Shares or payment of any cash until the time (if ever) the RSUs have vested.

 

1.2              Incorporation of Terms of Plan. The RSUs are subject to the terms and conditions set forth in this Agreement and the Plan, which is incorporated herein by reference. In the event of any inconsistency between the Plan and this Agreement, the terms of the Plan will control.

 

1.3              Unsecured Promise. The RSUs will at all times prior to settlement represent an unsecured Company obligation payable only from the Company’s general assets.

 

Article II.
VESTING; forfeiture AND SETTLEMENT

 

2.1              Vesting; Forfeiture. The RSUs will vest according to the vesting schedule in the Grant Notice except that any fraction of an RSU that would otherwise be vested will be accumulated and will vest only when a whole RSU has accumulated. In the event of Participant’s Termination of Service for any reason, all unvested RSUs will immediately and automatically be cancelled and forfeited, except as otherwise determined by the Administrator or provided in a binding written agreement between Participant and the Company.

 

 

2.2               Settlement.

 

(a)               RSUs will be paid in Shares or cash, at the Company’s option, as soon as administratively practicable after the vesting of the applicable RSU, but in no event more than sixty (60) days after the RSU’s vesting date. Notwithstanding the foregoing, the Company may delay any payment under this Agreement that the Company reasonably determines would violate Applicable Law until the earliest date the Company reasonably determines the making of the payment will not cause such a violation (in accordance with Treasury Regulation Section 1.409A-2(b)(7)(ii)), provided the Company reasonably believes the delay will not result in the imposition of excise taxes under Section 409A.

 

(b)               If an RSU is paid in cash, the amount of cash paid with respect to the RSU will equal the Fair Market Value of a Share on the day immediately preceding the payment date.

 

Article III.
TAXATION AND TAX WITHHOLDING

 

3.1               Representation. Participant represents to the Company that Participant has reviewed with Participant’s own tax advisors the tax consequences of this Award and the transactions contemplated by the Grant Notice and this Agreement. Participant is relying solely on such advisors and not on any statements or representations of the Company or any of its agents.

 

3.2               Tax Withholding.

 

(a)               The provisions of Section 9.5 of the Plan are incorporated herein by reference and made a part hereof. Participant represents to the Company that Participant has reviewed with Participant’s own tax advisors the tax consequences of this Award and the transactions contemplated by the Grant Notice and this Agreement. Participant is relying solely on such advisors and not on any statements or representations of the Company or any of its employees, agents or representatives.

 

(b)               Participant acknowledges that Participant is ultimately liable and responsible for all taxes owed in connection with the RSUs regardless of any action the Company or any Affiliate takes with respect to any tax withholding obligations that arise in connection with the RSUs Neither the Company nor any Affiliate makes any representation or undertaking regarding the treatment of any tax withholding in connection with the awarding, vesting or payment of the RSUs or the subsequent sale of Shares. The Company and the Affiliates do not commit and are under no obligation to structure the RSUs to reduce or eliminate Participant’s tax liability.

 

Article IV.
other provisions

 

4.1              Adjustments. Participant acknowledges that the RSUs, the Shares subject to the RSUs are subject to adjustment, modification and termination in certain events as provided in this Agreement and the Plan.

 

4.2               Notices. Any notice to be given under the terms of this Agreement to the Company must be in writing and addressed to the Company in care of the Company’s Secretary at the Company’s principal office or the Secretary’s then-current email address or facsimile number. Any notice to be given under the terms of this Agreement to Participant must be in writing and addressed to Participant at Participant’s last known mailing address, email address or facsimile number in the Company’s personnel files. By a notice given pursuant to this Section, either party may designate a different address for notices to be given to that party. Any notice will be deemed duly given when actually received, when sent by email, when sent by certified mail (return receipt requested) and deposited with postage prepaid in a post office or branch post office regularly maintained by the United States Postal Service, when delivered by a nationally recognized express shipping company or upon receipt of a facsimile transmission confirmation.

 

 

4.3              Titles. Titles are provided herein for convenience only and are not to serve as a basis for interpretation or construction of this Agreement.

 

4.4              Conformity to Securities Laws. Participant acknowledges that the Plan, the Grant Notice and this Agreement are intended to conform to the extent necessary with all Applicable Laws and, to the extent Applicable Laws permit, will be deemed amended as necessary to conform to Applicable Laws.

 

4.5              Successors and Assigns. The Company may assign any of its rights under this Agreement to single or multiple assignees, and this Agreement will inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer set forth in the Plan, this Agreement will be binding upon and inure to the benefit of the heirs, legatees, legal representatives, successors and assigns of the parties hereto.

 

4.6              Limitations Applicable to Section 16 Persons. Notwithstanding any other provision of the Plan or this Agreement, if Participant is subject to Section 16 of the Exchange Act, the Plan, the Grant Notice, this Agreement, the RSUs will be subject to any additional limitations set forth in any applicable exemptive rule under Section 16 of the Exchange Act (including any amendment to Rule 16b-3) that are requirements for the application of such exemptive rule. To the extent Applicable Laws permit, this Agreement will be deemed amended as necessary to conform to such applicable exemptive rule.

 

4.7              Entire Agreement. The Plan, the Grant Notice and this Agreement (including any exhibit hereto) constitute the entire agreement of the parties and supersede in their entirety all prior undertakings and agreements of the Company and Participant with respect to the subject matter hereof.

 

4.8              Agreement Severable. In the event that any provision of the Grant Notice or this Agreement is held illegal or invalid, the provision will be severable from, and the illegality or invalidity of the provision will not be construed to have any effect on, the remaining provisions of the Grant Notice or this Agreement.

 

4.9              Limitation on Participant’s Rights. Participation in the Plan confers no rights or interests other than as herein provided. This Agreement creates only a contractual obligation on the part of the Company as to amounts payable and may not be construed as creating a trust. Neither the Plan nor any underlying program, in and of itself, has any assets. Participant will have only the rights of a general unsecured creditor of the Company with respect to amounts credited and benefits payable, if any, with respect to the RSUs and rights no greater than the right to receive cash or the Shares as a general unsecured creditor with respect to the RSUs as and when settled pursuant to the terms of this Agreement.

 

4.10            Not a Contract of Employment. Nothing in the Plan, the Grant Notice or this Agreement confers upon Participant any right to continue in the employ or service of the Company or any Affiliate or interferes with or restricts in any way the rights of the Company and its Subsidiaries, which rights are hereby expressly reserved, to discharge or terminate the services of Participant at any time for any reason whatsoever, with or without Cause, except to the extent expressly provided otherwise in a written agreement between the Company or an Affiliate and Participant.

 

 

4.11            Counterparts. The Grant Notice may be executed in one or more counterparts, including by way of any electronic signature, subject to Applicable Law, each of which will be deemed an original and all of which together will constitute one instrument.

 

4.12            Electronic Signature and Delivery. By accepting this Agreement, the Participant consents to the electronic delivery of prospectuses, annual reports and other information required to be delivered by the U.S. Securities and Exchange Commission rules. Without limiting the foregoing, the Company may, in its sole discretion, decide to deliver any documents related to current or future participation in the Plan by electronic means. The Participant hereby consents to receive such documents by electronic delivery and agrees to participate in the Plan through an online or electronic system established and maintained by the Company or a third party designated by the Company.

 

4.13            Section 409A. The RSUs are intended to be exempt from, or compliant with, Section 409A of the Code. Notwithstanding the foregoing or any provision of the Plan or this Agreement, if any provision of the Plan or this Agreement contravenes Section 409A of the Code or could cause the Participant to incur any tax, interest or penalties under Section 409A of the Code, the Administrator may, in its sole discretion and without the Participant’s consent, modify such provision to (i) comply with, or avoid being subject to, Section 409A of the Code, or to avoid the incurrence of taxes, interest and penalties under Section 409A of the Code, and/or (iii) maintain, to the maximum extent practicable, the original interest and economic benefit to the Participant of the applicable provision without materially increasing the cost to the Company or contravening the provisions of Section 409A of the Code. This Section 4.13 does not create an obligation on the part of the Company to modify the Plan or this Agreement and does not guarantee that the RSUs will not be subject to interest and penalties under Section 409A of the Code.

 

4.14            Clawback. The RSUs shall at all times be subject to any clawback or similar policy or program established by the Company, as may be amended from time to time (a “Clawback Policy”). In addition (and without limiting the Company’s rights and the Participant’s obligations under any Clawback Policy), to the extent required by applicable law or the rules and regulations of the Nasdaq Global Market or any other securities exchange or interdealer quotation on which the Common Stock is listed or quote, the RSUs shall be subject (including on a retroactive basis) to clawback, forfeiture or similar requirements (and such requirements shall be deemed incorporated by reference into this Agreement).

 

* * * * *

 

 

 

Exhibit 10.12

 

Fluence Energy, Inc.
Non-Employee Independent Director Compensation Policy

 

Non-employee independent members of the board of directors (the “Board”) of Fluence Energy, Inc. (the “Company”) shall be eligible to receive cash and equity compensation as set forth in this Non-Employee Independent Director Compensation Policy (this “Policy”). The cash and equity compensation described in this Policy shall be paid or be made, as applicable, automatically and without further action of the Board, to each member of the Board who (a) is not an employee of the Company or any parent or subsidiary of the Company and (b) was not nominated to the Board by The AES Corporation (“AES”), Siemens Industry, Inc. (“SII”) or Qatar Holding LLC (“QHL”) or any of their respective affiliates pursuant to their respective nomination rights set forth in the Stockholders Agreement, dated as of the Effective Date, by and among the Company, AES, SII and QHL (each, a “Non-Employee Independent Director”) who may be eligible to receive such cash or equity compensation, unless such Non-Employee Independent Director declines the receipt of such cash or equity compensation by written notice to the Company. This Policy shall become effective after the effectiveness of the Company’s Form S-1 Registration (the “Effective Date”) and shall remain in effect until it is revised or rescinded by further action of the Board. This Policy may be amended, modified or terminated by the Board at any time in its sole discretion. The terms and conditions of this Policy shall supersede any prior cash and/or equity compensation arrangements for service as a member of the Board between the Company and any of its Non-Employee Independent Directors and between any subsidiary of the Company and any of its non-employee independent directors.

 

1.            Cash Compensation.

 

(a)            Annual Retainers. Each Non-Employee Independent Director shall receive an annual retainer of $50,000 for service on the Board.

 

(b)           Additional Annual Retainers. In addition, a Non-Employee Independent Director shall receive the following annual retainers:

 

(i)              Chairperson of the Board. A Non-Employee Independent Director serving as Chairperson of the Board shall receive an additional annual retainer of $25,000 for such service.

 

(ii)             Audit Committee. A Non-Employee Independent Director serving as Chairperson of the Audit Committee shall receive an additional annual retainer of $10,000 for such service.

 

(iii)            Compensation Committee. A Non-Employee Independent Director serving as Chairperson of the Compensation Committee shall receive an additional annual retainer of $10,000 for such service.

 

(iv)            Nominating and Corporate Governance Committee. A Non-Employee Independent Director serving as Chairperson of the Nominating and Corporate Governance Committee shall receive an additional annual retainer of $10,000 for such service.

 

 

(c)            Payment of Retainers. The annual retainers described in Sections 1(a) and 1(b) shall be earned on a quarterly basis based on a calendar quarter and shall be paid by the Company in arrears not later than the fifteenth day following the end of each calendar quarter. In the event a Non-Employee Independent Director does not serve as a Non-Employee Independent Director, or in the applicable positions described in Section 1(b), for an entire calendar quarter, such Non-Employee Independent Director shall receive a prorated portion of the retainer(s) otherwise payable to such Non-Employee Independent Director for such calendar quarter pursuant to Sections 1(a) and 1(b), with such prorated portion determined by multiplying such otherwise payable retainer(s) by a fraction, the numerator of which is the number of days during which the Non-Employee Independent Director serves as a Non-Employee Independent Director or in the applicable positions described in Section 1(b) during the applicable calendar quarter and the denominator of which is the number of days in the applicable calendar quarter.

 

2.            Equity Compensation. Non-Employee Independent Directors shall be granted the equity awards described below. The awards described below shall be granted under and shall be subject to the terms and provisions of the Company’s 2021 Incentive Award Plan or any other applicable Company equity incentive plan then-maintained by the Company (such plan, as may be amended from time to time, the “Equity Plan”) and shall be granted subject to the execution and delivery of award agreements, including attached exhibits, in substantially the forms previously approved by the Board. All applicable terms of the Equity Plan apply to this Policy as if fully set forth herein, and all equity grants hereunder are subject in all respects to the terms of the Equity Plan.

 

(a)            Effective Date Awards. Each Non-Employee Independent Director who (i) serves on the Board as of the Effective Date and (ii) will continue to serve as a Non-Employee Independent Director immediately following the Effective Date, shall be automatically granted, on the Effective Date, an award of restricted stock units that has an aggregate fair value on the date of grant of $100,000 (as determined in accordance with FASB Accounting Codification Topic 718 (“ASC 718”) and subject to adjustment as provided in the Equity Plan in each case). The awards described in this Section 2(a) shall be referred to herein as the “Effective Date Awards”). For the avoidance of doubt, a Non-Employee Independent Director eligible to receive an Effective Date Award shall not be eligible to receive an Initial Award (as defined below).

 

(b)            Annual Awards. Each Non-Employee Independent Director who (i) serves on the Board as of the date of any annual meeting of the Company’s stockholders (an “Annual Meeting”) after the Effective Date and (ii) will continue to serve as a Non-Employee Independent Director immediately following such Annual Meeting, shall be automatically granted, on the date of such Annual Meeting, an award of restricted stock units that has an aggregate fair value on the date of grant of $100,000 (as determined in accordance with ASC 718 and subject to adjustment as provided in the Equity Plan). The awards described in this Section 2(b) shall be referred to as the “Annual Awards.” For the avoidance of doubt, a Non-Employee Independent Director elected for the first time to the Board at an Annual Meeting shall receive only an Annual Award in connection with such election, and shall not receive any Initial Award on the date of such Annual Meeting as well.

 

 

(c)            Initial Awards. Except as otherwise determined by the Board, each Non-Employee Independent Director who is initially elected or appointed to the Board after the Effective Date on any date other than the date of an Annual Meeting shall be automatically granted, on the date of such Non-Employee Independent Director’s initial election or appointment (such Non-Employee Independent Director’s “Start Date”), an award of restricted stock units that has an aggregate fair value on such Non-Employee Independent Director’s Start Date equal to the product of (i) $100,000 (as determined in accordance with ASC 718) and (ii) a fraction, the numerator of which is (x) 365 minus (y) the number of days in the period beginning on the date of the Annual Meeting immediately preceding such Non-Employee Independent Director’s Start Date (or, if no such Annual Meeting has occurred, the Effective Date) and ending on such Non-Employee Independent Director’s Start Date and the denominator of which is 365 (with the number of shares of common stock underlying each such award subject to adjustment as provided in the Equity Plan). The awards described in this Section 2(c) shall be referred to as “Initial Awards.” For the avoidance of doubt, no Non-Employee Independent Director shall be granted more than one Initial Award.

 

(d)            Termination of Employment of Employee Directors. Members of the Board who are employees of the Company or any parent or subsidiary of the Company who subsequently terminate their employment with the Company and any parent or subsidiary of the Company and remain on the Board will not receive an Initial Award pursuant to Section 2(c) above, but to the extent that they are otherwise eligible, will be eligible to receive, after termination from employment with the Company and any parent or subsidiary of the Company, Annual Awards as described in Section 2(b) above.

 

(e)            Vesting of Awards Granted to Non-Employee Independent Directors. Each Effective Date Award shall vest on the first anniversary of the date of grant, subject to the Non-Employee Independent Director continuing in service on the Board through the applicable vesting date, and each Annual Award and Initial Award shall vest on the earlier of (i) the day immediately preceding the date of the first Annual Meeting following the date of grant and (ii) the first anniversary of the date of grant, subject to the Non-Employee Independent Director continuing in service on the Board through the applicable vesting date. No portion of an Effective Date Award, Annual Award or Initial Award that is unvested at the time of a Non-Employee Independent Director’s termination of service on the Board shall become vested thereafter. All of a Non-Employee Independent Director’s Effective Date Awards, Annual Awards and Initial Awards shall vest in full immediately prior to the occurrence of a Change in Control (as defined in the Equity Plan), to the extent outstanding at such time.

 

* * * * *

 

  

Exhibit 10.13

 

INDEMNIFICATION And Advancement AGREEMENT

 

This Indemnification and Advancement Agreement (the “Agreement”) is made as of _____________, 202__ by and between Fluence Energy, Inc. a Delaware corporation (the “Company”), and __________________ (“Indemnitee”). This Agreement supersedes and replaces any and all previous Agreements between the Company and Indemnitee covering indemnification and advancement.

 

RECITALS

 

WHEREAS, the Board of Directors of the Company (the “Board”) believes that highly competent persons have become more reluctant to serve publicly-held corporations as directors, officers or in other capacities unless they are provided with adequate protection through insurance or adequate indemnification and advancement of expenses against inordinate risks of claims and actions against them arising out of their service to and activities on behalf of the corporation;

 

WHEREAS, the Board has determined that, in order to attract and retain qualified individuals, the Company will attempt to maintain on an ongoing basis, at its sole expense, liability insurance to protect persons serving the Company and its subsidiaries from certain liabilities. Although the furnishing of such insurance has been a customary and widespread practice among United States-based corporations and other business enterprises, the Company believes that, given current market conditions and trends, such insurance may be available to it in the future only at higher premiums and with more exclusions. At the same time, directors, officers, and other persons in service to corporations or business enterprises are being increasingly subjected to expensive and time-consuming litigation relating to, among other things, matters that traditionally would have been brought only against the Company or business enterprise itself. The Bylaws and Certificate of Incorporation of the Company require indemnification of the officers and directors of the Company. Indemnitee may also be entitled to indemnification pursuant to the General Corporation Law of the State of Delaware (the “DGCL”). The Bylaws, Certificate of Incorporation, and the DGCL expressly provide that the indemnification provisions set forth therein are not exclusive, and thereby contemplate that contracts may be entered into between the Company and members of the board of directors, officers, and other persons with respect to indemnification and advancement of expenses;

 

WHEREAS, the uncertainties relating to such insurance, to indemnification, and to advancement of expenses may increase the difficulty of attracting and retaining such persons;

 

WHEREAS, the Board has determined that the increased difficulty in attracting and retaining such persons is detrimental to the best interests of the Company and its stockholders and that the Company should act to assure such persons that there will be increased certainty of such protection in the future;

 

WHEREAS, it is reasonable, prudent and necessary for the Company contractually to obligate itself to indemnify, and to advance expenses on behalf of, such persons to the fullest extent permitted by applicable law so that they will serve or continue to serve the Company free from undue concern that they will not be so indemnified;

 

 

WHEREAS, this Agreement is a supplement to and in furtherance of the Bylaws, Certificate of Incorporation and any resolutions adopted pursuant thereto, and is not a substitute therefor, nor diminishes or abrogates any rights of Indemnitee thereunder; and

 

WHEREAS, Indemnitee does not regard the protection available under the Bylaws, Certificate of Incorporation, DGCL and insurance as adequate in the present circumstances, and may not be willing to serve or continue to serve as a director, officer or other employee or agent without adequate additional protection, and the Company desires Indemnitee to serve or continue to serve in such capacity. Indemnitee is willing to serve, continue to serve and to take on additional service for or on behalf of the Company on the condition that Indemnitee be so indemnified and be advanced expenses.

 

NOW, THEREFORE, in consideration of the premises and the covenants contained herein, the Company and Indemnitee do hereby covenant and agree as follows:

 

Section 1.      Services to the Company. Indemnitee has agreed to serve as a director, officer or other employee or agent of the Company. Indemnitee may at any time and for any reason resign from such position (subject to any other contractual obligation or any obligation imposed by operation of law). This Agreement does not create any obligation on the Company to continue Indemnitee in such position and is not an employment contract between the Company (or any of its subsidiaries or any Enterprise) and Indemnitee.

 

Section 2.      Definitions. As used in this Agreement:

 

(a)      “Agent” means any person who is authorized by the Company or an Enterprise to act for or represent the interests of the Company or an Enterprise, respectively.

 

(b)      A “Change in Control” occurs upon the earliest to occur after the date of this Agreement of any of the following events:

 

i.            Acquisition of Stock by Third Party. Any Person (as defined below) other than the Sponsor Entities is or becomes the Beneficial Owner (as defined below), directly or indirectly, of securities of the Company representing fifteen percent (15%) or more of the combined voting power of the Company’s then outstanding securities unless the change in relative beneficial ownership of the Company’s securities by any Person results solely from a reduction in the aggregate number of outstanding shares of securities entitled to vote generally in the election of directors;

 

ii.           Change in Board of Directors. During any period of two (2) consecutive years (not including any period prior to the execution of this Agreement), individuals who at the beginning of such period constitute the Board, and any new director (other than a director designated by a person who has entered into an agreement with the Company to effect a transaction described in Sections 2(b)(i), 2(b)(iii) or 2(b)(iv) of this Agreement) whose election by the Board or nomination for election by the Company’s stockholders was approved by a vote of at least two-thirds of the directors then still in office who either were directors at the beginning of the period or whose election or nomination for election was previously so approved, cease for any reason to constitute at least a majority of the members of the Board;

 

 

iii.          Corporate Transactions. The effective date of a merger or consolidation of the Company with any other entity, other than a merger or consolidation which would result in the voting securities of the Company outstanding immediately prior to such merger or consolidation continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) more than 51% of the combined voting power of the voting securities of the surviving entity outstanding immediately after such merger or consolidation and with the power to elect at least a majority of the board of directors or other governing body of such surviving entity;

 

iv.          Liquidation. The approval by the stockholders of the Company of a complete liquidation of the Company or an agreement for the sale or disposition by the Company of all or substantially all of the Company’s assets; and

 

v.           Other Events. There occurs any other event of a nature that would be required to be reported in response to Item 6(e) of Schedule 14A of Regulation 14A (or a response to any similar item on any similar schedule or form) promulgated under the Exchange Act (as defined below), whether or not the Company is then subject to such reporting requirement.

 

vi.          For purposes of this Section 2(b), the following terms have the following meanings:

 

1

“Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time.

 

2

“Person” has the meaning as set forth in Sections 13(d) and 14(d) of the Exchange Act; provided, however, that Person excludes (i) the Company, (ii) any trustee or other fiduciary holding securities under an employee benefit plan of the Company, and (iii) any corporation owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of stock of the Company.

 

3

“Beneficial Owner” has the meaning given to such term in Rule 13d-3 under the Exchange Act; provided, however, that Beneficial Owner excludes any Person otherwise becoming a Beneficial Owner by reason of the stockholders of the Company approving a merger of the Company with another entity.

 

(c)      “Corporate Status” describes the status of a person who is or was acting as a director, officer, employee, fiduciary, or Agent of the Company or an Enterprise.

 

(d)      “Disinterested Director” means a director of the Company who is not and was not a party to the Proceeding in respect of which indemnification is sought by Indemnitee.

 

(e)      “Enterprise” means any other corporation, limited liability company, partnership, joint venture, trust, employee benefit plan or other entity for which Indemnitee is or was serving at the request of the Company as a director, officer, employee, or Agent.

 

 

(f)       “Expenses” includes all reasonable attorneys’ fees, retainers, court costs, transcript costs, fees of experts and other professionals, witness fees, travel expenses, duplicating costs, printing and binding costs, telephone charges, postage, delivery service fees, any federal, state, local or foreign taxes imposed on Indemnitee as a result of the actual or deemed receipt of any payments under this Agreement, Employee Retirement Income Security Act of 1974, as amended, (“ERISA”) excise taxes and penalties, and all other disbursements or expenses of the types customarily incurred in connection with prosecuting, defending, preparing to prosecute or defend, investigating, being or preparing to be a witness in, or otherwise participating in, a Proceeding. Expenses also include (i) Expenses incurred in connection with any appeal resulting from any Proceeding, including without limitation the premium, security for, and other costs relating to any cost bond, supersedeas bond, or other appeal bond or its equivalent, and (ii) for purposes of Section 14(d) of this Agreement only, Expenses incurred by Indemnitee in connection with the interpretation, enforcement or defense of Indemnitee’s rights under this Agreement, by litigation or otherwise. The parties agree that for the purposes of any advancement of Expenses for which Indemnitee has made written demand to the Company in accordance with this Agreement, all Expenses included in such demand that are certified by affidavit of Indemnitee’s counsel as being reasonable in the good faith judgment of such counsel will be presumed conclusively to be reasonable. Expenses, however, do not include amounts paid in settlement by Indemnitee or the amount of judgments or fines against Indemnitee.

 

(g)      “Independent Counsel” means a law firm, or a member of a law firm, that is experienced in matters of corporation law and neither presently is, nor in the past five years has been, retained to represent: (i) the Company or Indemnitee in any matter material to either such party (other than with respect to matters concerning the Indemnitee under this Agreement, or of other indemnitees under similar indemnification agreements), or (ii) any other party to the Proceeding giving rise to a claim for indemnification hereunder. Notwithstanding the foregoing, the term “Independent Counsel” does not include any person who, under the applicable standards of professional conduct then prevailing, would have a conflict of interest in representing either the Company or Indemnitee in an action to determine Indemnitee’s rights under this Agreement.

 

(h)      The term “Proceeding” includes any threatened, pending or completed action, suit, claim, counterclaim, cross claim, arbitration, mediation, alternate dispute resolution mechanism, investigation, inquiry, administrative hearing or any other actual, threatened or completed proceeding, whether brought in the right of the Company or otherwise and whether of a civil, criminal, administrative, legislative, or investigative (formal or informal) nature, including any appeal therefrom, in which Indemnitee was, is or will be involved as a party, potential party, non-party witness or otherwise by reason of Indemnitee’s Corporate Status or by reason of any action taken by Indemnitee (or a failure to take action by Indemnitee) or of any action (or failure to act) on Indemnitee’s part while acting pursuant to Indemnitee’s Corporate Status, in each case whether or not serving in such capacity at the time any liability or Expense is incurred for which indemnification, reimbursement, or advancement of Expenses can be provided under this Agreement. A Proceeding also includes a situation the Indemnitee believes in good faith may lead to or culminate in the institution of a Proceeding.

 

(i)       “Sponsor Entities” means entities affiliated with AES Grid Stability, LLC, Siemens Industry, Inc. and/or Qatar Investment Authority.

 

 

Section 3.      Indemnity in Third-Party Proceedings. The Company will indemnify Indemnitee in accordance with the provisions of this Section 3 if Indemnitee is, or is threatened to be made, a party to or a participant in any Proceeding, other than a Proceeding by or in the right of the Company to procure a judgment in its favor. Pursuant to this Section 3, the Company will indemnify Indemnitee to the fullest extent permitted by applicable law against all Expenses, judgments, fines and amounts paid in settlement (including all interest, assessments and other charges paid or payable in connection with or in respect of such Expenses, judgments, penalties, fines and amounts paid in settlement) actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection with such Proceeding or any claim, issue or matter therein, if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the best interests of the Company and, in the case of a criminal Proceeding had no reasonable cause to believe that Indemnitee’s conduct was unlawful.

 

Section 4.      Indemnity in Proceedings by or in the Right of the Company. The Company will indemnify Indemnitee in accordance with the provisions of this Section 4 if Indemnitee is, or is threatened to be made, a party to or a participant in any Proceeding by or in the right of the Company to procure a judgment in its favor. Pursuant to this Section 4, the Company will indemnify Indemnitee to the fullest extent permitted by applicable law against all Expenses actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection with such Proceeding or any claim, issue or matter therein, if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the best interests of the Company. The Company will not indemnify Indemnitee for Expenses under this Section 4 related to any claim, issue or matter in a Proceeding for which Indemnitee has been finally adjudged by a court to be liable to the Company, unless, and only to the extent that, the Delaware Court of Chancery or any court in which the Proceeding was brought determines upon application by Indemnitee that, despite the adjudication of liability but in view of all the circumstances of the case, Indemnitee is fairly and reasonably entitled to indemnification.

 

Section 5.      Indemnification for Expenses of an Indemnitee Who is Wholly or Partly Successful. Notwithstanding any other provisions of this Agreement, to the fullest extent permitted by applicable law, the Company will indemnify Indemnitee against all Expenses actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection with any Proceeding to the extent that Indemnitee is successful, on the merits or otherwise. If Indemnitee is not wholly successful in such Proceeding but is successful, on the merits or otherwise, as to one or more but less than all claims, issues or matters in such Proceeding, the Company will indemnify Indemnitee against all Expenses actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection with or related to each successfully resolved claim, issue or matter to the fullest extent permitted by law. For purposes of this Section 5 and without limitation, the termination of any claim, issue or matter in such a Proceeding by dismissal, with or without prejudice, will be deemed to be a successful result as to such claim, issue or matter.

 

Section 6.      Indemnification For Expenses of a Witness. Notwithstanding any other provision of this Agreement and to the fullest extent permitted by applicable law, the Company will indemnify Indemnitee against all Expenses actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection with any Proceeding to which Indemnitee is not a party but to which Indemnitee is a witness, deponent, interviewee, or otherwise asked to participate.

 

 

Section 7.      Partial Indemnification. If Indemnitee is entitled under any provision of this Agreement to indemnification by the Company for some or a portion of Expenses, but not, however, for the total amount thereof, the Company will indemnify Indemnitee for the portion thereof to which Indemnitee is entitled.

 

Section 8.      Additional Indemnification. Notwithstanding any limitation in Sections 3, 4 or 5 of this Agreement, the Company will indemnify Indemnitee to the fullest extent permitted by applicable law (including, but not limited to, the DGCL and any amendments to or replacements of the DGCL adopted after the date of this Agreement that expand the Company’s ability to indemnify its officers and directors) if Indemnitee is a party to or threatened to be made a party to any Proceeding (including a Proceeding by or in the right of the Company to procure a judgment in its favor).

 

Section 9.      Exclusions. Notwithstanding any provision in this Agreement, the Company is not obligated under this Agreement to make any indemnification payment to Indemnitee in connection with any Proceeding:

 

(a)      for which payment has actually been made to or on behalf of Indemnitee under any insurance policy or other indemnity provision, except to the extent provided in Section 15(b) of this Agreement and except with respect to any excess beyond the amount paid under any insurance policy or other indemnity provision; or

 

(b)      for (i) an accounting of profits made from the purchase and sale (or sale and purchase) by Indemnitee of securities of the Company within the meaning of Section 16(b) of the Exchange Act (as defined in Section 2(b) hereof) or similar provisions of state statutory law or common law, (ii) any reimbursement of the Company by the Indemnitee of any bonus or other incentive-based or equity-based compensation or of any profits realized by the Indemnitee from the sale of securities of the Company, as required in each case under the Exchange Act (including any such reimbursements that arise from an accounting restatement of the Company pursuant to Section 304 of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”), or the payment to the Company of profits arising from the purchase and sale by Indemnitee of securities in violation of Section 306 of the Sarbanes-Oxley Act) or (iii) any reimbursement of the Company by Indemnitee of any compensation pursuant to any compensation recoupment or clawback policy adopted by the Board or the compensation committee of the Board, including, but not limited, to any such policy adopted to comply with stock exchange listing requirements implementing Section 10D of the Exchange Act; or

 

(c)      initiated by Indemnitee, including any Proceeding (or any part of any Proceeding) initiated by Indemnitee against the Company or its directors, officers, employees or other indemnitees, unless (i) the Proceeding or part of any Proceeding is to enforce Indemnitee’s rights to indemnification or advancement of Expenses, including a Proceeding (or any part of any Proceeding) initiated pursuant to Section 14 of this Agreement, (ii) the Board authorized the Proceeding (or any part of any Proceeding) prior to its initiation (it being understood and agreed that such authorization or consent shall not be unreasonably withheld in connection with any compulsory counterclaim brought by Indemnitee in response to any Proceeding otherwise indemnifiable under this Agreement) or (iii) the Company provides the indemnification, in its sole discretion, pursuant to the powers vested in the Company under applicable law.

 

 

Section 10.     Advances of Expenses.

 

(a)       The Company will advance, to the extent not prohibited by law, the Expenses incurred by Indemnitee in connection with any Proceeding (or any part of any Proceeding) not initiated by Indemnitee or any Proceeding (or any part of any Proceeding) initiated by Indemnitee if (i) the Proceeding or part of any Proceeding is to enforce Indemnitee’s rights to obtain indemnification or advancement of Expenses from the Company or Enterprise, including a proceeding initiated pursuant to Section 14 of this Agreement or (ii) the Board authorized the Proceeding (or any part of any Proceeding) prior to its initiation (it being understood and agreed that such authorization or consent shall not be unreasonably withheld in connection with any compulsory counterclaim brought by Indemnitee in response to any Proceeding otherwise indemnifiable under this Agreement). The Company will advance the Expenses within thirty (30) days after the receipt by the Company of a statement or statements requesting such advances from time to time, whether prior to or after final disposition of any Proceeding.

 

(b)      Advances will be unsecured and interest free. Indemnitee undertakes to repay the amounts advanced (without interest) to the extent that it is ultimately determined that Indemnitee is not entitled to be indemnified by the Company, thus Indemnitee qualifies for advances upon the execution of this Agreement and delivery to the Company. No other form of undertaking is required other than the execution of this Agreement. The Company will make advances without regard to Indemnitee’s ability to repay the Expenses and without regard to Indemnitee’s ultimate entitlement to indemnification under the other provisions of this Agreement.

 

Section 11.     Procedure for Notification of Claim for Indemnification or Advancement.

 

(a)       Indemnitee will notify the Company in writing of any Proceeding with respect to which Indemnitee intends to seek indemnification or advancement of Expenses hereunder as soon as reasonably practicable following the receipt by Indemnitee of written notice thereof. Indemnitee will include in the written notification to the Company a description of the nature of the Proceeding and the facts underlying the Proceeding and provide such documentation and information as is reasonably available to Indemnitee and is reasonably necessary to determine whether and to what extent Indemnitee is entitled to advancement of Expenses or indemnification following the final disposition of such Proceeding. Indemnitee’s failure to notify the Company will not relieve the Company from any obligation it may have to Indemnitee under this Agreement, and any delay in so notifying the Company will not constitute a waiver by Indemnitee of any rights under this Agreement. The Secretary of the Company will, promptly upon receipt of such a request for indemnification or advancement, advise the Board in writing that Indemnitee has requested indemnification or advancement.

 

(b)      The Company will be entitled to participate in the Proceeding at its own expense.

 

Section 12.     Procedure Upon Application for Indemnification.

 

(a)       Unless a Change of Control has occurred, the determination of Indemnitee’s entitlement to indemnification will be made:

 

i.            by a majority vote of the Disinterested Directors, even though less than a quorum of the Board;

 

 

ii.           by a committee of Disinterested Directors designated by a majority vote of the Disinterested Directors, even though less than a quorum of the Board;

 

iii.          if there are no such Disinterested Directors or, if such Disinterested Directors so direct, by written opinion provided by Independent Counsel selected by the Board; or

 

iv.          if so directed by the Board, by the stockholders of the Company.

 

(b)      If a Change in Control has occurred, the determination of Indemnitee’s entitlement to indemnification will be made by written opinion provided by Independent Counsel selected by Indemnitee (unless Indemnitee requests such selection be made by the Board).

 

(c)      The party selecting Independent Counsel pursuant to subsection (a)(iii) or (b) of this Section 12 will provide written notice of the selection to the other party. The notified party may, within ten (10) days after receiving written notice of the selection of Independent Counsel, deliver to the selecting party a written objection to such selection; provided, however, that such objection may be asserted only on the ground that the Independent Counsel so selected does not meet the requirements of “Independent Counsel” as defined in Section 2 of this Agreement, and the objection will set forth with particularity the factual basis of such assertion. Absent a proper and timely objection, the person so selected will act as Independent Counsel. If such written objection is so made and substantiated, the Independent Counsel so selected may not serve as Independent Counsel unless and until such objection is withdrawn or the Delaware Court of Chancery has determined that such objection is without merit. If, within thirty (30) days after the later of submission by Indemnitee of a written request for indemnification pursuant to Section 11(a) hereof and the final disposition of the Proceeding, Independent Counsel has not been selected or, if selected, any objection to has not been resolved, either the Company or Indemnitee may petition the Delaware Court of Chancery for the appointment as Independent Counsel of a person selected by such court or by such other person as such court designates. Upon the due commencement of any judicial proceeding or arbitration pursuant to Section 14(a) of this Agreement, Independent Counsel will be discharged and relieved of any further responsibility in such capacity (subject to the applicable standards of professional conduct then prevailing).

 

(d)      Indemnitee will cooperate with the person, persons or entity making the determination with respect to Indemnitee’s entitlement to indemnification, including providing to such person, persons or entity upon reasonable advance request any documentation or information which is not privileged or otherwise protected from disclosure and which is reasonably available to Indemnitee and reasonably necessary to such determination. The Company will advance and pay any Expenses incurred by Indemnitee in so cooperating with the person, persons or entity making the indemnification determination irrespective of the determination as to Indemnitee’s entitlement to indemnification and the Company hereby indemnifies and agrees to hold Indemnitee harmless therefrom. The Company promptly will advise Indemnitee in writing of the determination that Indemnitee is or is not entitled to indemnification, including a description of any reason or basis for which indemnification has been denied and providing a copy of any written opinion provided to the Board by Independent Counsel.

 

(e)       If it is determined that Indemnitee is entitled to indemnification, the Company will make payment to Indemnitee within thirty (30) days after such determination.

 

 

Section 13.     Presumptions and Effect of Certain Proceedings.

 

(a)       In making a determination with respect to entitlement to indemnification hereunder, the person or persons or entity making such determination will, to the fullest extent not prohibited by law, presume Indemnitee is entitled to indemnification under this Agreement if Indemnitee has submitted a request for indemnification in accordance with Section 11(a) of this Agreement, and the Company will, to the fullest extent not prohibited by law, have the burden of proof to overcome that presumption. Neither the failure of the Company (including by its directors or Independent Counsel) to have made a determination prior to the commencement of any action pursuant to this Agreement that indemnification is proper in the circumstances because Indemnitee has met the applicable standard of conduct, nor an actual determination by the Company (including by its directors or Independent Counsel) that Indemnitee has not met such applicable standard of conduct, will be a defense to the action or create a presumption that Indemnitee has not met the applicable standard of conduct.

 

(b)      If the determination of the Indemnitee’s entitlement to indemnification has not made pursuant to Section 12 of this Agreement within sixty (60) days after the later of (i) receipt by the Company of Indemnitee’s request for indemnification pursuant to Section 11(a) and (ii) the final disposition of the Proceeding for which Indemnitee requested Indemnification (the “Determination Period”), the requisite determination of entitlement to indemnification will, to the fullest extent not prohibited by law, be deemed to have been made and Indemnitee will be entitled to such indemnification, absent (i) a misstatement by Indemnitee of a material fact, or an omission of a material fact necessary to make Indemnitee’s statement not materially misleading, in connection with the request for indemnification, or (ii) a prohibition of such indemnification under applicable law. The Determination Period may be extended for a reasonable time, not to exceed an additional thirty (30) days, if the person, persons or entity making the determination with respect to entitlement to indemnification in good faith requires such additional time for the obtaining or evaluating of documentation and/or information relating thereto; and provided, further, the Determination Period may be extended an additional fifteen (15) days if the determination of entitlement to indemnification is to be made by the stockholders pursuant to Section 12(a)(iv) of this Agreement.

 

(c)       The termination of any Proceeding or of any claim, issue or matter therein, by judgment, order, settlement or conviction, or upon a plea of nolo contendere or its equivalent, will not (except as otherwise expressly provided in this Agreement) of itself adversely affect the right of Indemnitee to indemnification or create a presumption that Indemnitee did not act in good faith and in a manner which Indemnitee reasonably believed to be in or not opposed to the best interests of the Company or, with respect to any criminal Proceeding, that Indemnitee had reasonable cause to believe that Indemnitee’s conduct was unlawful.

 

(d)      For purposes of any determination of good faith, Indemnitee will be deemed to have acted in good faith if Indemnitee acted based on the records or books of account of the Company, its subsidiaries, or an Enterprise, including financial statements, or on information supplied to Indemnitee by the directors or officers of the Company, its subsidiaries, or an Enterprise in the course of their duties, or on the advice of legal counsel for the Company, its subsidiaries, or an Enterprise or on information or records given or reports made to the Company or an Enterprise by an independent certified public accountant or by an appraiser, financial advisor or other expert selected with reasonable care by or on behalf of the Company, its subsidiaries, or an Enterprise. Further, Indemnitee will be deemed to have acted in a manner “not opposed to the best interests of the Company,” as referred to in this Agreement if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in the best interests of the participants and beneficiaries of an employee benefit plan. The provisions of this Section 13(d) is not exclusive and does not limit in any way the other circumstances in which the Indemnitee may be deemed to have met the applicable standard of conduct set forth in this Agreement.

 

 

(e)       The knowledge and/or actions, or failure to act, of any director, officer, trustee, partner, managing member, fiduciary, agent or employee of the Enterprise may not be imputed to Indemnitee for purposes of determining Indemnitee’s right to indemnification under this Agreement.

 

Section 14.     Remedies of Indemnitee.

 

(a)       Indemnitee may commence litigation against the Company in the Delaware Court of Chancery to obtain indemnification or advancement of Expenses provided by this Agreement in the event that (i) a determination is made pursuant to Section 12 of this Agreement that Indemnitee is not entitled to indemnification under this Agreement, (ii) the Company does not advance Expenses pursuant to Section 10 of this Agreement, (iii) the determination of entitlement to indemnification is not made pursuant to Section 12 of this Agreement within the Determination Period, (iv) the Company does not indemnify Indemnitee pursuant to Section 5 or 6 or the second to last sentence of Section 12(d) of this Agreement within ten (10) days after receipt by the Company of a written request therefor, (v) the Company does not indemnify Indemnitee pursuant to Section 3, 4, 7 or 8 of this Agreement within ten (10) days after a determination has been made that Indemnitee is entitled to indemnification, or (vi) in the event that the Company or any other person takes or threatens to take any action to declare this Agreement void or unenforceable, or institutes any litigation or other action or Proceeding designed to deny, or to recover from, the Indemnitee the benefits provided or intended to be provided to the Indemnitee hereunder. Alternatively, Indemnitee, at Indemnitee’s or the Company’s option, may seek an award in arbitration to be conducted by a single arbitrator pursuant to the Commercial Arbitration Rules of the American Arbitration Association. Indemnitee must commence such Proceeding seeking an adjudication or an award in arbitration within one-hundred and eighty (180) days following the date on which Indemnitee first has the right to commence such Proceeding pursuant to this Section 14(a); provided, however, that the foregoing clause does not apply in respect of a Proceeding brought by Indemnitee to enforce Indemnitee’s rights under Section 5 of this Agreement. The Company will not oppose Indemnitee’s right to seek any such adjudication or award in arbitration.

 

(b)      If a determination is made pursuant to Section 12 of this Agreement that Indemnitee is not entitled to indemnification, any judicial proceeding or arbitration commenced pursuant to this Section 14 will be conducted in all respects as a de novo trial, or arbitration, on the merits and Indemnitee may not be prejudiced by reason of that adverse determination. In any judicial proceeding or arbitration commenced pursuant to this Section 14 the Company will have the burden of proving Indemnitee is not entitled to indemnification or advancement of Expenses, as the case may be and will not introduce evidence of the determination made pursuant to Section 12 of this Agreement.

 

 

(c)       If a determination is made pursuant to Section 12 of this Agreement that Indemnitee is entitled to indemnification, the Company will be bound by such determination in any judicial proceeding or arbitration commenced pursuant to this Section 14, absent (i) a misstatement by Indemnitee of a material fact, or an omission of a material fact necessary to make Indemnitee’s statement not materially misleading, in connection with the request for indemnification, or (ii) a prohibition of such indemnification under applicable law.

 

(d)      The Company is, to the fullest extent not prohibited by law, precluded from asserting in any judicial proceeding or arbitration commenced pursuant to this Section 14 that the procedures and presumptions of this Agreement are not valid, binding and enforceable and will stipulate in any such court or before any such arbitrator that the Company is bound by all the provisions of this Agreement.

 

(e)       It is the intent of the Company that, to the fullest extent permitted by law, the Indemnitee not be required to incur legal fees or other Expenses associated with the interpretation, enforcement or defense of Indemnitee’s rights under this Agreement by litigation or otherwise because the cost and expense thereof would substantially detract from the benefits intended to be extended to the Indemnitee hereunder. The Company, to the fullest extent permitted by law, will (within thirty (30) days after receipt by the Company of a written request therefor) advance to Indemnitee such Expenses which are incurred by Indemnitee in connection with any action concerning this Agreement, Indemnitee’s right to indemnification or advancement of Expenses from the Company, or concerning any directors’ and officers’ liability insurance policies maintained by the Company. and will indemnify Indemnitee against any and all such Expenses unless the court determines that each of the Indemnitee’s claims in such Proceeding were made in bad faith or were frivolous or are prohibited by law.

 

Section 15.     Non-exclusivity; Survival of Rights; Insurance; Subrogation.

 

(a)       The indemnification and advancement of Expenses provided by this Agreement are not exclusive of any other rights to which Indemnitee may at any time be entitled under applicable law, the Certificate of Incorporation, the Bylaws, any agreement, a vote of stockholders or a resolution of directors, or otherwise. The indemnification and advancement of Expenses provided by this Agreement may not be limited or restricted by any amendment, alteration or repeal of this Agreement in any way with respect to any action taken or omitted by Indemnitee in Indemnitee’s Corporate Status occurring prior to any amendment, alteration or repeal of this Agreement. To the extent that a change in Delaware law, whether by statute or judicial decision, permits greater indemnification or advancement of Expenses than would be afforded currently under the Bylaws, Certificate of Incorporation, or this Agreement, it is the intent of the parties hereto that Indemnitee enjoy by this Agreement the greater benefits so afforded by such change. No right or remedy herein conferred is intended to be exclusive of any other right or remedy, and every other right and remedy is cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion or employment of any right or remedy hereunder, or otherwise, will not prevent the concurrent assertion or employment of any other right or remedy.

 

 

(b)      The Company hereby acknowledges that Indemnitee may have certain rights to indemnification, advancement of Expenses and/or insurance provided by one or more other Persons with whom or which Indemnitee may be associated (including, without limitation, any Sponsor Entities). The relationship between the Company and such other Persons, other than an Enterprise, with respect to the Indemnitee’s rights to indemnification, advancement of Expenses, and insurance is described by this subsection, subject to the provisions of subsection (d) of this Section 15 with respect to a Proceeding concerning Indemnitee’s Corporate Status with an Enterprise.

 

i.            The Company hereby acknowledges and agrees:

 

1)            the Company is the indemnitor of first resort with respect to any request for indemnification or advancement of Expenses made pursuant to this Agreement concerning any Proceeding arising from or related to Indemnitee’s Corporate Status with the Company;

 

2)            the Company is primarily liable for all indemnification and indemnification or advancement of Expenses obligations for any Proceeding arising from or related to Indemnitee’s Corporate Status, whether created by law, organizational or constituent documents, contract (including this Agreement) or otherwise;

 

3)            any obligation of any other Persons with whom or which Indemnitee may be associated (including, without limitation, any Sponsor Entities) to indemnify Indemnitee and/or advance Expenses to Indemnitee in respect of any proceeding are secondary to the obligations of the Company’s obligations;

 

4)            the Company will indemnify Indemnitee and advance Expenses to Indemnitee hereunder to the fullest extent provided herein without regard to any rights Indemnitee may have against any other Person with whom or which Indemnitee may be associated (including, any Sponsor Entities) or insurer of any such Person; and

 

ii.           the Company irrevocably waives, relinquishes and releases (A) any other Person with whom or which Indemnitee may be associated (including, without limitation, any Sponsor Entities) from any claim of contribution, subrogation, reimbursement, exoneration or indemnification, or any other recovery of any kind in respect of amounts paid by the Company to Indemnitee pursuant to this Agreement and (B) any right to participate in any claim or remedy of Indemnitee against any Person (including, without limitation, any Sponsor Entities), whether or not such claim, remedy or right arises in equity or under contract, statute or common law, including, without limitation, the right to take or receive from any Person (including, without limitation, any Sponsor Entities), directly or indirectly, in cash or other property or by set-off or in any other manner, payment or security on account of such claim, remedy or right.

 

iii.          In the event any other Person with whom or which Indemnitee may be associated (including, without limitation, any Sponsor Entities) or their insurers advances or extinguishes any liability or loss for Indemnitee, the payor has a right of subrogation against the Company or its insurers for all amounts so paid which would otherwise be payable by the Company or its insurers under this Agreement. In no event will payment by any other Person with whom or which Indemnitee may be associated (including, without limitation, any Sponsor Entities) or their insurers affect the obligations of the Company hereunder or shift primary liability for the Company’s obligation to indemnify or advance Expenses to any other Person with whom or which Indemnitee may be associated (including, without limitation, any Sponsor Entities).

 

iv.          Any indemnification or advancement of Expenses provided by any other Person with whom or which Indemnitee may be associated (including, without limitation, any Sponsor Entities) is specifically in excess over the Company’s obligation to indemnify and advance Expenses or any valid and collectible insurance (including but not limited to any malpractice insurance or professional errors and omissions insurance) provided by the Company.

 

 

(c)       The Company shall use its reasonable best efforts to purchase and maintain a policy or policies of insurance with reputable insurance companies, providing Indemnitee with coverage for any liability asserted against, and incurred by, Indemnitee or on Indemnitee’s behalf by reason of Indemnitee’s Corporate Status, whether or not the Company would have the power to indemnify Indemnitee against such liability under the provisions of this Agreement. Such insurance policies shall have coverage terms and policy limits at least as favorable to Indemnitee as the insurance coverage provided to any other director, officer, employee or agent of the Company, as applicable. To the extent that the Company maintains an insurance policy or policies providing liability insurance for directors, officers, employees or agents of the Enterprise, the Company will obtain a policy or policies covering Indemnitee to the maximum extent of the coverage available for any such director, officer, employee or agent under such policy or policies, including coverage in the event the Company does not or cannot, for any reason, indemnify or advance Expenses to Indemnitee as required by this Agreement. If, at the time of the receipt of a notice of a claim pursuant to this Agreement, the Company has director and officer liability insurance in effect, the Company will give prompt notice of such claim or of the commencement of a Proceeding, as the case may be, to the insurers in accordance with the procedures set forth in the respective policies. The Company will thereafter take all necessary or desirable action to cause such insurers to pay, on behalf of the Indemnitee, all amounts payable as a result of such Proceeding in accordance with the terms of such policies. Indemnitee agrees to assist the Company efforts to cause the insurers to pay such amounts and will comply with the terms of such policies, including selection of approved panel counsel, if required.

 

(d)      The Company’s obligation to indemnify or advance Expenses hereunder to Indemnitee for any Proceeding concerning Indemnitee’s Corporate Status with an Enterprise will be reduced by any amount Indemnitee has actually received as indemnification or advancement of Expenses from such Enterprise. The Company and Indemnitee intend that any such Enterprise (and its insurers) be the indemnitor of first resort with respect to indemnification and advancement of Expenses for any Proceeding related to or arising from Indemnitee’s Corporate Status with such Enterprise. The Company’s obligation to indemnify and advance Expenses to Indemnitee is secondary to the obligations the Enterprise or its insurers owe to Indemnitee. Indemnitee agrees to take all reasonably necessary and desirable action to obtain from an Enterprise indemnification and advancement of Expenses for any Proceeding related to or arising from Indemnitee’s Corporate Status with such Enterprise.

 

(e)       In the event of any payment made by the Company under this Agreement, the Company will be subrogated to the extent of such payment to all of the rights of recovery of Indemnitee from any Enterprise or insurance carrier. Indemnitee will execute all papers required and take all action necessary to secure such rights, including execution of such documents as are necessary to enable the Company to bring suit to enforce such rights.

 

 

Section 16.     Duration of Agreement. This Agreement continues until and terminates upon the later of: (a) ten (10) years after the date that Indemnitee ceases to have Corporate Status or (b) one (1) year after the final termination of any Proceeding then pending in respect of which Indemnitee is granted rights of indemnification or advancement of Expenses hereunder and of any Proceeding commenced by Indemnitee pursuant to Section 14 of this Agreement relating thereto. The indemnification and advancement of Expenses rights provided by or granted pursuant to this Agreement are binding upon and be enforceable by the parties hereto and their respective successors and assigns (including any direct or indirect successor by purchase, merger, consolidation or otherwise to all or substantially all of the business or assets of the Company), continue as to an Indemnitee who has ceased to be a director, officer, employee or agent of the Company or of any other Enterprise, and inure to the benefit of Indemnitee and Indemnitee’s spouse, assigns, heirs, devisees, executors and administrators and other legal representatives.

 

Section 17.     Severability. If any provision or provisions of this Agreement is held to be invalid, illegal or unenforceable for any reason whatsoever: (a) the validity, legality and enforceability of the remaining provisions of this Agreement (including without limitation, each portion of any Section of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) will not in any way be affected or impaired thereby and remain enforceable to the fullest extent permitted by law; (b) such provision or provisions will be deemed reformed to the extent necessary to conform to applicable law and to give the maximum effect to the intent of the parties hereto; and (c) to the fullest extent possible, the provisions of this Agreement (including, without limitation, each portion of any Section of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) will be construed so as to give effect to the intent manifested thereby.

 

Section 18.     Interpretation. Any ambiguity in the terms of this Agreement will be resolved in favor of Indemnitee and in a manner to provide the maximum indemnification and advancement of Expenses permitted by law. The Company and Indemnitee intend that this Agreement provide to the fullest extent permitted by law for indemnification and advancement in excess of that expressly provided, without limitation, by the Certificate of Incorporation, the Bylaws, vote of the Company stockholders or disinterested directors, or applicable law.

 

Section 19.     Enforcement.

 

(a)       The Company expressly confirms and agrees that it has entered into this Agreement and assumed the obligations imposed on it hereby in order to induce Indemnitee to serve as a director, officer or other employee or agent of the Company, and the Company acknowledges that Indemnitee is relying upon this Agreement in serving or continuing to serve the Company.

 

(b)      This Agreement constitutes the entire agreement between the parties hereto with respect to the subject matter hereof and supersedes all prior agreements and understandings, oral, written and implied, between the parties hereto with respect to the subject matter hereof; provided, however, that this Agreement is a supplement to and in furtherance of the Certificate of Incorporation, the Bylaws and applicable law, and is not a substitute therefor, nor to diminish or abrogate any rights of Indemnitee thereunder.

 

Section 20.     Modification and Waiver. No supplement, modification or amendment of this Agreement is binding unless executed in writing by the parties hereto. No waiver of any of the provisions of this Agreement will be deemed or constitutes a waiver of any other provisions of this Agreement nor will any waiver constitute a continuing waiver.

 

 

Section 21.     Notice by Indemnitee. Indemnitee agrees promptly to notify the Company in writing upon being served with any summons, citation, subpoena, complaint, indictment, information or other document relating to any Proceeding or matter which may be subject to indemnification or advancement of Expenses covered hereunder. The failure of Indemnitee to so notify the Company does not relieve the Company of any obligation which it may have to the Indemnitee under this Agreement or otherwise.

 

Section 22.     Notices. All notices, requests, demands and other communications under this Agreement will be in writing and will be deemed to have been duly given if (a) delivered by hand to the other party, (b) sent by reputable overnight courier to the other party or (c) sent by facsimile transmission or electronic mail, with receipt of oral confirmation that such communication has been received:

 

(a)       If to Indemnitee, at the address indicated on the signature page of this Agreement, or such other address as Indemnitee provides to the Company.

 

(b)      If to the Company to:

 

Fluence Energy, Inc.

4601 N. Fairfax Drive, Suite 600

Arlington, VA 22203

Attn: General Counsel

Email: frank.fuselier@fluenceenergy.com

 

with a copy, which shall not constitute notice, to:

 

Latham & Watkins LLP

1271 Avenue of the Americas

New York, NY 10020

Attention: Senet Bischoff

Telephone: (212) 906-1834

 

or to any other address as may have been furnished to Indemnitee by the Company.

 

Section 23.     Contribution. To the fullest extent permissible under applicable law, if the indemnification provided for in this Agreement is unavailable to Indemnitee for any reason whatsoever, the Company, in lieu of indemnifying Indemnitee, will contribute to the amount incurred by Indemnitee, whether for judgments, fines, penalties, excise taxes, amounts paid or to be paid in settlement and/or for Expenses, in connection with any claim relating to an indemnifiable event under this Agreement, in such proportion as is deemed fair and reasonable in light of all of the circumstances of such Proceeding in order to reflect (i) the relative benefits received by the Company and Indemnitee as a result of the event(s) and/or transaction(s) giving cause to such Proceeding; and/or (ii) the relative fault of the Company (and its directors, officers, employees and agents) and Indemnitee in connection with such event(s) and/or transaction(s).

 

 

Section 24.     Applicable Law and Consent to Jurisdiction. This Agreement and the legal relations among the parties are governed by, and construed and enforced in accordance with, the laws of the State of Delaware, without regard to its conflict of laws rules. Except with respect to any arbitration commenced by Indemnitee pursuant to Section 14(a) of this Agreement, the Company and Indemnitee hereby irrevocably and unconditionally (i) agree that any action or Proceeding arising out of or in connection with this Agreement may be brought only in the Delaware Court of Chancery and not in any other state or federal court in the United States of America or any court in any other country, (ii) consent to submit to the exclusive jurisdiction of the Delaware Court of Chancery for purposes of any action or Proceeding arising out of or in connection with this Agreement, (iii) waive any objection to the laying of venue of any such action or Proceeding in the Delaware Court of Chancery, and (iv) waive, and agree not to plead or to make, any claim that any such action or Proceeding brought in the Delaware Court of Chancery has been brought in an improper or inconvenient forum.

 

Section 25.     Identical Counterparts. This Agreement may be executed in one or more counterparts, each of which will for all purposes be deemed to be an original but all of which together constitutes one and the same Agreement. Only one such counterpart signed by the party against whom enforceability is sought needs to be produced to evidence the existence of this Agreement.

 

Section 26.     Headings. The headings of this Agreement are inserted for convenience only and do not constitute part of this Agreement or affect the construction thereof.

 

[Signature Pages Follow]

 

 

IN WITNESS WHEREOF, the parties have caused this Agreement to be signed as of the day and year first above written.

 

	COMPANY
	Fluence Energy, Inc.
	By:
	Name:
	Title:
	By:
	Name:
	Title:

 

[Signature Page to Indemnification Agreement]

 

 

	INDEMNITEE
	By:
		Name:
		Address:

 

[Signature Page to Indemnification Agreement]

 

 

 

Exhibit 10.14

 

 

REVOLVING CREDIT AGREEMENT

 

dated as of

 

[_], 2021 among

 

FLUENCE ENERGY, LLC,

as the Borrower,

 

FLUENCE ENERGY, INC.,

as the Parent

 

THE GUARANTORS PARTY HERETO

 

The Lenders Party Hereto

and

 

JPMORGAN CHASE BANK, N.A.,

as Administrative Agent

 

 

JPMORGAN CHASE BANK, N.A.,

MORGAN STANLEY SENIOR FUNDING, INC.

BARCLAYS BANK PLC,

and

BOFA SECURITIES, INC.

as Joint Lead Arrangers and Joint Bookrunners

 

MORGAN STANLEY SENIOR FUNDING, INC.,

as Syndication Agent

 

Barclays Bank PLC

and

BANK OF AMERICA, N.A.,

as Documentation Agents

 

 

TABLE OF CONTENTS

 

Page

 

Article 1

DEFINITIONS

1

 

Section 1.01	Defined Terms	1
Section 1.02	Classification of Loans and Borrowings	48
Section 1.03	Terms Generally	48
Section 1.04	Accounting Terms; GAAP	49
Section 1.05	Interest Rates; LIBOR Notification	50
Section 1.06	Divisions	51
Section 1.07	Letter of Credit Amounts	51
Section 1.08	Exchange Rates; Currency Equivalents	51
Section 1.09	Certain Calculations and Tests	52
Section 1.10	Australian Terms	53

 

Article 2

THE CREDITS

54

 

Section 2.01	Commitments	54
Section 2.02	Loans and Borrowings	54
Section 2.03	Requests for Borrowings	55
Section 2.04	Funding of Borrowings	55
Section 2.05	Interest Elections	56
Section 2.06	Termination and Reduction of Commitments	58
Section 2.07	Repayment of Loans; Evidence of Debt	58
Section 2.08	Prepayment of Loans	59
Section 2.09	Fees	60
Section 2.10	Interest	61
Section 2.11	Alternate Rate of Interest	62
Section 2.12	Increased Costs	66
Section 2.13	Break Funding Payments	67
Section 2.14	Taxes	68
Section 2.15	Payments Generally; Pro Rata Treatment; Sharing of Set-offs	72
Section 2.16	Mitigation Obligations; Replacement of Lenders	73
Section 2.17	Defaulting Lenders/Subordinated Lender	74
Section 2.18	Incremental Facility	78
Section 2.19	Letters of Credit	79
Section 2.20	Judgment Currency	84

 

Article 3

REPRESENTATIONS AND WARRANTIES

84

 

Section 3.01	Organization; Powers	84
Section 3.02	Authorization; Enforceability	85
Section 3.03	Governmental Approvals; No Conflicts	85
Section 3.04	Financial Condition; No Material Adverse Change	85
Section 3.05	Properties	86
Section 3.06	Litigation and Environmental Matters	86
Section 3.07	Compliance with Laws and Agreements; No Default	86

 

 

Section 3.08	Investment Company Status	87
Section 3.09	Margin Stock	87
Section 3.10	Taxes	87
Section 3.11	ERISA	87
Section 3.12	Disclosure	88
Section 3.13	Subsidiaries	89
Section 3.14	Solvency	89
Section 3.15	Anti-Terrorism Law	89
Section 3.16	Anti-Corruption Laws and Sanctions	90
Section 3.17	Security Documents	90
Section 3.18	Australian Representations	91

 

Article 4

CONDITIONS

92

 

Section 4.01	Effective Date	92
Section 4.02	Each Credit Event	94

 

Article 5

AFFIRMATIVE COVENANTS

95

 

Section 5.01	Financial Statements; Ratings Change and Other Information	95
Section 5.02	Notices of Material Events	97
Section 5.03	Existence; Conduct of Business	98
Section 5.04	Payment of Taxes	98
Section 5.05	Maintenance of Properties; Protection of Intellectual Property; Insurance	98
Section 5.06	Maintenance of Material Agreements	98
Section 5.07	Books and Records; Inspection Rights	98
Section 5.08	ERISA Events	99
Section 5.09	Compliance with Laws and Agreements	99
Section 5.10	Use of Proceeds	99
Section 5.11	Guarantors; Additional Collateral	99
Section 5.12	Cash Management	101
Section 5.13	Further Assurances	102
Section 5.14	Accuracy of Information	102

 

Article 6

NEGATIVE COVENANTS

102

 

Section 6.01	Indebtedness	102
Section 6.02	Liens	105
Section 6.03	Fundamental Changes	107
Section 6.04	Investments, Loans, Advances, Guarantees and Acquisitions	108
Section 6.05	Restricted Payments	111
Section 6.06	Restrictive Agreements	114
Section 6.07	Transactions with Affiliates	115
Section 6.08	Use of Proceeds	115
Section 6.09	Disposition of Property	115
Section 6.10	Financial Covenants	117
Section 6.11	Swap Agreements	117
Section 6.12	Permitted Activities of Parent	117

 

 

Article 7

EVENTS OF DEFAULT

119

 

Section 7.01	Events of Default	119
Section 7.02	Right to Cure	122
Section 7.03	Application of Proceeds	123

 

Article 8

THE AGENTS

124

 

Section 8.01	Appointment of Administrative Agent	124
Section 8.02	Powers and Duties	124
Section 8.03	General Immunity	125
Section 8.04	Administrative Agent Entitled to Act as Lender	126
Section 8.05	Lenders’ Representations, Warranties and Acknowledgment	126
Section 8.06	Right to Indemnity	127
Section 8.07	Successor Administrative Agent	127
Section 8.08	Guaranty and Security Documents	128
Section 8.09	Withholding Taxes	128
Section 8.10	Administrative Agent May File Bankruptcy Disclosure and Proofs of Claim	129
Section 8.11	Acknowledgment of Lenders and Issuing Banks	130
Section 8.12	Authorization of the Administrative Agent under German Law	131

 

Article 9

GUARANTY

133

 

Section 9.01	Guaranty	133
Section 9.02	Additional Agreements	135
Section 9.03	Information	135
Section 9.04	Guarantor Notices	136
Section 9.05	Termination	136
Section 9.06	Right of Set Off	136
Section 9.07	Additional Guarantors	136
Section 9.08	Article IX Severability	136

 

Article 10

MISCELLANEOUS

137

 

Section 10.01	Notices	137
Section 10.02	Waivers; Amendments	139
Section 10.03	Expenses; Indemnity; Damage Waiver	140
Section 10.04	Successors and Assigns	143
Section 10.05	Survival	147
Section 10.06	Counterparts; Integration; Effectiveness	147
Section 10.07	Severability	149
Section 10.08	Right of Setoff	149
Section 10.09	Governing Law; Jurisdiction; Consent to Service of Process	149
Section 10.10	Waiver Of Jury Trial	150
Section 10.11	Headings	150
Section 10.12	Confidentiality	151
Section 10.13	Interest Rate Limitation	152
Section 10.14	No Advisory or Fiduciary Responsibility	152

 

 

Section 10.15	Electronic Execution of Assignments and Certain Other Documents	153
Section 10.16	USA PATRIOT Act	153
Section 10.17	Releases of Guarantors and Liens	153
Section 10.18	Acknowledgement Regarding Any Supported QFCs	154
Section 10.19	Acknowledgement and Consent to Bail-In of Affected Financial Institutions	155
Section 10.20	Parallel Debt (Covenant to pay the Administrative Agent)	156
Section 10.21	Subordinated Lender	156
Section 10.22	Restricted Lender	157

 

 

SCHEDULE 1.01	Existing Letters of Credit
SCHEDULE 2.01	Commitments
SCHEDULE 3.06	Litigation or Environmental Matters
SCHEDULE 3.10	Taxes
SCHEDULE 3.13	Subsidiaries
SCHEDULE 4.01(b)	Foreign Security Agreements
SCHEDULE 4.01(l)	Foreign Security Filings
SCHEDULE 5.06	Material Agreements
SCHEDULE 6.01	Indebtedness
SCHEDULE 6.02	Permitted Liens
SCHEDULE 6.04(b)(ii)	Existing Investments
SCHEDULE 6.06	Permitted Restrictive Agreements
SCHEDULE 6.07	Transactions with Affiliates
EXHIBIT A	Form of Assignment and Assumption
EXHIBIT B-1	Form of Borrowing Request
EXHIBIT B-2	Form of Letter of Credit Request
EXHIBIT C	Form of Interest Election Request
EXHIBIT D	Form of Revolving Note
EXHIBIT E	Form of Guaranty Supplement
EXHIBIT F	Form of Compliance Certificate
EXHIBIT G	Form of Agreed Security Principles
EXHIBIT H-1	U.S. Tax Certificate (For Non-U.S. Lenders that are not Partnerships for U.S. Federal Income Tax Purposes)
EXHIBIT H-2	U.S. Tax Certificate (For Non-U.S. Lenders that are Partnerships for U.S. Federal Income Tax Purposes)
EXHIBIT H-3	U.S. Tax Certificate (For Non-U.S. Participants that are not Partnerships for U.S. Federal Income Tax Purposes)
EXHIBIT H-4	U.S. Tax Certificate (For Non-U.S. Participants that are Partnerships for U.S. Federal Income Tax Purposes)

 

 

  

REVOLVING CREDIT AGREEMENT dated as of [_], 2021 among FLUENCE, ENERGY LLC, a Delaware limited liability company, as the Borrower, FLUENCE ENERGY, INC., a Delaware corporation, as the Parent, the LENDERS party hereto and JPMORGAN CHASE BANK, N.A., as Administrative Agent.

 

The parties hereto agree as follows:

 

Article 1
DEFINITIONS

 

Section 1.01        Defined Terms. As used in this Agreement, the following terms have the meanings specified below:

 

“ABR”, when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are bearing interest at a rate determined by reference to the Alternate Base Rate. All ABR Loans shall be denominated in Dollars.

 

“Adjusted EURIBOR Rate” means, with respect to any Term Benchmark Borrowing denominated in Euros for any Interest Period, an interest rate per annum equal to (a)  the EURIBOR Rate for such Interest Period multiplied by (b) the Statutory Reserve Rate.

 

“Adjusted LIBO Rate” means, with respect to any Term Benchmark Borrowing denominated in Dollars for any Interest Period, an interest rate per annum (rounded upwards, if necessary, to the next 1/16 of 1%) equal to (a) the LIBO Rate for such Interest Period multiplied by (b) the Statutory Reserve Rate.

 

“Administrative Agent” means JPMorgan Chase Bank, N.A. (or any of its designated branch offices or affiliates), in its capacity as administrative agent for the Lenders hereunder, or any successor administrative agent.

 

“Administrative Questionnaire” means an Administrative Questionnaire in a form supplied by the Administrative Agent.

 

“AES” means The AES Corporation, a Delaware corporation, and its subsidiaries and affiliates, including AES Grid Stability, LLC, a Delaware limited liability company.

 

“Affected Financial Institution” means (a) any EEA Financial Institution or (b) any UK Financial Institution.

 

“Affiliate” means, with respect to a specified Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified.

 

“Agent Parties” has the meaning set forth in Section 10.01.

 

“Agents” means the Administrative Agent, the Arrangers, the Syndication Agent and the Documentation Agents.

 

 

“Agreed Currency” means Dollars and any Alternative Currency.

 

“Agreed Security Principles” has the meaning assigned to such term in Exhibit G.

 

“Agreement” means this Revolving Credit Agreement, as the same may hereafter be modified, supplemented, extended, amended, restated or amended and restated from time to time.

 

“Alternate Base Rate” means, for any day, a rate per annum equal to the greatest of (a) the Prime Rate in effect on such day, (b) the NYFRB Rate in effect on such day plus ¹⁄2 of 1% and (c) the Adjusted LIBO Rate for a one month Interest Period on such day (or if such day is not a Business Day, the immediately preceding Business Day) plus 1%, provided that for the purpose of this definition, the Adjusted LIBO Rate for any day shall be based on the LIBO Screen Rate (or if the LIBO Screen Rate is not available for such one month Interest Period, the LIBO Interpolated Rate) at approximately 11:00 a.m. London time on such day. Any change in the Alternate Base Rate due to a change in the Prime Rate, the NYFRB Rate or the Adjusted LIBO Rate shall be effective from and including the effective date of such change in the Prime Rate, the NYFRB Rate or the Adjusted LIBO Rate, respectively. If the Alternate Base Rate is being used as an alternate rate of interest pursuant to Section 2.11 hereof (for the avoidance of doubt, only until the Benchmark Replacement has been determined pursuant to Section 2.11(b)), then the Alternate Base Rate shall be the greater of clause (a) and (b) above and shall be determined without reference to clause (c) above. For the avoidance of doubt, if the Alternate Base Rate as determined pursuant to the foregoing would be less than 1.00%, such rate shall be deemed to be 1.00% for purposes of this Agreement.

 

“Alternative Currency” means Pounds Sterling, Euros, Australian Dollars and any additional currencies determined after the Effective Date by mutual agreement of the Borrower, Lenders, Issuing Banks and Administrative Agent; provided that each such currency is a lawful currency that is readily available, freely transferable and not restricted, able to be converted into Dollars and available in the London interbank deposit market.

 

“Alternative Currency Payment Office” of the Administrative Agent means, for each Alternative Currency, the office, branch, affiliate or correspondent bank of the Administrative Agent for such currency as specified from time to time by notice to the Borrower and each Lender.

 

“Ancillary Document” has the meaning set forth in Section 10.06(b).

 

“Anti-Corruption Laws” means all laws, rules, and regulations of any jurisdiction applicable to the Parent, the Borrower or any of its Affiliates from time to time concerning or relating to bribery or corruption.

 

“Anti-Terrorism Laws” has the meaning set forth in Section 3.15(a)(ii).

 

“Applicable Percentage” means, with respect to any Lender, the percentage of the total Commitments represented by such Lender’s Commitment. If the Commitments have terminated or expired, the Applicable Percentages shall be determined based upon the Commitments most recently in effect, giving effect to any assignments.

 

 

“Applicable Rate” means, for any day, with respect to any Term Benchmark Loans, ABR Loans, RFR Loans, CBR Loans or the commitment fees payable hereunder, as the case may be, the applicable rate per annum set forth under the caption “Applicable Rate” across from the caption “Term Benchmark Loans”, “ABR Loans”, “RFR Loans”, “CBR Loans” or “Commitment Fee” in the table below, as the case may be.

 

Type	Applicable Rate
Term Benchmark Loans	3.00%
ABR Loans	2.00%
RFR Loans	3.1193%
Commitment Fee	0.55%

 

“Approved Fund” means any Person (other than a natural person) that is engaged in making, purchasing, holding or investing in bank loans and similar extensions of credit in the ordinary course of its activities and that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.

 

“Arrangers” means each of JPMorgan Chase Bank, N.A., Morgan Stanley Senior Funding, Inc., Barclays Bank PLC and BofA Securities, Inc., in their respective capacities as lead arranger and bookrunner, and any successors thereto.

 

“ASR Agreement” has the meaning set forth in Section 6.05(vi).

 

“Assignment and Assumption” means an assignment and assumption entered into by a Lender and an assignee (with the consent of any party whose consent is required by Section 10.04), and accepted by the Administrative Agent, in the form of Exhibit A or any other form (including electronic records generated by the use of an electronic platform) approved by the Administrative Agent.

 

“AUD Interpolated Rate” means, at any time, the rate per annum determined by the Administrative Agent to be equal to the rate that results from interpolating on a linear basis between: (a) the AUD Screen Rate for the longest period for which that AUD Screen Rate is available that is shorter than the Impacted AUD Interest Period and (b) the AUD Screen Rate for the shortest period for which that AUD Screen Rate is available that exceeds the Impacted AUD Interest Period, in each case, at such time. If at any time the AUD Interpolated Rate is less than zero, the AUD Interpolated Rate shall be deemed to be zero for purposes of this Agreement.

 

“AUD Rate” means, with respect to any Term Benchmark Borrowing denominated in Australian Dollars and for any Interest Period, the AUD Screen Rate at approximately 11:00 A.M., Sydney, Australia time, on the first day of such Interest Period; provided, that, if the AUD Screen Rate shall not be available at such time for such Interest Period (an “Impacted AUD Interest Period”), then the AUD Rate shall be the AUD Interpolated Rate.

 

 

“AUD Screen Rate” means with respect to any Interest Period:

 

(1)       the Australian Bank Bill Swap Reference Rate (Bid) administered by ASX Benchmarks Pty Limited (ACN 616 075 417) (or any other Person that takes over the administration of such rate) for Australian Dollar bills of exchange with a tenor equal in length to such Interest Period as displayed on page BBSY of the Reuters screen (or, in the event such rate does not appear on such Reuters page, on any successor or substitute page on such screen that displays such rate, or on the appropriate page of such other information service that publishes such rate as shall be selected by the Administrative Agent from time to time in its reasonable discretion) at or about 11:00 a.m. (Sydney, Australia time) on the first day of such Interest Period. If the AUD Screen Rate shall be less than zero, the AUD Screen Rate shall be deemed to be zero for purposes of this Agreement; and

 

(2)       if the rate described in sub-paragraph (1) above is not available, the sum of:

 

(A)       the Australian Bank Bill Swap Reference Rate administered by ASX Benchmarks Pty Limited (or any other person which takes over the administration of that rate) for the relevant period displayed on page BBSW of the Reuters Screen (or any replacement Reuters page which displays that rate) (or, in the event such rate does not appear on such Reuters page, on any successor or substitute page on such screen that displays such rate, or on the appropriate page of such other information service that publishes such rate as shall be selected by the Administrative Agent from time to time in its reasonable discretion) at or about 11:00 a.m. (Sydney, Australia time) on the first day of such Interest Period; and

 

(B)       0.05 per cent per annum;

 

(3)       if (i) for any reason that rate is not displayed for a term equivalent to that period; or (ii) the basis on which that rate is displayed is changed or the relevant rate is otherwise unascertainable pursuant to the foregoing provision, and it is not possible to determine the AUD Interpolated Rate, then the AUD Screen Rate will be the rate determined by the Administrative Agent to be the average of the buying rates quoted to the Administrative Agent by three Reference Banks at or about that time on that date; provided, however, that such rate shall not be less than 0%. The buying rates must be for bills of exchange accepted by a leading Australian bank and which have a term equivalent to the period.

 

“Australia” means the Commonwealth of Australia, including its states and territories (and “Australian” should be construed accordingly).

 

"Australian Banking Code of Practice" means the Banking Code of Practice published by the Australian Banking Association, as amended, revised or amended and restated from time to time.

 

"Australian Collateral Agreements" shall mean the security agreements set forth on Schedule 4.01(b) under the heading [*] which agreements shall be granted in accordance with the Agreed Security Principles, in each case as may be amended, restated, supplemented or otherwise modified from time to time, and any other security agreement, pledge agreement or similar document governed by Australian law delivered by any Loan Party in favor of the Administrative Agent.

 

 

“Australian Controller” has the meaning given to the term “controller” in section 9 of the Corporations Act.

 

“Australian Corporations Act” means the Corporations Act 2001 (Cth) (Australia).

 

“Australian Dollars” and “A$” means lawful money of the Commonwealth of Australia.

 

“Australian GST” means goods and services tax or similar value added tax levied or imposed in Australia under the Australian GST Act.

 

“Australian GST Act” means the A New Tax System (Goods and Services Tax) Act 1999 (Cth).

 

“Australian Loan Party” means a Loan Party that is incorporated in Australia. As of the Effective Date, the Australian Loan Parties shall constitute Fluence Energy Pty Ltd (ACN 627 071 461), an Australian corporation.

 

“Australian PPS Act” means the Personal Property Securities Act 2009 (Cth) (Australia).

 

“Australian PPS Law” means (a) the Australian PPS Act, (b) any regulations made under the Australian PPS Act, (c) any legislative instrument made under the Australian PPS Act, (d) any amendment to any of the above, made at any time, or (e) any amendment made at any time to any other legislation as a consequence of an Australian PPS Law referred to in clauses (a) to (d).

 

“Australian Tax Act” means the Income Tax Assessment Act 1936 (Cth) (Australia) or the Income Tax Assessment Act 1997 (Cth) (Australia), as applicable.

 

“Australian Tax Consolidated Group” means a Consolidated Group or a MEC Group as defined in the Australian Tax Act.

 

“Australian Tax Funding Agreement” means any tax funding agreement for Australian tax consolidation purposes.

 

“Australian Tax Sharing Agreement” means any tax sharing agreement for Australian tax consolidation purposes that satisfies the requirements of section 721-25 of the Australian Tax Act for being a valid tax sharing agreement.

 

“Availability Period” means the period from and including the Effective Date to but excluding the earlier of the Maturity Date and the date of termination of the Commitments.

 

“Available Tenor” means, as of any date of determination and with respect to the then-current Benchmark for any Agreed Currency, as applicable, any tenor for such Benchmark (or component thereof) or payment period for interest calculated with reference to such Benchmark (or component thereof), as applicable, that is or may be used for determining the length of an Interest Period for any term rate or otherwise, for determining any frequency of making payments of interest calculated pursuant to this Agreement as of such date and not including, for the avoidance of doubt, any tenor for such Benchmark that is then-removed from the definition of “Interest Period” pursuant to clause (f) of Section 2.11.

 

 

“Bail-In Action” means the exercise of any Write-Down and Conversion Powers by the applicable Resolution Authority in respect of any liability of an Affected Financial Institution.

 

“Bail-In Legislation” means (a) with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law, regulation rule or requirement for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule and (b) with respect to the United Kingdom, Part I of the United Kingdom Banking Act 2009 (as amended from time to time) and any other law, regulation or rule applicable in the United Kingdom relating to the resolution of unsound or failing banks, investment firms or other financial institutions or their affiliates (other than through liquidation, administration or other insolvency proceedings).

 

“Bankruptcy Code” means Title 11 of the United States Code entitled “Bankruptcy”, as now and hereafter in effect, or any successor statute.

 

“Benchmark” means, initially, with respect to any (i) RFR Loan in any Agreed Currency, the applicable Relevant Rate for such Agreed Currency or (ii) Term Benchmark Loan, the Relevant Rate for such Agreed Currency; provided that if a Benchmark Transition Event, a Term SOFR Transition Event, an Early Opt-in Election or an Other Benchmark Rate Election, as applicable, and its related Benchmark Replacement Date have occurred with respect to the applicable Relevant Rate or the then-current Benchmark for such Agreed Currency, then “Benchmark” means the applicable Benchmark Replacement to the extent that such Benchmark Replacement has replaced such prior benchmark rate pursuant to clause (b) or clause (c) of Section 2.11.

 

“Benchmark Replacement” means, for any Available Tenor, the first alternative set forth in the order below that can be determined by the Administrative Agent for the applicable Benchmark Replacement Date; provided that, in the case of any Loan denominated in an Alternative Currency or in the case of an Other Benchmark Rate Election, “Benchmark Replacement” shall mean the alternative set forth in (3) below:

 

(1)       in the case of any Loan denominated in Dollars, the sum of: (a) Term SOFR and (b) the related Benchmark Replacement Adjustment;

 

(2)       in the case of any Loan denominated in Dollars, the sum of: (a) Daily Simple SOFR and (b) the related Benchmark Replacement Adjustment;

 

(3)       the sum of: (a) the alternate benchmark rate that has been selected by the Administrative Agent and the Borrower as the replacement for the then-current Benchmark for the applicable Corresponding Tenor giving due consideration to (i) any selection or recommendation of a replacement benchmark rate or the mechanism for determining such a rate by the Relevant Governmental Body or (ii) any evolving or then-prevailing market convention for determining a benchmark rate as a replacement for the then-current Benchmark for syndicated credit facilities denominated in the applicable Agreed Currency at such time in the United States and (b) the related Benchmark Replacement Adjustment;

 

 

provided that, in the case of clause (1), such Unadjusted Benchmark Replacement is displayed on a screen or other information service that publishes such rate from time to time as selected by the Administrative Agent in its reasonable discretion; provided further that, in the case of clause (3), when such clause is used to determine the Benchmark Replacement in connection with the occurrence of an Other Benchmark Rate Election, the alternate benchmark rate selected by the Administrative Agent and the Borrower shall be the term benchmark rate that is used in lieu of a LIBOR-based rate in the relevant other Dollar-denominated syndicated credit facilities; provided further that, notwithstanding anything to the contrary in this Agreement or in any other Loan Document, upon the occurrence of a Term SOFR Transition Event, and the delivery of a Term SOFR Notice,  on the applicable Benchmark Replacement Date the “Benchmark Replacement” shall revert to and shall be deemed to be the sum of (a) Term SOFR and (b) the related Benchmark Replacement Adjustment, as set forth in clause (1) of this definition (subject to the first proviso above).

 

If the Benchmark Replacement as determined pursuant to clause (1), (2) or (3) above would be less than the Floor, the Benchmark Replacement will be deemed to be the Floor for the purposes of this Agreement and the other Loan Documents.

 

“Benchmark Replacement Adjustment” means, with respect to any replacement of the then-current Benchmark with an Unadjusted Benchmark Replacement for any applicable Interest Period and Available Tenor for any setting of such Unadjusted Benchmark Replacement:

 

(1)       for purposes of clauses (1) and (2) of the definition of “Benchmark Replacement,” the first alternative set forth in the order below that can be determined by the Administrative Agent:

 

(a)       the spread adjustment, or method for calculating or determining such spread adjustment, (which may be a positive or negative value or zero) as of the Reference Time such Benchmark Replacement is first set for such Interest Period that has been selected or recommended by the Relevant Governmental Body for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement for the applicable Corresponding Tenor;

 

(b)       the spread adjustment (which may be a positive or negative value or zero) as of the Reference Time such Benchmark Replacement is first set for such Interest Period that would apply to the fallback rate for a derivative transaction referencing the ISDA Definitions to be effective upon an index cessation event with respect to such Benchmark for the applicable Corresponding Tenor; and

 

 

(2)       for purposes of clause (3) of the definition of “Benchmark Replacement,” the spread adjustment, or method for calculating or determining such spread adjustment, (which may be a positive or negative value or zero) that has been selected by the Administrative Agent and the Borrower for the applicable Corresponding Tenor giving due consideration to (i) any selection or recommendation of a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement by the Relevant Governmental Body on the applicable Benchmark Replacement Date and/or (ii) any evolving or then-prevailing market convention for determining a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement for syndicated credit facilities denominated in the applicable Agreed Currency at such time;

 

provided that, in the case of clause (1) above, such adjustment is displayed on a screen or other information service that publishes such Benchmark Replacement Adjustment from time to time as selected by the Administrative Agent in its reasonable discretion.

 

“Benchmark Replacement Conforming Changes” means, with respect to any Benchmark Replacement, any technical, administrative or operational changes (including changes to the definition of “Alternate Base Rate,” the definition of “Business Day,” the definition of “Interest Period,” timing and frequency of determining rates and making payments of interest, timing of borrowing requests or prepayment, conversion or continuation notices, length of lookback periods, the applicability of breakage provisions, and other technical, administrative or operational matters) that the Administrative Agent decides in its reasonable and good faith discretion may be appropriate to reflect the adoption and implementation of such Benchmark Replacement and to permit the administration thereof by the Administrative Agent in a manner substantially consistent with market practice (or, if the Administrative Agent decides in its reasonable good faith discretion that adoption of any portion of such market practice is not administratively feasible or if the Administrative Agent determines in its reasonable good faith discretion that no market practice for the administration of such Benchmark Replacement exists, in such other manner of administration as the Administrative Agent decides is reasonably necessary in connection with the administration of this Agreement and the other Loan Documents).

 

“Benchmark Replacement Date” means, with respect to any Benchmark, the earliest to occur of the following events with respect to such then-current Benchmark:

 

(1)       in the case of clause (1) or (2) of the definition of “Benchmark Transition Event,” the later of (a) the date of the public statement or publication of information referenced therein and (b) the date on which the administrator of such Benchmark (or the published component used in the calculation thereof) permanently or indefinitely ceases to provide all Available Tenors of such Benchmark (or such component thereof);

 

(2)       in the case of clause (3) of the definition of “Benchmark Transition Event,” the first date on which such Benchmark (or the published component used in the calculation thereof) has been determined and announced by the regulatory supervisor for the administrator of such Benchmark (or such component thereof) to be no longer representative; provided, that such non-representativeness will be determined by reference to the most recent statement or publication referenced in such clause (c) and even if any Available Tenor of such Benchmark (or such component thereof) continues to be provided on such date;

 

 

(3)       in the case of a Term SOFR Transition Event, the date that is thirty (30) days after the date a Term SOFR Notice is provided to the Lenders and the Borrower pursuant to Section 2.11(c); or

 

(4)       in the case of an Early Opt-in Election or an Other Benchmark Rate Election, the sixth (6th) Business Day after the date notice of such Early Opt-in Election or Other Benchmark Rate Election, as applicable, is provided to the Lenders, so long as the Administrative Agent has not received, by 5:00 p.m. (New York City time) on the fifth (5th) Business Day after the date notice of such Early Opt-in Election or Other Benchmark Rate Election, as applicable, is provided to the Lenders, written notice of objection to such Early Opt-in Election or Other Benchmark Rate Election, as applicable, from Lenders comprising the Required Lenders.

 

For the avoidance of doubt, (i) if the event giving rise to the Benchmark Replacement Date occurs on the same day as, but earlier than, the Reference Time in respect of any determination, the Benchmark Replacement Date will be deemed to have occurred prior to the Reference Time for such determination and (ii) the “Benchmark Replacement Date” will be deemed to have occurred in the case of clause (1) or (2) with respect to any Benchmark upon the occurrence of the applicable event or events set forth therein with respect to all then-current Available Tenors of such Benchmark (or the published component used in the calculation thereof).

 

“Benchmark Transition Event” means, with respect to any Benchmark, the occurrence of one or more of the following events with respect to such then-current Benchmark:

 

(1) a public statement or publication of information by or on behalf of the administrator of such Benchmark (or the published component used in the calculation thereof) announcing that such administrator has ceased or will cease to provide all Available Tenors of such Benchmark (or such component thereof), permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide any Available Tenor of such Benchmark (or such component thereof);

 

(2) a public statement or publication of information by the regulatory supervisor for the administrator of such Benchmark (or the published component used in the calculation thereof), the Federal Reserve Board, the NYFRB, the central bank for the Agreed Currency applicable to such Benchmark, an insolvency official with jurisdiction over the administrator for such Benchmark (or such component), a resolution authority with jurisdiction over the administrator for such Benchmark (or such component) or a court or an entity with similar insolvency or resolution authority over the administrator for such Benchmark (or such component), in each case, which states that the administrator of such Benchmark (or such component) has ceased or will cease to provide all Available Tenors of such Benchmark (or such component thereof) permanently or indefinitely; provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide any Available Tenor of such Benchmark (or such component thereof); or

 

 

(3) a public statement or publication of information by the regulatory supervisor for the administrator of such Benchmark (or the published component used in the calculation thereof) announcing that all Available Tenors of such Benchmark (or such component thereof) are no longer, or as of a specified future date will no longer be, representative.

 

For the avoidance of doubt, a “Benchmark Transition Event” will be deemed to have occurred with respect to any Benchmark if a public statement or publication of information set forth above has occurred with respect to each then-current Available Tenor of such Benchmark (or the published component used in the calculation thereof).

 

“Benchmark Unavailability Period” means, with respect to any Benchmark, the period (if any) (x) beginning at the time that a Benchmark Replacement Date pursuant to clauses (1) or (2) of that definition has occurred if, at such time, no Benchmark Replacement has replaced such then-current Benchmark for all purposes hereunder and under any Loan Document in accordance with Section 2.11(b) and (y) ending at the time that a Benchmark Replacement has replaced such then-current Benchmark for all purposes hereunder and under any Loan Document in accordance with Section 2.11(b).

 

“Beneficial Ownership Certification” means a certification regarding beneficial ownership or control as required by the Beneficial Ownership Regulation.

 

“Beneficial Ownership Regulation” means 31 C.F.R. § 1010.230.

 

“BHC Act Affiliate” of a party means an “affiliate’ (as such term is defined under, and interpreted in accordance with, 12 U.S.C. 1841(k)) of such party.

 

“Board” means the Board of Governors of the Federal Reserve System of the United States of America.

 

“Borrower” means Fluence Energy, LLC, a Delaware limited liability company.

 

“Borrower Competitor” means any competitor of the Borrower and/or any of its Subsidiaries.

 

“Borrowing” means Loans of the same Type and Agreed Currency, made, converted or continued on the same date and, in the case of Term Benchmark Loans, as to which a single Interest Period is in effect.

 

“Borrowing Request” means a request by the Borrower for a Borrowing in accordance with Section 2.03.

 

 

“Business Day” means any day that is not a Saturday, Sunday or other day on which commercial banks in New York City are authorized or required by law to remain closed; provided that, (a) when used in connection with a Term Benchmark Loan, the term “Business Day” shall also exclude any day on which banks are not open for dealings in Dollar deposits in the London interbank market, (b) when used in connection with Loans denominated in Euros and in relation to the calculation or computation of EURIBOR, any day which is a TARGET Day, (c) in relation to Loans denominated in Australian Dollars and in relation to the calculation or computation of BBSY or BBSW, any day (other than a Saturday or a Sunday) on which banks are open for business in Sydney, Australia and (d) in relation to RFR Loans and any interest rate settings, fundings, disbursements, settlements or payments of any such RFR Loan, or any other dealings in the applicable Agreed Currency of such RFR Loan, any such day that is only an RFR Business Day.

 

“Capital Lease Obligations” of any Person means the obligations of such Person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital leases on a balance sheet of such Person under GAAP, and the amount of such obligations shall be the capitalized amount thereof determined in accordance with GAAP; provided that, for the avoidance of doubt, any obligations relating to a lease that was accounted for by such Person as an operating lease as of the Effective Date and any similar lease entered into after the Effective Date by such Person shall be accounted for as obligations relating to an operating lease and not as Capital Lease Obligations.

 

“Captive Insurance Company” means each Subsidiary of the Borrower formed from time to time that engages primarily in the business of insuring risks of the Borrower and its Subsidiaries.

 

“Cash Collateralize” means, in respect of an Obligation, to provide and pledge (as a first priority perfected security interest) cash collateral in Dollars, at a location and pursuant to documentation in form and substance reasonably satisfactory to the Administrative Agent and the applicable Issuing Bank (and “Cash Collateralization” has a corresponding meaning). “Cash Collateral” shall have a meaning correlative to the foregoing and shall include the proceeds of such cash collateral and other credit support.

 

“Cash Equivalents” means:

 

(a)                direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the United States of America (or by any agency thereof or issued by FNMA, FHLMC or FFCB), in each case maturing within one year from the date of acquisition thereof;

 

(b)                investments in commercial paper maturing within one (1) year from the date of acquisition thereof and (i) issued by any Lender or bank holding company owning any Lender or (ii) rated at least “A-2” or the equivalent thereof by S&P or at least “P-2” or the equivalent thereof by Moody’s, respectively (in each case, at the time of acquisition);

 

 

(c)                investments in certificates of deposit, floating rate certificates of deposit, bankers’ acceptances and time deposits (including eurodollar deposits) maturing within one (1) year from the date of acquisition thereof issued or guaranteed by or placed with, and money market deposit accounts issued or offered by (i) any domestic office of any commercial bank organized under the laws of the United States of America or any State thereof which has a combined capital and surplus and undivided profits of not less than $100 million; or (ii) any Lender or bank holding company owning any Lender (in each case, at the time of acquisition);

 

(d)                fully collateralized repurchase agreements with a term of not more than 30 days for securities described in clause (a) above and entered into with a financial institution satisfying the criteria described in clause (c) above;

 

(e)                money market funds that (i) comply with the criteria set forth in SEC Rule 2a-7 under the Investment Company Act of 1940, (ii) are rated AAA by S&P and Aaa by Moody’s and (iii) have portfolio assets of at least $5 billion;

 

(f)                 securities with maturities of one year or less from the date of acquisition issued or fully guaranteed by any state, commonwealth or territory of the United States, or by any political subdivision or taxing authority thereof or by any foreign government, and rated at least “A” by S&P or “A” by Moody’s (in each case, at the time of acquisition);

 

(g)                securities with maturities of six months or less from the date of acquisition backed by standby letters of credit issued by any Lender or any commercial bank satisfying the requirements of clause (c) above (in each case, at the time of acquisition);

 

(h)                corporate notes issued by domestic corporations that are rated at least “A” by S&P or “A” by Moody’s, in each case maturing within one year from the date of acquisition;

 

(i)                 auction rate securities including taxable municipals, taxable auction notes, and money market preferred; provided that the credit quality is consistent with clause (g) of this definition;

 

(j)                 marketable direct obligations issued by any state of the United States or any political subdivision of any such state or any public instrumentality thereof maturing within one (1) year from the date of acquisition thereof and, at the time of acquisition, having one of the two highest ratings obtainable from either S&P or Moody’s;

 

(k)                short term investments similar to the foregoing made by foreign Subsidiaries of the Parent consistent with the Parent’s or the Borrower’s, as applicable, investment guidelines or as approved from time to time by the Parent’s or the Borrower’s, as applicable, board of directors or governing body;

 

(l)                 money market mutual funds that invest primarily in the foregoing items (determined at the time such investment in such fund is made); and

 

(m)              such other comparable investments as may be approved by the Administrative Agent from time to time.

 

 

“CBR Loan” means a Loan that bears interest at a rate determined by reference to the Central Bank Rate.

 

“Central Bank Rate” means, (A) the greater of (i) for any Loan denominated in (a) Sterling, the Bank of England (or any successor thereto)’s “Bank Rate” as published by the Bank of England (or any successor thereto) from time to time, (b) Euro, one of the following three rates as may be selected by the Administrative Agent in its reasonable discretion: (1) the fixed rate for the main refinancing operations of the European Central Bank (or any successor thereto), or, if that rate is not published, the minimum bid rate for the main refinancing operations of the European Central Bank (or any successor thereto), each as published by the European Central Bank (or any successor thereto) from time to time, (2) the rate for the marginal lending facility of the European Central Bank (or any successor thereto), as published by the European Central Bank (or any successor thereto) from time to time or (3) the rate for the deposit facility of the central banking system of the Participating Member States, as published by the European Central Bank (or any successor thereto) from time to time and (c) any other Alternative Currency, a central bank rate as determined by the Administrative Agent in its reasonable discretion and (ii) 0%; plus (B) the applicable Central Bank Rate Adjustment.

 

“Central Bank Rate Adjustment” means, for any day, for any Loan denominated in (a) Euro, a rate equal to the difference (which may be a positive or negative value or zero) of (i) the average of the EURIBOR Rate for the five most recent Business Days preceding such day for which the EURIBOR Screen Rate was available (excluding, from such averaging, the highest and the lowest EURIBOR Rate applicable during such period of five Business Days) minus (ii) the Central Bank Rate in respect of Euro in effect on the last Business Day in such period, (b) Sterling, a rate equal to the difference (which may be a positive or negative value or zero) of (i) the average of SONIA for the five most recent RFR Business Days preceding such day for which SONIA was available (excluding, from such averaging, the highest and the lowest SONIA applicable during such period of five RFR Business Days) minus (ii) the Central Bank Rate in respect of Sterling in effect on the last RFR Business Day in such period and (c) any other Alternative Currency, a Central Bank Rate Adjustment as determined by the Administrative Agent in its reasonable discretion. For purposes of this definition, (x) the term Central Bank Rate shall be determined disregarding clause (B) of the definition of such term and (y) the EURIBOR Rate on any day shall be based on the EURIBOR Screen Rate on such day at approximately the time referred to in the definition of such term for deposits in the applicable Agreed Currency for a maturity of one month (or, in the event the EURIBOR Screen Rate for deposits in the applicable Agreed Currency is not available for such maturity of one month, shall be based on the EURIBOR Interpolated Rate as of such time); provided that if such rate shall be less than 0.00%, such rate shall be deemed to be 0.00%.

 

“CFC” has the meaning assigned to it in the definition of “Excluded Subsidiary.”

 

“CFC Holdco” has the meaning assigned to it in the definition of “Excluded Subsidiary.”

 

“Change in Control” means (a) the acquisition of ownership, directly or indirectly, beneficially or of record, by any Person or group (within the meaning of the Securities Exchange Act and the rules of the SEC thereunder) (other than the Permitted Holders), of Equity Interests in each of the Parent and the Borrower (i) representing more than 40% of the aggregate ordinary voting power represented by the issued and outstanding Equity Interests in each of the Parent and the Borrower and (ii) representing more of the aggregate ordinary voting power represented by the issued and outstanding Equity Interests in each of the Parent and the Borrower than the aggregate ordinary voting power represented by the issued and outstanding Equity Interests in each of the Parent and the Borrower that are owned, directly or indirectly, beneficially or of record, by the Permitted Holders, or (b) the Parent or any successor thereto in accordance with Section 6.12(d) shall at any time cease to be the sole managing member of the Borrower.

 

 

“Change in Law” means the occurrence, after the date of this Agreement, of any of the following: (a) the adoption or taking effect of any law, rule, regulation or treaty, (b) any change in any law, rule, regulation or treaty or in the administration, interpretation, implementation or application thereof by any Governmental Authority or (c) the making or issuance of any request, rule, guideline or directive (whether or not having the force of law) by any Governmental Authority; provided that, notwithstanding anything herein to the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (y) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in Law,” regardless of the date enacted, adopted or issued.

 

“Charges” has the meaning set forth in Section 10.13.

 

“Citi Supplier Financing Agreement” means that certain Global Paying Services Agreement, dated as of July 22, 2021 between the Borrower and Citibank, N.A., as it may be amended, restated, supplemented, replaced or otherwise modified from time to time.

 

“Code” means the U.S. Internal Revenue Code of 1986, as amended from time to time.

 

“Collateral” means all property and rights of the Loan Parties, now owned or hereafter acquired, upon which a Lien is purported to be created by any Security Document, provided that Collateral shall not include any Excluded Property.

 

“Commercial Letter of Credit” means any Letter of Credit issued for the purpose of providing the primary payment mechanism in connection with the purchase of any materials, goods or services by the Borrower or any of its subsidiaries in the ordinary course of business of such Person.

 

“Commitment” means, with respect to each Lender, the commitment of such Lender to make Loans and to acquire participations in Letters of Credit hereunder, expressed as an amount representing the maximum aggregate amount of such Lender’s Revolving Credit Exposure hereunder, as such commitment may be (a) reduced from time to time pursuant to Section 2.06 and (b) reduced or increased from time to time pursuant to assignments by or to such Lender pursuant to Section 10.04. The initial amount of each Lender’s Commitment as of the Effective Date is set forth on Schedule 2.01 opposite such Lender’s name under the caption “Commitment”. The initial aggregate amount of the Lenders’ Commitments as of the Effective Date is $200,000,000.

 

 

“Commitment Fee” has the meaning set forth in Section 2.09(a).

 

“Communications” has the meaning set forth in Section 10.01.

 

“Connection Income Taxes” means Other Connection Taxes that are imposed on or measured by net income (however denominated) or that are franchise Taxes or branch profits Taxes.

 

“Consolidated EBITDA” means, for the Parent and its Subsidiaries for any period, Consolidated Net Income for such period adjusted (i) to exclude (a) gains or losses from disposed, abandoned, transferred, closed or discontinued operations, (b) any gains or losses attributable to business dispositions or asset dispositions other than in the ordinary course of business (as reasonably determined by the Borrower acting in good faith), (c) any extraordinary or non-recurring gains or losses, (d) any non-cash gains, losses, charges or expenses, (e) the cumulative effect of changes in accounting principles, including any changes to Accounting Standards Codification 715 (or any subsequently adopted standards relating to pension and postretirement benefits) adopted by the Financial Accounting Standards Board after the date hereof, (f) Interest Expense, (g) consolidated tax expense or income, (h) all depreciation and amortization expense, including the depreciation of property, plant and equipment, the amortization of intangible assets, deferred financing fees and amortization of unrecognized prior service costs and actuarial gains and losses related to pensions and other post-employment benefits, (i) all other non-cash charges, including actuarial gains or losses from pension and postretirement plans, impairment charges and asset write-offs, non-cash expense realized or resulting from stock option plans, employee benefit plans or post-employment benefit plans, or grants or sales of stock, stock appreciation or similar rights, stock options, restricted stock or other Equity Interests, or non-cash compensation charges, (j) any costs and expenses related to employment of terminated employees or realized in connection with or resulting from stock appreciation or similar rights, stock options, restricted stock or other Equity Interests, (k) any gains or losses attributable to the early extinguishment of Indebtedness, Swap Agreements or other derivative instruments, (l) any currency translation gains and losses, and any realized or unrealized net loss or gain resulting from hedging transactions, (m) any expenses or charges related to any issuance of Equity Interests, Investment, acquisition, Disposition, recapitalization, Restricted Payment, or incurrence or repayment of Indebtedness permitted hereunder or any other Specified Transaction (in each case, whether or not consummated), (n) restructuring losses and expenses and (o) any payments by the Parent to the Permitted Holders under the Tax Receivable Agreement and (ii) to include proceeds received from business interruption insurance. For purposes of this definition, whenever Pro Forma Effect is to be given to any event, the Pro Forma Effect calculations shall be made in good faith by a Financial Officer of the Borrower.

 

“Consolidated Leverage Ratio” means, for any Measurement Period, the ratio of (a) Net Debt for Borrowed Money of the Parent (excluding Indebtedness attributable to the Parent Convertible Notes) and its Subsidiaries as of the end of such period to (b) Consolidated EBITDA of the Parent and its Subsidiaries for such period.

 

 

“Consolidated Net Income” means, for the Parent and its Subsidiaries for any period, the net income of the Parent and its Subsidiaries, determined on a consolidated basis for such period in accordance with GAAP.

 

“Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise. “Controlling” and “Controlled” have meanings correlative thereto.

 

“Control Account Agreement” means any tri-party agreement by and among a U.S. Loan Party, the Administrative Agent and a depositary bank or securities intermediary at which such U.S. Loan Party maintains a Controlled Account, in each case in form and substance reasonably satisfactory to the Administrative Agent and which shall provide that, upon the occurrence and during the continuance of any Event of Default, the Administrative Agent can cause the applicable depositary bank or securities intermediary to honor the instructions of the Administrative Agent with respect to any such Controlled Account on terms set forth therein.

 

“Controlled Account” has the meaning set forth in Section 5.12.

 

“Corresponding Debt” has the meaning assigned to such term in Section 10.20(b).

 

“Corresponding Tenor” with respect to any Available Tenor means, as applicable, either a tenor (including overnight) or an interest payment period having approximately the same length (disregarding business day adjustment) as such Available Tenor.

 

“Covered Entity” means any of the following:

 

(i)                 a “covered entity” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 252.82(b);

 

(ii)               a “covered bank” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 47.3(b); or

 

(iii)             a “covered FSI” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 382.2(b).

 

“Covered Party” has the meaning assigned to it in Section 10.18.

 

“Cure Amount” has the meaning specified in Section 7.02(a).

 

“Cure Expiration Date” has the meaning specified in Section 7.02(a).

 

“Cure Right” has the meaning specified in Section 7.02(a).

 

“Cure Quarter” has the meaning specified in Section 7.02(e).

 

“Daily Simple RFR” means, for any day (an “RFR Interest Day”), for any RFR Loan denominated in Sterling, an interest rate per annum equal to the greater of (a) SONIA for the day that is five Business Days prior to (A) if such RFR Interest Day is a Business Day, such RFR Interest Day or (B) if such RFR Interest Day is not a Business Day, the Business Day immediately preceding such RFR Interest Day and (b) 0.00%. Any change in Daily Simple RFR due to a change in the applicable RFR shall be effective from and including the effective date of such change in the RFR without notice to the Borrower.

 

 

“Daily Simple SOFR” means, for any day, SOFR, with the conventions for this rate (which may include a lookback) being established by the Administrative Agent in accordance with the conventions for this rate selected or recommended by the Relevant Governmental Body for determining “Daily Simple SOFR” for business loans; provided, that if the Administrative Agent decides that any such convention is not administratively feasible for the Administrative Agent, then the Administrative Agent may establish another convention in its reasonable discretion.

 

[“Debt Purchase Transaction” means, in relation to a person, a transaction where such person:

 

(a) purchases by way of assignment or transfer;

 

(b) enters into any sub-participation in respect of; or

 

(c) enters into any other agreement or arrangement having an economic effect substantially similar to a sub-participation in respect of,

 

any Commitment or amount outstanding under this Agreement.]

 

“Debtor Relief Laws” means the Bankruptcy Code, and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief Laws of the United States or other applicable jurisdictions from time to time in effect.

 

“Deemed LC Issuance” has the meaning set forth in Section 2.19(l).

 

“Deemed LC Request” has the meaning set forth in Section 2.19(l).

 

“Deemed LC Termination” has the meaning set forth in Section 2.19(l).

 

“Default” means any event or condition which constitutes an Event of Default or which upon notice, lapse of time or both would, unless cured or waived, become an Event of Default.

 

“Default Right” has the meaning assigned to that term in, and shall be interpreted in accordance with, 12 C.F.R. §§ 252.81, 47.2 or 382.1, as applicable.

 

 

“Defaulting Lender” means, subject to Section 2.17(b), any Lender that (a) has failed to (i) fund all or any portion of its Loans within two Business Days of the date such Loans were required to be funded hereunder, unless such Lender notifies the Administrative Agent and the Borrower in writing that such failure is the result of such Lender’s good faith determination that one or more conditions precedent to such funding (each of which conditions precedent, together with any applicable default, shall be specifically identified in such writing) has not been satisfied, (ii) fund any portion of its participation in Letters of Credit hereunder within two Business Days of the date when due or (iii) pay to the Administrative Agent, any Issuing Bank or any other Lender any other amount required to be paid by it hereunder within two Business Days of the date when due, (b) has notified the Borrower or the Administrative Agent in writing that it does not intend to comply with its funding obligations hereunder, or has made a public statement to that effect (unless such writing or public statement relates to such Lender’s obligation to fund a Loan hereunder and states that such position is based on such Lender’s determination that a condition precedent to funding (which condition precedent, together with any applicable default, shall be specifically identified in such writing or public statement) cannot be satisfied), (c) has failed, within three Business Days after written request by the Administrative Agent or the Borrower, to confirm in writing to the Administrative Agent and the Borrower that it will comply with its prospective funding obligations hereunder; provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon receipt of such written confirmation by the Administrative Agent and the Borrower, (d) has, or has a direct or indirect parent company that has, (i) become the subject of a proceeding under any Debtor Relief Law, or (ii) had appointed for it a receiver, custodian, conservator, trustee, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business or assets, including the Federal Deposit Insurance Corporation or any other state or federal regulatory authority acting in such a capacity; provided that a Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any equity interest in that Lender or any direct or indirect parent company thereof by a Governmental Authority so long as such ownership interest does not result in or provide such Lender with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permit such Lender (or such Governmental Authority) to reject, repudiate, disavow or disaffirm any contracts or agreements made with such Lender, or (e) has become the subject of a Bail-In Action. Any determination by the Administrative Agent that a Lender is a Defaulting Lender under clauses (a) through (e) above shall be conclusive and binding absent manifest error, and such Lender shall be deemed to be a Defaulting Lender (subject to Section 2.17(b)) upon delivery of written notice of such determination to the Borrower and each Lender.

 

“Disposition” means, with respect to any property or right, any sale, lease, sale and leaseback, assignment, license, conveyance, transfer or other disposition thereof (in one transaction or in a series of transactions and whether effected pursuant to a Division or otherwise). “Dispose” and “Disposed of” have meanings correlative thereto.

 

“Disqualified Lender” means (a) any Person identified in writing by name to the Arrangers prior to the Effective Date, (b) any Person that is or becomes a Borrower Competitor, and is designated by name by the Borrower as such in a writing provided to the Administrative Agent after the Effective Date, and (c) any Affiliate of any Person referred to in clauses (a) and (b) above that (i) have been identified to the Administrative Agent by the Borrower in writing from time to time or (ii) otherwise are reasonably identifiable on the basis of their name; provided that no written notice delivered pursuant to clauses (b) and (c) above shall (A) apply retroactively to disqualify any Person that has previously acquired an assignment or participation interest in any Loans or entered into a trade for either of the foregoing or (B) become effective until two Business Days after such written notice is delivered to the Administrative Agent.

 

 

[“Distributed Amount” means the amount distributed or paid to the Secured Parties or to the Administrative Agent on behalf of the Secured Parties (or any of them) by the person responsible for the distribution of the assets (including any payments) of a Loan Party which is insolvent or otherwise subject to insolvency or similar proceedings.]

 

“Dividing Person” has the meaning assigned to it in the definition of “Division”.

 

“Division” means the division of the assets, liabilities and/or obligations of a Person (the “Dividing Person”) among two or more Persons (whether pursuant to a “plan of division” or similar arrangement), which may or may not include the Dividing Person and pursuant to which the Dividing Person may or may not survive.

 

“Documentation Agent” means each of Barclays Bank PLC and Bank of America, N.A. in their capacities as documentation agents, and any successors thereto.

 

“Dollar Equivalent” means, for any amount, at the time of determination thereof, (a) if such amount is expressed in Dollars, such amount, (b) if such amount is expressed in an Alternative Currency, the equivalent of such amount in Dollars determined by using the rate of exchange for the purchase of Dollars with the Alternative Currency last provided (either by publication or otherwise provided to the Administrative Agent) by Reuters on the Business Day (New York City time) immediately preceding the date of determination or if such service ceases to be available or ceases to provide a rate of exchange for the purchase of Dollars with the Alternative Currency, as provided by such other publicly available information service which provides that rate of exchange at such time in place of Reuters chosen by the Administrative Agent in its sole discretion (or if such service ceases to be available or ceases to provide such rate of exchange, the equivalent of such amount in Dollars as determined by the Administrative Agent using any method of determination it deems appropriate in its sole discretion) and (c) if such amount is denominated in any other currency, the equivalent of such amount in Dollars as determined by the Administrative Agent using any method of determination it deems appropriate in its reasonable discretion; provided that, in the case of any such amount that is expressed in a currency other than Dollars, to the extent such amount is the subject of a currency hedge arrangement evidenced by a Swap Agreement, the “Dollar Equivalent” of such amount shall be the equivalent of such amount in Dollars determined by using the rate of exchange for the purchase of Dollars with such currency as set forth in such Swap Agreement.

 

“Dollars” or “$” refers to lawful money of the United States of America.

 

“Domestic Subsidiary” means any Subsidiary that is organized under the laws of any political subdivision of the United States, excluding (x) any such Subsidiary substantially all of the assets of which consist of Equity Interests in one or more Subsidiaries that are “controlled foreign corporations” within the meaning of Section 957 of the Code and (y) any such Subsidiary that is owned (directly or indirectly, in whole or in part) by one or more Subsidiaries that are “controlled foreign corporations” within the meaning of Section 957 of the Code.

 

 

“Early Opt-in Election” means, if the then current Benchmark with respect to Dollars is LIBO Rate, the occurrence of:

 

(1)       a notification by the Administrative Agent to (or the request by the Borrower to the Administrative Agent to notify) each of the other parties hereto that at least five currently outstanding Dollar denominated syndicated credit facilities at such time contain (as a result of amendment or as originally executed) a SOFR-based rate (including SOFR, a term SOFR or any other rate based upon SOFR) as a benchmark rate (and such syndicated credit facilities are identified in such notice and are publicly available for review), and

 

(2)       the joint election by the Administrative Agent and the Borrower to trigger a fallback from LIBO Rate and the provision, as applicable, by the Administrative Agent of written notice of such election to the Borrower and the Lenders.

 

“EEA Financial Institution” means (a) any credit institution or investment firm established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.

 

“EEA Member Country” means any of the member states of the European Union, Iceland, Liechtenstein, and Norway.

 

“EEA Resolution Authority” means any public administrative authority or any Person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.

 

“Effective Date” means the date on which each of the conditions set forth in Section 4.01 have been satisfied (or waived in accordance with Section 10.02), which date occurred on [_], 2021.

 

“Electronic Signature” means an electronic sound, symbol, or process attached to, or associated with, a contract or other record and adopted by a Person with the intent to sign, authenticate or accept such contract or record.

 

“Environmental Laws” means all laws, rules, regulations, codes, ordinances, orders, decrees, judgments, injunctions, notices or binding agreements issued, promulgated or entered into by any Governmental Authority, relating in any way to the environment, preservation or reclamation of natural resources, the generation, use, handling, transportation, storage, treatment, disposal, management, release or threatened release of any Hazardous Material or to health and safety matters (to the extent related to Hazardous Material).

 

“Environmental Liability” means any liability, contingent or otherwise (including any liability for damages, costs of investigation, reclamation or remediation, fines, penalties or indemnities), of the Parent, the Borrower or any Subsidiary directly or indirectly resulting from or based upon (a) any Environmental Law, including compliance or noncompliance therewith, (b) the generation, use, handling, transportation, storage, treatment or disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials, (d) the presence, release or threatened release of any Hazardous Materials into the environment or (e) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or imposed with respect to any of the foregoing.

 

 

“Equity Interests” means shares of capital stock, partnership interests, membership interests in a limited liability company, beneficial interests in a trust or other equity ownership interests in a Person, and any warrants, options or other rights entitling the holder thereof to purchase or acquire any such equity interest; provided that Equity Interests shall not include any debt securities that are convertible into or exchangeable for any combination of Equity Interests and/or cash.

  

“ERISA” means the U.S. Employee Retirement Income Security Act of 1974, as amended from time to time, and the regulations promulgated and rulings issued thereunder.

 

“ERISA Affiliate” means any person that for purposes of Title I or Title IV of ERISA or Section 412 of the Code would be deemed at any relevant time to be a single employer or otherwise aggregated with the Parent, the Borrower or a Subsidiary under Section 414(b), (c), (m) or (o) of the Code or Section 4001 of ERISA.

 

“ERISA Event” means any one or more of the following: (a) any reportable event, as defined in Section 4043 of ERISA, with respect to a Plan, as to which the PBGC has not waived under subsection .22, .23, .25, .26, .27, .28, .29, .30, .31, .32, .34 or .35 of PBGC Regulation Section 4043 the requirement of Section 4043(a) of ERISA that it be notified of such event; (b) the termination of any Plan under Section 4041(c) of ERISA; (c) the institution of proceedings by the PBGC under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Plan; (d) the failure to make a required contribution to any Plan that would result in the imposition of a lien or other encumbrance or the provision of security under Section 430 of the Code or Section 303 or 4068 of ERISA, or the arising of such a lien or encumbrance; (e) the failure to satisfy the minimum funding standard under Section 412 of the Code or Section 302 of ERISA, whether or not waived; or a determination that any Plan is considered an at-risk plan within the meaning of Section 430 of the Code or Section 303 of ERISA; (f) engaging in a non-exempt prohibited transaction within the meaning of Section 4975 of the Code or Section 406 of ERISA with respect to a Plan; (g) the complete or partial withdrawal of the Parent, any Borrower, Subsidiary or any ERISA Affiliate from a Multiemployer Plan which results in the imposition of Withdrawal Liability or the insolvency under Title IV of ERISA of any Multiemployer Plan or (h) a determination that any Multiemployer Plan is in endangered or critical status under Section 432 of the Code or Section 305 of ERISA.

 

“EU Bail-In Legislation Schedule” means the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor Person), as in effect from time to time.

 

“Euro”, “EUR” and “€” mean the single currency of the Participating Member States.

 

“EURIBOR Interpolated Rate” means, at any time, with respect to any Term Benchmark Borrowing denominated in Euros and for any Interest Period, the rate per annum (rounded to the same number of decimal places as the EURIBOR Screen Rate) determined by the Administrative Agent (which determination shall be conclusive and binding absent manifest error) to be equal to the rate that results from interpolating on a linear basis between: (a) the EURIBOR Screen Rate for the longest period (for which the EURIBOR Screen Rate is available for Euros) that is shorter than the Impacted EURIBOR Rate Interest Period; and (b) the EURIBOR Screen Rate for the shortest period (for which the EURIBOR Screen Rate is available for Euros) that exceeds the Impacted EURIBOR Rate Interest Period, in each case, at such time; provided that, if any EURIBOR Interpolated Rate shall be less than 0.00%, such rate shall be deemed to be 0.00% for the purposes of this Agreement.

 

 

 

“EURIBOR Rate” means, with respect to any Term Benchmark Borrowing denominated in Euros and for any Interest Period, the EURIBOR Screen Rate at approximately 11:00 a.m., Brussels time, two TARGET Days prior to the commencement of such Interest Period; provided that, if the EURIBOR Screen Rate shall not be available at such time for such Interest Period (an “Impacted EURIBOR Rate Interest Period”) with respect to Euros then the EURIBOR Rate shall be the EURIBOR Interpolated Rate.

 

“EURIBOR Screen Rate” means the euro interbank offered rate administered by the European Money Markets Institute (or any other person which takes over the administration of that rate) for the relevant period displayed (before any correction, recalculation or republication by the administrator) on page EURIBOR01 of the Thomson Reuters screen (or any replacement Thomson Reuters page which displays that rate) or on the appropriate page of such other information service which publishes that rate from time to time in place of Thomson Reuters as of 11:00 a.m. Brussels time two TARGET Days prior to the commencement of such Interest Period. If such page or service ceases to be available, the Administrative Agent may specify another page or service displaying the relevant rate after consultation with the Borrower. If the EURIBOR Screen Rate shall be less than 0.00%, the EURIBOR Screen Rate shall be deemed to be 0.00% for purposes of this Agreement.

 

“Event of Default” has the meaning set forth in Article 7.

 

“Excluded Property” means (a) any fee interest in real property having a value of at least $2,500,000 and any leasehold interest in real property, (b) any property that secures Indebtedness permitted to be incurred pursuant to Section 6.01(d) to the extent the documents governing such Indebtedness do not permit any other Lien on such property, (c) motor vehicles, aircraft, boats and other assets subject to a certificate of title to the extent a Lien on such other assets cannot be perfected by filing a UCC-1 financing statement, (d) property the grant of a security interest thereon to secure the Obligations is (1) prohibited by applicable law, rule or regulation (in each case, except to the extent such prohibition is unenforceable after giving effect to the applicable anti-assignment provisions of Article 9 of the Uniform Commercial Code) or (2) which requires governmental consent, approval, license or authorization to be pledged (unless such consent, approval, license or authorization has been received and the Borrower shall be under no obligation to seek such consent), (e) any lease, license or other agreement and any property subject thereto on the Effective Date or on the date of the acquisition of such property (other than any property acquired by a Loan Party subject to any such contract or other agreement to the extent such contract or other agreement was incurred in contemplation of such acquisition) to the extent that a grant of a security interest therein to secure the Obligations would violate or invalidate such lease, license, contract or agreement or create a right of termination in favor of any other party thereto (other than the Borrower, any other Loan Party or any Subsidiary) after giving effect to the applicable anti-assignment provisions of Article 9 of the Uniform Commercial Code, (f) any governmental licenses or state or local franchises, charters and authorizations, to the extent security interests in such licenses, franchises, charters or authorizations are prohibited or restricted thereby or require the consent of any Governmental Authority (to the extent such consent has not been obtained; provided that the Borrower shall be under no obligation to seek such consent) after giving effect to the applicable anti-assignment provisions of Article 9 of the Uniform Commercial Code, (g) pending United States “intent-to-use” trademark applications for which a verified statement of use or an amendment to allege use has not been filed with and accepted by the United States Patent and Trademark Office, (h) (A) payroll, healthcare and other employee wage and benefit accounts, (B) tax accounts, including, without limitation, sales tax accounts, (C) escrow, defeasance and redemption accounts, (D) fiduciary or trust accounts, (E) cash collateral accounts encumbered by Liens pursuant to Section 6.02(z) and (F) bank accounts containing an average daily balance not to exceed $2,500,000 in the aggregate for all such accounts for any fiscal month (items (h)(A) through (F) hereof, the “Unrestricted Accounts”); (l) commercial tort claims in an amount not exceeding $2,500,000 individually; (i) assets to the extent a security interest in such assets could reasonably be expected to result in adverse tax consequences as determined in good faith by the Borrower; (j) those assets or Equity Interests as to which the Administrative Agent and the Borrower reasonably agree that the costs or other consequence (including any adverse tax consequence) of obtaining or perfecting such a security interest or perfection thereof are excessive in relation to the value of the security to be afforded thereby and (k) Excluded Securities.

 

 

“Excluded Securities” means (a) voting Equity Interests of any CFC or any CFC Holdco (except to the extent such CFC is a Foreign Guarantor) in excess of 65% of the outstanding voting Equity Interests of such Subsidiary, (b) any Equity Interests or Indebtedness to the extent and for so long as the pledge thereof would be prohibited by any applicable law after giving effect to the applicable anti-assignment provisions of Article 9 of the Uniform Commercial Code, (c) any Equity Interests in any person that is not a wholly-owned Subsidiary, (d) any Equity Interests in any Excluded Subsidiary (other than any Excluded Subsidiary as defined in clauses (b), (c), (d), (g) (except to the extent the assumed Indebtedness prohibits the Equity Interests in such Subsidiary from being pledged) and (i) (unless the Equity Interests in such Subsidiary are otherwise excluded pursuant to this definition of “Excluded Securities”) in the definition thereof), (e) any margin stock (as defined in Regulation U and Regulation X of the Board of Governors of the Federal Reserve System) and (f) Equity Interests of the Borrower that are not owned by the Parent.

 

“Excluded Subsidiary” means (a) each Subsidiary that is not a direct or indirect wholly-owned Subsidiary of the Borrower, (b) each Immaterial Subsidiary, (c) any Subsidiary that is a “controlled foreign corporation” within the meaning of the Code (a “CFC”) except if such CFC is otherwise a Foreign Guarantor hereunder as elected by the Borrower, (d) any Subsidiary substantially all the assets of which consist of Equity Interests (or Equity Interests and Indebtedness) of one or more CFCs (a “CFC Holdco”) or other CFC Holdcos, (e) any Subsidiary of a CFC, (f) any Subsidiary that is prohibited by Law, regulation or contractual obligation existing on the Effective Date or on the date such entity becomes a Subsidiary after the Effective Date (so long as such prohibition did not arise in contemplation of such entity becoming a subsidiary) from providing the Guaranty or that would require a an approval of a Governmental Authority or third party (pursuant to a contractual obligation) consent, approval, license or authorization in order to grant such Guaranty that has not been obtained, (g) any Subsidiary acquired pursuant to a permitted Investment financed with Indebtedness permitted to be assumed pursuant to the Loan Documents and any Subsidiary thereof that Guarantees such Indebtedness, in each case to the extent such Indebtedness prohibits such Subsidiary from becoming a Guarantor, provided that such Indebtedness is not created in contemplation of or in connection with such permitted Investment or such Person becoming a Subsidiary, (h) any Special Purpose Subsidiary, and (i) each Subsidiary as to which the Administrative Agent and the Borrower reasonably agree that the costs or other consequence (including any adverse tax consequence) of obtaining a guaranty therefrom are excessive in relation to the value to be afforded thereby; provided, however, in each case of the foregoing that, if the Borrower has elected to cause a Subsidiary that would otherwise constitute an Excluded Subsidiary to become a Foreign Guarantor hereunder, such Foreign Guarantor shall not be an Excluded Subsidiary; provided, further that any Person that is or that becomes (i) a Foreign Guarantor, shall not, except as a result of any Change in Law that could reasonably be expected to result in adverse tax consequences (as reasonably determined by the Borrower in consultation with the Administrative Agent), at any time thereafter be designated as or deemed an Excluded Subsidiary or (ii) a Guarantor (other than a Foreign Guarantor), shall not, except to the extent such Guarantor, at any time, is determined by the Borrower and notified to the Administrative Agent to be an “Excluded Subsidiary” pursuant to clauses (a), (b), (d), (e) and (i) above or as a result of any Change in Law that could reasonably be expected to result in adverse tax consequences (as reasonably determined by the Borrower in consultation with the Administrative Agent), at any time thereafter be designated as or deemed an Excluded Subsidiary; provided further that, to the extent a Guarantor is determined to be an Excluded Subsidiary pursuant to the proviso set forth immediately above, at the time of such determination, all outstanding Investments which prior thereto were made by a Loan Party in such Subsidiary shall be deemed to have been made in an Excluded Subsidiary for the purposes of Section 6.04.

 

 

“Excluded Swap Obligation” with respect to any Guarantor, (a) any Swap Agreement Obligation if, and to the extent that, and only for so long as, all or a portion of the guarantee of such Guarantor of, or the grant by such Guarantor of a security interest to secure, as applicable, such Swap Agreement Obligation (or any guarantee thereof) is or becomes illegal under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof) by virtue of such Guarantor’s failure to constitute an “eligible contract participant,” as defined in the Commodity Exchange Act and the regulations thereunder, at the time the guarantee of (or grant of such security interest by, as applicable) such Guarantor becomes or would become effective with respect to such Swap Agreement Obligation. If a Swap Agreement Obligation arises under a master agreement governing more than one Swap Agreement, such exclusion shall apply only to the portion of such Swap Agreement Obligation that is attributable to Swaps for which such guarantee or security interest is or becomes illegal.

 

“Excluded Taxes” means, with respect to the Administrative Agent, any Issuing Bank, any Lender or any other recipient of any payment to be made by or on account of any obligation of the Parent or the Borrower, as applicable, hereunder, (a) Taxes imposed on (or measured by) its net income (however denominated), franchise Taxes, and branch profits Taxes, in each case (i) imposed by the jurisdiction (or any political subdivision thereof) under the laws of which such recipient is organized or in which its principal office is located or, in the case of any Lender, in which its applicable lending office is located or (ii) that otherwise are Other Connection Taxes, (b) in the case of a Lender, any U.S. federal withholding Tax that is imposed on amounts payable to such Lender at the time such Lender becomes a party to this Agreement (other than pursuant to an assignment request by Borrower under Section 2.16(b)) or designates a new lending office, except to the extent that such Lender (or its assignor, if any) was entitled, at the time of designation of a new lending office or assignment, to receive additional amounts from the Borrower with respect to such withholding tax pursuant to Section 2.14(a), (c) Taxes attributable to such recipient’s failure to comply with Section 2.14(f), (d) any withholding Taxes imposed under FATCA, (e) any Taxes imposed by Germany solely due to the fact that the Loans are secured by real estate located in Germany (inländischer Grundbesitz) or by German rights subject to the civil code provisions relating to real estate (inländische Rechte, die den Vorschriften des bürgerlichen Rechts über Grundstücke unterliegen)(including any withholding requested by the German tax authorities pursuant to Sec. 50a para. 7 German Income Tax Act) and (f) any Taxes which are imposed solely because the payment is made with respect to a Lender incorporated, having its place of effective management, or acting through a lending office or office, as the case may be, located in a Non-Cooperative Jurisdiction, (g) withholding required on account of the payee receiving a direction under section 255 of the Australian Taxation Act or section 260-5 of Schedule 1 of the Taxation Administration Act 1953 (Cth), (h) Taxes imposed because the payee has not received written notice of that recipient's tax file number or Australian business number or evidence of any exemption that recipient may have from the need to advise its tax file number or Australian business number; and (i) any Indirect Tax (which, for the avoidance of doubt, shall be handled in accordance with clause 2.14(i)).

 

 

“Executive Order” has the meaning set forth in Section 3.15(a)(i).

 

“Existing Letters of Credit” shall mean the letters of credit described in Schedule 1.01.

 

“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with) and any current or future regulations or official interpretations thereof, any agreements entered into pursuant to Section 1471(b)(1) of the Code or any published intergovernmental agreement and any fiscal or regulatory legislation, rules or official practices adopted pursuant to any published intergovernmental agreement entered into in connection with the implementation of such Sections of the Code.

 

“FCA” has the meaning assigned to such term in Section 1.05.

 

“Federal Funds Effective Rate” means, for any day, the rate calculated by the NYFRB based on such day’s federal funds transactions by depositary institutions, as determined in such manner as the NYFRB shall set forth on its public website from time to time, and published on the next succeeding Business Day by the NYFRB as the federal funds effective rate, provided that if the Federal Funds Effective Rate shall be less than zero, such rate shall be deemed to zero for the purposes of this Agreement.

 

“Fee Letter” means that certain Fee Letter, dated as of [_], 2021, by and among the Borrower and the Administrative Agent.

 

 

“Fiduciary Account” means (i) any account maintained in the ordinary course of business by the Parent or any of its Subsidiaries in order to hold, as a fiduciary or on a contractual basis, funds owned by another Person or (ii) any escrow account.

 

“Financial Officer” means the chief financial officer, principal accounting officer, treasurer, vice president of finance or corporate controller of the Borrower.

 

“Floor” means the benchmark rate floor, if any, provided in this Agreement initially (as of the execution of this Agreement, the modification, amendment or renewal of this Agreement or otherwise) with respect to LIBO Rate, EURIBOR Rate, AUD Rate or Daily Simple RFR, as applicable.

 

“Foreign Guarantor” means each Subsidiary of the Parent that is organized under the laws of a jurisdiction other than the United States (or any State thereof) and has been designated by the Borrower, in writing to the Administrative Agent, as a “Foreign Guarantor” hereunder. As of the Effective Date, the Foreign Guarantors shall constitute Fluence Energy GmbH, a German corporation, Fluence Energy Pty Ltd. (ACN 627 071 461), an Australian corporation, and Fluence Energy Inc., a Philippine corporation.

 

“Foreign Lender” means any Lender that is organized under the laws of a jurisdiction other than that in which the Borrower is located. For purposes of this definition, the United States of America, each State thereof and the District of Columbia shall be deemed to constitute a single jurisdiction.

 

“Foreign Security Agreement” means each of the agreements set forth on Schedule 4.01(b), including the Australian Collateral Agreements or otherwise entered into from time to time by any Foreign Guarantor in accordance with Section 5.01 and the Agreed Securities Principles.

 

“Fronting Exposure” means, at any time there is a Defaulting Lender, with respect to any Issuing Bank, such Defaulting Lender’s Applicable Percentage of the outstanding Obligations with respect to Letters of Credit issued by such Issuing Bank other than such Obligations as to which such Defaulting Lender’s participation obligation has been reallocated to other Lenders or Cash Collateralized in accordance with the terms hereof.

 

“GAAP” means generally accepted accounting principles in the United States of America, as set forth in the Accounting Standards Codification of the Financial Accounting Standards Board from time to time.

 

[“German Security” means any security interest created under the German Security Documents.

 

“German Security Document” means any Security Document which is governed by German law.]

 

“Governmental Authority” means the government of the United States of America, any other nation or any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government (including any supra-national bodies such as the European Union or the European Central Bank).

 

 

“Guarantee” of or by any Person (the “guarantor”) means any obligation, contingent or otherwise, of the guarantor guaranteeing or having the economic effect of guaranteeing any Indebtedness or other obligation of any other Person (the “primary obligor”) in any manner, whether directly or indirectly, and including any obligation of the guarantor, direct or indirect, (a) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation or to purchase (or to advance or supply funds for the purchase of) any security for the payment thereof, (b) to purchase or lease property, securities or services for the purpose of assuring the owner of such Indebtedness or other obligation of the payment thereof, (c) to maintain working capital, equity capital or any other financial statement condition or liquidity of the primary obligor so as to enable the primary obligor to pay such Indebtedness or other obligation or (d) as an account party in respect of any letter of credit or letter of guaranty issued to support such Indebtedness or obligation; provided, that the term Guarantee shall not include endorsements for collection or deposit in the ordinary course of business, or customary indemnification obligations entered into in connection with any acquisition or disposition of assets or of other entities (other than to the extent that the primary obligations that are the subject of such indemnification obligation would be considered Indebtedness hereunder).

 

“Guarantor” means any Subsidiary (not including an Excluded Subsidiary) of the Parent party hereto or that has executed a guaranty supplement pursuant to Section 5.11 or Section 9.07, the Parent and, other than with respect to its own Obligations, the Borrower.

 

“Guaranty” means the guaranty and other provisions in Article IX.

 

“Guaranty Subordinated Debt” has the meaning set forth in Section 9.02(b).

 

“Hazardous Materials” means all explosive or radioactive substances or wastes and all hazardous or toxic substances, wastes or other pollutants, including petroleum or petroleum distillates, asbestos or asbestos containing materials, polychlorinated biphenyls, radon gas and all other substances or wastes of any nature regulated pursuant to any Environmental Law.

 

“Immaterial Subsidiary” means any Subsidiary that (a) did not, as of the last day of the fiscal quarter of the Borrower most recently ended for which financials have been delivered pursuant to Section 5.01(a) or (b), have (i) total assets with a value in excess of 5% of the Total Assets, or (ii) revenues representing in excess of 5% of the Total Revenues, for the four fiscal quarters ended as of such date and (b) taken together with all Immaterial Subsidiaries as of the last day of the fiscal quarter of the Borrower most recently ended for which financials have been delivered pursuant to Section 5.01(a) or (b), did not have (i) total assets with a value in excess of 10% of the Total Assets, or (ii) revenues representing in excess of 10% of the Total Revenues for the four fiscal quarters ended as of such date. Each Immaterial Subsidiary as of the Effective Date shall be set forth in Schedule 3.13.

 

“Impacted AUD Interest Period” has the meaning assigned to such term in the definition of “AUD Rate”.

 

 

“Impacted EURIBOR Rate Interest Period” has the meaning assigned to such term in the definition of “EURIBOR Rate.”

 

“Impacted LIBO Rate Interest Period” has the meaning set forth in the definition of “LIBO Rate”.

 

“Increased Amount Date” has the meaning set forth in Section 2.18.

 

“Incremental Amount” means $50,000,000.

 

“Indebtedness” of any Person at any date means, without duplication, (a) all indebtedness of such Person for borrowed money, (b) all obligations of such Person for the deferred purchase price of property or services to the extent required to be included as a liability on the balance sheet of such Person at such time in accordance with GAAP (other than current trade payables incurred in the ordinary course of such Person’s business), (c) all obligations of such Person evidenced by notes, bonds, debentures or other similar instruments, (d) all indebtedness created or arising under any conditional sale or other title retention agreement with respect to property acquired by such Person (even though the rights and remedies of the seller or lender under such agreement in the event of default are limited to repossession or sale of such property), (e) all Capital Lease Obligations of such Person, (f) any earn-out obligation to the extent such obligation is (or is required to be) listed as a liability on the balance sheet of such Person in accordance with GAAP, has not been paid when due and is not disputed in good faith, (g) all obligations of such Person, contingent or otherwise, as an account party or applicant under or in respect of bankers’ acceptances, letters of credit, surety bonds or similar arrangements, (h) all Guarantees of such Person in respect of obligations of the kind referred to in clauses (a) through (g) above, and (i) all obligations of the kind referred to in clauses (a) through (h) above secured by (or for which the holder of such obligation has an existing right, contingent or otherwise, to be secured by) any Lien on property (including accounts and contract rights) owned or acquired by such Person, whether or not such Person has assumed or become liable for the payment of such obligation (other than Liens granted on Equity Interests of an Excluded Subsidiary to secure obligations of such Excluded Subsidiary and its Subsidiaries). The Indebtedness of any Person shall include the Indebtedness of any other entity (including any partnership in which such Person is a general partner) to the extent such Person is liable therefor as a result of such Person’s ownership interest in or other relationship with such entity, except to the extent the terms of such Indebtedness expressly provide that such Person is not liable therefor.

 

“Indemnified Taxes” means (a) Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by or on account of any obligation of any Loan Party under any Loan Document and (b) to the extent not otherwise described in (a), Other Taxes.

 

“Indemnitee” has the meaning set forth in Section 10.03(b).

 

"Indirect Tax" means any goods and services tax (including Australian GST), consumption tax, value added tax or any tax of a similar nature imposed by any Governmental Authority, including any interest, additions to indirect tax and penalties applicable thereto.

 

“Information” has the meaning set forth in Section 10.12(a).

 

 

“Intellectual Property” has the meaning set forth in the Security Agreement.

 

“Interest Coverage Ratio” means, for any Measurement Period, the ratio of (a) Consolidated EBITDA to (b) Interest Expense (excluding any Interest Expense attributable to the Parent Convertible Notes) of the Parent and its Subsidiaries for such Period.

 

“Interest Election Request” has the meaning set forth in Section 2.05(b).

 

“Interest Expense” means, with reference to any period, total cash interest expense (including that attributable to Capital Lease Obligations) of the Parent and its Subsidiaries for such period with respect to all outstanding Indebtedness of the Parent and its Subsidiaries (including all net payments and receipts (if any) under Swap Agreements in respect of interest rates to the extent such net payments and receipts are made in cash in such period and allocable to such period in accordance with GAAP), calculated on a consolidated basis for the Parent and its Subsidiaries for such period in accordance with GAAP.

 

“Interest Payment Date” means (a) with respect to any ABR Loan, the last Business Day of each March, June, September and December, (b) with respect to any RFR Loan, (1) the last Business Day of each March, June, September and December; and (2) the Maturity Date and (c) with respect to any Term Benchmark Loan, the last day of the Interest Period applicable to the Borrowing of which such Loan is a part and, in the case of a Term Benchmark Borrowing with an Interest Period of more than three months’ duration, each day prior to the last day of such Interest Period that occurs at intervals of three months’ duration after the first day of such Interest Period.

 

“Interest Period” means, with respect to any Term Benchmark Borrowing, the period commencing on the date of such Borrowing and ending on the numerically corresponding day in the calendar month that is one, three or six months (or, with the consent of each Lender, twelve months or less than one month) thereafter, (in each case, subject to the availability for the Benchmark applicable to the relevant Loan or Commitment for any Agreed Currency) as the Borrower may elect; provided, that (i) if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless such next succeeding Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day and (ii) any Interest Period pertaining to a Term Benchmark Borrowing that commences on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the last calendar month of such Interest Period) shall end on the last Business Day of the last calendar month of such Interest Period. For purposes hereof, the date of a Borrowing initially shall be the date on which such Borrowing is made and thereafter shall be the effective date of the most recent conversion or continuation of such Borrowing.

 

“Interest Rate Determination Date” means, with respect to any Interest Period, the date that is two Business Days prior to the first day of such Interest Period.

 

“Investment” has the meaning given to such term in Section 6.04.

 

“IPO” means a bona fide underwritten sale to the public of common stock of the Parent pursuant to a registration statement (other than on Form S-8 or any other form relating to securities issuable under any benefit plan of the Parent or any of its Subsidiaries, as the case may be) that is declared effective by the SEC.

 

 

“IRS” means the U.S. Internal Revenue Service.

 

“ISDA Definitions” means the 2006 ISDA Definitions published by the International Swaps and Derivatives Association, Inc. or any successor thereto, as amended or supplemented from time to time, or any successor definitional booklet for interest rate derivatives published from time to time by the International Swaps and Derivatives Association, Inc. or such successor thereto.

 

“Issuing Bank” means, with respect to a particular Letter of Credit, (a) each of JPMorgan Chase Bank N.A., Morgan Stanley Senior Funding, Inc., Bank of America, N.A., Barclays Bank PLC and Citibank, N.A., each in its capacity as the issuer of such Letter of Credit, and its successors in such capacity as provided in Section 2.19(j), (b) such other Lender selected by the Borrower from time to time to issue such Letter of Credit hereunder upon receipt by the Administrative Agent of documentation in form and substance reasonably satisfactory to the Administrative Agent pursuant to which such Lender agrees to assume the rights and obligations of an Issuing bank hereunder (provided that no Lender shall be required to become an Issuing Bank pursuant to this subclause (b) without such Lender’s consent), and/or (c) any Lender selected by the Borrower (with the prior consent of the Administrative Agent (not to be unreasonably withheld, delayed or conditioned)) to replace a Lender who is a Defaulting Lender at the time of such Lender’s appointment as an Issuing Bank (provided that no Lender shall be required to become an Issuing Bank pursuant to this subclause (c) without such Lender’s consent) or any successor in such capacity as provided in Section 2.19(j). Any Issuing Bank may, in its reasonable discretion, arrange for one or more Letters of Credit (including Existing Letters of Credit) to be issued by Affiliates or branches of such Issuing Bank, in which case the term “Issuing Bank” shall include any such Affiliate with respect to Letters of Credit issued by such Affiliate or branch.

 

“Joinder Agreement” means a joinder agreement in form and substance reasonably satisfactory to the Administrative Agent.

 

“LC Commitment” means, with respect to any Issuing Bank, the amount set forth on Schedule 2.01 opposite such Issuing Bank’s name under the caption “LC Commitments”.

 

“LC Disbursement” means a payment made by an Issuing Bank pursuant to a Letter of Credit.

 

“LC Exposure” means, at any time, the sum of (a) the aggregate undrawn amount of all outstanding Letters of Credit at such time plus (b) the aggregate amount of all LC Disbursements that have not yet been reimbursed by or on behalf of the Borrower at such time. The LC Exposure of any Lender at any time shall be its Applicable Percentage of the total LC Exposure at such time.

 

“LC Sublimit” means the lesser of (a) $200,000,000 and (b) the aggregate unused amount of the Commitments then in effect; provided that no Issuing Bank shall be required to issue Letters of Credit in an aggregate amount outstanding at any time in excess of the LC Commitment of such Issuing Bank.

 

 

“Lenders” means the Persons listed on Schedule 2.01 and any other Person that shall have become a party hereto pursuant to an Assignment and Assumption, other than any such Person that ceases to be a party hereto pursuant to an Assignment and Assumption. Unless the context otherwise requires, the term “Lenders” includes the Issuing Banks.

 

“Letter of Credit” means any letter of credit issued (or deemed to be issued) under and pursuant to this Agreement, including any Existing Letters of Credit. A Letter of Credit may be issued in Dollars or in any Alternative Currency.

 

“Letter of Credit Request” means a request by the Borrower for a Letter of Credit in accordance with Section 2.19.

 

“LIBO Interpolated Rate” means, at any time with respect to any Term Benchmark Borrowing denominated in Dollars and for any Interest Period, the rate per annum (rounded to the same number of decimal places as the LIBO Screen Rate) determined by the Administrative Agent (which determination shall be conclusive and binding absent manifest error) to be equal to the rate that results from interpolating on a linear basis between: (a) the LIBO Screen Rate for the longest period (for which the LIBO Screen Rate is available for the applicable Agreed Currency) that is shorter than the Impacted LIBO Rate Interest Period; and (b) the LIBO Screen Rate for the shortest period (for which the LIBO Screen Rate is available for the applicable Agreed Currency) that exceeds the Impacted LIBO Rate Interest Period, in each case, at such time; provided that if any LIBO Interpolated Rate shall be less than 0.00%, such rate shall be deemed to be 0.00% for the purposes of this Agreement.

 

“LIBO Rate” means, with respect to any Term Benchmark Borrowing denominated in Dollars and for any Interest Period, the LIBO Screen Rate at approximately 11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period; provided that if the LIBO Screen Rate shall not be available at such time for such Interest Period (an “Impacted LIBO Rate Interest Period”) with respect to such Agreed Currency, then the LIBO Rate shall be the LIBO Interpolated Rate.

 

“LIBO Screen Rate” means, for any day and time, with respect to any Term Benchmark Borrowing denominated in Dollars and for any Interest Period, the London interbank offered rate as administered by ICE Benchmark Administration (or any other Person that takes over the administration of such rate for Dollars for a period equal in length to such Interest Period as displayed on such day and time on pages LIBOR01 or LIBOR02 of the Reuters screen that displays such rate (or, in the event such rate does not appear on a Reuters page or screen, on any successor or substitute page on such screen that displays such rate, or on the appropriate page of such other information service that publishes such rate from time to time as selected by the Administrative Agent in its reasonable discretion, provided that if the LIBO Screen Rate shall be less than 0.00%, such rate shall be deemed 0.00% for the purposes of this Agreement.

 

“LIBOR” has the meaning assigned to such term in Section 1.05.

 

 

“Lien” means, with respect to any asset or right, (a) any mortgage, deed of trust, lien, pledge, hypothecation, encumbrance, charge or security interest in, on or of such asset or right (including a “security interest” within the meaning of section 12(1) and section 12(2) of the Australian PPSA, but not section 12(3) unless that security interest in substance secures payment or performance of an obligation), and (b) the interest of a vendor or a lessor under any conditional sale agreement, capital lease or title retention agreement (or any financing lease having substantially the same economic effect as any of the foregoing) relating to such asset or right.

 

“Loan Documents” means this Agreement (including any amendment hereto or waiver hereunder), the Notes (if any), any Joinder Agreement, any guaranty supplement delivered pursuant to Section 5.11 hereof, the Security Documents, the Fee Letter and any other agreement, instrument or document executed by one or more Loan Parties after the Effective Date and designated by its terms as a Loan Document.

 

“Loan Parties” means the Borrower and the Guarantors.

 

“Loans” means the loans made by the Lenders to the Borrower pursuant to this Agreement.

 

“Local Time” means (a) in the case of a Loan, Borrowing or LC Disbursement denominated in Dollars, New York City time, and (b) in the case of a Loan, Borrowing or LC Disbursement denominated in an Alternative Currency, local time (it being understood that such local time shall mean London, England time unless otherwise notified by the Administrative Agent) and (c) in the case of a Borrowing in Australian Dollars, “Local Time” shall mean Sydney time (daylight or standard, as applicable).

 

“Material Adverse Effect” means a material adverse effect on (a) the business, property, financial condition or results of operations of the Parent and its Subsidiaries taken as a whole, (b) the ability of the Parent or the Borrower to perform any of its payment obligations under this Agreement or any other Loan Document or (c) the rights of or remedies available to the Agents and the Lenders, taken as a whole, under this Agreement or any other Loan Document.

 

“Material Indebtedness” means Indebtedness (other than any Indebtedness under the Loan Documents and Letters of Credit hereunder), or obligations in respect of one or more Swap Agreements, of any one or more of the Parent and its Subsidiaries having an outstanding principal amount exceeding $15,000,000. For purposes of determining Material Indebtedness, the “principal amount” of the obligations of the Parent or any Subsidiary in respect of any Swap Agreement at any time shall be the maximum aggregate amount (giving effect to any netting agreements) that the Parent or such Subsidiary would be required to pay if such Swap Agreement were terminated at such time.

 

“Maturity Date” means the fourth anniversary of the Effective Date.

 

[“Maximum Amount” means the amount which would, but for any reduction or prohibition of payment or other distribution due to the relationship between any Subordinated Lender and a Loan Party, have been distributed or distributable to the Secured Parties or to the Administrative Agent on behalf of the relevant Secured Parties (or any of them).]

 

 

“Maximum ASR Amount” has the meaning set forth in Section 6.05(vi).

 

“Maximum Rate” has the meaning set forth in Section 10.13.

 

“Measurement Period” means, at any date of determination, the most recently completed four consecutive fiscal quarters of the Parent ended on or prior to such date.

 

“Minimum Collateral Amount” means, at any time, with respect to Cash Collateral consisting of cash or deposit account balances, an amount equal to 103% of the Fronting Exposure of an Issuing Bank with respect to Letters of Credit issued and outstanding at such time.

 

“Moody’s” means Moody’s Investors Service, Inc.

 

“Multiemployer Plan” means any multiemployer plan as defined in Section 4001(a)(3) of ERISA, which is contributed to by (or to which there is or would be an obligation to contribute of) the Parent, the Borrower or a Subsidiary or an ERISA Affiliate, and each such plan for the five- year period immediately following the latest date on which the Parent, the Borrower, or a Subsidiary or an ERISA Affiliate contributed to or had an obligation to contribute to such plan.

 

“Net Debt for Borrowed Money” of the Parent and its Subsidiaries means, as of any date of determination, an amount equal to (i) the sum of (a) the outstanding principal amount of all Indebtedness for borrowed money (including reimbursement obligations with respect to any drawn letters of credit) of all such Persons on a consolidated basis, (b) the aggregate amount of all Capital Lease Obligations of all such Persons on a consolidated basis, and (c) to the extent not duplicative with the Indebtedness and obligations specified in clauses (a) and (b) above, all Guarantees of all such Persons on a consolidated basis with respect to outstanding Indebtedness and obligations of the types specified in clauses (a) and (b) above of other Persons minus (ii) all cash and Cash Equivalents (except, for the avoidance of doubt, any Restricted Cash) of the Parent and its Subsidiaries in an aggregate amount not to exceed $75,000,000. For the avoidance of doubt, the amount of Net Debt for Borrowed Money shall be deemed to be zero with respect to any letter of credit, unless and until a drawing is made with respect thereto.

 

“New Commitments” has the meaning set forth in Section 2.18.

 

“New Lender” has the meaning set forth in Section 2.18.

 

“New Loans” has the meaning set forth in Section 2.18.

 

“Non-Consenting Lender” means any Lender that does not approve any consent, waiver or amendment that (i) requires the approval of all Lenders or all affected Lenders in accordance with the terms of Section 10.02 and (ii) has been approved by the Required Lenders.

 

“Non-Cooperative Jurisdiction” means a “non-cooperative tax jurisdiction” (nicht kooperatives Steuerhoheitsgebiet) as set out in the German Act to avert tax evasion and unfair tax competition (Gesetz zur Abwehr von Steuervermeidung und unfairem Steuerwettbewerb) and the respective legislative decree (Rechtsverordnung) as amended from time to time.

 

 

“Non-Defaulting Lender” means, at any time, each Lender that is not a Defaulting Lender at such time.

 

“Non-U.S. Plan” means any plan, fund (including, without limitation, any superannuation fund) or other similar program established, contributed to (regardless of whether through direct contributions or through employee withholding) or maintained outside the United States by the Parent, the Borrower or one or more Subsidiaries primarily for the benefit of employees of the Parent, the Borrower or such Subsidiaries residing outside the United States, which plan, fund or other similar program provides, or results in, retirement income, a deferral of income in contemplation of retirement or payments to be made upon termination of employment, and which plan is not subject to ERISA or the Code.

 

“Note” has the meaning set forth in Section 2.07.

 

“NYFRB” means the Federal Reserve Bank of New York.

 

“NYFRB’s Website” means the website of the NYFRB at http://www.newyorkfed.org, or any successor source.

 

“NYFRB Rate” means, for any day, the greater of (a) the Federal Funds Effective Rate in effect on such day and (b) the Overnight Bank Funding Rate in effect on such day (or for any day that is not a Business Day, for the immediately preceding Business Day); provided that if none of such rates are published for any day that is a Business Day, the term “NYFRB Rate” means the rate for a federal funds transaction quoted at 11:00 a.m. on such day received to the Administrative Agent from a federal funds broker of recognized standing selected by it; provided, further, that if any of the aforesaid rates shall be less than zero, such rate shall be deemed to be zero for purposes of this Agreement.

 

“Obligations” means all amounts owing by any Loan Party to the Administrative Agent, any Issuing Bank or any Lender (or, in the case of (x) Specified Cash Management Agreements, any Affiliate of any Lender and (y) Specified Swap Agreements, any Person that was a Lender or an Affiliate of a Lender at the time the relevant Swap Agreement was entered into) pursuant to the terms of this Agreement or any other Loan Document, including any obligation to provide Cash Collateral, or in respect of any Letter of Credit, any Specified Swap Agreement or any Specified Cash Management Agreement (including all interest which accrues after the commencement of any case or proceeding in bankruptcy after the insolvency of, or for the reorganization of the Parent or any of its Subsidiaries, whether or not allowed in such case or proceeding).

 

“Other Benchmark Rate Election” means, with respect to any Loan denominated in Dollars, if the then-current Benchmark is the LIBO Rate, the occurrence of:

 

(a) a request by the Borrower to the Administrative Agent to notify each of the other parties hereto that, at the determination of the Borrower, Dollar-denominated syndicated credit facilities at such time contain (as a result of amendment or as originally executed), in lieu of a LIBOR-based rate, a term benchmark rate as a benchmark rate, and

 

(b) the Administrative Agent, in its sole discretion, and the Borrower jointly elect to trigger a fallback from the LIBO Rate and the provision, as applicable, by the Administrative Agent of written notice of such election to the Borrower and the Lenders.

 

 

“Other Connection Taxes” means, with respect to the Administrative Agent, any Issuing Bank, any Lender or any other recipient of any payment to be made by or on account of any obligation of the Parent or the Borrower, as applicable, hereunder, Taxes imposed as a result of a present or former connection between such Administrative Agent, Issuing Bank, Lender or other recipient and the jurisdiction imposing such Tax (other than connections arising solely from such Administrative Agent, Issuing Bank, Lender or recipient having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced any Loan Document, or sold or assigned an interest in any Loan, Letter of Credit or Loan Document).

 

“Other Taxes” means any and all present or future stamp, court or documentary taxes or any other excise, property, intangible, recording, filing or similar Taxes which arise from any payment made, from the execution, delivery, performance, enforcement or registration of, from the receipt or perfection of a security interest under, or otherwise with respect to, this Agreement and the other Loan Documents; excluding, however, such Taxes that are Other Connection Taxes imposed with respect to an assignment (other than such Taxes imposed with respect to an assignment that occurs as a result of the Borrower’s request pursuant to Section 2.16(b)).

 

“Overnight Bank Funding Rate” means, for any day, the rate comprised of both overnight federal funds and overnight Term Benchmark borrowings by U.S.-managed banking offices of depository institutions, as such composite rate shall be determined by the NYFRB as set forth on its public website from time to time, and published on the next succeeding Business Day by the NYFRB as an overnight bank funding rate (from and after such date as the NYFRB shall commence to publish such composite rate).

 

“Parallel Debt” has the meaning assigned to such term in Section 10.20(a).

 

“Parent” means Fluence Energy, Inc., a Delaware corporation.

 

“Parent Convertible Notes” means senior unsecured convertible notes issued by the Parent which (i) are not guaranteed by or otherwise of recourse to the Borrower or any of its Subsidiaries, (ii) do not mature or require any principal payments prior to the date that is 180 days following the Maturity Date and (iii) contain terms which (x) are customary for similar types of Indebtedness at such time (as reasonably determined by the Parent) and (y) are not more restrictive on the Parent and its Subsidiaries than this Agreement and do not contain any financial maintenance covenants.

 

“Participant” has the meaning set forth in Section 10.04(c)(i).

 

“Participant Register” has the meaning set forth in Section 10.04(c)(iii).

 

 

“Participating Member State” means any member state of the European Union that has the euro as its lawful currency in accordance with legislation of the European Union relating to Economic and Monetary Union.

 

“Payment” has the meaning specified in Section 8.11(a).

 

“Payment Notice” has the meaning specified in Section 8.11(b).

 

“PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in ERISA and any successor entity performing similar functions.

 

“Pension Plan” means any “employee pension benefit plan” within the meaning of Section 3(2) of ERISA, other than a Multiemployer Plan, that is subject to Title IV of ERISA, Section 412 of the Code or Section 302 of ERISA and is maintained in whole or in part by the Parent, the Borrower, any Subsidiary or any ERISA Affiliate or with respect to which any of the Parent, the Borrower, any Subsidiary or any ERISA Affiliate has actual or contingent liability.

 

“Permitted Bond Hedge Transaction” means any call or capped call option (or substantively equivalent derivative transaction) on the Parent’s common stock purchased by the Parent in connection with the issuance of the Parent Convertible Notes; provided that the purchase price for such Permitted Bond Hedge Transaction, less the proceeds received by the Parent from the sale of any related Permitted Warrant Transaction, does not exceed the net proceeds received by the Parent from the sale of such Parent Convertible Notes issued in connection with the Permitted Bond Hedge Transaction.

 

“Permitted Encumbrances” means:

 

(a)                Liens imposed by law for taxes, assessments or governmental charges or levies that are not yet delinquent or are being contested in compliance with Section 5.04;

 

(b)                carriers’, warehousemen’s, mechanics’, materialmen’s, landlord’s, supplier’s, repairmen’s and other like Liens imposed by law, arising in the ordinary course of business and securing obligations that are not overdue by more than 90 days or are being contested in compliance with Section 5.04;

 

(c)                pledges and deposits made in the ordinary course of business in compliance with workers’ compensation, unemployment insurance and other social security laws or regulations;

 

(d)                deposits to secure the performance of bids, trade contracts, leases, statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature, in each case incurred in the ordinary course of business and to secure surety and appeal bonds in respect of judgments that do not constitute an Event of Default under Section 7.01(k);

 

(e)                Liens in respect of judgments that do not constitute an Event of Default under Section 7.01(k);

 

(f)                 easements, zoning restrictions, rights-of-way, encroachments and similar encumbrances on real property imposed by law or arising in the ordinary course of business that do not secure any monetary obligations and do not materially detract from the value of the affected property or interfere with the ordinary conduct of business of the Parent, the Borrower or any Subsidiary;

 

 

(g)                Uniform Commercial Code financing statements filed (or similar filings under applicable law) solely as a precautionary measure in connection with operating leases;

 

(h)                leases or subleases granted to other Persons and not interfering in any material respect, individually or taken as a whole, with the business of the lessor or sublessor;

 

(i)                 Liens in favor of customs and revenue authorities arising as a matter of law to secure payment of customs duties in connection with the importation of goods;

 

(j)                 deposits made or other security provided to secure liabilities to insurance carriers under insurance or self-insurance arrangements;

 

(k)                rights of consignors of goods in goods consigned, whether or not perfected by the filing of a financing statement or other registration, recording or filing;

 

(l)                 Liens (i) of a collection bank arising under Section 4-210 of the UCC or any comparable or successor provision on items in the course of collection, (ii) attaching to commodity trading accounts or other commodity brokerage accounts incurred in the ordinary course of business and not for speculative purposes and (iii) in favor of banking institutions encumbering deposits (including the right of set-off);

 

(m)              any zoning or similar law or right reserved to or vested in any Governmental Authority to control or regulate the use of any real property that does not materially detract from the value of the affected property or interfere with the ordinary conduct of the business of Holdings and its Subsidiaries, taken as a whole;

 

(n)                Liens encumbering reasonable customary initial deposits and margin deposits and Liens attaching to commodity trading accounts or other brokerage accounts incurred in the ordinary course of business and not for speculative purposes;

 

(o)                Liens given to a public utility or any Governmental Authority when required by such utility or Governmental Authority in connection with the operations of that Person in the ordinary course of its business;

 

(p)                operating leases of vehicles or equipment which are entered into in the ordinary course of the business; and

 

(q)                customary restrictions in any license agreement with the Borrower as a licensee, including without limitation, with respect to the sale of Inventory (provided that the Borrower shall give the Administrative Agent prompt notice of the execution of any such license agreement).

 

“Permitted Holders” means one or more of AES and Siemens.

 

 

“Permitted Refinancing” means, with respect to any Indebtedness, any Indebtedness constituting a refinancing or replacement thereof so long as (a) on the date of such refinancing or replacement, no Event of Default shall have occurred and be continuing or would arise therefrom; (b) any such refinancing or replacement Indebtedness shall (i) not have a stated maturity or, other than in the case of a revolving credit facility, a weighted average life to maturity that is shorter than that of the Indebtedness being refinanced or replaced, (ii) if the Indebtedness being refinanced or replaced (or the Liens securing such Indebtedness) is subordinated to the Obligations (or to the Liens securing the Obligations, if applicable) by its terms or by the terms of any agreement or instrument relating to such Indebtedness, be (and be secured by Liens, if applicable) at least as subordinate to the Obligations (or to the Liens securing the Obligations) as the Indebtedness being refinanced or replaced (and unsecured if the refinanced or replaced Indebtedness is unsecured) and (iii) be in a principal amount that does not exceed the principal amount so refinanced or replaced plus, accrued interest, any customary premium or other payment required to be paid in connection with such refinancing or replacement, the amount of customary fees and expenses of the Borrower or any of its Subsidiaries incurred in connection with such refinancing or replacement, and any unutilized commitments thereunder; and (c) the obligors on such refinancing or replacement Indebtedness shall be the obligors on such Indebtedness being refinanced or replaced; provided that any Loan Party shall be permitted to guarantee any such refinancing or replacement Indebtedness of any other Loan Party.

 

“Permitted Third Party Bank” means any bank or other financial institution, other than the Lenders, with whom any U.S. Loan Party maintains a Controlled Account.

 

“Permitted Warrant Transaction” means any call option, warrant or right to purchase (or substantively equivalent derivative transaction) on the Parent’s common stock sold by the Parent substantially concurrently with any purchase by the Parent of a related Permitted Bond Hedge Transaction.

 

“Person” means any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership, Governmental Authority or other entity.

 

“Plan” means any “employee benefit plan” as defined in Section 3 of ERISA (other than a Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section 412 of the Code or Section 302 of ERISA maintained or contributed to by the Parent, the Borrower, a Subsidiary or any ERISA Affiliate or to which the Parent, the Borrower, a Subsidiary or an ERISA Affiliate has or would have an obligation to contribute, and each such plan subject to the provisions of Title IV of ERISA or Section 412 of the Code or Section 302 of ERISA for the five-year period immediately following the latest date on which the Parent, the Borrower, a Subsidiary or an ERISA Affiliate maintained, contributed to or had an obligation to contribute to (or is deemed under Section 4069 of ERISA to have maintained or contributed to or to have had an obligation to contribute to, or otherwise to have liability with respect to) such plan.

 

“Platform” has the meaning set forth in Section 10.01.

 

“Pounds Sterling” and “£” mean the lawful currency of the United Kingdom.

 

 

“Prime Rate” means the rate of interest last quoted by The Wall Street Journal as the “Prime Rate” in the U.S. or, if The Wall Street Journal ceases to quote such rate, the highest per annum interest rate published by the Board in Federal Reserve Statistical Release H.15 (519) (Selected Interest Rates) as the “bank prime loan” rate or, if such rate is no longer quoted therein, any similar rate quoted therein (as determined by the Administrative Agent) or any similar release by the Board (as determined by the Administrative Agent). Each change in the Prime Rate shall be effective from and including the date such change is publicly announced or quoted as being effective.

 

“Principal Office” means the office of the Administrative Agent as set forth in Section 10.01, or such other office or office of a third party or sub-agent, as appropriate, as the Administrative Agent may from time to time designate in writing to Borrower and each Lender.

 

“Pro Forma Basis” or “Pro Forma Effect” means, with respect to compliance with any test or covenant or calculation of any ratio hereunder, the determination or calculation of such test, covenant or ratio (including in connection with Specified Transactions) in accordance with Section 1.09.

 

“Proceeds”: all “proceeds” as such term is defined in Section 9-102(a)(64) of the New York UCC and, in any event, shall include, without limitation, all dividends or other income from the Investment Property, collections thereon or distributions or payments with respect thereto.

 

“Purchase Money Indebtedness” means Indebtedness incurred to finance the acquisition, construction or improvement of any fixed or capital asset to the extent incurred prior to or within 180 days following such acquisition, construction or improvement.

 

“QFC” has the meaning assigned to the term “qualified financial contract” in, and shall be interpreted in accordance with, 12 U.S.C. 5390(c)(8)(D).

 

“QFC Credit Support” has the meaning assigned to it in Section 10.18.

 

“Qualified Keepwell Provider” has the meaning assigned to it in Section 9.01(i).

 

“Reference Banks” shall mean Commonwealth Bank of Australia, Westpac Banking Corporation, National Australia Bank or Australia and New Zealand Banking Group Limited or such other bank or financial institution agreed in writing by the Administrative Agent and the Borrower from time to time that actively trades or lends Australian Dollars.

 

“Reference Time” with respect to any setting of the then-current Benchmark means (1) if such Benchmark is LIBO Rate, 11:00 a.m. (London time) on the day that is two London banking days preceding the date of such setting, (2) if such Benchmark is EURIBOR Rate, 11:00 a.m. Brussels time two TARGET Days preceding the date of such setting, (3) if the RFR for such Benchmark is SONIA, then 11:00 a.m. (London time) on the day that is four Business Days prior to such setting, (4) if such Benchmark is AUD Rate, 11:00 a.m. Sydney, Australia time two Business Days preceding the date of such setting or (5) if such Benchmark is not the LIBO Rate, the EURIBOR Rate, AUD Rate or SONIA, the time determined by the Administrative Agent in its reasonable discretion.

 

 

“Register” has the meaning set forth in Section 10.04(b).

 

“Regulation D” means Regulation D of the Federal Reserve Board, as in effect from time to time and all official rulings and interpretations thereunder or thereof.

 

“Regulation U” means Regulation U of the Federal Reserve Board, as in effect from time to time and all official rulings and interpretations thereunder or thereof.

 

“Regulation X” means Regulation X of the Federal Reserve Board, as in effect from time to time and all official rulings and interpretations thereunder or thereof.

 

“Related Parties” means, with respect to any specified Person, such Person’s Affiliates and the respective directors, officers, employees, agents and advisors of such Person and such Person’s Affiliates.

 

“Relevant Governmental Body” means (i) with respect to a Benchmark Replacement in respect of Loans denominated in Dollars, the Federal Reserve Board and/or the NYFRB, or a committee officially endorsed or convened by the Federal Reserve Board and/or the NYFRB or, in each case, any successor thereto, (ii) with respect to a Benchmark Replacement in respect of Loans denominated in Sterling, the Bank of England, or a committee officially endorsed or convened by the Bank of England or, in each case, any successor thereto, (iii) with respect to a Benchmark Replacement in respect of Loans denominated in Euros, the European Central Bank, or a committee officially endorsed or convened by the European Central Bank or, in each case, any successor thereto and (iv) with respect to a Benchmark Replacement in respect of Loans denominated in any other currency, (a) the central bank for the currency in which such Benchmark Replacement is denominated or any central bank or other supervisor which is responsible for supervising either (1) such Benchmark Replacement or (2) the administrator of such Benchmark Replacement or (b) any working group or committee officially endorsed or convened by (1) the central bank for the currency in which such Benchmark Replacement is denominated, (2) any central bank or other supervisor that is responsible for supervising either (A) such Benchmark Replacement or (B) the administrator of such Benchmark Replacement, (3) a group of those central banks or other supervisors or (4) the Financial Stability Board or any part thereof.

 

“Relevant Rate” means (i) with respect to any Term Benchmark Borrowing denominated in Dollars, the LIBO Rate, (ii) with respect to any Term Benchmark Borrowing denominated in Euros, the EURIBOR Rate, (iii) with respect to any Term Benchmark Borrowing denominated in Australian Dollars, the AUD Rate and (iv) with respect to any Borrowing denominated in Sterling, Daily Simple RFR.

 

“Relevant Screen Rate” means (i) with respect to any Term Benchmark Borrowing denominated in Dollars, the LIBO Screen Rate, (ii) with respect to any Term Benchmark Borrowing denominated in Euros, the EURIBOR Screen Rate and (iii) with respect to any Term Benchmark Borrowing denominated in Australian Dollars, the AUD Screen Rate, as applicable.

 

“Required Lenders” means, at any time, Lenders (a) having Revolving Credit Exposures and unused Commitments representing more than 50% of the sum of the total Revolving Credit Exposures and unused Commitments of all Lenders at such time, or (b) at any time after the Commitments of all Lenders shall have been terminated, holding more than 50% of the total Revolving Credit Exposures at such time; provided that, for purposes of this definition of “Required Lenders”, a Lender and its Affiliates shall be deemed to be one Lender. The Revolving Credit Exposure and Commitment of any Defaulting Lender shall be disregarded in determining Required Lenders at any time.

 

 

“Resolution Authority” means an EEA Resolution Authority or, with respect to any UK Financial Institution, a UK Resolution Authority.

 

“Responsible Officer” means any of the president, the chief executive officer or any Financial Officer of the applicable Loan Party, or any other Person designated by any such Loan Party in writing to the Administrative Agent from time to time, acting singly.

 

“Restricted Cash” means, at any time, the cash and Cash Equivalents of the Borrower to the extent (a) classified (or required to be classified) as restricted cash or restricted cash equivalents on the balance sheet of the Borrower in accordance with GAAP or (b) such cash or Cash Equivalents are subject to any Lien (other than (x) Liens in favor of the Secured Parties pursuant to the Security Documents and (y) Liens permitted pursuant to clauses (a), (b), (e), (l)(i) and (l)(iii) of Permitted Encumbrances and under Section 6.02(l)).

 

“Restricted Payment” means any dividend or other distribution (whether in cash, securities or other property) with respect to any Equity Interests in the Borrower or any Subsidiary of the Parent, or any payment (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any such Equity Interests or any option, warrant or other right to acquire any such Equity Interest. For the avoidance of doubt, the receipt or acceptance by the Borrower or any Subsidiary of the return of Equity Interests issued by the Borrower or any Subsidiary to the seller of a Person, business or division as consideration for the purchase of such Person, business or division, which return is in settlement of indemnification claims owed by such seller in connection with such acquisition, shall not be deemed to be a Restricted Payment.

 

“Reuters” means, as applicable, Thomson Reuters Corp., Refinitiv, or any successor thereto.

 

“Revaluation Date” shall mean (a) with respect to any Loan denominated in any Alternative Currency, each of the following: (i) the date of the Borrowing of such Loan, (ii) with respect to any Term Benchmark Loan, each date of a conversion into or continuation of such Loan pursuant to the terms of this Agreement, and (iii) with respect to any RFR Loan, each Interest Payment Date; (b) with respect to any Letter of Credit denominated in an Alternative Currency, each of the following: (i) the date on which such Letter of Credit is issued, (ii) the first Business Day of each calendar month, (iii) the date of any  extension of such Letter of Credit, (iv) the date of any amendment of such letter of Credit that has the effect of increasing the face amount thereof and (v) each date of any payment by the applicable Issuing Bank under any Letter of Credit denominated in an Alternative Currency; (c) for purposes of calculating the Commitment Fee, the last day of any fiscal quarter; and (d) any additional date as the Administrative Agent may determine at any time when an Event of Default exists.

 

 

 

“Revolving Credit Exposure” means, with respect to any Lender at any time, the sum of the outstanding principal amount of such Lender’s Loans and its LC Exposure at such time.

 

“RFR” means, for any RFR Loan denominated in Sterling, SONIA.

 

“RFR Administrator” means the SONIA Administrator.

 

“RFR Borrowing” means, as to any Borrowing, the RFR Loans comprising such Borrowing.

 

“RFR Business Day” means, for any Loan denominated in Sterling, any day except for (i) a Saturday, (ii) a Sunday or (iii) a day on which banks are closed for general business in London.

 

“RFR Interest Day” has the meaning specified in the definition of “Daily Simple RFR”.

 

“RFR Loan” means a Loan that bears interest at a rate based on Daily Simple RFR.

 

“S&P” means Standard & Poor’s Rating Services, a Standard & Poor’s Financial Services LLC business.

 

“Sanctioned Country” means, at any time, a country, region or territory which is the subject or target of any country-wide or territory-wide Sanctions (and, as of the Effective Date, Crimea, Cuba, Iran, North Korea and Syria).

 

“Sanctioned Person” means, at any time, (a) any Person listed in any Sanctions-related list of designated Persons maintained by the Office of Foreign Assets Control of the U.S. Department of the Treasury, the U.S. Department of State, the United Nations Security Council, the European Union, any EU member state, Her Majesty’s Treasury of the United Kingdom or any other applicable sanctions authority in which the Borrower and its Subsidiaries operate, (b) any Person operating, organized or resident in a Sanctioned Country or (c) any Person owned or controlled by any such Person or Persons described in the foregoing clauses (a) or (b), or (d) any Person otherwise the subject of any Sanctions.

 

“Sanctions” means all economic or financial sanctions or trade embargoes imposed, administered or enforced from time to time by (a) the U.S. government, including those administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury or the U.S. Department of State, or (b) the United Nations Security Council, the European Union, any European Union member state, Her Majesty’s Treasury of the United Kingdom or any other applicable sanctions authority in which the Borrower and its Subsidiaries operate.

 

“SEC” means the Securities and Exchange Commission or any Governmental Authority succeeding to any of its principal functions.

 

“Secured Parties” has the meaning assigned to such term in the Security Agreement.

 

“Security Agreement” means the Security Agreement, dated on or about the Effective Date, between the Borrower, the Parent, [_] and the Administrative Agent for the benefit of the Secured Parties, as amended, supplemented or otherwise modified from time to time, including by each joinder agreement thereto.

 

 

“Security Documents” means the collective reference to the Security Agreement, Foreign Security Agreements, the Control Account Agreements and all other security documents hereafter delivered to the Administrative Agent by a Loan Party granting or perfecting a Lien on any property or right of any person to secure the obligations and liabilities of any Loan Party under any Loan Document.

 

“Shareholder Loan Agreement” means, collectively, (i) the Promissory Note, dated August 11, 2021, issued by the Borrower to Siemens Industry, Inc. and (ii) the Promissory Note, dated August 11, 2021, issued by the Borrower to AES Grig Stability, LLC.

 

[“Shortfall Amount” means the amount by which the Maximum Amount exceeds the Distributed Amount.]

 

“Siemens” refers to Siemens AG, a company incorporated under the laws of Germany, and its subsidiaries and affiliates, including Siemens Industry, Inc., a Delaware corporation.

 

“SOFR” means, with respect to any Business Day, a rate per annum equal to the secured overnight financing rate for such Business Day published by the SOFR Administrator on the SOFR Administrator’s Website on the immediately succeeding Business Day.

 

“SOFR Administrator” means the NYFRB (or a successor administrator of the secured overnight financing rate).

 

“SOFR Administrator’s Website” means the NYFRB’s website, currently at http://www.newyorkfed.org, or any successor source for the secured overnight financing rate identified as such by the SOFR Administrator from time to time.

 

“Solvent” means, with respect to the Parent and its Subsidiaries on a particular date, that on such date (a) the fair value of the assets of the Parent and its Subsidiaries, on a consolidated basis, is greater than the total amount of liabilities, including, without limitation, contingent liabilities, of the Parent and its Subsidiaries, on a consolidated basis, (b) the present fair saleable value of the assets of the Parent and its Subsidiaries, on a consolidated basis, is not less than the total amount of liabilities, including contingent liabilities, of the Parent and its Subsidiaries, on a consolidated basis, (c) the Parent and its Subsidiaries, on a consolidated basis, do not intend to, and do not believe that they will, incur debts or liabilities (including current obligations and contingent liabilities) beyond their ability to pay such debts and liabilities as they mature in the ordinary course of business, (d) the Parent and its Subsidiaries on a consolidated basis have, and will have, adequate capital with which to conduct the business they are presently conducting and reasonably anticipate conducting and (e) with respect to any Australian Loan Party, it is solvent (within the meaning of section 95A of the Australian Corporations Act) and able to pay its debts as and when they fall due). The amount of contingent liabilities at any time shall be computed as the amount that, in the light of all the facts and circumstances existing at such time, represents the amount that can reasonably be expected to become an actual or matured liability (irrespective of whether such contingent liabilities meet the criteria for accrual under Statement of Financial Accounting Standard No. 5 (ASC 450)).

 

 

“SONIA” means, with respect to any Business Day, a rate per annum equal to the Sterling Overnight Index Average for such Business Day published by the SONIA Administrator on the SONIA Administrator’s Website on the immediately succeeding Business Day.

 

“SONIA Administrator” means the Bank of England (or any successor administrator of the Sterling Overnight Index Average).

 

“SONIA Administrator’s Website” means the Bank of England’s website, currently at http://www.bankofengland.co.uk, or any successor source for the Sterling Overnight Index Average identified as such by the SONIA Administrator from time to time.

 

“Special Purpose Subsidiary” means (a) any not-for-profit Subsidiary and (b) any Captive Insurance Company.

 

“Specified Cash Management Agreement” means any agreement providing for treasury, depositary, purchasing card or cash management services, including in connection with any automated clearing house transfers of funds or any similar transactions between the Borrower or any Guarantor and any Lender or affiliate thereof, which is in effect as of the Effective Date or which has been designated by such Lender and the Borrower, by notice to the Administrative Agent not later than 90 days after the execution and delivery by the Borrower or such Guarantor, as a “Specified Cash Management Agreement”.

 

“Specified Swap Agreement” means any Swap Agreement in respect of interest rates or currency exchange rates entered into by the Borrower or any Guarantor and any Person that is a Lender or an Affiliate of a Lender at the time such Swap Agreement is entered into; provided that such Swap Agreement is entered into to hedge or mitigate risks, and not for speculative purposes, in the ordinary course of the Borrower or such Guarantor’s business or in order to effectively cap, collar or exchange interest rates (from floating to fixed rates, from one floating rate to another floating rate or otherwise) with respect to any interest-bearing liability or investment of the Borrower or such Guarantor.

 

“Specified Transaction” means (a) any incurrence or repayment of Indebtedness of the Borrower or a Subsidiary, (b) any Investment that results in a Person becoming a Subsidiary, (c) any Disposition, (d) the establishment, acquisition or creation of any new joint venture of the Borrower or any Subsidiary, (e) any issuance of Equity Interests, and (f) any acquisition or Investment constituting an acquisition of assets constituting a business unit, line of business or division of another Person or of all or substantially all of the assets of a Person.

 

“Standby Letter of Credit” means any Letter of Credit other than any Commercial Letter of Credit.

 

“Statutory Reserve Rate” means a fraction (expressed as a decimal), the numerator of which is the number one and the denominator of which is the number one minus the aggregate of the maximum reserve percentage (including any marginal, special, emergency or supplemental reserves) expressed as a decimal established by the Board to which the Administrative Agent is subject with respect to the Adjusted LIBO Rate or Adjusted EURIBOR Rate, as applicable, for eurocurrency funding (currently referred to as “Eurocurrency Liabilities” in Regulation D of the Board). Such reserve percentage shall include those imposed pursuant to such Regulation D. Term Benchmark Loans shall be deemed to constitute eurocurrency funding and to be subject to such reserve requirements without benefit of or credit for proration, exemptions or offsets that may be available from time to time to any Lender under such Regulation D or any comparable regulation. The Statutory Reserve Rate shall be adjusted automatically on and as of the effective date of any change in any reserve percentage.

 

 

“Sterling” or “£” mean the lawful currency of the United Kingdom.

 

[“Subordinated Lender” means any Lender which has a relationship with a Loan Party which leads to a reduction or prohibition of payment (including payments in form of an insolvency quota) or other distribution (including the proceeds from the enforcement of any Collateral) by that Loan Party (including any administrator or insolvency administrator) to that Lender, including, without limitation, by reason of that Lender:

 

(i) being a Subsidiary of the Parent or an Affiliate thereof; or

 

(ii) having acquired (directly or indirectly) any Commitment, participation in any Loan and/or any other participation rights (including by way of sub-participation) in any of the Loans and/or any other rights and obligations under the Loan Documents from a Subsidiary of the Parent or an Affiliate thereof in accordance with Section 10.04 or otherwise.]

 

“Subsidiary” means, unless otherwise specified, any subsidiary of the Parent.

 

“subsidiary” means, with respect to any Person (the “parent”) at any date, any corporation, limited liability company, partnership, association or other entity the accounts of which would be consolidated with those of the parent in the parent’s consolidated financial statements if such financial statements were prepared in accordance with GAAP as of such date, as well as any other corporation, limited liability company, partnership, association or other entity (a) of which securities or other ownership interests representing more than 50% of the equity or more than 50% of the ordinary voting power or, in the case of a partnership, more than 50% of the general partnership interests are, as of such date, owned, controlled or held, or (b) that is, as of such date, otherwise Controlled, by the parent or one or more subsidiaries of the parent or by the parent and one or more subsidiaries of the parent and which is required by GAAP to be consolidated in the consolidated financial statements of the parent.

 

“Supplier Financing Excess Amount” has the meaning assigned to it in Section 6.01(k).

 

“Supported QFC” has the meaning assigned to it in Section 10.18.

 

“Swap Agreement” means any agreement with respect to any swap, forward, future or derivative transaction or option or similar agreement involving, or settled by reference to, one or more rates, currencies, commodities, equity or debt instruments or securities, or economic, financial or pricing indices or measures of economic, financial or pricing risk or value or any similar transaction or any combination of these transactions; provided that no phantom stock or similar plan providing for payments only on account of services provided by current or former directors, officers, employees or consultants of the Parent or its Subsidiaries shall be a Swap Agreement.

 

 

“Swap Obligation” has the meaning assigned to it in Section 9.01(i).

 

“Syndication Agent” means Morgan Stanley Senior Funding, Inc., in its capacity as syndication agent, and any successor thereto.

 

“TARGET2” means the Trans-European Automated Real-time Gross Settlement Express Transfer payment system which utilizes a single shared platform and which was launched on November 19, 2007.

 

“TARGET Day” means any day on which TARGET2 (or, if such payment system ceases to be operative, such other payment system, if any, determined by the Administrative Agent to be a suitable replacement) is open for the settlement of payments in Euro.

 

“Tax Receivable Agreement” means that certain Tax Receivable Agreement, dated as of [_], among the Parent, the Borrower and the other parties thereto, as the same may hereafter be modified, supplemented, extended, amended, restated or amended and restated from time to time.

 

“Taxes” means any and all present or future taxes, levies, imposts, duties, deductions, goods and services tax including Indirect Tax, charges, withholdings (including backup withholding), assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.

 

“Term Benchmark” when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are bearing interest at a rate determined by reference to the Adjusted LIBO Rate, the Adjusted EURIBOR Rate or the AUD Rate.

 

“Term SOFR” means, for the applicable Corresponding Tenor as of the applicable Reference Time, the forward-looking term rate based on SOFR that has been selected or recommended by the Relevant Governmental Body.

 

“Term SOFR Notice” means a notification by the Administrative Agent to the Lenders and the Borrower of the occurrence of a Term SOFR Transition Event.

 

“Term SOFR Transition Event” means the determination by the Administrative Agent that (a) Term SOFR has been recommended for use by the Relevant Governmental Body, (b) the administration of Term SOFR is administratively feasible for the Administrative Agent and (c) a Benchmark Transition Event or an Early Opt-in Election, as applicable (and, for the avoidance of doubt, not in the case of an Other Benchmark Rate Election), has previously occurred resulting in a Benchmark Replacement in accordance with Section 2.11(b) that is not Term SOFR.

 

“Total Assets” means, as of any date of determination, the total assets of the Parent and its Subsidiaries on a consolidated basis in accordance with GAAP, as shown on the most recent balance sheet of the Parent delivered pursuant to Section 5.01(a) or (b).

 

“Total Liquidity” means, at any time, the sum of (a) all cash and Cash Equivalents (except, for the avoidance of doubt, any Restricted Cash) held by (i) the U.S. Loan Parties, other than cash and Cash Equivalents held in a Controlled Account of a U.S. Loan Party which is not subject to a Control Account Agreement following the date that is ninety (90) days after (x) the Effective Date or (y) (in the case of a Controlled Account opened with a Lender after the Effective Date) the date such account is opened, and (ii) the Foreign Guarantors to the extent that such cash and Cash Equivalents are held in a deposit, securities or other account which is subject to an enforceable Lien of the Administrative Agent pursuant to the Security Documents under which it may cause the applicable depositary bank or other relevant institution to honor its instructions upon enforcement of such Lien under applicable law, in each case at such time and (b) the aggregate unused amount of the Commitments then in effect and which are then available to be drawn under this Agreement.

 

 

“Total Revenues” means, as of any date of determination, the gross revenues of the Parent and its Subsidiaries, determined on a consolidated basis in accordance with GAAP, as shown on the most recent income statement of the Parent delivered pursuant to Section 5.01(a) or (b).

 

“Transactions” means the execution, delivery and performance by the Loan Parties of each Loan Document to which it is a party, the borrowing of Loans and the issuance of Letters of Credit hereunder, the use of the proceeds thereof, consummation of the IPO and the use of the proceeds thereof, and the payment of fees and expenses relating to each of the foregoing.

 

“Trigger Date” means the first date to occur following the later of (1) the last day of a fiscal quarter for which Consolidated EBITDA of Parent and its Subsidiaries, calculated for the four consecutive fiscal quarter period ended on such day, is not less than $150,000,000 and (2) the date on which the Borrower shall have provided an irrevocable notice to the Administrative Agent informing the Administrative Agent of the event described in clause (1) above and including a reasonable calculation of such Consolidated EBITDA.

 

“Type”, when used in reference to any Loan or Borrowing, refers to whether the rate of interest on such Loan, or on the Loans comprising such Borrowing, is determined by reference to the Adjusted LIBO Rate, the Adjusted EURIBOR Rate, the AUD Rate, the Daily Simple RFR or the Alternate Base Rate.

 

“UK Financial Institutions” means any BRRD Undertaking (as such term is defined under the PRA Rulebook (as amended from time to time) promulgated by the United Kingdom Prudential Regulation Authority) or any person falling within IFPRU 11.6 of the FCA Handbook (as amended from time to time) promulgated by the United Kingdom Financial Conduct Authority, which includes certain credit institutions and investment firms, and certain affiliates of such credit institutions or investment firms.

 

“UK Resolution Authority” means the Bank of England or any other public administrative authority having responsibility for the resolution of any UK Financial Institution.

 

“Unadjusted Benchmark Replacement” means the applicable Benchmark Replacement excluding the related Benchmark Replacement Adjustment.

 

“Unfunded Pension Liability” means the excess of a Pension Plan’s benefit liabilities under Section 4001(a)(16) of ERISA, over the current value of that Pension Plan’s assets, determined in accordance with the assumptions used for funding the Pension Plan pursuant to Section 412 of the Code for the applicable plan year.

 

 

“Unrestricted Account” has the meaning set forth in the definition of “Excluded Property”.

 

“USA Patriot Act” means the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (Title III of Pub. L. No. 107-56 (signed into law October 26, 2001)), as amended from time to time.

 

“U.S. Loan Party” means any Loan Party organized or existing under the laws of the United States of America, any State of the United States or the District of Columbia or any territory thereto.

 

“U.S. Person” means any Person that is a “United States Person” as defined in Section 7701(a)(30) of the Code.

 

“U.S. Special Resolution Regime” has the meaning assigned to it in Section 10.18.

 

“Withdrawal Liability” means liability to a Multiemployer Plan as a result of a complete or partial withdrawal from such Multiemployer Plan, as such terms are defined in Title IV of ERISA.

 

“Withholding Agent” means any Loan Party and the Administrative Agent.

 

“Write-Down and Conversion Powers” means, (a) with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule, and (b) with respect to the United Kingdom, any powers of the applicable Resolution Authority under the Bail-In Legislation to cancel, reduce, modify or change the form of a liability of any UK Financial Institution or any contract or instrument under which that liability arises, to convert all or part of that liability into shares, securities or obligations of that person or any other person, to provide that any such contract or instrument is to have effect as if a right had been exercised under it or to suspend any obligation in respect of that liability or any of the powers under that Bail-In Legislation that are related to or ancillary to any of those powers.

 

Section 1.02        Classification of Loans and Borrowings. For purposes of this Agreement, Loans may be classified and referred to by Type (e.g., a “Term Benchmark Loan” or an “RFR Loan”). Borrowings also may be classified and referred to by Type (e.g., a “Term Benchmark Borrowing” or an “RFR Borrowing”).

 

Section 1.03        Terms Generally. The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation.” The word “will” shall be construed to have the same meaning and effect as the word “shall.” Unless the context requires otherwise (a) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, restated, amended and restated, supplemented or otherwise modified (subject to any restrictions on such amendments, amendments and restatements, supplements or modifications set forth herein), (b) any reference herein to any Person shall be construed to include such Person’s successors and assigns, (c) the words “herein,” “hereof” and “hereunder,” and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, (d) all references herein to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, this Agreement, (e) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights and (f) any reference to any law shall include all statutory and regulatory provisions consolidating, amending, replacing or interpreting such law and any reference to any law or regulation shall, unless otherwise specified, refer to such law or regulation as amended, modified or supplemented from time to time.

 

 

Section 1.04        Accounting Terms; GAAP. Except as otherwise expressly provided herein, all terms of an accounting or financial nature shall be construed in accordance with GAAP, as in effect from time to time; provided that, if the Borrower notifies the Administrative Agent that the Borrower requests an amendment to any provision hereof to eliminate the effect of any change occurring after the Effective Date in GAAP or in the application thereof on the operation of such provision (or if the Administrative Agent notifies the Borrower that the Required Lenders request an amendment to any provision hereof for such purpose), regardless of whether any such notice is given before or after such change in GAAP or in the application thereof, then such provision shall be interpreted on the basis of GAAP as in effect and applied immediately before such change shall have become effective until such notice shall have been withdrawn or such provision amended in accordance herewith. If at any time any change in GAAP would affect the computation of any financial ratio or requirement set forth in any Loan Document, and either the Borrower or the Required Lenders shall so request, the Administrative Agent, the Lenders and the Borrower shall negotiate in good faith to amend such ratio or requirement to preserve the original intent thereof in light of such change in GAAP; provided that, until so amended, (i) such ratio or requirement shall continue to be computed in accordance with GAAP prior to such change therein and (ii) the Borrower shall provide to the Administrative Agent and the Lenders financial statements and other documents required under this Agreement setting forth a reconciliation between calculations of such ratio or requirement made before and after giving effect to such change in GAAP. Notwithstanding the foregoing, all financial covenants contained herein shall be calculated (1) without giving effect to any election under the Statement of Financial Accounting Standards No. 159 (ASC 825) (or any similar accounting principle) permitting or requiring a Person to value its financial liabilities or Indebtedness at the fair value thereof, (2) without giving effect to any treatment of Indebtedness in respect of convertible debt instruments under Accounting Standards Codification 470-20 (or any other Accounting Standards Codification or Financial Accounting Standard having a similar result or effect) to value any such Indebtedness in a reduced or bifurcated manner as described therein, and such Indebtedness shall at all times be valued at the full stated principal amount thereof and (3) all leases and obligations under any leases of any Person that are or would be characterized as operating leases and/or operating lease obligations in accordance with GAAP on December 14, 2018 (whether or not such operating leases and/or operating lease obligations were in effect on such date) shall continue to be accounted for as operating leases and/or operating lease obligations (and not as Capital Lease Obligations) for purposes of this Agreement regardless of any change in GAAP following the date that would otherwise require such obligations to be recharacterized as Capital Lease Obligations. Prior to the first delivery of financial statements pursuant to Section 5.01(a) or (b) on or after the Effective Date, any reference in this Agreement to the financial statements delivered pursuant to Section 5.01(a) or (b) or similar reference to the same effect shall be deemed to refer to the most recently delivered financial statements.

 

 

Section 1.05        Interest Rates; LIBOR Notification. The interest rate on a Loan denominated in dollars or an Alternative Currency may be derived from an interest rate benchmark that is, or may in the future become, the subject of regulatory reform. Regulators have signaled the need to use alternative benchmark reference rates for some of these interest rate benchmarks and, as a result, such interest rate benchmarks may cease to comply with applicable laws and regulations, may be permanently discontinued, and/or the basis on which they are calculated may change. The London interbank offered rate (“LIBOR”) is intended to represent the rate at which contributing banks may obtain short-term borrowings from each other in the London interbank market. On March 5, 2021, the U.K. Financial Conduct Authority (“FCA”) publicly announced that: (a) immediately after December 31, 2021, publication of all seven euro LIBOR settings, all seven Swiss Franc LIBOR settings, the spot next, 1-week, 2-month and 12-month Japanese Yen LIBOR settings, the overnight, 1-week, 2-month and 12-month British Pound Sterling LIBOR settings, and the 1-week and 2-month U.S. Dollar LIBOR settings will permanently cease; immediately after June 30, 2023, publication of the overnight and 12-month U.S. Dollar LIBOR settings will permanently cease; immediately after December 31, 2021, the 1-month, 3-month and 6-month Japanese Yen LIBOR settings and the 1-month, 3-month and 6-month British Pound Sterling LIBOR settings will cease to be provided or, subject to consultation by the FCA, be provided on a changed methodology (or “synthetic”) basis and no longer be representative of the underlying market and economic reality they are intended to measure and that representativeness will not be restored; and immediately after June 30, 2023, the 1-month, 3-month and 6-month U.S. Dollar LIBOR settings will cease to be provided or, subject to the FCA’s consideration of the case, be provided on a synthetic basis and no longer be representative of the underlying market and economic reality they are intended to measure and that representativeness will not be restored. There is no assurance that dates announced by the FCA will not change or that the administrator of LIBOR and/or regulators will not take further action that could impact the availability, composition, or characteristics of LIBOR or the currencies and/or tenors for which LIBOR is published. Each party to this Agreement should consult its own advisors to stay informed of any such developments. Public and private sector industry initiatives are currently underway to identify new or alternative reference rates to be used in place of LIBOR. Upon the occurrence of a Benchmark Transition Event, a Term SOFR Transition Event, an Early Opt-in Election or an Other Benchmark Rate Election, Section 2.11(b) and (c) provide a mechanism for determining an alternative rate of interest. The Administrative Agent will promptly notify the Borrower, pursuant to Section 2.11(b), of any change to the reference rate upon which the interest rate on Term Benchmark Loans is based. However, the Administrative Agent does not warrant or accept any responsibility for, and shall not have any liability with respect to, the administration, submission, performance or any other matter related to the Daily Simple RFR, LIBOR or other rates in the definition of “LIBO Rate” (or “EURIBOR Rate” or “AUD Rate”) or with respect to any alternative or successor rate thereto, or replacement rate thereof (including, without limitation, (i) any such alternative, successor or replacement rate implemented pursuant to Section 2.11(b) or (c), whether upon the occurrence of a Benchmark Transition Event, a Term SOFR Transition Event, an Early Opt-in Election or an Other Benchmark Rate Election, and (ii) the implementation of any Benchmark Replacement Conforming Changes pursuant to Section 2.11(b)), including without limitation, whether the composition or characteristics of any such alternative, successor or replacement reference rate will be similar to, or produce the same value or economic equivalence of, the Daily Simple RFR, the LIBO Rate (or the EURIBOR Rate or AUD Rate, as applicable) or have the same volume or liquidity as did the London interbank offered rate (or the euro interbank offered rate or the Tokyo interbank offered rate, as applicable) prior to its discontinuance or unavailability. The Administrative Agent and its affiliates and/or other related entities may engage in transactions that affect the calculation of any Daily Simple RFR, any alternative, successor or alternative rate (including any Benchmark Replacement) and/or any relevant adjustments thereto, in each case, in a manner adverse to the Borrower. The Administrative Agent may select information sources or services in its reasonable discretion to ascertain any RFR, Daily Simple RFR or the Term Benchmark Rate, any component thereof, or rates referenced in the definition thereof, in each case pursuant to the terms of this Agreement, and shall have no liability to the Borrower, any Lender or any other person or entity for damages of any kind, including direct or indirect, special, punitive, incidental or consequential damages, costs, losses or expenses (whether in tort, contract or otherwise and whether at law or in equity), for any error or calculation of any such rate (or component thereof) provided by any such information source or service.

 

 

Section 1.06        Divisions. For all purposes under the Loan Documents, in connection with any division or plan of division under Delaware law (or any comparable event under a different jurisdiction’s laws): (a) if any asset, right, obligation or liability of any Person becomes the asset, right, obligation or liability of a different Person, then it shall be deemed to have been transferred from the original Person to the subsequent Person, and (b) if any new Person comes into existence, such new Person shall be deemed to have been organized and acquired on the first date of its existence by the holders of its Equity Interests at such time.

 

Section 1.07        Letter of Credit Amounts. Unless otherwise specified herein, the amount of a Letter of Credit at any time shall be deemed to be the Dollar Equivalent of the stated amount of such Letter of Credit available to be drawn at such time; provided that with respect to any Letter of Credit that, by its terms or the terms of any Letter of Credit agreement related thereto, provides for one or more automatic increases in the stated amount thereof, the amount of such Letter of Credit shall be deemed to be the Dollar Equivalent of the maximum stated amount of such Letter of Credit after giving effect to all such increases, whether or not such maximum stated amount is available to be drawn at such time.

 

Section 1.08        Exchange Rates; Currency Equivalents. (a) The Administrative Agent or the Issuing Bank, as applicable, shall determine the Dollar Equivalent amounts of Term Benchmark Borrowings or Letter of Credit extensions denominated in Alternative Currencies. Such Dollar Equivalent shall become effective as of such Revaluation Date and shall be the Dollar Equivalent of such amounts until the next Revaluation Date to occur. Except for purposes of financial statements delivered by the Borrower hereunder or calculating financial covenants hereunder or except as otherwise provided herein, the applicable amount of any Agreed Currency (other than Dollars) for purposes of the Loan Documents shall be such Dollar Equivalent amount as so determined by the Administrative Agent or the Issuing Bank, as applicable.

 

 

(b)               Wherever in this Agreement in connection with a Borrowing, conversion, continuation or prepayment of a Term Benchmark Loan or an RFR Loan or the issuance, amendment or extension of a Letter of Credit, an amount, such as a required minimum or multiple amount, is expressed in Dollars, but such Borrowing, Loan or Letter of Credit is denominated in an Alternative Currency, such amount shall be the Dollar Equivalent of such amount (rounded to the nearest unit of such Alternative Currency, with 0.5 of a unit being rounded upward), as determined by the Administrative Agent or the Issuing Bank, as the case may be.

 

Section 1.09        Certain Calculations and Tests.

 

(a)               Notwithstanding anything to the contrary herein, the Consolidated Leverage Ratio and the Interest Coverage Ratio (and the component definitions thereof) shall be calculated in the manner prescribed by this Section 1.09; provided that, notwithstanding anything to the contrary in subsections (b) or (c) of this Section 1.09, when calculating the Consolidated Leverage Ratio and the Interest Coverage Ratio (and the component definitions thereof), as applicable, for purposes of determining actual compliance (and not Pro Forma compliance or compliance on a Pro Forma Basis) with any financial covenant pursuant to Section 6.10, the events described in this Section 1.09 that occurred subsequent to the end of the applicable Measurement Period shall not be given Pro Forma Effect.

 

(b)               For purposes of calculating the Consolidated Leverage Ratio and the Interest Coverage Ratio (and the component definitions thereof), Specified Transactions that have been consummated (i) during the applicable Measurement Period or (ii) subsequent to such Measurement Period and prior to or simultaneously with the event for which the calculation of any such ratio is made in each case shall be calculated on a Pro Forma Basis assuming that all such Specified Transactions (and any increase or decrease in Consolidated EBITDA and the component financial definitions used therein attributable to any Specified Transaction) had occurred on the first day of the applicable Measurement Period. If, since the beginning of any applicable Measurement Period, any Person that subsequently became a Subsidiary or was merged, amalgamated or consolidated with or into the Borrower or any of its Subsidiaries since the beginning of such Measurement Period shall have made any Specified Transaction that would have required adjustment pursuant to this Section 1.09, then the Consolidated Leverage Ratio and the Interest Coverage Ratio (and the component definitions thereof) shall be calculated to give Pro Forma Effect thereto in accordance with this Section 1.09.

 

(c)               In the event that the Borrower or any Subsidiary incurs (including by assumption or guarantees) or repays (including by redemption, repayment, prepayment, retirement, exchange, extinguishment or satisfaction and discharge) any Indebtedness included in the calculations of the Consolidated Leverage Ratio and the Interest Coverage Ratio (and the component definitions thereof), as the case may be (in each case, other than Indebtedness incurred or repaid under this Agreement), (i) during the applicable Measurement Period and/or (ii) subsequent to the end of the applicable Measurement Period and prior to or simultaneously with the event for which the calculation of any such ratio is made, then the Consolidated Leverage Ratio and the Interest Coverage Ratio (and the component definitions thereof) shall be calculated giving Pro Forma Effect to such incurrence or repayment of Indebtedness, to the extent required, as if the same had occurred on (A) the last day of the applicable Measurement Period in the case of the Consolidated Leverage Ratio and (B) the first day of the applicable Measurement Period in the case of the Interest Coverage Ratio. If any Indebtedness bears a floating rate of interest and is being given Pro Forma Effect, the interest on such Indebtedness shall be calculated as if the rate in effect on the date of the event for which the calculation of the Interest Coverage Ratio is made had been the applicable rate for the entire period (taking into account any hedging obligations applicable to such Indebtedness); provided that, in the case of repayment of any Indebtedness, to the extent actual interest related thereto was included during all or any portion of the applicable Measurement Period, the actual interest may be used for the applicable portion of such Measurement Period. Interest on a Capital Lease Obligation shall be deemed to accrue at an interest rate reasonably determined by a Financial Officer of the Borrower to be the rate of interest implicit in such Capital Lease Obligation in accordance with GAAP. Interest on Indebtedness that may optionally be determined at an interest rate based upon a factor of a prime or similar rate, a London interbank offered rate, or other rate, shall be determined to have been based upon the rate actually chosen, or if none, then based upon such optional rate chosen as the Borrower may designate.

 

 

(d)               Notwithstanding anything to the contrary herein, unless the Borrower otherwise notifies the Administrative Agent, with respect to any amounts incurred or transactions entered into (or consummated) in reliance on a provision of this Agreement that does not require compliance with a financial ratio or test (any such amounts, the “Fixed Amounts”) substantially concurrently with any amounts incurred or transactions entered into (or consummated) in reliance on a provision of this Agreement that requires compliance with a financial ratio or test (any such amounts, the “Incurrence-Based Amounts”), it is understood and agreed that the Fixed Amounts shall be disregarded in the calculation of the financial ratio or test applicable to the Incurrence-Based Amounts in connection with such substantially concurrent incurrence.

 

(e)               For the avoidance of doubt, notwithstanding any classification under GAAP of any Person or business in respect of which a definitive agreement for the Disposition thereof has been entered into as discontinued operations, the earnings of such Person or business shall not be excluded from the calculation of Consolidated EBITDA until such Disposition shall have been consummated.

 

Section 1.10        Australian Terms.

 

(a)               Without limiting Section 8.08, in relation to Security Documents that are governed by the laws of Australia, each present and future Secured Party appoints and authorizes the Administrative Agent (in its capacity as “collateral agent”) to hold each such Security Document as security trustee on its behalf.

 

(b)               The parties agree that the Australian Banking Code of Practice does not apply to the Loan Documents and the transactions under them.

 

 

Article 2

THE CREDITS

 

Section 2.01        Commitments. Subject to the terms and conditions set forth herein, each Lender severally agrees to make Loans in Dollars or in one or more Alternative Currencies to the Borrower from time to time during the Availability Period in an aggregate principal amount that will not result in (a) the Dollar Equivalent of such Lender’s Revolving Credit Exposure exceeding such Lender’s Commitment or (b) the sum of the Dollar Equivalents of the total Revolving Credit Exposures of all Lenders exceeding the total Commitments of all Lenders. Within the foregoing limits and subject to the terms and conditions set forth herein, the Borrower may borrow, prepay and reborrow Loans.

 

Section 2.02        Loans and Borrowings.

 

(a)               Each Loan shall be made as part of a Borrowing consisting of Loans made by the Lenders in accordance with their respective Applicable Percentages. The failure of any Lender to make any Loan required to be made by it shall not relieve any other Lender of its obligations hereunder; provided that the Commitments of the Lenders are several and no Lender shall be responsible for any other Lender’s failure to make Loans as required.

 

(b)               Subject to Section 2.11, each Borrowing shall be comprised (A) in the case of Borrowings in Dollars, entirely of ABR Loans or Term Benchmark Loans and (B) in the case of Borrowings in any other Agreed Currency, entirely of Term Benchmark Loans or RFR Loans, as applicable, in each case of the same Agreed Currency, as the Borrower may request in accordance herewith. Each Lender at its option may make any Term Benchmark Loan or RFR Loan by causing any domestic or foreign branch or Affiliate of such Lender to make such Loan; provided that any exercise of such option shall not affect the obligation of the Borrower to repay such Loan in accordance with the terms of this Agreement.

 

(c)               At the commencement of each Interest Period for any Term Benchmark Borrowing, such Borrowing shall be in an aggregate amount that is an integral multiple of the Dollar Equivalent of $1,000,000 and not less than the Dollar Equivalent of $1,000,000. At the time that each ABR Borrowing and/or RFR Borrowing is made, such Borrowing shall be in an aggregate amount that is an integral multiple of the Dollar Equivalent of $1,000,000 and not less than the Dollar Equivalent of $1,000,000; provided that an ABR Borrowing may be in an aggregate amount that is equal to the entire unused balance of the total Commitments or that is required to finance the reimbursement of an LC Disbursement as contemplated by Section 2.19(e). Borrowings of more than one Type may be outstanding at the same time; provided that there shall not at any time be more than a total of fifteen Term Benchmark Borrowings or RFR Borrowings outstanding.

 

(d)               Notwithstanding any other provision of this Agreement, the Borrower shall not be entitled to request, or to elect to convert or continue, any Borrowing if the Interest Period requested with respect thereto would end after the Maturity Date.

 

 

Section 2.03        Requests for Borrowings. To request a Borrowing, the Borrower shall notify the Administrative Agent of such request by telephone or telecopy (i) in the case of a Term Benchmark Borrowing, not later than 12:00 noon, New York City time, three Business Days before the date of the proposed Borrowing, (ii) in the case of an RFR Borrowing denominated in Sterling, not later than 11:00a.m., New York City time, five Business Days before the date of the proposed Borrowing or (iii) in the case of an ABR Borrowing, not later than 10:00 a.m., New York City time, on the date of the proposed Borrowing. Each such telephonic Borrowing Request shall be confirmed promptly by delivery to the Administrative Agent of a written Borrowing Request in substantially the form of Exhibit B-1 attached hereto and signed by the Borrower. Each such telephonic and written Borrowing Request shall specify the following information in compliance with Section 2.02:

 

(i)               the Agreed Currency and aggregate amount of the requested Borrowing;

 

(ii)              the date of such Borrowing, which shall be a Business Day;

 

(iii)             whether such Borrowing is to be an ABR Borrowing, a Term Benchmark Borrowing or an RFR Borrowing;

 

(iv)             in the case of a Term Benchmark Borrowing, the initial Interest Period to be applicable thereto, which shall be a period contemplated by the definition of the term “Interest Period”; and

 

(v)             the location and number of the account or accounts to which funds are to be disbursed, which shall comply with the requirements of Section 2.04.

 

If no election as to the currency of a Borrowing is specified, then the requested Revolving Borrowing shall be made in Dollars. If no election as to the Type of Borrowing is specified, then the requested Borrowing shall be an ABR Borrowing. If no Interest Period is specified with respect to any requested Term Benchmark Borrowing, then the Borrower shall be deemed to have selected an Interest Period of one month’s duration. Promptly following receipt of a Borrowing Request in accordance with this Section, the Administrative Agent shall advise each Lender of the details thereof and of the amount of such Lender’s Loan to be made as part of the requested Borrowing. Except as otherwise provided herein, a Borrowing Notice for a Term Benchmark Borrowing shall be irrevocable on and after the related Interest Rate Determination Date, and the Borrower shall be bound to make a borrowing in accordance therewith. As soon as practicable after 10:00 a.m., New York City time, on each Interest Rate Determination Date, Administrative Agent shall determine (which determination shall, absent manifest error, be final, conclusive and binding upon all parties) the interest rate that shall apply to the Term Benchmark Borrowing for which an interest rate is then being determined for the applicable Interest Period and shall promptly give notice thereof (in writing or by telephone confirmed in writing) to the Borrower and each Lender.

 

Section 2.04        Funding of Borrowings.

 

(a)               Each Lender shall make each Loan to be made by it hereunder on the proposed date thereof by wire transfer of immediately available funds by 12:00 noon, New York City time, to the account of the Administrative Agent most recently designated by it for such purpose by notice to the Lenders. The Administrative Agent will make such Loans available to the Borrower by promptly crediting the amounts so received, in like funds, to an account or accounts designated by the Borrower in the applicable Borrowing Request; provided that ABR Loans made to finance the reimbursement of an LC Disbursement as provided in Section 2.19(e) shall be remitted by the Administrative Agent to the applicable Issuing Bank.

 

 

(b)               Unless the Administrative Agent shall have received notice from a Lender prior to the proposed date of any Borrowing that such Lender will not make available to the Administrative Agent such Lender’s Applicable Percentage of such Borrowing, the Administrative Agent may assume that such Lender has made such Applicable Percentage available on such date in accordance with paragraph (a) of this Section and may, in reliance upon such assumption, make available to the Borrower a corresponding amount. In such event, if a Lender has not in fact made its Applicable Percentage of the applicable Borrowing available to the Administrative Agent, then the applicable Lender and the Borrower severally agree to pay to the Administrative Agent forthwith on demand such corresponding amount with interest thereon, for each day from and including the date such amount is made available to the Borrower to but excluding the date of payment to the Administrative Agent, at (i) in the case of such Lender, the greater of the Federal Funds Effective Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation or (ii) in the case of the Borrower, the interest rate applicable to ABR Loans. If such Lender pays such amount to the Administrative Agent, then such amount shall constitute such Lender’s Loan included in such Borrowing.

 

Section 2.05        Interest Elections.

 

(a)               Each Borrowing initially shall be of the Type and Agreed Currency specified in the applicable Borrowing Request and, in the case of a Term Benchmark Borrowing, shall have an initial Interest Period as specified in such Borrowing Request. Thereafter, the Borrower may elect to convert such Borrowing to a different Type or to continue such Borrowing and, in the case of a Term Benchmark Borrowing, may elect Interest Periods therefor, all as provided in this Section. The Borrower may elect different options with respect to different portions of the affected Borrowing, in which case each such portion shall be allocated among the Lenders holding the Loans comprising such Borrowing in accordance with their respective Applicable Percentages, and the Loans comprising each such portion shall be considered a separate Borrowing.

 

(b)               To make an election pursuant to this Section, the Borrower shall notify the Administrative Agent of such election by telephone by the time that a Borrowing Request would be required under Section 2.03 if the Borrower were requesting a Borrowing of the Type resulting from such election to be made on the effective date of such election. Each such telephonic request shall be irrevocable and shall be confirmed promptly by hand delivery or telecopy to the Administrative Agent of a written request (an “Interest Election Request”) in substantially the form of Exhibit C attached hereto and signed by the Borrower.

 

(c)               Each telephonic and written Interest Election Request shall specify the following information in compliance with Section 2.02:

 

(i)              The Agreed Currency and principal amount of the Borrowing to which such Interest Election Request applies and, if different options are being elected with respect to different portions thereof, the portions thereof to be allocated to each resulting Borrowing (in which case the information to be specified pursuant to clauses (iii) and (iv) below shall be specified for each resulting Borrowing);

 

 

(ii)              the effective date of the election made pursuant to such Interest Election Request, which shall be a Business Day;

 

(iii)            whether the resulting Borrowing is to be an ABR Borrowing (in the case of Borrowings denominated in Dollars) or a Term Benchmark Borrowing; and

 

(iv)            if the resulting Borrowing is a Term Benchmark Borrowing, the Interest Period to be applicable thereto after giving effect to such election, which shall be a period contemplated by the definition of the term “Interest Period”.

 

If any such Interest Election Request requests a Term Benchmark Borrowing but does not specify an Interest Period, then the Borrower shall be deemed to have selected an Interest Period of one month’s duration.

 

(d)               Promptly following receipt of an Interest Election Request, the Administrative Agent shall advise each Lender of the details thereof and of such Lender’s portion of each resulting Borrowing. Except as otherwise provided herein, an Interest Election Request for conversion to, or continuation of, any Term Benchmark Borrowing shall be irrevocable on and after the related Interest Rate Determination Date, and the Borrower shall be bound to effect a conversion or continuation in accordance therewith.

 

(e)               If the Borrower fails to deliver a timely Interest Election Request with respect to a Term Benchmark Revolving Borrowing in Dollars prior to the end of the Interest Period applicable thereto, then, unless such Borrowing is repaid as provided herein, at the end of such Interest Period such Borrowing shall be converted to an ABR Borrowing at the end of such Interest Period. If the Borrower fails to deliver a timely and complete Interest Election Request with respect to a Term Benchmark Borrowing in an Alternative Currency prior to the end of the Interest Period therefor, then, unless such Term Benchmark Borrowing is repaid as provided herein, the Borrower shall be deemed to have selected that such Term Benchmark Borrowing shall automatically be continued as a Term Benchmark Borrowing in its original Agreed Currency with an Interest Period of one month at the end of such Interest Period. Notwithstanding any contrary provision hereof, if an Event of Default has occurred and is continuing and the Administrative Agent, at the request of the Required Lenders, so notifies the Borrower, then, so long as an Event of Default is continuing (i) no outstanding Borrowing may be converted to or continued as a Term Benchmark Borrowing and (ii) unless repaid, (x) each Term Benchmark Borrowing denominated in Dollars shall be converted to an ABR Borrowing at the end of the Interest Period applicable thereto and (y) each Term Benchmark Borrowing denominated in an Alternative Currency shall bear interest at the Central Bank Rate for the applicable Agreed Currency plus the Applicable Rate for Term Benchmark Loans; provided that, if the Administrative Agent determines (which determination shall be conclusive and binding absent manifest error) that the Central Bank Rate for the applicable Agreed Currency cannot be determined, any outstanding affected Term Benchmark Loans denominated in any Agreed Currency other than Dollars shall either be (A) converted to an ABR Borrowing denominated in Dollars (in an amount equal to the Dollar Equivalent of such Alternative Currency) at the end of the Interest Period, as applicable, therefor or (B) prepaid at the end of the applicable Interest Period, as applicable, in full; provided that if no election is made by the Borrower by the earlier of (x) the date that is three Business Days after receipt by the Borrower of such notice and (y) the last day of the current Interest Period for the applicable Term Benchmark Loan, the Borrower shall be deemed to have elected clause (A) above.

 

 

Section 2.06         Termination and Reduction of Commitments.

 

(a)               Unless previously terminated, the Commitments shall terminate on the Maturity Date.

 

(b)               The Borrower may at any time terminate, or from time to time reduce, the Commitments; provided that (i) each reduction of the Commitments shall be in an amount that is an integral multiple of $1,000,000 and not less than $5,000,000 and (ii) the Borrower shall not terminate or reduce the Commitments if, after giving effect to any concurrent prepayment of the Loans in accordance with Section 2.08, the sum of the Dollar Equivalents of the Revolving Credit Exposures would exceed the total Commitments.

 

(c)               The Borrower shall notify the Administrative Agent of any election to terminate or reduce the Commitments under paragraph (b) of this Section at least three Business Days prior to the effective date of such termination or reduction, specifying such election and the effective date thereof. Promptly following receipt of any notice, the Administrative Agent shall advise the Lenders of the contents thereof. Each notice delivered by the Borrower pursuant to this Section shall be irrevocable; provided that a notice of termination of the Commitments delivered by the Borrower may state that such notice is conditioned upon the effectiveness of other credit facilities or another transaction, in which case such notice may be revoked by the Borrower (by notice to the Administrative Agent on or prior to the specified effective date) if such condition is not satisfied. Any termination or reduction of the Commitments shall be permanent. Each reduction of the Commitments shall be applied to the Lenders in accordance with their respective Applicable Percentages.

 

Section 2.07         Repayment of Loans; Evidence of Debt.

 

(a)               The Borrower hereby unconditionally promises to pay to the Administrative Agent for the account of each Lender the then unpaid principal amount of each Loan on the Maturity Date.

 

(b)               Each Lender shall maintain in accordance with its usual practice an account or accounts evidencing the indebtedness of the Borrower to such Lender resulting from each Loan made by such Lender, including the amounts of principal and interest payable and paid to such Lender from time to time hereunder.

 

(c)               The Administrative Agent shall maintain accounts in which it shall record (i) the amount of each Loan made hereunder, the Type thereof, the currency thereof and the Interest Period applicable thereto, (ii) the amount of any principal or interest due and payable or to become due and payable from the Borrower to each Lender hereunder and (iii) the amount of any sum received by the Administrative Agent hereunder for the account of the Lenders and each Lender’s share thereof.

 

 

(d)               The entries made in the accounts maintained pursuant to paragraph (b) or (c) of this Section shall be prima facie evidence of the existence and amounts of the obligations recorded therein (absent manifest error); provided that the failure of any Lender or the Administrative Agent to maintain such accounts or any error therein shall not in any manner affect the obligation of the Borrower to repay the Loans in accordance with the terms of this Agreement.

 

(e)               Any Lender may request that Loans made by it be evidenced by a promissory note (each such promissory note being called a “Note” and all such promissory notes being collectively called the “Notes”). In such event, the Borrower shall prepare, execute and deliver to such Lender a Note payable to such Lender (or, if requested by such Lender, to such Lender and its registered assigns) in substantially the form of Exhibit D attached hereto. Thereafter, the Loans evidenced by such Note and interest thereon shall at all times (including after assignment pursuant to Section 10.04) be represented by one or more promissory notes in such form payable to the payee named therein (or, if such promissory note is a registered note, to such payee and its registered assigns).

 

Section 2.08         Prepayment of Loans.

 

(a)               The Borrower shall have the right at any time and from time to time to prepay any Borrowing in whole or in part, without premium or penalty (subject to the requirements of Section 2.13), subject to prior notice in accordance with paragraph (b) of this Section.

 

(b)               The Borrower shall notify the Administrative Agent by telephone (confirmed by telecopy or delivery of written notice) or telecopy of any prepayment hereunder (i)(x) in the case of prepayment of a Term Benchmark Borrowing denominated in Dollars, not later than 12:00 noon, New York City time, three Business Days before the date of prepayment, (y) in the case of prepayment of a Term Benchmark Borrowing denominated in Euros, not later than 12:00 noon, New York City time, three Business Days before the date of prepayment and (z) in the case of prepayment of an RFR Borrowing denominated in Sterling, not later than 11:00 a.m., New York City time five Business Days before the date of prepayment or (ii) in the case of prepayment of an ABR Borrowing, not later than 12:00 noon, New York City time, one Business Day before the date of prepayment. Each such notice shall be irrevocable and shall specify the prepayment date and the principal amount of each Borrowing or portion thereof to be prepaid; provided that, if a notice of prepayment is given in connection with a conditional notice of termination of the Commitments as contemplated by Section 2.06, then such notice of prepayment may be revoked if such notice of termination is revoked in accordance with Section 2.06. Promptly following receipt of any such notice relating to a Borrowing, the Administrative Agent shall advise the Lenders of the contents thereof. Each partial prepayment of any Borrowing shall be in an amount that would be permitted in the case of an advance of a Borrowing of the same Type as provided in Section 2.02. Each prepayment of a Borrowing shall be applied ratably to the Loans of the Lenders in accordance with their respective Applicable Percentages. Prepayments shall be accompanied by accrued interest to the extent required by Section 2.10 and any costs incurred as contemplated by Section 2.13.

 

 

(c)               The Borrower shall from time to time prepay the Loans to the extent necessary so that the Dollar Equivalent of the aggregate principal amount of all outstanding Loans shall not at any time exceed the Commitments then in effect.

 

(d)               If at any time, (i) other than as a result of fluctuations in currency exchange rates, the Dollar Equivalent of the Lenders’ aggregate Revolving Credit Exposures (calculated, with respect to any Loans or LC Exposure denominated in an Alternative Currency, as of the most recent Revaluation Date with respect to such Loan or LC Exposure) exceeds the aggregate Commitments then in effect, or (ii) solely as a result of fluctuations in currency exchange rates, the Dollar Equivalent of the Lenders’ aggregate Revolving Credit Exposures (so calculated), as of the most recent Revaluation Date, exceeds one hundred ten percent (110%) of the aggregate Commitments then in effect, the Borrower shall immediately repay Borrowings and cash collateralize LC Exposure in accordance with the procedures set forth in Section 2.17(d) in an aggregate principal amount sufficient to cause the Dollar Equivalent of the Lenders’ aggregate Revolving Credit Exposures (so calculated) to be less than or equal to the aggregate Commitments then in effect.

 

Section 2.09        Fees.

 

(a)               The Borrower agrees to pay to the Administrative Agent for the account of each Lender (other than any Defaulting Lender) a commitment fee (the “Commitment Fee”), which shall accrue at the relevant percentage set forth in the row entitled “Commitment Fee” in the definition of “Applicable Rate” on the average daily amount of the unused Commitment of such Lender during the period from and including the Effective Date to but excluding the date on which such Commitment terminates. Accrued commitment fees shall be payable in arrears on the last day of March, June, September and December of each year and on the date on which the Commitments terminate, commencing on the first such date to occur after the Effective Date; provided that any commitment fees accruing after the date on which the Commitments terminate shall be payable on demand. All commitment fees shall be computed on the basis of a year of 360 days and shall be payable for the actual number of days elapsed (including the first day but excluding the last day).

 

(b)               The Borrower agrees to pay (i) to the Administrative Agent for the account of each Lender a participation fee with respect to its participations in Letters of Credit, which shall accrue at 2.75% per annum on the Dollar Equivalent of the average daily amount of such Lender’s LC Exposure (excluding any portion thereof attributable to unreimbursed LC Disbursements) during the period from and including the Effective Date to but excluding the later of the date on which such Lender’s Commitment terminates and the date on which such Lender ceases to have any LC Exposure, and (ii) to the applicable Issuing Bank a fronting fee, which shall accrue at the rate or rates per annum separately agreed upon between the Borrower and such Issuing Bank (but not to exceed 0.20% per annum) on the Dollar Equivalent of the average daily amount of the LC Exposure (excluding any portion thereof attributable to unreimbursed LC Disbursements) during the period from and including the Effective Date to but excluding the later of the date of termination of the Commitments and the date on which there ceases to be any LC Exposure, as well as such Issuing Bank’s standard fees with respect to the issuance, amendment, renewal or extension of any Letter of Credit or processing of drawings thereunder. Accrued participation fees and fronting fees shall be payable on the last day of March, June, September and December of each year, commencing on the first such date to occur after the Effective Date; provided that all such fees shall be payable on the date on which the Commitments terminate and any such fees accruing after the date on which the Commitments terminate shall be payable on demand. Any other fees payable to any Issuing Bank pursuant to this paragraph shall be payable within 10 days after demand. All participation fees and fronting fees shall be computed on the basis of a year of 360 days and shall be payable for the actual number of days elapsed (including the first day but excluding the last day).

 

 

(c)               The Borrower agrees to pay to the Administrative Agent, for its own account, fees payable in the amounts and at the times separately agreed upon between the Borrower and the Administrative Agent in the Fee Letter.

 

(d)               All fees payable hereunder shall be paid on the dates due, in immediately available funds, to the Administrative Agent (or to the applicable Issuing Bank, in the case of fees payable to it) for distribution, in the case of commitment fees and participation fees, to the Lenders. Fees paid shall not be refundable under any circumstances.

 

Section 2.10        Interest.

 

(a)               The Loans comprising each ABR Borrowing shall bear interest at the Alternate Base Rate plus the Applicable Rate.

 

(b)               The Loans comprising each Term Benchmark Borrowing shall bear interest at the Adjusted LIBO Rate, the Adjusted EURIBOR Rate, or the AUD Rate, as applicable, for the Interest Period in effect for such Borrowing plus the Applicable Rate.

 

(c)               Each RFR Loan shall bear interest at a rate per annum equal to the applicable Daily Simple RFR plus the Applicable Rate.

 

(d)               Notwithstanding the foregoing, at all times when an Event of Default listed in paragraph (a) or (b) of Section 7.01 has occurred hereunder and is continuing, all overdue amounts outstanding hereunder shall bear interest, after as well as before judgment, at a rate per annum equal to (i) in the case of overdue principal of any Loan, 2% plus the rate otherwise applicable to such Loan as provided in the preceding paragraphs of this Section or (ii) in the case of any other overdue amount, 2% plus the rate applicable to ABR Loans as provided in paragraph (a) of this Section.

 

(e)               Accrued interest on each Loan shall be payable in arrears on each Interest Payment Date for such Loan and upon termination of the Commitments; provided that (i) interest accrued pursuant to paragraph (d) of this Section shall be payable on demand, (ii) in the event of any repayment or prepayment of any Loan (other than a prepayment of an ABR Loan prior to the end of the Availability Period), accrued interest on the principal amount repaid or prepaid shall be payable on the date of such repayment or prepayment and (iii) in the event of any conversion of any Term Benchmark Loan prior to the end of the current Interest Period therefor, accrued interest on such Loan shall be payable on the effective date of such conversion.

 

(f)                Interest computed by reference to the LIBO Rate or the EURIBOR Rate hereunder shall be computed on the basis of a year of 360 days. Interest computed by reference to the Daily Simple RFR with respect to Sterling or the Alternate Base Rate at times when the Alternate Base Rate is based on the Prime Rate shall be computed on the basis of a year of 365 days (or 366 days in a leap year). Interest computed by reference to the AUD Rate shall be computed on the basis of a year of 365 days. In each case interest shall be payable for the actual number of days elapsed (including the first day but excluding the last day). All interest hereunder on any Loan shall be computed on a daily basis based upon the outstanding principal amount of such Loan as of the applicable date of determination. The applicable Alternate Base Rate, Adjusted LIBO Rate, LIBO Rate, Adjusted EURIBOR Rate, EURIBOR Rate, AUD Rate, or Daily Simple RFR shall be determined by the Administrative Agent, and such determination shall be conclusive absent manifest error.

 

 

 

Section 2.11        Alternate Rate of Interest. (a) Subject to clauses (b), (c), (d), (e), (f) and (g) of this Section 2.11, if:

 

(i)                 the Administrative Agent determines (which determination shall be conclusive absent manifest error) (A) prior to the commencement of any Interest Period for a Term Benchmark Borrowing, that adequate and reasonable means do not exist for ascertaining the Adjusted LIBO Rate, the LIBO Rate, the Adjusted EURIBOR Rate, the EURIBOR Rate or the AUD Rate, as applicable (including because the Relevant Screen Rate is not available or published on a current basis), for the applicable Agreed Currency and such Interest Period or (B) at any time, that adequate and reasonable means do not exist for ascertaining the applicable Daily Simple RFR or RFR for the applicable Agreed Currency; or

 

(ii)              the Administrative Agent is advised by the Required Lenders that (A) prior to the commencement of any Interest Period for a Term Benchmark Borrowing, the Adjusted LIBO Rate, the LIBO Rate, the Adjusted EURIBOR Rate, the EURIBOR Rate or the AUD Rate for the applicable Agreed Currency and such Interest Period will not adequately and fairly reflect the cost to such Lenders (or Lender) of making or maintaining their Loans (or its Loan) included in such Borrowing for the applicable Agreed Currency and such Interest Period or (B) at any time, the applicable Daily Simple RFR or RFR for the applicable Agreed Currency will not adequately and fairly reflect the cost to such Lenders (or Lender) of making or maintaining their Loans (or its Loan) included in such Borrowing for the applicable Agreed Currency;

 

 

then the Administrative Agent shall give notice thereof to the Borrower and the Lenders by telephone, telecopy or electronic mail as promptly as practicable thereafter and, until the Administrative Agent notifies the Borrower and the Lenders that the circumstances giving rise to such notice no longer exist, (A) any Interest Election Request that requests the conversion of any Borrowing to, or continuation of any Borrowing as, a Term Benchmark Borrowing shall be ineffective, (B) if any Borrowing Request requests a Term Benchmark Borrowing in Dollars, such Borrowing shall be made as an ABR Borrowing and (C) if any Borrowing Request requests a Term Benchmark Borrowing or an RFR Borrowing for the relevant rate above in an Alternative Currency, then such request shall be ineffective; provided that if the circumstances giving rise to such notice affect only one Type of Borrowings, then all other Types of Borrowings shall be permitted. Furthermore, if any Term Benchmark Loan or RFR Loan in any Agreed Currency is outstanding on the date of the Borrower’s receipt of the notice from the Administrative Agent referred to in this Section 2.11(i) with respect to a Relevant Rate applicable to such Term Benchmark Loan or RFR Loan, then until the Administrative Agent notifies the Borrower and the Lenders that the circumstances giving rise to such notice no longer exist, (i) if such Term Benchmark Loan is denominated in Dollars, then on the last day of the Interest Period applicable to such Loan (or the next succeeding Business Day if such day is not a Business Day), such Loan shall be converted by the Administrative Agent to, and shall constitute, an ABR Loan denominated in Dollars on such day, (ii) if such Term Benchmark Loan is denominated in any Agreed Currency other than Dollars, then such Loan shall, on the last day of the Interest Period applicable to such Loan (or the next succeeding Business Day if such day is not a Business Day) bear interest at the Central Bank Rate for the applicable Agreed Currency plus the Applicable Rate for Term Benchmark Loans; provided that, if the Administrative Agent determines (which determination shall be conclusive and binding absent manifest error) that the Central Bank Rate for the applicable Agreed Currency cannot be determined, any outstanding affected Term Benchmark Loans denominated in any Agreed Currency other than Dollars shall, at the Borrower’s election prior to such day: (A) be prepaid by the Borrower on such day or (B) solely for the purpose of calculating the interest rate applicable to such Term Benchmark Loan, such Term Benchmark Loan denominated in any Agreed Currency other than Dollars shall be deemed to be a Term Benchmark Loan denominated in Dollars and shall accrue interest at the same interest rate applicable to Term Benchmark Loans denominated in Dollars at such time or (iii) if such RFR Loan is denominated in any Agreed Currency other than Dollars, then such Loan shall bear interest at the Central Bank Rate for the applicable Agreed Currency plus the Applicable Rate for RFR Loans; provided that, if the Administrative Agent determines (which determination shall be conclusive and binding absent manifest error) that the Central Bank Rate for the applicable Agreed Currency cannot be determined, any outstanding affected RFR Loans denominated in any Agreed Currency other than Dollars, at the Borrower’s election, shall either (A) be converted into ABR Loans denominated in Dollars (in an amount equal to the Dollar Equivalent of such Alternative Currency) immediately or (B) be prepaid in full immediately.

 

(b)               Notwithstanding anything to the contrary herein or in any other Loan Document (and any Swap Agreement shall be deemed not to be a “Loan Document” for purposes of this Section 2.11(b)), if a Benchmark Transition Event, an Early Opt-in Election or an Other Benchmark Rate Election, as applicable, and its related Benchmark Replacement Date have occurred prior to the Reference Time in respect of any setting of the then-current Benchmark, then (x) if a Benchmark Replacement is determined in accordance with clause (1) or (2) of the definition of “Benchmark Replacement” with respect to Dollars for such Benchmark Replacement Date, such Benchmark Replacement will replace such Benchmark for all purposes hereunder and under any Loan Document in respect of such Benchmark setting and subsequent Benchmark settings without any amendment to, or further action or consent of any other party to, this Agreement or any other Loan Document and (y) if a Benchmark Replacement is determined in accordance with clause (3) of the definition of “Benchmark Replacement” with respect to any Agreed Currency for such Benchmark Replacement Date, such Benchmark Replacement will replace such Benchmark for all purposes hereunder and under any Loan Document in respect of any Benchmark setting at or after 5:00 p.m. (New York City time) on the fifth (5th) Business Day after the date notice of such Benchmark Replacement is provided to the Lenders without any amendment to, or further action or consent of any other party to, this Agreement or any other Loan Document so long as the Administrative Agent has not received, by such time, written notice of objection to such Benchmark Replacement from Lenders comprising the Required Lenders.

 

 

(c)               Notwithstanding anything to the contrary herein or in any other Loan Document and subject to the proviso below in this paragraph, with respect to a Loan denominated in Dollars, if a Term SOFR Transition Event and its related Benchmark Replacement Date have occurred prior to the Reference Time in respect of any setting of the then-current Benchmark, then the applicable Benchmark Replacement will replace the then-current Benchmark for all purposes hereunder or under any Loan Document in respect of such Benchmark setting and subsequent Benchmark settings, without any amendment to, or further action or consent of any other party to, this Agreement or any other Loan Document; provided that, this clause (c) shall not be effective unless the Administrative Agent has delivered to the Lenders and the Borrower a Term SOFR Notice. For the avoidance of doubt, the Administrative Agent shall not be required to deliver a Term SOFR Notice after the occurrence of a Term SOFR Transition Event and may do so in its sole discretion.

 

(d)               In connection with the implementation of a Benchmark Replacement, the Administrative Agent will have the right to make Benchmark Replacement Conforming Changes from time to time and, notwithstanding anything to the contrary herein or in any other Loan Document, any amendments implementing such Benchmark Replacement Conforming Changes will become effective without any further action or consent of any other party to this Agreement or any other Loan Document.

 

(e)               The Administrative Agent will promptly notify the Borrower and the Lenders of (i) any occurrence of a Benchmark Transition Event, an Early Opt-in Election or an Other Benchmark Rate Election, as applicable, (ii) the implementation of any Benchmark Replacement, (iii) the effectiveness of any Benchmark Replacement Conforming Changes, (iv) the removal or reinstatement of any tenor of a Benchmark pursuant to clause (f) below and (v) the commencement or conclusion of any Benchmark Unavailability Period. Any determination, decision or election that may be made by the Administrative Agent or, if applicable, any Lender (or group of Lenders) pursuant to this Section 2.11(e), including any determination with respect to a tenor, rate or adjustment or of the occurrence or non-occurrence of an event, circumstance or date and any decision to take or refrain from taking any action or any selection, will be conclusive and binding absent manifest error and may be made in its or their sole discretion and without consent from any other party to this Agreement or any other Loan Document, except, in each case, as expressly required pursuant to this Section 2.11(e).

 

(f)                Notwithstanding anything to the contrary herein or in any other Loan Document, at any time (including in connection with the implementation of a Benchmark Replacement), (i) if the then-current Benchmark is a term rate (including Term SOFR, LIBO Rate, EURIBOR Rate or AUD Rate) and either (A) any tenor for such Benchmark is not displayed on a screen or other information service that publishes such rate from time to time as selected by the Administrative Agent in its reasonable discretion or (B) the regulatory supervisor for the administrator of such Benchmark has provided a public statement or publication of information announcing that any tenor for such Benchmark is or will be no longer representative, then the Administrative Agent may modify the definition of “Interest Period” for any Benchmark settings at or after such time to remove such unavailable or non-representative tenor and (ii) if a tenor that was removed pursuant to clause (i) above either (A) is subsequently displayed on a screen or information service for a Benchmark (including a Benchmark Replacement) or (B) is not, or is no longer, subject to an announcement that it is or will no longer be representative for a Benchmark (including a Benchmark Replacement), then the Administrative Agent may modify the definition of “Interest Period” for all Benchmark settings at or after such time to reinstate such previously removed tenor.

 

 

(g)               Upon the Borrower’s receipt of notice of the commencement of a Benchmark Unavailability Period, the Borrower may revoke any request for a Term Benchmark Borrowing or RFR Borrowing of, conversion to or continuation of Term Benchmark Loans to be made, converted or continued during any Benchmark Unavailability Period and, failing that, either (x) the Borrower will be deemed to have converted any request for a Term Benchmark Borrowing denominated in Dollars into a request for a Borrowing of or conversion to ABR Loans or (y) any Term Benchmark Borrowing or RFR Borrowing denominated in an Alternative Currency shall be ineffective. During any Benchmark Unavailability Period or at any time that a tenor for the then-current Benchmark is not an Available Tenor, the component of ABR based upon the then-current Benchmark or such tenor for such Benchmark, as applicable, will not be used in any determination of ABR. Furthermore, if any Term Benchmark Loan or RFR Loan in any Agreed Currency is outstanding on the date of the Borrower’s receipt of notice of the commencement of a Benchmark Unavailability Period with respect to a Relevant Rate applicable to such Term Benchmark Loan or RFR Loan, then until such time as a Benchmark Replacement for such Agreed Currency is implemented pursuant to this Section 2.11(g), (i) if such Term Benchmark Loan is denominated in Dollars, then on the last day of the Interest Period applicable to such Loan (or the next succeeding Business Day if such day is not a Business Day), such Loan shall be converted by the Administrative Agent to, and shall constitute, an ABR Loan denominated in Dollars on such day, (ii) if such Term Benchmark Loan is denominated in any Agreed Currency other than Dollars, then such Loan shall, on the last day of the Interest Period applicable to such Loan (or the next succeeding Business Day if such day is not a Business Day) bear interest at the Central Bank Rate for the applicable Agreed Currency plus the Applicable Rate for Term Benchmark Loans; provided that, if the Administrative Agent determines (which determination shall be conclusive and binding absent manifest error) that the Central Bank Rate for the applicable Agreed Currency cannot be determined, any outstanding affected Term Benchmark Loans denominated in any Agreed Currency other than Dollars shall, at the Borrower’s election prior to such day: (A) be prepaid by the Borrower on such day or (B) solely for the purpose of calculating the interest rate applicable to such Term Benchmark Loan, such Term Benchmark Loan denominated in any Agreed Currency other than Dollars shall be deemed to be a Term Benchmark Loan denominated in Dollars and shall accrue interest at the same interest rate applicable to Term Benchmark Loans denominated in Dollars at such time or (iii) if such RFR Loan is denominated in any Agreed Currency other than Dollars, then such Loan shall bear interest at the Central Bank Rate for the applicable Agreed Currency plus the Applicable Rate for RFR Loans; provided that, if the Administrative Agent determines (which determination shall be conclusive and binding absent manifest error) that the Central Bank Rate for the applicable Agreed Currency cannot be determined, any outstanding affected RFR Loans denominated in any Agreed Currency, at the Borrower’s election, shall either (A) be converted into ABR Loans denominated in Dollars (in an amount equal to the Dollar Equivalent of such Alternative Currency) immediately or (B) be prepaid in full immediately.

 

 

Section 2.12        Increased Costs.

 

(a)               If any Change in Law shall:

 

(i)                 impose, modify or deem applicable any reserve, special deposit, compulsory loan, insurance charge or similar requirement against assets of, deposits with or for the account of, or credit extended by, any Lender (except any such reserve requirement reflected in the Adjusted LIBO Rate or Adjusted EURIBOR Rate) or any Issuing Bank;

 

(ii)              subject the Administrative Agent, any Issuing Bank, any Lender, the London or other applicable offshore interbank market for the applicable Agreed Currency or any other recipient of any payment to be made by or on account of any obligation of the Borrower hereunder, to any Taxes (other than (A) Indemnified Taxes, (B) Taxes described in clauses (b) through (d) of the definition of Excluded Taxes and (C) Connection Income Taxes) on its loans, loan principal, letters of credit, commitments, or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto; or

 

(iii)            impose on any Lender or Issuing Bank or the London interbank market any other condition, cost or expense (other than Indemnified Taxes and Excluded Taxes) affecting this Agreement or Term Benchmark Loans made by such Lender or any Letter of Credit or participation therein; and the result of any of the foregoing shall be to increase the cost to such Lender or Issuing Bank of making, continuing, converting to or maintaining any Loan (or of maintaining its obligation to make any such Loan) or to increase the cost to such Lender or Issuing Bank of participating in, issuing or maintaining any Letter of Credit or to reduce the amount of any sum received or receivable by such Lender or Issuing Bank hereunder (whether of principal, interest or otherwise), then the Borrower will pay to such Lender or Issuing Bank such additional amount or amounts as will compensate such Lender or Issuing Bank for such additional costs incurred or reduction suffered.

 

(b)               If any Lender or Issuing Bank determines that any Change in Law regarding capital or liquidity requirements has or would have the effect of reducing the rate of return on such Lender’s or Issuing Bank’s capital or on the capital of such Lender’s or Issuing Bank’s holding company, if any, as a consequence of this Agreement, the Commitments hereunder or the Loans made by, or participations in Letters of Credit held by, such Lender, or the Letters of Credit issued by such Issuing Bank, to a level below that which such Lender or such Issuing Bank or such Lender’s or such Issuing Bank’s holding company would have achieved but for such Change in Law (taking into consideration such Lender’s or Issuing Bank’s policies and the policies of such Lender’s or Issuing Bank’s holding company with respect to capital adequacy or liquidity), then from time to time the Borrower will pay to such Lender or Issuing Bank such additional amount or amounts as will compensate such Lender or Issuing Bank or such Lender’s or Issuing Bank’s holding company for any such reduction suffered.

 

(c)               A certificate of a Lender or Issuing Bank setting forth in reasonable detail the amount or amounts necessary to compensate such Lender or Issuing Bank or its holding company, as the case may be, as specified in paragraph (a) or (b) of this Section shall be delivered to the Borrower and shall be conclusive absent manifest error. The Borrower shall pay such Lender or Issuing Bank the amount shown as due on any such certificate within 10 days after receipt thereof.

 

 

(d)               Failure or delay on the part of any Lender or Issuing Bank to demand compensation pursuant to this Section shall not constitute a waiver of such Lender’s or Issuing Bank’s right to demand such compensation; provided that the Borrower shall not be required to compensate a Lender or Issuing Bank pursuant to this Section for any increased costs or reductions incurred more than 180 days prior to the date that such Lender or Issuing Bank notifies the Borrower of the Change in Law giving rise to such increased costs or reductions and of such Lender’s or Issuing Bank’s intention to claim compensation therefore; provided further that, if the Change in Law giving rise to such increased costs or reductions is retroactive (or has retroactive effect), then the 180-day period referred to above shall be extended to include the period of retroactive effect thereof.

 

(e)               Notwithstanding the foregoing, increased costs due to a Change in Law resulting from the Dodd-Frank Wall Street Reform and Consumer Protection Act and Basel III may only be requested by a Lender imposing such increased costs on borrowers similarly situated to the Borrower under syndicated credit facilities comparable to those provided hereunder.

 

Section 2.13        Break Funding Payments. (a) With respect to Loans that are not RFR Loans, in the event of (i) the payment or prepayment of any principal of any Term Benchmark Loan other than on the last day of an Interest Period applicable thereto (whether voluntary, mandatory, automatic, by reason of acceleration, or otherwise), (ii) the conversion of any Term Benchmark Loan other than on the last day of the Interest Period applicable thereto, (iii) the failure to borrow, convert, continue or prepay any Term Benchmark Loan on the date specified in any notice delivered pursuant hereto (regardless of whether such notice may be revoked under Section 2.08(b) and is revoked in accordance therewith), (iv) the assignment of any Term Benchmark Loan other than on the last day of the Interest Period applicable thereto as a result of a request by the Borrower pursuant to Section 2.16 or (v) the failure by the Borrower to make any payment of any Loan or drawing under any Letter of Credit (or interest due thereof) denominated in an Alternative Currency on its scheduled due date or any payment thereof in a different currency, then, in any such event, the Borrower shall compensate each Lender for the loss, cost and expense attributable to such event. In the case of a Term Benchmark Loan, such loss, cost or expense to any Lender shall be deemed to include an amount determined by such Lender to be the excess, if any, of (i) the amount of interest which would have accrued on the principal amount of such Loan had such event not occurred, at the Adjusted LIBO Rate or the Adjusted EURIBOR Rate, as applicable, that would have been applicable to such Loan, for the period from the date of such event to the last day of the then current Interest Period therefor (or, in the case of a failure to borrow, convert or continue, for the period that would have been the Interest Period for such Loan), over (ii) the amount of interest which would accrue on such principal amount for such period at the interest rate which such Lender would bid were it to bid, at the commencement of such period, for deposits in the applicable Agreed Currency of a comparable amount and period from other banks in the applicable offshore interbank market for such Agreed Currency. A certificate of any Lender setting forth in reasonable detail any amount or amounts that such Lender is entitled to receive pursuant to this Section shall be delivered to the Borrower and shall be conclusive absent manifest error. The Borrower shall pay such Lender the amount shown as due on any such certificate within 10 days after receipt thereof.

 

 

(b)               With respect to RFR Loans, in the event of (i) the payment of any principal of any RFR Loan other than on the Interest Payment Date applicable thereto (including as a result of an Event of Default or an optional or mandatory prepayment of Loans), (ii) the failure to borrow or prepay any RFR Loan on the date specified in any notice delivered pursuant hereto (regardless of whether such notice may be revoked under Section 2.08(b) and is revoked in accordance therewith), (iii) the assignment of any RFR Loan other than on the Interest Payment Date applicable thereto as a result of a request by the Borrower pursuant to Section 2.16 or (iv) the failure by the Borrower to make any payment of any Loan or drawing under any Letter of Credit (or interest due thereof) denominated in an Alternative Currency on its scheduled due date or any payment thereof in a different currency, then, in any such event, the Borrower shall compensate each Lender for the loss, cost and expense attributable to such event. A certificate of any Lender setting forth any amount or amounts that such Lender is entitled to receive pursuant to this Section shall be delivered to the Borrower and shall be conclusive absent manifest error. The Borrower shall pay such Lender the amount shown as due on any such certificate within 10 days after receipt thereof.

 

Section 2.14        Taxes.

 

(a)               Any and all payments by or on account of any obligation of any Loan Party under any Loan Document shall be made free and clear of and without deduction or withholding for any Taxes, except as required by law. If any applicable law (as determined in the good faith discretion of an applicable Withholding Agent) requires the deduction or withholding of any Tax from any such payment by a Withholding Agent, then the applicable Withholding Agent shall make such deduction or withholding and timely pay the full amount deducted or withheld to the relevant Governmental Authority in accordance with applicable law and, if such Tax is an Indemnified Tax, then the sum payable by the Borrower shall be increased as necessary (or, where the Indemnified Tax is a Tax imposed by Australia, the applicable Withholding Agent shall pay an additional amount to the Administrative Agent, Issuing Bank or Lender (as the case may be)) so that after making such deduction or withholding for Indemnified Taxes (including such deductions and withholdings for Indemnified Taxes applicable to additional sums payable under this Section) the Administrative Agent, Issuing Bank or Lender (as the case may be) receives an amount equal to the sum it would have received had no such deduction or withholding for Indemnified Taxes been made.

 

(b)               In addition, the Loan Parties shall timely pay any Other Taxes to the relevant Governmental Authority in accordance with applicable law.

 

(c)               The Loan Parties shall jointly and severally indemnify the Administrative Agent, each Issuing Bank and each Lender, within 10 days after demand therefor, for the full amount of any Indemnified Taxes paid by the Administrative Agent, such Issuing Bank or such Lender, as the case may be, or required to be withheld or deducted from any payment to such recipient by or on account of any obligation of the Borrower hereunder (including Indemnified Taxes imposed or asserted on or attributable to amounts payable under this Section) and reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to the Borrower by an Issuing Bank or a Lender (with a copy to the Administrative Agent), or by the Administrative Agent on its own behalf or on behalf of an Issuing Bank or a Lender, shall be conclusive absent manifest error.

 

 

(d)               Each Lender shall severally indemnify the Administrative Agent, within 10 days after demand therefor, for (i) any Indemnified Taxes attributable to such Lender (but only to the extent that the Loan Parties have not already indemnified the Administrative Agent for such Indemnified Taxes and without limiting the obligation of the Borrower to do so), (ii) any Taxes attributable to such Lender’s failure to comply with the provisions of Section 10.04 relating to the maintenance of a Participant Register and (iii) any Excluded Taxes attributable to such Lender, in each case, that are paid by the Administrative Agent in connection with any Loan Document, and any reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to any Lender by the Administrative Agent shall be conclusive absent manifest error. Each Lender hereby authorizes the Administrative Agent to set off and apply any and all amounts at any time owing to such Lender under any Loan Document or otherwise payable by the Administrative Agent to the Lender from any other source against any amount due to the Administrative Agent under this paragraph (d).

 

(e)               As soon as practicable after any payment of Taxes by any Loan Party to a Governmental Authority, such Loan Party shall deliver to the Administrative Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Administrative Agent.

 

(f)                Any Foreign Lender, if it is legally entitled to do so, shall deliver to the Borrower and the Administrative Agent (in such number of copies as shall be required by law or requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter as required by law or upon the reasonable request of the Borrower or the Administrative Agent, but only if such Foreign Lender is legally entitled to do so), whichever of the following is applicable:

 

(i)                 executed originals of IRS Form W-8BEN or IRS Form W-8BEN-E, as applicable, claiming eligibility for benefits of an income tax treaty to which the United States of America is a party;

 

(ii)              executed originals of IRS Form W-8ECI;

 

(iii)            in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under Section 881(c) of the Code, (x) a certificate to the effect that such Foreign Lender is not (A) a “bank” within the meaning of Section 881(c)(3)(A) of the Code, (B) a “10 percent shareholder” of the Borrower within the meaning of Section 881(c)(3)(B) of the Code, or (C) a “controlled foreign corporation” described in Section 881(c)(3)(C) of the Code and (y) executed originals of IRS Form W-8BEN or IRS Form W-8BEN-E, as applicable;

 

(iv)             to the extent a Foreign Lender is not the beneficial owner, executed originals of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN, IRS Form W-8BEN-E, a portfolio interest certificate in compliance with Section 2.14(f)(iii), IRS Form W-9, and/or other certification documents from each beneficial owner, as applicable; provided that if the Foreign Lender is a partnership and one or more direct or indirect partners of such Foreign Lender are claiming the portfolio interest exemption, such Foreign Lender may provide a certificate in compliance with Section 2.14(f)(iii) on behalf of such direct or indirect partner or partners; or

 

 

(v)               any other form prescribed by applicable law as a basis for claiming exemption from or a reduction in U.S. federal withholding tax duly completed together with such supplementary documentation as may be prescribed by applicable law to permit the Borrower to determine the withholding or deduction required to be made unless, in the Foreign Lender’s reasonable determination, such completion would subject such Foreign Lender to any material cost or expense or would materially prejudice the legal or commercial position of such Foreign Lender.

 

In addition, any Lender that is a U.S. Person shall deliver to the Borrower and the Administrative Agent on or prior to the date on which such Lender becomes a Lender under this Agreement (and from time to time thereafter as required by law or upon the reasonable request of the Borrower or the Administrative Agent), executed originals of IRS Form W-9 certifying that such Lender is exempt from U.S. federal backup withholding. In addition, each Lender shall deliver such forms (including those forms required pursuant to Section 2.14(g)) promptly upon the obsolescence or invalidity of any form previously delivered by such Lender or promptly notify the Borrower and the Administrative Agent in writing of its legal inability to do so.

 

In addition, the Administrative Agent shall deliver to the Borrower on or prior to the date on which the Administrative Agent becomes the Administrative Agent under this Agreement (and from time to time thereafter as required by law or upon the reasonable request of the Borrower), an executed original of IRS Form W-9 certifying that such Administrative Agent is exempt from U.S. federal backup withholding.

 

(g)               If a payment made to a Lender under any Loan Document would be subject to U.S. federal withholding Tax imposed by FATCA if such Lender failed to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall deliver to the Borrower and the Administrative Agent at the time or times prescribed by law and at such time or times reasonably requested by the Borrower or the Administrative Agent such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such other documentation reasonably requested by the Borrower and the Administrative Agent sufficient for the Administrative Agent and the Borrower to comply with their obligations under FATCA and to determine that such Lender has complied with such Lender’s obligations under FATCA or to determine the amount to deduct and withhold from such payment. Solely for purposes of this Section 2.14(g), “FATCA” shall include any amendments made to FATCA after the date of this Agreement.

 

(h)               If any party determines, in its sole discretion exercised in good faith, that it has received a refund of any Taxes as to which it has been indemnified pursuant to this Section (including by the payment of additional amounts pursuant to this Section), it shall pay to the indemnifying party an amount equal to such refund (but only to the extent of indemnity payments made under this Section with respect to the Taxes giving rise to such refund), net of all out-of-pocket expenses (including Taxes) of such indemnified party and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund). Such indemnifying party, upon the request of such indemnified party, shall repay to such indemnified party the amount paid over pursuant to this paragraph (h) (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) in the event that such indemnified party is required to repay such refund to such Governmental Authority. Notwithstanding anything to the contrary in this paragraph (h), in no event will the indemnified party be required to pay any amount to an indemnifying party pursuant to this paragraph (h), the payment of which would place the indemnified party in a less favorable net after-Tax position than the indemnified party would have been in if the Tax subject to indemnification and giving rise to such refund had not been deducted, withheld or otherwise imposed and the indemnification payments or additional amounts with respect to such Tax had never been paid. This paragraph shall not be construed to require any indemnified party to make available its Tax returns (or any other information relating to its Taxes that it deems confidential) to the indemnifying party or any other Person.

 

 

(i)                 Indirect Tax.

 

(i)                 All payments to be made by a Loan Party under or in connection with any Loan Document have been calculated without regard to Indirect Tax. If all or part of any such payment is the consideration for a taxable supply or chargeable without Indirect Tax then, when the Loan Party makes the payment: (a) it must pay to the Administrative Agent, Issuing Bank or Lender (as the case may be) an additional amount equal to that payment (or part) multiplied by the appropriate rate of Indirect Tax; and (b) the Administrative Agent, Issuing Bank or Lender (as the case may be) will promptly provide to the Loan Party a tax invoice complying with the relevant law relating to that Indirect Tax.

 

(ii)              Where a Loan Document requires a Loan Party to reimburse or indemnify the Administrative Agent, an Issuing Bank or a Lender (as the case may be) for any costs or expenses, that Loan Party shall also at the same time pay and indemnify that Administrative Agent, Issuing Bank or Lender against all Indirect Tax incurred by that Administrative Agent, Issuing Bank or Lender in respect of the costs or expenses save to the extent that that Administrative Agent, Issuing Bank or Lender is entitled to repayment or credit in respect of the Indirect Tax. The Administrative Agent, Issuing Bank or Lender (as the case may be) will promptly provide to the Loan Party a tax invoice complying with the relevant law relating to that Indirect Tax.

 

(j)                 Each party’s obligations under this Section 2.14 shall survive the resignation or replacement of the Administrative Agent or any assignment of rights by, or the replacement of, a Lender, the termination of the Commitments and the repayment, satisfaction or discharge of all obligations under any Loan Document.

 

(k)               For purposes of this Section, the term “Lender” includes any Issuing Bank and the term applicable law includes FATCA.

 

 

Section 2.15        Payments Generally; Pro Rata Treatment; Sharing of Set-offs.

 

(a)               (i) Except with respect to principal of and interest on Loans denominated in an Alternative Currency, the Borrower shall make each payment required to be made by it hereunder (whether of principal, interest, fees or reimbursement of LC Disbursements, or of amounts payable under Sections 2.12, 2.13 or 2.14, or otherwise) in Dollars prior to 12:00 noon, Local Time, on the date when due and (ii) all payments with respect to principal and interest on Loans denominated in an Alternative Currency shall be made in such Alternative Currency not later than the Local Time specified by the Administrative Agent on the dates specified herein, in each case, in immediately available funds, without setoff, recoupment or counterclaim. Any amounts received after such time on any date may, in the discretion of the Administrative Agent, be deemed to have been received on the next succeeding Business Day for purposes of calculating interest thereon. All such payments shall be made to the Administrative Agent (i) in the case of payments denominated in Dollars, at its Principal Office and (ii) in the case of payments denominated in an Alternative Currency, at its Alternative Currency Payment Office for such Alternative Currency; provided that payments pursuant to Sections 2.12, 2.13 or 2.14 and Section 10.03 shall be made directly to the Persons entitled thereto. The Administrative Agent shall distribute any such payments received by it for the account of any other Person to the appropriate recipient promptly following receipt thereof. If any payment or performance hereunder shall be due on a day that is not a Business Day, the date for payment or performance shall be extended to the next succeeding Business Day, and, in the case of any payment accruing interest, interest thereon shall be payable for the period of such extension. All payments hereunder of principal or interest in respect of any Loan or LC Disbursement shall, except as otherwise expressly provided herein, be made in the currency of such Loan or LC Disbursement, and all other payments hereunder and under each other Loan Document shall be made in Dollars. Notwithstanding the foregoing provisions of this Section, if, after the making of any Loan or LC Disbursement in any Alternative Currency, currency control or exchange regulations are imposed in the country which issues such Alternative Currency with the result that such Alternative Currency no longer exists or the Borrower is not able to make payment to the Administrative Agent for the account of the Lenders in such Alternative Currency, then all payments to be made by the Borrower hereunder in such Alternative Currency shall instead be made when due in a currency that replaced such Alternative Currency or, if no such replacement currency exists, in Dollars in an amount equal to the Dollar Equivalent (as of the date of repayment) of such payment due, it being the intention of the parties hereto that the Borrower takes all risks of the imposition of any such currency control or exchange regulations.

 

(b)               If at any time insufficient funds are received by and available to the Administrative Agent to pay fully all amounts of principal, unreimbursed LC Disbursements, interest and fees then due hereunder, such funds shall (subject to the provisions of Section 10.21) be applied (i) first, towards payment of interest and fees then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of interest and fees then due to such parties, and (ii) second, towards payment of principal and unreimbursed LC Disbursements then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of principal and unreimbursed LC Disbursements then due to such parties.

 

 

(c)               Subject to the provisions of Section 10.21, if any Lender shall, by exercising any right of set off or counterclaim or otherwise, obtain payment in respect of any principal of or interest on any of its Loans or participations in LC Disbursements resulting in such Lender receiving payment of a greater proportion of the aggregate amount of its Loans and participations in LC Disbursements and accrued interest thereon than the proportion received by any other Lender, then the Lender receiving such greater proportion shall purchase (for cash at face value) participations in the Loans and participations in LC Disbursements of other Lenders to the extent necessary so that the benefit of all such payments shall be shared by the Lenders ratably in accordance with the aggregate amount of principal of and accrued interest on their respective Loans and participations in LC Disbursements; provided that (i) if any such participations are purchased and all or any portion of the payment giving rise thereto is recovered, such participations shall be rescinded and the purchase price restored to the extent of such recovery, without interest, and (ii) the provisions of this paragraph shall not be construed to apply to any payment made by the Borrower pursuant to and in accordance with the express terms of this Agreement (including the application of funds arising from the existence of a Defaulting Lender) or any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Loans or participations in LC Disbursements to any assignee or participant, other than to the Borrower or any Subsidiary or Affiliate thereof (as to which the provisions of this paragraph shall apply). The Borrower consents to the foregoing and agrees, to the extent it may effectively do so under applicable law, that any Lender acquiring a participation pursuant to the foregoing arrangements may exercise against the Borrower rights of set-off and counterclaim with respect to such participation as fully as if such Lender were a direct creditor of the Borrower in the amount of such participation.

 

(d)               Unless the Administrative Agent shall have received notice from the Borrower prior to the date on which any payment is due to the Administrative Agent for the account of the Lenders or the applicable Issuing Bank hereunder that the Borrower will not make such payment, the Administrative Agent may assume that the Borrower has made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to the Lenders the amount due. In such event, if the Borrower has not in fact made such payment, then each of the Lenders or the applicable Issuing Bank, as the case may be, severally agrees to repay to the Administrative Agent forthwith on demand the amount so distributed to such Lender or Issuing Bank with interest thereon, for each day from and including the date such amount is distributed to it to but excluding the date of payment to the Administrative Agent, at the greater of the Federal Funds Effective Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation.

 

(e)               If any Lender shall fail to make any payment required to be made by it pursuant to Section 2.04(b), paragraph (d) or (e) of Section 2.19, or paragraph (d) of this Section, then the Administrative Agent may, in its discretion (notwithstanding any contrary provision hereof), apply any amounts thereafter received by the Administrative Agent for the account of such Lender to satisfy such Lender’s obligations under such Sections until all such unsatisfied obligations are fully paid.

 

Section 2.16        Mitigation Obligations; Replacement of Lenders.

 

(a)               If any Lender requests compensation under Section 2.12, or if the Borrower is required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.14, then such Lender shall use reasonable efforts to designate a different lending office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section 2.12 or Section 2.14, as the case may be, in the future and (ii) would not subject such Lender to any unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender. The Borrower hereby agrees to pay all reasonable costs and expenses incurred by any Lender in connection with any such designation or assignment.

 

 

(b)               If (i) any Lender requests compensation under Section 2.12, (ii) the Borrower is required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.14 or (iii) any Lender is a Defaulting Lender or a Non-Consenting Lender, then the Borrower may, at its sole expense and effort, upon notice to such Lender and the Administrative Agent, require such Lender to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in Section 10.04), all its interests, rights and obligations under this Agreement and the other Loan Documents to an assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment); provided that (i) the Borrower shall have received the prior written consent of the Administrative Agent (and if a Commitment is being assigned, the Issuing Banks), which consent shall not unreasonably be withheld, (ii) such Lender shall have received payment of an amount equal to the outstanding principal of its Loans and participations in LC Disbursements, accrued interest thereon, accrued fees and all other amounts payable to it hereunder and under the other Loan Documents, from the assignee (to the extent of such outstanding principal and accrued interest and fees so assigned) or the Borrower (in the case of all other amounts so assigned), (iii) in the case of any such assignment resulting from a claim for compensation under Section 2.12 or payments required to be made pursuant to Section 2.14, such assignment will result in a reduction in such compensation or payments, (iv) such assignment does not conflict with applicable law and (v) in the case of any assignment resulting from a Lender becoming a Non-Consenting Lender, (x) the applicable assignee shall have consented to, or shall consent to, the applicable amendment, waiver or consent and (y) the Borrower exercises its rights pursuant to this clause (b) with respect to all Non-Consenting Lenders relating to the applicable amendment, waiver or consent; provided, further, that in the event such Lender shall have received payment of the amount referred to in clause (ii) above, such Lender shall be deemed to have so assigned and delegated all its interests, rights and obligations under this Agreement and the other Loan Documents pursuant to the terms set forth in Exhibit A hereto. A Lender shall not be required to make any such assignment or delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling the Borrower to require such assignment and delegation cease to apply.

 

Section 2.17        Defaulting Lenders/Subordinated Lender.

 

(a)               Notwithstanding anything to the contrary contained in this Agreement, if any Lender becomes a Defaulting Lender, then, until such time as such Lender is no longer a Defaulting Lender, to the extent permitted by applicable law:

 

(i)                 Such Defaulting Lender’s right to approve or disapprove any amendment, waiver or consent with respect to this Agreement shall be restricted as set forth in the definition of Required Lenders and in Section 10.02.

 

 

(ii)              Any payment of principal, interest, fees or other amounts received by the Administrative Agent for the account of such Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to Article 7 or otherwise) or received by the Administrative Agent from a Defaulting Lender pursuant to Section 10.08 shall be applied at such time or times as may be determined by the Administrative Agent as follows: first, to the payment of any amounts owing by such Defaulting Lender to the Administrative Agent hereunder; second, to the payment on a pro rata basis of any amounts owing by such Defaulting Lender to the Issuing Banks hereunder; third, to Cash Collateralize each Issuing Bank’s Fronting Exposure with respect to such Defaulting Lender in accordance with Section 2.17(d); fourth, as the Borrower may request (so long as no Default or Event of Default exists), to the funding of any Loan in respect of which such Defaulting Lender has failed to fund its portion thereof as required by this Agreement, as determined by the Administrative Agent; fifth, if so determined by the Administrative Agent and the Borrower, to be held in a non-interest bearing deposit account and released pro rata in order to (x) satisfy such Defaulting Lender’s potential future funding obligations with respect to Loans under this Agreement and (y) Cash Collateralize each Issuing Bank’s future Fronting Exposure with respect to such Defaulting Lender with respect to future Letters of Credit issued under this Agreement, in accordance with Section 2.17(d); sixth, to the payment of any amounts owing to the Lenders or the Issuing Banks as a result of any judgment of a court of competent jurisdiction obtained by any Lender or any Issuing Bank against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement; seventh, so long as no Default or Event of Default exists, to the payment of any amounts owing to the Borrower as a result of any judgment of a court of competent jurisdiction obtained by the Borrower against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement; and eighth, to such Defaulting Lender or as otherwise directed by a court of competent jurisdiction; provided that if (x) such payment is a payment of the principal amount of any Loans or reimbursement obligations with respect to Letters of Credit in respect of which such Defaulting Lender has not fully funded its appropriate share, and (y) such Loans were made or the related Letters of Credit were issued at a time when the conditions set forth in Section 4.02 were satisfied or waived, such payment shall be applied solely to pay the Loans of, and reimbursement obligations with respect to Letters of Credit owed to, all Non-Defaulting Lenders on a pro rata basis prior to being applied to the payment of any Loans of, or reimbursement obligations with respect to Letters of Credit owed to, such Defaulting Lender until such time as all Loans and funded and unfunded participations in Letters of Credit are held by the Lenders pro rata in accordance with the Commitments without giving effect to Section 2.17(a)(iv). Any payments, prepayments or other amounts paid or payable to a Defaulting Lender that are applied (or held) to pay amounts owed by a Defaulting Lender or to post Cash Collateral pursuant to this Section 2.17(a)(ii) shall be deemed paid to and redirected by such Defaulting Lender, and each Lender irrevocably consents hereto.

 

(iii)            (A) No Defaulting Lender shall be entitled to receive any commitment fee pursuant to Section 2.09(a) or participation fees pursuant to Section 2.09(b)(i) for any period during which that Lender is a Defaulting Lender (and the Borrower shall not be required to pay any such fee that otherwise would have been required to have been paid to that Defaulting Lender); provided that such Defaulting Lender shall be entitled to receive participation fees pursuant to Section 2.09(b)(i) for any period during which that Lender is a Defaulting Lender only to extent allocable to its Applicable Percentage of the stated amount of Letters of Credit for which it has provided Cash Collateral pursuant to Section 2.17(d); and (B) with respect to any fees not required to be paid to any Defaulting Lender pursuant to clause (A) above, the Borrower shall (x) pay to each Non-Defaulting Lender that portion of any such fee otherwise payable to such Defaulting Lender with respect to such Defaulting Lender’s participation in Letters of Credit that has been reallocated to such Non-Defaulting Lender pursuant to clause (iv) below, (y) pay to each Issuing Bank the amount of any such fee otherwise payable to such Defaulting Lender to the extent allocable to such Issuing Bank’s Fronting Exposure to such Defaulting Lender, and (z) not be required to pay the remaining amount of any such fee.

 

 

(iv)             So long as no Event of Default shall have occurred and be continuing, all or any part of such Defaulting Lender’s participation in Letters of Credit shall be reallocated among the Non-Defaulting Lenders in accordance with their respective Applicable Percentages (calculated without regard to such Defaulting Lender’s Commitment) but only to the extent that such reallocation does not cause the Dollar Equivalent of the aggregate Revolving Credit Exposure of any Non-Defaulting Lender to exceed such Non-Defaulting Lender’s Commitment. Subject to Section 10.19, no reallocation hereunder shall constitute a waiver or release of any claim of any party hereunder against a Defaulting Lender arising from that Lender having become a Defaulting Lender, including any claim of a Non-Defaulting Lender as a result of such Non-Defaulting Lender’s increased exposure following such reallocation.

 

(v)               If the reallocation described in clause (iv) above cannot, or can only partially, be effected, the Borrower shall, without prejudice to any right or remedy available to it hereunder or under law, Cash Collateralize each Issuing Bank’s Fronting Exposure in accordance with the procedures set forth in Section 2.17(d).

 

(b)               If the Borrower, the Administrative Agent and each Issuing Bank agree in writing that a Lender is no longer a Defaulting Lender, the Administrative Agent will so notify the parties hereto, whereupon as of the effective date specified in such notice and subject to any conditions set forth therein (which may include arrangements with respect to any Cash Collateral), that Lender will, to the extent applicable, purchase at par that portion of outstanding Loans of the other Lenders or take such other actions as the Administrative Agent may determine to be necessary to cause the Loans and funded and unfunded participations in Letters of Credit to be held on a pro rata basis by the Lenders in accordance with their respective Applicable Percentages (without giving effect to Section 2.17(a)(iv)), whereupon such Lender will cease to be a Defaulting Lender; provided that no adjustments will be made retroactively with respect to fees accrued or payments made by or on behalf of the Borrower while that Lender was a Defaulting Lender; and provided, further, that except to the extent otherwise expressly agreed by the affected parties, no change hereunder from Defaulting Lender to Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender.

 

(c)               So long as any Lender is a Defaulting Lender, each Issuing Bank shall not be required to issue, extend, renew or increase any Letter of Credit unless it is satisfied that the participations in any then existing Letters of Credit as well as the new, extended, renewed or increased Letter of Credit has been or will be fully allocated among the Non-Defaulting Lenders in a manner consistent with clause (a)(iv) above and such Defaulting Lender shall not participate therein except to the extent such Defaulting Lender’s participation has been or will be fully Cash Collateralized in accordance with Section 2.17(d).

 

 

(d)               At any time that there shall exist a Defaulting Lender, within one Business Day following the written request of the Administrative Agent or any Issuing Bank (with a copy to the Administrative Agent), the Borrower shall Cash Collateralize such Issuing Bank’s Fronting Exposure with respect to such Defaulting Lender (determined after giving effect to Section 2.17(a)(iv) and any Cash Collateral provided by such Defaulting Lender) in an amount not less than the Minimum Collateral Amount.

 

(i)                 The Borrower, and to the extent provided by any Defaulting Lender, such Defaulting Lender, hereby grants to the Administrative Agent, for the benefit of the Issuing Banks, and agrees to maintain, a first priority security interest in all such Cash Collateral as security for the Defaulting Lenders’ obligation to fund participations in respect of Letters of Credit, to be applied pursuant to clause (ii) below. If at any time the Administrative Agent determines that Cash Collateral is subject to any right or claim of any Person other than the Administrative Agent and the Issuing Banks as herein provided, or that the total amount of such Cash Collateral is less than the Minimum Collateral Amount, the Borrower will, promptly upon demand by the Administrative Agent, pay or provide to the Administrative Agent additional Cash Collateral in an amount sufficient to eliminate such deficiency (after giving effect to any Cash Collateral provided by the Defaulting Lender).

 

(ii)              Notwithstanding anything to the contrary contained in this Agreement, Cash Collateral provided under this Section 2.17 in respect of Letters of Credit shall be applied to the satisfaction of the Defaulting Lender’s obligation to fund participations in respect of Letters of Credit (including, as to Cash Collateral provided by a Defaulting Lender, any interest accrued on such obligation) for which the Cash Collateral was so provided, prior to any other application of such property as may otherwise be provided for herein.

 

(iii)            Cash Collateral (or the appropriate portion thereof) provided to reduce each Issuing Bank’s Fronting Exposure shall no longer be required to be held as Cash Collateral pursuant to this Section 2.17 following (i) the elimination of the applicable Fronting Exposure (including by the termination of Defaulting Lender status of the applicable Lender) or (ii) the determination by the Administrative Agent and such Issuing Bank that there exists excess Cash Collateral; provided that, subject to the other provisions of this Section 2.17, the Person providing Cash Collateral and such Issuing Bank may agree that Cash Collateral shall be held to support future anticipated Fronting Exposure or other obligations.

 

(e)               [Each Subordinated Lender agrees that to the extent and for so long as its Commitment, participation in any Loan or subparticipation or other agreement or arrangement relating to a Commitment, including, without limitation, following a Debt Purchase Transaction, could result in the subordination of claims of any other Lender under the Loans pursuant to any law regarding the subordination of shareholder loans or prejudice or adversely affect the Collateral or guarantee and indemnity pursuant to [●] (or their enforceability) in any way, the relevant Subordinated Lender shall not be a secured or guaranteed party (however described) under and for the purposes of any Loan Document and no amount owing to it under any Loan Document shall be secured by the Security Documents (unless the subordination ceases to apply or subsequently or at the same time applies to the Lenders generally (other than where such subordination of the Lenders generally is caused by a Debt Purchase Transaction by a Subordinated Lender)).]

 

 

Section 2.18        Incremental Facility.

 

(a)               The Borrower may by written notice to the Administrative Agent elect to request prior to the Maturity Date, one or more increases to the existing Commitments (any such increase, the “New Commitments”), in Dollars or an Alternative Currency, by an amount not in excess of the Incremental Amount in the aggregate and not less than $5,000,000 individually (or such lesser amount which shall be approved by the Administrative Agent or such lesser amount that shall constitute the difference between the Incremental Amount and all such New Commitments obtained prior to such date), and integral multiples of $1,000,000 in excess of that amount. Each such notice shall specify (A) the date (each, an “Increased Amount Date”) on which the Borrower proposes that the New Commitments shall be effective, which shall be a date not less than 5 Business Days after the date on which such notice is delivered to the Administrative Agent (unless otherwise agreed by the Administrative Agent in its sole discretion), (B) the proposed currency denomination and the requested amount of the New Commitment, and (C) the identity of each Lender or other Person that is an eligible assignee under Section 10.04(b), subject to approval thereof by the Administrative Agent in the case of a Person that is not a Lender (such approval not to be unreasonably withheld or delayed) (each, a “New Lender”), to whom the Borrower proposes any portion of such New Commitments be allocated and the amounts of such allocations; provided that any Lender approached to provide all or a portion of the New Commitments may elect or decline, in its sole discretion, to provide a New Commitment; and provided, further that any Lender approached to provide all or a portion of the New Commitments and that does not respond in writing within 5 Business Days of receipt of such offer shall be deemed to have declined. Such New Commitments shall become effective as of such Increased Amount Date; provided that (1) on such Increased Amount Date before or after giving effect to such New Commitments, each of the conditions set forth in Section 4.02 shall be satisfied; (2) the New Commitments shall be effected pursuant to one or more Joinder Agreements executed and delivered by the Borrower, the New Lenders and the Administrative Agent, and each of which shall be recorded in the Register and each New Lender shall be subject to the requirements set forth in Section 2.14; (3) the Borrower shall make any payments required pursuant to Sections 2.12 and 2.13 in connection with the New Commitments; and (4) the Borrower shall deliver or cause to be delivered any legal opinions or other documents reasonably requested by the Administrative Agent in connection with any such transaction.

 

(b)               On any Increased Amount Date on which New Commitments are effected, subject to the satisfaction (or waiver by the Required Lenders) of the foregoing terms and conditions, (i) each of the Lenders shall assign to each of the New Lenders, and each of the New Lenders shall purchase from each of the Lenders, at the principal amount thereof (together with accrued interest), such interests in the Loans outstanding on such Increased Amount Date as shall be necessary in order that, after giving effect to all such assignments and purchases, such Loans will be held by existing Lenders and New Lenders ratably in accordance with their Commitments after giving effect to the addition of such New Commitments to the Commitments, (ii) each New Commitment shall be deemed for all purposes a Commitment and each Loan made thereunder (a “New Loan”) shall be deemed, for all purposes, a Loan and (iii) each New Lender shall become a Lender for all purposes hereunder.

 

 

(c)               The Administrative Agent shall notify Lenders promptly upon receipt of the Borrower’s notice of each Increased Amount Date and in respect thereof (i) the New Commitments and the New Lenders, and (ii) the respective interests in such Lender’s Loans, in each case subject to the assignments contemplated by this Section 2.18.

 

(d)               The terms and provisions (including pricing) of the New Loans shall be identical to the existing Loans. Notwithstanding anything in Section 10.02 to the contrary, each Joinder Agreement may, without the consent of any other Lenders, effect such amendments to this Agreement and the other Loan Documents as may be necessary or appropriate in the opinion of the Administrative Agent to effect the provision of this Section 2.18, including, to the extent the New Commitments are incurred in an Alternative Currency, any amendments to reflect such Alternative Currency hereunder.

 

Section 2.19        Letters of Credit.

 

(a)               General. Subject to the terms and conditions set forth herein, the Borrower may request the issuance of (and subject to the terms of this Section 2.19, each Issuing Bank shall issue) Letters of Credit as the applicant thereof for the support of its or its Subsidiaries’ obligations, in a form reasonably acceptable to the Administrative Agent and the applicable Issuing Bank, at any time and from time to time during the Availability Period. In the event of any inconsistency between the terms and conditions of this Agreement and the terms and conditions of any form of letter of credit application or other agreement submitted by the Borrower to, or entered into by the Borrower with, the applicable Issuing Bank relating to any Letter of Credit, the terms and conditions of this Agreement shall control. Notwithstanding anything herein to the contrary, (i) the Borrower shall not request, and no Issuing Bank shall issue, any Letter of Credit the proceeds of which would be made to any Person (A) to fund any activity or business of or with any Sanctioned Person, or in any country, region or territory, that at the time of such funding is a Sanctioned Country or (B) in any manner that would result in a violation of any Sanctions by any party to this Agreement, (ii) no Issuing Bank shall have any obligation hereunder to issue any Letter of Credit if the issuance of such Letter of Credit would violate one or more policies of such Issuing Bank now or hereafter in effect applicable to letters of credit generally, (iii) no Issuing Bank shall have any obligation hereunder to issue any Letter of Credit (1) if the aggregate LC Exposure with respect to all Letters of Credit issued by such Issuing Bank would exceed such Issuing Bank’s LC Commitment, (2) denominated in a currency other than Dollars or with respect to each Issuing Bank, any applicable Alternative Currency set forth adjacent to its name on Schedule 2.01, or otherwise consented to by such Issuing Bank or (3) unless it is a Standby Letter of Credit (or, with the consent of such Issuing Bank (in its sole discretion), a Commercial Letter of Credit) and (iv) the Borrower shall not request, and no Issuing Bank shall issue, any Letter of Credit if after giving effect to such issuance of a Letter of Credit, (1) the Dollar Equivalent of any Lender’s Revolving Credit Exposure would exceed such Lender’s Commitment or (2) the sum of the Dollar Equivalents of the total Revolving Credit Exposures of all Lenders would exceed the total Commitments of all Lenders. All Existing Letters of Credit shall be deemed to have been issued pursuant hereto, and from and after the Effective Date shall be subject to and governed by the terms and conditions hereof.

 

 

(b)               Notice of Issuance, Amendment, Renewal, Extension; Certain Conditions. To request the issuance of a Letter of Credit (or the amendment, renewal or extension of an outstanding Letter of Credit), the Borrower shall hand deliver or telecopy (or transmit by electronic communication, if arrangements for doing so have been approved by the applicable Issuing Bank) to the applicable Issuing Bank and the Administrative Agent (reasonably in advance of the requested date of issuance, amendment, renewal or extension, but in any event no less than three Business Days in connection with a Letter of Credit denominated in Dollars and five Business Days in connection with a Letter of Credit denominated in a currency other than Dollars) a written Letter of Credit Request in substantially the form of Exhibit B-2 attached hereto and signed by the Borrower requesting the issuance of a Letter of Credit, or identifying the Letter of Credit to be amended, renewed or extended, and specifying the date of issuance, amendment, renewal or extension (which shall be a Business Day), the date on which such Letter of Credit is to expire (which shall comply with paragraph (c) of this Section), the amount of such Letter of Credit, the Agreed Currency applicable thereto, the name and address of the beneficiary thereof and such other information as shall be necessary to prepare, amend, renew or extend such Letter of Credit. If requested by the applicable Issuing Bank, the Borrower also shall submit a letter of credit application on such Issuing Bank’s standard form in connection with any request for a Letter of Credit. A Letter of Credit shall be issued, amended, renewed or extended only if (and upon issuance, amendment, renewal or extension of each Letter of Credit, the Borrower shall be deemed to represent and warrant that), after giving effect to such issuance, amendment, renewal or extension (i) the Dollar Equivalent of the LC Exposure shall not exceed the LC Sublimit, (ii) the sum of the Dollar Equivalents of the total Revolving Credit Exposures shall not exceed the total Commitments, (iii) the Dollar Equivalent of the LC Exposure of the applicable Issuing Bank shall not exceed the LC Sublimit applicable to such Issuing Bank and (iv) the Dollar Equivalent of the Revolving Credit Exposure of the applicable Issuing Bank shall not exceed the Commitment of such Issuing Bank.

 

(c)               Currency; Expiration Date. Each Letter of Credit shall be denominated in Dollars or any Alternative Currency to the extent provided in Section 2.19(a) above. Each Letter of Credit shall expire (or be subject to termination by notice from the applicable Issuing Bank to the beneficiary thereof) at or prior to the close of business on the earlier of (i) the date one year after the date of the issuance of such Letter of Credit unless otherwise consented to by the applicable Issuing Bank (or, in the case of any renewal or extension thereof, one year after such renewal or extension) and (ii) the date that is five Business Days prior to the Maturity Date; provided that, notwithstanding anything to the contrary in this paragraph (c), a Letter of Credit may expire on a date following the Maturity Date if the Borrower provides Cash Collateral for, “backstops” or replaces such Letter of Credit, in each case, in an amount equal to 103% of the applicable Issuing Bank’s LC Exposure attributable to such Letter of Credit plus any accrued and unpaid interest thereon and pursuant to arrangements (and with “backstop” letter of credit issuers) reasonably acceptable to the applicable Issuing Bank.

 

(d)               Participations. By the issuance of a Letter of Credit (or an amendment to a Letter of Credit increasing the amount thereof) and without any further action on the part of any Issuing Bank or the Lenders, the applicable Issuing Bank hereby grants to each Lender, and each Lender hereby acquires from the applicable Issuing Bank, a participation in such Letter of Credit equal to such Lender’s Applicable Percentage of the aggregate amount available to be drawn under such Letter of Credit; provided that the Lenders’ participations in a Letter of Credit shall terminate upon giving effect to any Deemed LC Termination in respect of such Letter of Credit. In consideration and in furtherance of the foregoing, each Lender hereby absolutely, unconditionally and irrevocably agrees to pay to the Administrative Agent, for the account of such Issuing Bank, such Lender’s Applicable Percentage of each LC Disbursement made by such Issuing Bank and not reimbursed by the Borrower on the date due as provided in paragraph (e) of this Section, or of any reimbursement payment required to be refunded to the Borrower for any reason. Each Lender acknowledges and agrees that its obligation to acquire participations pursuant to this paragraph in respect of Letters of Credit is absolute, unconditional and irrevocable and shall not be affected by any circumstance whatsoever, including any amendment, renewal or extension of any Letter of Credit or the occurrence and continuance of a Default or reduction or termination of the Commitments, and that each such payment shall be made without any offset, abatement, withholding or reduction whatsoever.

 

 

 

(e)               Reimbursement. If any Issuing Bank shall make any LC Disbursement in respect of a Letter of Credit, the Borrower shall reimburse such LC Disbursement by paying to the Administrative Agent an amount equal to such LC Disbursement in the applicable Agreed Currency within one (1) Business Day after the Borrower shall have received notice of such LC Disbursement; provided that the Borrower may, subject to the conditions to borrowing set forth herein, request in accordance with Section 2.03 that such payment be financed with an ABR Borrowing in an amount equal to the Dollar Equivalent of such LC Disbursement and, to the extent so financed, the Borrower’s obligation to make such payment shall be discharged and replaced by the resulting ABR Borrowing. If the Borrower fails to make such payment when due, (x) any LC Disbursement denominated in an Alternative Currency shall automatically be converted to an LC Disbursement denominated in Dollars in an amount equal to the Dollar Equivalent of such LC Disbursement at such time and (y) the Administrative Agent shall notify each Lender of the applicable LC Disbursement, the payment then due from the Borrower in respect thereof and such Lender’s Applicable Percentage thereof. Promptly following receipt of such notice, each Lender shall pay to the Administrative Agent its Applicable Percentage of the payment then due from the Borrower, in the same manner as provided in Section 2.04 with respect to Loans made by such Lender (and Section 2.04 shall apply, mutatis mutandis, to the payment obligations of the Lenders), and the Administrative Agent shall promptly pay to the applicable Issuing Bank the amounts so received by it from the Lenders. Promptly following receipt by the Administrative Agent of any payment from the Borrower pursuant to this paragraph, the Administrative Agent shall distribute such payment to the applicable Issuing Bank or, to the extent that Lenders have made payments pursuant to this paragraph to reimburse such Issuing Bank, then to such Lenders and such Issuing Bank as their interests may appear. Any payment made by a Lender pursuant to this paragraph to reimburse any Issuing Bank for any LC Disbursement (other than the funding of ABR Loans as contemplated above) shall not constitute a Loan and shall not relieve the Borrower of its obligation to reimburse such LC Disbursement. If the Borrower’s reimbursement of, or obligation to reimburse, any amounts in any Alternative Currency would subject the Administrative Agent, any Issuing Bank or any Lender to any stamp duty, ad valorem charge or similar tax that would not be payable if such reimbursement were made or required to be made in Dollars, the Borrower shall, at its option, either (x) pay the amount of any such tax requested by the Administrative Agent, such Issuing Bank or such Lender or (y) reimburse each LC Disbursement made in such Alternative Currency in Dollars, in an amount equal to the Dollar Equivalent of such LC Disbursement on the date such LC Disbursement is made.

 

(f)               Obligations Absolute. The Borrower’s obligation to reimburse LC Disbursements as provided in paragraph (e) of this Section shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement under any and all circumstances whatsoever and irrespective of (i) any lack of validity or enforceability of any Letter of Credit or this Agreement, or any term or provision therein, (ii) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent or invalid in any respect or any statement therein being untrue or inaccurate in any respect, (iii) payment by any Issuing Bank under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit, or (iv) any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of, or provide a right of setoff against, the Borrower’s obligations hereunder. Neither the Administrative Agent, the Lenders nor the Issuing Banks, nor any of their Related Parties, shall have any liability or responsibility by reason of or in connection with the issuance or transfer of any Letter of Credit or any payment or failure to make any payment thereunder (irrespective of any of the circumstances referred to in the preceding sentence), or any error, omission, interruption, loss or delay in transmission or delivery of any draft, notice or other communication under or relating to any Letter of Credit (including any document required to make a drawing thereunder), any error in interpretation of technical terms or any consequence arising from causes beyond the control of any Issuing Bank; provided that the foregoing shall not be construed to excuse any Issuing Bank from liability to the Borrower to the extent of any direct damages (as opposed to special, indirect, consequential or punitive damages, claims in respect of which are hereby waived by the Borrower to the extent permitted by applicable law) suffered by the Borrower that are caused by such Issuing Bank’s failure to exercise care when determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof. The parties hereto expressly agree that, in the absence of gross negligence or willful misconduct on the part of any Issuing Bank (as finally determined by a court of competent jurisdiction), such Issuing Bank shall be deemed to have exercised care in each such determination. In furtherance of the foregoing and without limiting the generality thereof, the parties agree that, with respect to documents presented which appear on their face to be in substantial compliance with the terms of a Letter of Credit, any Issuing Bank may, in its sole discretion, either accept and make payment upon such documents without responsibility for further investigation, regardless of any notice or information to the contrary, or refuse to accept and make payment upon such documents if such documents are not in strict compliance with the terms of such Letter of Credit.

 

 

(g)              Disbursement Procedures. Each Issuing Bank shall, promptly following its receipt thereof, examine all documents purporting to represent a demand for payment under a Letter of Credit. Such Issuing Bank shall promptly notify the Administrative Agent by telephone (confirmed by telecopy) of such demand for payment and whether such Issuing Bank has made or will make an LC Disbursement thereunder and, upon receipt of such notice, the Administrative Agent shall promptly notify the Borrower by telephone (confirmed by telecopy) of the same; provided that any failure to give or delay by the Issuing Bank or the Administrative Agent in giving such notice shall not relieve the Borrower of its obligation to reimburse such Issuing Bank and the Lenders with respect to any such LC Disbursement.

 

(h)              Interim Interest. If any Issuing Bank shall make any LC Disbursement, then, unless the Borrower shall reimburse such LC Disbursement in full on the date such LC Disbursement is made, the unpaid amount thereof shall bear interest, for each day from and including the date such LC Disbursement is made to but excluding the date that the reimbursement is due and payable at the rate per annum then applicable to ABR Loans; provided that, if the Borrower fails to reimburse such LC Disbursement when due pursuant to paragraph (e) of this Section, then Section 2.10(d) shall apply. Interest accrued pursuant to this paragraph shall be for the account of such Issuing Bank, except that interest accrued on and after the date of payment by any Lender pursuant to paragraph (e) of this Section to reimburse such Issuing Bank shall be for the account of such Lender to the extent of such payment.

 

 

(i)               Cash Collateralization. If any Event of Default shall occur and be continuing, on the Business Day that the Borrower receives notice from the Administrative Agent, any Issuing Bank or the Required Lenders (or, if the maturity of the Loans has been accelerated, Lenders with LC Exposure representing greater than 50.0% of the total LC Exposure) demanding the deposit of Cash Collateral pursuant to this paragraph, the Borrower shall provide Cash Collateral in an amount equal to 103% of the LC Exposure as of such date plus any accrued and unpaid interest thereon; provided that the obligation to deposit such Cash Collateral shall become effective immediately, and such deposit shall become immediately due and payable, without demand or other notice of any kind, upon the occurrence of any Event of Default with respect to the Borrower described in clause (h) or (i) of Article 7. Such Cash Collateral shall be held by the Administrative Agent as collateral for the payment and performance of the obligations of the Borrower under this Agreement. The Administrative Agent shall have exclusive dominion and control, including the exclusive right of withdrawal, over such account. Other than any interest earned on the investment of such deposits, which investments shall be made at the option and sole discretion of the Administrative Agent and at the Borrower’s risk and expense, such deposits shall not bear interest. Interest or profits, if any, on such investments shall accumulate in such account. Moneys in such account shall be applied by the Administrative Agent to reimburse the applicable Issuing Bank for LC Disbursements for which it has not been reimbursed and, to the extent not so applied, shall be held for the satisfaction of the reimbursement obligations of the Borrower for the LC Exposure at such time or, if the maturity of the Loans has been accelerated (but subject to the consent of each Issuing Bank), be applied to satisfy other obligations of the Borrower under this Agreement. If the Borrower is required to provide an amount of Cash Collateral hereunder as a result of the occurrence of an Event of Default, such amount (to the extent not applied as aforesaid) shall be returned to the Borrower within three Business Days after all Events of Default have been cured or waived.

 

(j)               Replacement of an Issuing Bank. Any Issuing Bank may be replaced at any time by written agreement among the Borrower, the Administrative Agent, the replaced Issuing Bank and the successor Issuing Bank. The Administrative Agent shall notify the Lenders of any such replacement of any Issuing Bank. At the time any such replacement shall become effective, the Borrower shall pay all unpaid fees accrued for the account of the replaced Issuing Bank pursuant to Section 2.09(b). From and after the effective date of any such replacement, (i) the successor Issuing Bank shall have all the rights and obligations of an Issuing Bank under this Agreement with respect to Letters of Credit to be issued thereafter and (ii) references herein to the term “Issuing Bank” shall be deemed to refer to such successor or to any previous Issuing Bank, or to such successor and all previous Issuing Banks, as the context shall require. After the replacement of an Issuing Bank hereunder, the replaced Issuing Bank shall remain a party hereto and shall continue to have all the rights and obligations of an Issuing Bank under this Agreement with respect to Letters of Credit issued by it prior to such replacement, but shall not be required to issue additional Letters of Credit.

 

(k)              Resignation of an Issuing Bank. Any Issuing Bank may resign at any time that such Issuing Bank (or its applicable Affiliate) ceases to hold a Commitment hereunder. The Administrative Agent shall notify the Lenders of any such resignation of any Issuing Bank. After the resignation of an Issuing Bank hereunder, the resigning Issuing Bank shall remain a party hereto and shall continue to have all the rights and obligations of an Issuing Bank under this Agreement with respect to Letters of Credit issued by it prior to such resignation, but shall not be required to issue additional Letters of Credit.

 

 

(l)               Deemed Letter of Credit Requests. The Borrower may, from time to time, request (a “Deemed LC Request”) that (i) any undrawn Letter of Credit issued hereunder be deemed to be terminated and issued under a separate letter of credit facility with the applicable Issuing Bank (a “Deemed LC Termination”) or (ii) any undrawn letter of credit issued under a separate letter of credit facility with an Issuing Bank be deemed to be terminated and issued hereunder as a Letter of Credit (a “Deemed LC Issuance”). Any such Deemed LC Request shall identify the applicable Letter of Credit, and the Deemed LC Termination or Deemed LC Issuance specified therein shall, subject to the prior written consent of each of the Administrative Agent and the applicable Issuing Bank (which consent may be withheld in its sole discretion) and, in the case of any Deemed LC Issuance, the satisfaction of the conditions set forth in Section 4.02, be effective upon receipt of such written consent.

 

Section 2.20        Judgment Currency. If, for the purposes of obtaining judgment in any court, it is necessary to convert a sum due from the Borrower hereunder in the currency expressed to be payable herein (the “specified currency”) into another currency, the parties hereto agree, to the fullest extent that they may effectively do so, that the rate of exchange used shall be that at which the Administrative Agent could, in accordance with normal banking procedures applicable to arm’s length transactions, purchase the specified currency with such other currency at the Administrative Agent’s Principal Office on the Business Day immediately preceding that on which final, non-appealable judgment is given. The obligations of the Borrower in respect of any sum due to the Administrative Agent, any Issuing Bank or any Lender hereunder shall, notwithstanding any judgment in a currency other than the specified currency, be discharged only to the extent that on the Business Day following receipt by the Administrative Agent, such Issuing Bank or such Lender of any sum adjudged to be so due in such other currency, the Administrative Agent, such Issuing Bank or such Lender may in accordance with normal, reasonable banking procedures purchase the specified currency with such other currency. If the amount of the specified currency so purchased is less than the sum originally due to the Administrative Agent, such Issuing Bank or such Lender in the specified currency, the Borrower agrees, to the fullest extent that it may effectively do so, as a separate obligation and notwithstanding any such judgment, to indemnify the Administrative Agent, such Issuing Bank or such Lender against such loss, and if the amount of the specified currency so purchased exceeds (a) the sum originally due to the Administrative Agent, such Issuing Bank or such Lender in the specified currency and (b) any amounts shared with other Lenders as a result of allocations of such excess as a disproportionate payment to such Lender under Section 2.15(c), the Administrative Agent, such Issuing Bank or such Lender agrees to remit such excess to the Borrower.

 

Article 3
REPRESENTATIONS AND WARRANTIES

 

The Parent and the Borrower, as applicable, represent and warrant to the Lenders that:

 

Section 3.01       Organization; Powers. Each of the Parent and its Subsidiaries is duly organized or formed, validly existing and (to the extent the concept is applicable in such jurisdiction) in good standing under the laws of the jurisdiction of its organization, has all requisite power and authority to carry on its business as now conducted and, except where the failure to do so, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect, is qualified to do business in, and is in good standing in, every jurisdiction where such qualification is required.

 

 

Section 3.02        Authorization; Enforceability. The Transactions are within the Borrower’s and each Guarantor’s corporate or other organizational powers and have been duly authorized by all necessary corporate or other organizational and, if required, equity holder action. Each of the Borrower and the Guarantors has duly executed and delivered each of the Loan Documents to which it is party, and each of such Loan Documents constitute its legal, valid and binding obligations, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law.

 

Section 3.03        Governmental Approvals; No Conflicts. The Transactions (a) do not require any consent or approval of, registration or filing with, or any other action by, any Governmental Authority, except (i) such as have been obtained or made and are in full force and effect and (ii) those approvals, consents, registrations, filings or other actions, the failure of which to obtain or make would not reasonably be expected to have a Material Adverse Effect, (b) except as would not reasonably be expected to have a Material Adverse Effect, will not violate any applicable law or regulation or any order of any Governmental Authority, (c) will not violate any charter, by-laws or other organizational document of the Parent or any of its Subsidiaries, (d) except as would not reasonably be expected to have a Material Adverse Effect, will not violate or result in a default under any indenture, agreement or other instrument (other than the agreements and instruments referred to in clause (c)) binding upon the Parent or any of its Subsidiaries or its assets, or give rise to a right thereunder to require any payment to be made by the Parent or any of its Subsidiaries, and (e) will not result in the creation or imposition of any Lien on any asset of the Parent or any of its Subsidiaries (other than Liens arising pursuant to the Security Documents or permitted under Section 6.02).

 

Section 3.04         Financial Condition; No Material Adverse Change.

 

(a)              The Borrower has heretofore furnished to the Administrative Agent (i) the Borrower’s consolidated balance sheets and related consolidated statements of operations and comprehensive loss, consolidated statements of changes in members’ (deficit) equity, and consolidated statements of cash flows as of and for the fiscal years ended September 30, 2019 and September 30, 2020, reported on by Ernst & Young LLP, independent public accountants and (ii) its condensed consolidated balance sheets and related condensed consolidated statements of operations and comprehensive loss, condensed consolidated statements of changes in members’ (deficit) equity, and condensed consolidated statements of cash flows as of the end of and for the fiscal quarters ended December 31, 2020, March 31, 2021 and June 30, 2021 and the then elapsed portion of the fiscal year. Such financial statements present fairly, in all material respects, the financial position and results of operations and cash flows of the Borrower and its consolidated Subsidiaries as of such dates and for such periods in accordance with GAAP.

 

 

(b)              Since September 30, 2020, no event, development or circumstance exists or has occurred that has had or would reasonably be expected to have a Material Adverse Effect.

 

Section 3.05        Properties.

 

(a)               Each of the Parent and its Subsidiaries has good title to, or valid leasehold interests in or rights to use, all its real and tangible personal property material to its business, other than minor defects in title that do not interfere with its ability to conduct its business as currently conducted or to utilize such properties for their intended purposes or those Liens permitted by Section 6.02, except in each case where failure to do so could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

 

(b)              Each of the Parent and its Subsidiaries owns, or has the valid right to use, all Intellectual Property material to its business as currently conducted, free and clear of all Liens other than Liens permitted by Section 6.02 except to the extent such failure to own or have the right to use, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect, and the operation of such business or the use of such Intellectual Property rights by the Parent and its Subsidiaries does not infringe upon, misappropriate, or otherwise violate the rights of any other Person, except for any such infringements, misappropriations, or violations that, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect.

 

Section 3.06        Litigation and Environmental Matters. Except as set forth on Schedule 3.06, there are no actions, suits or proceedings by or before any arbitrator or Governmental Authority pending against or, to the knowledge of the Parent or the Borrower, threatened in writing (including “cease and desist” letters and invitations to take a patent license) against or affecting the Parent or any of its Subsidiaries (i) that would reasonably be expected, individually or in the aggregate, to result in a Material Adverse Effect or (ii) that involve this Agreement, any other Loan Document or the Transactions.

 

(a)              Except with respect to any matter that, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect, neither the Parent nor any of its Subsidiaries (i) has failed to comply with any Environmental Law or to obtain, maintain or comply with any permit, license or other approval required under any Environmental Law, (ii) has become subject to any Environmental Liability, or (iii) has received notice of any claim with respect to any Environmental Liability.

 

Section 3.07        Compliance with Laws and Agreements; No Default. Each of the Parent and its Subsidiaries is in compliance with all laws, rules, regulations and orders of any Governmental Authority applicable to it or its property and rights and all indentures, agreements, and other instruments binding upon it or its property and rights, except where the failure to do so, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect. No Default has occurred and is continuing.

 

 

Section 3.08        Investment Company Status. None of the Parent or any of its Subsidiaries is or is required to be registered as an “investment company” under the Investment Company Act of 1940.

 

Section 3.09        Margin Stock. None of the Parent or any of its Subsidiaries is engaged, principally or as one of its important activities, in the business of extending credit for the purpose of purchasing or carrying margin stock (within the meaning of Regulation U and Regulation X issued by the Board).

 

Section 3.10        Taxes. Except as set forth on Schedule 3.10 or as would not reasonably be expected to result in a Material Adverse Effect, (i) each of the Parent and its Subsidiaries has timely filed or caused to be filed all Tax returns and reports required to have been filed with respect to income, properties or operations of the Parent and its Subsidiaries, (ii) such returns accurately reflect in all material respects all liability for Taxes of the Parent and its Subsidiaries as a whole for the periods covered thereby and (iii) each of the Parent and its Subsidiaries has paid or caused to be paid all Taxes required to have been paid by it, except Taxes that are being contested in good faith by appropriate proceedings and, to the extent required by GAAP, for which the Parent or such Subsidiary, as applicable, has set aside on its books adequate reserves in accordance with GAAP.

 

Section 3.11         ERISA.

 

(a)               Each Plan is in compliance in form and operation with its terms and with ERISA and the Code (including without limitation the Code provisions compliance with which is necessary for any intended favorable tax treatment) and all other applicable laws and regulations, except where any failure to comply would not reasonably be expected to result in any Material Adverse Effect. Each Plan (and each related trust, if any) which is intended to be qualified under Section 401(a) of the Code has received a favorable determination letter from the IRS to the effect that it meets the requirements of Sections 401(a) and 501(a) of the Code covering all applicable tax law changes or is comprised of a master or prototype plan that has received a favorable opinion letter from the IRS, and, nothing has occurred since the date of such determination that would adversely affect such determination (or, in the case of a Plan with no determination, nothing has occurred that would materially adversely affect the issuance of a favorable determination letter or otherwise materially adversely affect such qualification). No ERISA Event has occurred, or is reasonably expected to occur, other than as would not, individually or in the aggregate, reasonably be expected to result in any Material Adverse Effect).

 

(b)               There exists no Unfunded Pension Liability with respect to any Plan, except as would not reasonably be expected to result in a Material Adverse Effect.

 

(c)               None of the Borrower, any Subsidiary or any ERISA Affiliate is making or accruing an obligation to make contributions, or has within any of the five calendar years immediately preceding the date this assurance is given or deemed given, made or accrued an obligation to make contributions to any Multiemployer Plan.

 

 

(d)              There are no actions, suits or claims pending against or involving a Plan (other than routine claims for benefits) or, to the knowledge of the Borrower, any Subsidiary or any ERISA Affiliate, threatened, which would reasonably be expected to be asserted successfully against any Plan and, if so asserted successfully, would reasonably be expected either singly or in the aggregate to result in any Material Adverse Effect.

 

(e)               The Borrower, its Subsidiaries and its ERISA Affiliates have made all contributions to or under each Plan and Multiemployer Plan required by law within the applicable time limits prescribed thereby, the terms of such Plan or Multiemployer Plan, respectively, or any contract or agreement requiring contributions to a Plan or Multiemployer Plan save where any failure to comply, individually or in the aggregate, would not reasonably be expected to result in any Material Adverse Effect.

 

(f)               No Plan which is subject to Section 412 of the Code or Section 302 of ERISA has applied for or received an extension of any amortization period, within the meaning of Section 412 of the Code or Section 302 or 304 of ERISA. The Borrower, any Subsidiary, and any ERISA Affiliate have not ceased operations at a facility so as to become subject to the provisions of Section 4062(e) of ERISA, withdrawn as a substantial employer so as to become subject to the provisions of Section 4063 of ERISA or ceased making contributions to any Plan subject to Section 4064(a) of ERISA to which it made contributions. None of the Borrower, any Subsidiary or any ERISA Affiliate have incurred or reasonably expect to incur any liability to PBGC except as would not reasonably be expected to result in a Material Adverse Effect, save for any liability for premiums due in the ordinary course or other liability which would not reasonably be expected to result in a Material Adverse Effect, and no lien imposed under the Code or ERISA on the assets of the Borrower or any Subsidiary or any ERISA Affiliate exists or, to the knowledge of the Borrower, is likely to arise on account of any Plan. None of the Borrower, any Subsidiary or any ERISA Affiliate has engaged in a transaction that would reasonably be expected to be subject to Section 4069 or 4212(c) of ERISA.

 

(g)              Each Non-U.S. Plan has been maintained in compliance with its terms and with the requirements of any and all applicable laws, statutes, rules, regulations and orders and has been maintained, where required, in good standing with applicable regulatory authorities, except as would not reasonably be expected to result in a Material Adverse Effect. All contributions required to be made with respect to a Non-U.S. Plan have been timely made, except as would not reasonably be expected to result in a Material Adverse Effect. Neither the Borrower nor any of its Subsidiaries has incurred any obligation in connection with the termination of, or withdrawal from, any Non-U.S. Plan, except as would not reasonably be expected to result in a Material Adverse Effect. The present value of the accrued benefit liabilities (whether or not vested) under each Non-U.S. Plan, determined as of the end of the Borrower’s most recently ended fiscal year on the basis of actuarial assumptions, each of which is reasonable, did not exceed the current value of the assets of such Non-U.S. Plan allocable to such benefit liabilities, except as would not reasonably be expected to result in a Material Adverse Effect.

 

Section 3.12        Disclosure.

 

(a)              All written information provided by any Responsible Officer of the Parent or the Borrower, as applicable (other than any projected financial information, estimates, budgets, forward looking statements and other than information of a general economic or industry specific nature) to the Administrative Agent or any Lender in connection with this Agreement or delivered hereunder, as modified or supplemented by other information so furnished and when taken as a whole together with any information disclosed in the Parent’s public filings with the SEC, does not contain any material misstatement of fact or omit to state any material fact necessary to make the statements therein, in light of the circumstances under which they were made, not materially misleading; provided that, with respect to any projected financial information, the Parent and the Borrower, as applicable, represent only that such information was prepared in good faith based upon assumptions believed to be reasonable at the time furnished (it being understood that such projected financial information and all information concerning future proposed and intended activities are forward-looking statements by their nature and are subject to significant uncertainties and contingencies, any of which are beyond the Parent’s and the Borrower’s control, that no assurance can be given that any particular projections will be realized and that actual results during the period or periods covered by any such projected financial information may differ significantly from the projected results and such differences may be material).

 

 

(b)              As of the Effective Date, to the best knowledge of the Borrower, to the extent required to be delivered pursuant to Section 4.01(h), the information included in the Beneficial Ownership Certification provided on or prior to the Effective Date to any Lender in connection with this Agreement is true and correct in all material respects.

 

Section 3.13       Subsidiaries. Schedule 3.13 sets forth as of the Effective Date a list of all Subsidiaries, together with (a) the percentage ownership (directly or indirectly) of the Parent and the Borrower, as applicable, therein and (b) whether such Subsidiary is a Guarantor or an Excluded Subsidiary. Except as would not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect, the shares of capital stock or other ownership interests of all Subsidiaries of the Parent and the Borrower, as applicable, are fully paid and non-assessable and are owned by the Parent and the Borrower, as applicable, directly or indirectly, free and clear of all Liens other than Liens permitted under Section 6.02.

 

Section 3.14        Solvency. On the Effective Date, the Parent and its consolidated Subsidiaries are and, after giving effect to the incurrence of any Loans being incurred on such date, will be Solvent.

 

Section 3.15        Anti-Terrorism Law.

 

(a)               None of (x) the Parent, any of its Subsidiaries or any of their respective directors, officers or employees, or (y) to the knowledge of the Parent or the Borrower, any agent or Affiliate of the Parent, the Borrower or any Subsidiary that will act in any capacity in connection with or benefit from the credit facility established hereby, is any of the following:

 

(i)                 a Person that is listed in the annex to, or is otherwise subject to the provisions of, Executive Order No. 13224 on Terrorist Financing effective September 24, 2001 (the “Executive Order”);

 

 

(ii)             a Person owned or controlled by, or acting for or on behalf of, any Person that is listed in the annex to, or is otherwise subject to the provisions of, the Executive Order;

 

(iii)            a Person with which any Lender is prohibited from dealing or otherwise engaging in any transaction by any legal requirement relating to applicable laws with respect to terrorism or money laundering (collectively, “Anti-Terrorism Laws”);

 

(iv)            a Person that commits, threatens or conspires to commit or supports “terrorism” as defined in the Executive Order; or

 

(v)             a Sanctioned Person.

 

(b)               Neither the Parent nor any of its Subsidiaries, nor, to the knowledge of the Parent or the Borrower, any of their respective Affiliates, (i) conducts any business with, or engages in making or receiving any contribution of funds, goods or services to or for the benefit of, a Person described in Section 3.15(a)(i)-(v) above, except as permitted under U.S. law, (ii) deals in, or otherwise engages in any transaction relating to, any property or interests in property blocked pursuant to the Executive Order, or (iii) engages in or conspires to engage in any transaction that evades or avoids, or has the purpose of evading or avoiding, or attempts to violate, any of the prohibitions set forth in any Anti-Terrorism Law.

 

(c)               The Parent will not use, and will not permit any of its Subsidiaries or Affiliates to use, the proceeds of the Loans or Letters of Credit or otherwise make available such proceeds to any Person described in Section 3.15(a)(i)-(v) above, for the purpose of financing the activities of any Person described in Section 3.15(a)(i)-(v) above, in any Sanctioned Country or in any other manner that would violate any Anti-Terrorism Laws or Sanctions by any party hereto.

 

Section 3.16        Anti-Corruption Laws and Sanctions.

 

(a)               No part of the proceeds of the Loans or Letters of Credit will be used by the Borrower or any of its Subsidiaries, or, to the knowledge of the Parent, the Borrower, any of their respective Affiliates, directly or indirectly, for any payments to any governmental official or employee, political party, official of a political party, candidate for political office, or anyone else acting in an official capacity, in order to obtain, retain or direct business or obtain any improper advantage, in violation of the United States Foreign Corrupt Practices Act of 1977, as amended, or any applicable Anti-Corruption Law.

 

(b)               The Parent has implemented and maintains in effect policies and procedures designed to ensure compliance by the Parent, the Borrower, their respective Subsidiaries and their respective directors, officers, employees, Affiliates and agents with Anti-Corruption Laws and applicable Sanctions, and the Parent, the Borrower, their respective Subsidiaries and their respective directors, officers and employees, and, to the knowledge of the Parent, the Borrower, their respective Affiliates and agents, are in compliance with Anti-Corruption Laws and applicable Sanctions in all material respects.

 

Section 3.17        Security Documents. The Security Documents (other than the Australian Collateral Agreements) are effective to create in favor of the Administrative Agent, for the benefit of the Lenders, a legal, valid and enforceable security interest (subject to Liens permitted by Section 6.02) in the Collateral described therein and proceeds thereof. In the case of any Equity Interests required to be pledged under the Security Agreement (other than the Australian Collateral Agreements), when stock certificates representing such Equity Interests are delivered to the Administrative Agent (together with a properly completed and signed stock power or endorsement), and in the case of the other Collateral described in the Security Agreement, when financing statements and other filings specified on Schedule 3 to the Security Agreement in appropriate form are filed in the offices specified on Schedule 3 to the Security Agreement, the Security Agreement shall constitute a fully perfected Lien on, and security interest (subject to Liens permitted by Section 6.02) in, all right, title and interest of the Loan Parties in such Collateral and the proceeds thereof (to the extent perfection is required pursuant to this Agreement and the Security Documents), as security for the Obligations, in each case prior and superior in right to any other Person (except for Liens permitted by Section 6.02), to the extent that such Liens can be perfected by (i) the filing of financing statements, (ii) the delivery to the Administrative Agent of stock certificates representing Equity Interests pledged pursuant to the Security Documents accompanied by stock power or endorsement, and (iii) the recordation of intellectual property security agreements with the United States Patent and Trademark Office or the United States Copyright Office, as applicable.

 

 

Section 3.18        Australian Representations. In respect of any Australian Loan Party:

 

(a)                Australian Collateral Agreements: The security interests created under the Australian Collateral Agreements will, upon execution thereof, create the legal, valid and enforceable security interest it is expressed to create with the ranking and priority it is expressed to have over the property to which it is expressed to apply, in each case subject to the principles of equity, stamping and registration, statute of limitations and laws affecting creditors' rights generally.

 

(b)               Trustee. It is not the trustee of any trust or settlement other than as disclosed to the Administrative Agent in writing and accepted by, prior to the date it became a Loan Party or any trust which arises in the ordinary course of its trading activities.

 

(c)               Related Party Benefit and Financial Assistance. It has not contravened nor will it contravene Chapter 2E or 2J.3 of the Australian Corporations Act by entering into any Loan Document to which it is a party or participating in any transaction in connection with any Loan Document to which it is a party to the extent that any contravention could not reasonably be expected to have a Material Adverse Effect.

 

(d)               Tax Consolidation. Neither it nor any other Subsidiary incorporated in Australia is a member of an Australian Consolidated Tax Group unless it has entered into an Australian Tax Sharing Agreement or an Australian Tax Funding Agreement in form and substance satisfactory to the Administrative Agent (acting reasonably).

 

 

Article 4

CONDITIONS

 

Section 4.01        Effective Date. The obligations of the Lenders to make Loans and the Issuing Banks to issue Letters of Credit hereunder shall not become effective until the date on which each of the following conditions is satisfied (or waived in accordance with Section 10.02):

 

(a)               The Administrative Agent (or its counsel) shall have received from each party hereto either (i) a counterpart of this Agreement signed on behalf of such party or (ii) written evidence reasonably satisfactory to the Administrative Agent (which may include telecopy or electronic transmission of a signed signature page of this Agreement) that such party has signed a counterpart of this Agreement.

 

(b)               The Administrative Agent shall have received (i) the Security Agreement, executed and delivered by the Borrower, the Parent, and all other U.S. Loan Parties and in form and substance reasonably acceptable to the Administrative Agent, (ii) each short-form intellectual property security agreement required pursuant to Section 4.8(j) of the Security Agreement, (iii) each Foreign Security Agreement set forth on Schedule 4.01(b) and (iv) a Note executed by the Borrower in favor of each Lender requesting a Note at least 5 Business Days prior to the Effective Date.

 

(c)               The Administrative Agent shall have received favorable written opinions (addressed to the Administrative Agent and the Lenders and dated the Effective Date) of (i) Latham & Watkins, LLP, counsel for the Loan Parties, (ii) Gilbert + Tobin as Australian Counsel to the Lenders, (iii) [German local law opinion] and (iv) [Philippines local law opinion], in each case, in form and substance reasonably satisfactory to the Administrative Agent. The Borrower hereby requests each such counsel to deliver such opinion.

 

(d)               The Administrative Agent shall have received (i) certified copies of the resolutions of the board of directors of the Borrower and the Guarantors (or in the case of an Australian Loan Party, extracts of resolutions) approving the transactions contemplated by the Loan Documents to which each such Loan Party is a party and the execution and delivery of such Loan Documents to be delivered by such Loan Party on the Effective Date, and all documents evidencing other necessary organizational action and governmental approvals, if any, with respect to the Loan Documents, and in the case of each Australian Loan Party, providing a statement of corporate benefit and (ii) all other documents reasonably requested by the Administrative Agent relating to the organization, existence and good standing of the Guarantors and the Borrower and authorization of the transactions contemplated hereby.

 

(e)               The Administrative Agent shall have received a certificate of the Secretary or an Assistant Secretary of the Borrower and each Guarantor (or director, in the case of the Australian Loan Party) certifying the names and true signatures of the officers of such entity authorized to sign the Loan Documents to which it is a party, to be delivered by such entity on the Effective Date and the other documents to be delivered hereunder on the Effective Date.

 

(f)                The Administrative Agent shall have received (i) a certificate, dated the Effective Date and signed on behalf of the Borrower by the President, a Vice President or a Financial Officer of the Borrower, confirming compliance with the conditions set forth in paragraphs (a) and (b) of Section 4.02 as of the Effective Date, and (ii) a certificate, dated the Effective Date and signed on behalf of the Borrower by the chief financial officer of the Borrower, certifying that, as of the Effective Date, the Parent is, individually and together with its Subsidiaries, and after giving effect to the incurrence of any Indebtedness and obligations being incurred in connection herewith will be, Solvent.

 

 

(g)               The Lenders, the Administrative Agent and the Arrangers shall have received all fees required to be paid by the Borrower on the Effective Date, and all expenses required to be reimbursed by the Borrower for which invoices have been presented at least three business days prior to the Effective Date, on or before the Effective Date.

 

(h)               (i) The Administrative Agent shall have received, to the extent reasonably requested by any of the Lenders at least five Business Days prior to the Effective Date, all documentation and other information required by bank regulatory authorities under applicable “know-your-customer” and anti-money laundering rules and regulations, including the USA Patriot Act and (ii) to the extent the Borrower qualifies as a “legal entity customer” under the Beneficial Ownership Regulation, at least three days prior to the Effective Date, any Lender that has requested, in a written notice to the Borrower at least ten days prior to the Effective Date, a Beneficial Ownership Certification in relation to the Borrower shall have received such Beneficial Ownership Certification (provided that, upon the execution and delivery by such Lender of its signature page to this Agreement, the condition set forth in this clause (ii) shall be deemed to be satisfied).

 

(i)                 The Administrative Agent shall have received (i) audited consolidated financial statements of the Borrower for the two most recent fiscal years ended at least 90 days prior to the Effective Date as to which such financial statements are available, (ii) unaudited interim consolidated financial statements of the Borrower for each quarterly period ended subsequent to the date of the latest financial statements delivered pursuant to clause (i) of this paragraph and at least 45 days prior to the Effective Date as to which such financial statements are available and (iii) reasonably detailed projections of the Parent and its Subsidiaries through its fiscal year ending September 30, 2025.

 

(j)                 All outstanding Equity Interests (other than Excluded Securities) owned by or on behalf of any Loan Party shall have been pledged pursuant to the Security Agreement or a Foreign Security Agreement and the Administrative Agent shall have received certificates or other instruments representing all such Equity Interests (if any), together with undated stock powers or other instruments of transfer with respect thereto endorsed in blank.

 

(k)               The Administrative Agent shall have received the results of a recent Lien search with respect to each Loan Party, and such search shall reveal no Liens on any of the assets of the Loan Parties except for Liens permitted by Section 6.02 or discharged on or prior to the Effective Date pursuant to documentation reasonably satisfactory to the Administrative Agent.

 

(l)                 Each document (including any Uniform Commercial Code financing statement (or similar filings under applicable law as set forth on Schedule 4.01(l)) required by the Security Documents or reasonably requested by the Administrative Agent to be filed, registered or recorded in order to create in favor of the Administrative Agent, for the benefit of the Lenders, a perfected Lien on the Collateral described therein, prior and superior in right to any other Person (other than with respect to Liens expressly permitted by Section 6.02), shall be in proper form for filing, registration or recordation.

 

 

(m)             An underwritten sale to the public of Class A common stock of the Parent pursuant to a registration statement on Form S-1 (as approved by the Arrangers without any changes thereto which are materially adverse to the interests of the Arrangers or the Lenders, unless consented to by the Arrangers (such consent not to be unreasonably withheld, conditioned or delayed)), that has been declared effective by the SEC shall have been consummated and which shall have generated gross cash proceeds of at least $600.0 million.

 

(n)               Evidence reasonably satisfactory to the Administrative Agent of repayment and termination of the Shareholder Loan Agreement.

 

(o)               In the case of the Australian Loan Party, a certificate, dated the Effective Date and signed on behalf of the Australian Loan Party by the Secretary or a Director of the Australian Loan Party confirming that:

 

(i)                 the Australian Loan Party is solvent for the purposes of section 95A of the Australian Corporations Act and there are no grounds for suspecting that it will not continue to be so after executing and complying with its obligations under the Finance Documents; and

 

(ii)              the Australian Loan Party is not prevented by Chapter 2E of the Australian Corporations Act from entering into and performing any of its obligations under the Loan Documents to which it is (or will become) a party.

 

The Administrative Agent shall notify the Borrower and the Lenders of the Effective Date, and such notice shall be conclusive and binding. Without limiting the generality of the provisions of Article 8, for purposes of determining compliance with the conditions specified in this Section, each Lender that has signed this Agreement shall be deemed to have consented to, approved or accepted or to be satisfied with, each document or other matter required thereunder to be consented to or approved by or acceptable or satisfactory to a Lender unless the Administrative Agent shall have received notice from such Lender prior to the proposed Effective Date specifying its objection thereto.

 

Section 4.02        Each Credit Event. The obligation of each Lender to make a Loan on the occasion of any Borrowing (provided that a conversion or a continuation shall not constitute a “Borrowing” for purposes of this Section 4.02), and of the applicable Issuing Bank to issue, renew or extend any Letter of Credit, is subject to the satisfaction (or waiver by the Required Lenders) of the following conditions:

 

(a)               The representations and warranties of the Parent and the Borrower, as applicable, set forth in this Agreement and the other Loan Documents shall be true and correct in all material respects on and as of the date of such Borrowing or the date of issuance, renewal or extension of such Letter of Credit, as applicable, except that (i) for purposes of this Section, the representations and warranties contained in Section 3.04(a) shall be deemed to refer to the most recent statements furnished pursuant to clauses (a) and (b) (subject, in the case of unaudited financial statements furnished pursuant to clause (b), to year-end audit adjustments and the absence of footnotes), respectively, of Section 5.01, (ii) to the extent that such representations and warranties specifically refer to an earlier date, they shall be true and correct in all material respects as of such earlier date and (iii) to the extent that such representations and warranties are already qualified or modified by materiality in the text thereof, they shall be true and correct in all respects; and

 

(b)               At the time of and immediately after giving effect on a Pro Forma Basis to such Borrowing or the issuance, renewal or extension of such Letter of Credit, as applicable, no Default or Event of Default shall have occurred and be continuing.

 

 

(c)               At the time of and immediately after giving effect on a Pro Forma Basis to such Borrowing or the issuance of such Letter of Credit, as applicable, the Borrower shall be in compliance with Section 6.10(i)(x).

 

Each Borrowing and each issuance, renewal or extension of a Letter of Credit shall be deemed to constitute a representation and warranty by the Borrower that the conditions specified in paragraphs (a) and (b) of this Section have been satisfied as of the date thereof.

 

Article 5
AFFIRMATIVE COVENANTS

 

Until each of (i) the Commitments have expired or been terminated, (ii) the principal of and interest on each Loan and all other Obligations hereunder (including unreimbursed LC Disbursements, but excluding contingent obligations as to which no claim has been asserted) shall have been paid in full or otherwise satisfied, and (iii) all Letters of Credit shall have (x) expired or terminated, in each case, without any pending draw, (y) been backstopped or Cash Collateralized in an amount not less than the Minimum Collateral Amount or (z) been deemed reissued under another agreement reasonably acceptable to the applicable Issuing Bank, the Parent and the Borrower, as applicable, covenant and agree with the Lenders that:

 

Section 5.01        Financial Statements; Ratings Change and Other Information. The Parent will furnish to the Administrative Agent (for distribution to each Lender):

 

(a)               on or before the date on which such financial statements are required to be filed with the SEC after the end of each fiscal year of the Parent (or, if such financial statements are not required to be filed with the SEC, within 120 days after the end of each fiscal year of the Parent), its audited consolidated balance sheet and related consolidated statements of operations and comprehensive income (loss), changes in stockholders’ equity, and cash flows as of the end of and for such year, setting forth in each case in comparative form the figures for the previous fiscal year, all reported on by Ernst & Young LLP or other independent public accountants of recognized national standing (without a “going concern” or like qualification or exception (other than a qualification related to the maturity of the Commitments and the Loans at the Maturity Date or upcoming maturity date under any other Indebtedness occurring within one year from the time such report is delivered or potential inability to satisfy a financial covenant under this Agreement or other Indebtedness) and without any qualification or exception as to the scope of such audit) to the effect that such consolidated financial statements present fairly in all material respects the financial condition and results of operations of the Parent and its Subsidiaries on a consolidated basis in accordance with GAAP consistently applied;

 

 

(b)               on or before the date on which such financial statements are required to be filed with the SEC after the end of each of the first three fiscal quarters of each fiscal year of the Parent (or, if such financial statements are not required to be filed with the SEC, within 45 days after the end of each of the first three fiscal quarters of each fiscal year of the Parent), its consolidated balance sheets and related consolidated statements of operations and comprehensive income (loss), changes in stockholders’ equity, and cash flows as of the end of and for such fiscal quarter and the then elapsed portion of the fiscal year, setting forth in each case in comparative form the figures for the corresponding period or periods of (or, in the case of the balance sheet, as of the end of) the previous fiscal year, all certified by one of its Financial Officers as presenting fairly in all material respects the financial condition and results of operations of the Parent and its Subsidiaries on a consolidated basis in accordance with GAAP consistently applied, subject to normal year-end audit adjustments and the absence of footnotes;

 

(c)               concurrently with any delivery of financial statements under clause (a) or (b) above, a certificate of a Financial Officer of the Borrower in substantially the form of Exhibit F attached hereto (i) certifying as to whether a Default has occurred and is continuing as of the date thereof and, if a Default has occurred and is continuing as of the date thereof, specifying the details thereof and any action taken or proposed to be taken with respect thereto, (ii) demonstrating compliance with Section 6.10, (iii) if and to the extent that any change in GAAP that has occurred since the date of the audited financial statements referred to in Section 3.04 had an impact on such financial statements, specifying the effect of such change on the financial statements accompanying such certificate and (iv) setting forth a list of any issued patents, registered trademarks or registered copyrights acquired by the Parent and its Subsidiaries since the Effective Date or the date of the most recent certificate delivered pursuant to this Section 5.01(c) prior to the date thereof, as applicable, which Intellectual Property (including any applications therefor) was not included in the Collateral as of the Effective Date or date of such certificate, as applicable;

 

(d)               promptly after the same become publicly available, copies of all periodic and other reports, proxy statements and other materials filed by the Parent or any Subsidiary with the SEC or any Governmental Authority succeeding to any or all of the functions of said Commission under Section 13 or 15(d) of the Securities Exchange Act of 1934, as the case may be, in each case that is not otherwise required to be delivered to the Administrative Agent pursuant hereto; and

 

(e)               promptly following any reasonable request in writing (including any electronic message) therefor, (i) such other information regarding the operations, business affairs and financial condition of the Parent or any Subsidiary, or compliance with the terms of this Agreement or any other Loan Document, as the Administrative Agent or any Lender (through the Administrative Agent) may reasonably request and (ii) information and documentation reasonably requested by the Administrative Agent or any Lender for purposes of compliance with applicable “know your customer” and anti-money laundering rules and regulations, including the USA Patriot Act and the Beneficial Ownership Regulation, provided that, notwithstanding the foregoing, none of the Parent or any of its Subsidiaries shall be required to disclose any document, information or other matter that (A) constitutes non-financial trade secrets or non-financial proprietary information, (B) in respect of which disclosure to the Administrative Agent or any Lender (or their respective representatives) is prohibited by applicable law or any third party contract legally binding on the Parent or its Subsidiaries or (C) is subject to attorney, client or similar privilege or constitutes attorney work-product.

 

 

Information required to be delivered pursuant to Section 5.01(a) or Section 5.01(b) may be delivered electronically and if so delivered, shall be deemed to have been delivered on the date on which such information is posted on the Borrower’s or the Parent’s behalf on an Internet or intranet website, if any, to which the Lenders and the Administrative Agent have been granted access (whether a commercial, third-party website or whether sponsored by the Administrative Agent).

 

Notwithstanding the foregoing, the obligations in Section 5.01(a) or Section 5.01(b) may be satisfied by furnishing (A) the applicable financial statements or other information required by such clauses of Parent (or any other parent company) or (B) the Parent’s or the Borrower’s (or any other parent company), as applicable, Form 10-K or 10-Q, as applicable, filed with the SEC or any securities exchange, in each case, within the time periods specified in such paragraphs; provided that, with respect to each of clauses (A) and (B), upon reasonable request by the Administrative Agent, (i) to the extent such financial statements are delivered under Section 5.01(a) or Section 5.01(b) and relate to the Parent, such financial statements shall be accompanied by consolidating information that explains in reasonable detail the differences between the information relating to the Parent, on the one hand, and the information relating to the Borrower on a standalone basis, on the other hand, which consolidating information shall be certified by a Responsible Officer of the Borrower as having been fairly presented and (ii) to the extent such statements are in lieu of statements required to be provided under Section 5.01(a), such statements shall be accompanied by a report and opinion of an independent registered public accounting firm of nationally recognized standing, which report and opinion shall satisfy the applicable requirements set forth in Section 5.01(a).

 

Section 5.02        Notices of Material Events. The Borrower will furnish to the Administrative Agent (for distribution to each Lender) prompt written notice of the following:

 

(a)               the occurrence of any Default;

 

(b)               the filing or commencement of any action, suit or proceeding by or before any arbitrator or Governmental Authority against or affecting the Parent or any of its Subsidiary thereof that would reasonably be expected to result in a Material Adverse Effect; and

 

(c)               any other development that results in, or would reasonably be expected to result in, a Material Adverse Effect.

 

Each notice delivered under this Section shall be accompanied by a statement of a Responsible Officer or other executive officer of the Borrower setting forth the details of the event or development requiring such notice and any action taken or proposed to be taken with respect thereto.

 

 

Section 5.03        Existence; Conduct of Business. The Parent will, and will cause each of its Subsidiaries to, do or cause to be done all things necessary to preserve, renew and keep in full force and effect its legal existence in its jurisdiction of organization and the rights, licenses, permits, privileges and franchises material to the conduct of its business; provided that (i) the foregoing shall not prohibit any merger, consolidation, liquidation or dissolution permitted under Section 6.03 and (ii) none of the Parent or any of its Subsidiaries shall be required to preserve, renew or keep in full force and effect its rights, licenses, permits, privileges or franchises where failure to do so would not reasonably be expected to result in a Material Adverse Effect.

 

Section 5.04        Payment of Taxes. The Parent will, and will cause each of its Subsidiaries to, pay all Tax liabilities, including all Taxes imposed upon it or upon its income or profits or upon any properties belonging to it that, if not paid, would reasonably be expected to result in a Material Adverse Effect, before the same shall become delinquent or in default, and all lawful claims other than Tax liabilities that, if unpaid, would become a Lien upon any properties of the Parent or any of its Subsidiaries not otherwise permitted under Section 6.02, in both cases except where (a) the validity or amount thereof is being contested in good faith by appropriate proceedings and (b) to the extent required by GAAP, the Parent or such Subsidiary has set aside on its books adequate reserves with respect thereto in accordance with GAAP.

 

Section 5.05        Maintenance of Properties; Protection of Intellectual Property; Insurance. The Parent will, and will cause each of its Subsidiaries to, (a) keep and maintain all property used in the conduct of its business in good working order and condition, ordinary wear and tear and casualty events excepted, except to the extent that failure to do so would not reasonably be expected to have a Material Adverse Effect, (b) preserve, renew and maintain in full force and effect all rights, licenses, intellectual property, copyright, trademarks, trade names, patents, domain names, permits, privileges, authorizations and other rights necessary for the conduct of its business, except to the extent that failure to do so would not reasonably be expected to have a Material Adverse Effect and (c) maintain insurance with financially sound and reputable insurance companies in such amounts and against such risks as are customarily maintained by companies engaged in the same or similar businesses or owning assets in the general areas in which the Borrower and its Subsidiaries operate.

 

Section 5.06        Maintenance of Material Agreements. The Parent will, and will cause each of its Subsidiaries to maintain in full force and effect the agreements listed on Schedule 5.06 hereto, except to the extent that failure to do so would not reasonably be expected to have a Material Adverse Effect.

 

Section 5.07        Books and Records; Inspection Rights. The Parent will, and will cause each of its Subsidiaries to, keep proper books of record and account in which entries full, true and correct in all material respects are made and are sufficient to prepare financial statements in accordance with GAAP. The Parent will, and will cause each of its Subsidiaries to, permit any representatives designated by the Administrative Agent or any Lender (pursuant to the request made through the Administrative Agent), upon reasonable prior notice, to visit and inspect its properties, to examine and make extracts from its books and records to the extent reasonably necessary, and to discuss its affairs, finances and condition with its officers and independent accountants (provided that the Parent or such Subsidiary shall be afforded the opportunity to participate in any discussions with such independent accountants), all at such reasonable times and as often as reasonably requested (but no more than once annually if no Event of Default exists). Notwithstanding anything to the contrary in this Section, none of the Parent or any of its Subsidiaries shall be required to disclose, permit the inspection, examination or making copies or abstracts of, or discussion of, any document, information or other matter that (i) constitutes non-financial trade secrets or non-financial proprietary information, (ii) in respect of which disclosure to the Administrative Agent or any Lender (or their respective representatives) is prohibited by applicable law or any third party contract legally binding on the Parent or its Subsidiaries or (iii) is subject to attorney, client or similar privilege or constitutes attorney work-product.

 

 

Section 5.08        ERISA Events. The Borrower will furnish to the Administrative Agent and each Lender prompt written notice of the occurrence of any ERISA Event that, alone or together with any other ERISA Events that have occurred, would reasonably be expected to result in a Material Adverse Effect.

 

Section 5.09       Compliance with Laws and Agreements. The Parent will, and will cause each of its Subsidiaries to, comply with all laws, rules, regulations and orders of any Governmental Authority applicable to it or its property and rights and all indentures, agreements, and other instruments binding upon it or its property and rights, except where the failure to do so, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect. The Parent will maintain in effect and enforce policies and procedures designed to ensure compliance by the Parent, its Subsidiaries and their respective directors, officers, employees and agents with Anti-Corruption Laws, Anti-Terrorism Laws and applicable Sanctions.

 

Section 5.10        Use of Proceeds. The proceeds of the Loans and Letters of Credit will be used only for working capital and general corporate purposes, including, without limitation, for stock repurchases under stock repurchase programs approved by the Borrower and for acquisitions not prohibited hereunder. No part of the proceeds of any Loan or Letter of Credit will be used, whether directly or indirectly, to purchase or carry margin stock (within the meaning of Regulations U and X of the Board) or to extend credit to others for the purpose of purchasing or carrying margin stock or to refund indebtedness originally incurred for such purpose.

 

Section 5.11        Guarantors; Additional Collateral.

 

(a)               If, as of the date of the most recently available financial statements delivered pursuant to Section 5.01(a) or (b), as the case may be, any Person shall have become (1) a Domestic Subsidiary (other than an Excluded Subsidiary), then the Parent or the Borrower, as applicable, shall, within 60 days (or such longer period of time as the Administrative Agent may agree in its reasonable discretion) after delivery of such financial statements, cause such Domestic Subsidiary to (i) enter into a guaranty supplement in the form of Exhibit E hereto to become a Guarantor under this Agreement and (ii) (A) enter into a joinder agreement in form and substance reasonably satisfactory to the Administrative Agent to the Security Agreement and (B) take such actions necessary or advisable to grant to the Administrative Agent for the benefit of the Lenders a perfected first priority security interest (subject to Liens permitted by Section 6.02) in the Collateral described in the Security Agreement with respect to such Domestic Subsidiary, including the filing of Uniform Commercial Code financing statements in such jurisdictions, and filings with the United States Patent and Trademark Office and United States Copyright Office, as may be required by the Security Agreement or as may be reasonably requested by the Administrative Agent and (iii) if requested by the Administrative Agent, deliver to the Administrative Agent legal opinions consistent with the legal opinions delivered on the Effective Date, which opinions shall be in form and substance, and from counsel, reasonably satisfactory to the Administrative Agent and/or (2) a foreign Subsidiary (other than an Excluded Subsidiary) and such foreign Subsidiary has been designated as a “Foreign Guarantor” by the Borrower, then the Parent or the Borrower, as applicable, shall, within 60 days (or such longer period of time as the Administrative Agent may agree in its reasonable discretion) after delivery of such financial statements, cause such foreign Subsidiary to take all actions necessary to (i) ensure that the Administrative Agent shall have a valid, perfected and enforceable security interest in its assets in accordance with the Agreed Security Principles, (ii) cause such foreign Subsidiary to enter into a guaranty supplement in the form of Exhibit E hereto or otherwise reasonably satisfactory to the Administrative Agent and (iii) if requested by the Administrative Agent, deliver to the Administrative Agent legal opinions consistent with the legal opinions delivered on the Effective Date, which opinions shall be in form and substance, and from counsel, reasonably satisfactory to the Administrative Agent; provided that the Parent and its Subsidiaries shall not be required to take any action under this Section 5.11(a) if prior to the end of such 60 day period (or such longer period of time as the Administrative Agent may agree in its sole discretion) such Person becomes an Excluded Subsidiary as a result of a transfer of assets from such Person to the Borrower in a transaction or transactions permitted under this Agreement;

 

 

(b)               If, as of the date of the most recently available financial statements delivered pursuant to Section 5.01(a) or (b), as the case may be, any foreign Subsidiary (not including any such foreign Subsidiary that becomes a Guarantor as provided for in Section 5.11(a)(2)) that is a direct Subsidiary of any Loan Party shall have been created or acquired after the Effective Date by any Loan Party, the Parent or Borrower, as applicable, will, or will cause the applicable Guarantor to, except to the extent the Equity Interests in such foreign Subsidiary constitute Excluded Securities, within 60 days (or such longer period of time as the Administrative Agent may agree in its sole discretion) after delivery of such financial statements, (i) execute and deliver to the Administrative Agent such amendments to the Security Agreement as the Administrative Agent deems necessary or advisable to grant to the Administrative Agent, for the benefit of the Lenders, a perfected first priority security interest (subject to Liens permitted by Section 6.02) in 65% of the total outstanding voting Equity Interests of any such foreign Subsidiary, (ii) deliver to the Administrative Agent any certificates representing such Equity Interests, together with undated stock powers, in blank, executed and delivered by a duly authorized officer of the relevant Loan Party, and take such other action as may be necessary or, in the opinion of the Administrative Agent, reasonably required to perfect the Administrative Agent’s security interest therein, and (iii) if reasonably requested by the Administrative Agent, deliver to the Administrative Agent legal opinions, which opinions shall be in form and substance, and from counsel, reasonably satisfactory to the Administrative Agent.

 

(c)               If, as of the date of the most recently available financial statements delivered pursuant to Section 5.01(a) or (b), as the case may be, any property shall be acquired by any Loan Party (other than (x) any property described in paragraphs (a) or (b) above or paragraph (d) below and (y) any property subject to a Lien expressly permitted by Section 6.02) as to which the Administrative Agent, for the benefit of the Lenders, does not have a perfected Lien, to the extent required by the Security Documents, the Parent or the Borrower, as applicable, will, or will cause the applicable Loan Party to, within 60 days (or such longer period of time as the Administrative Agent may agree in its sole discretion) after the delivery of such financial statements (i) execute and deliver to the Administrative Agent such amendments to the applicable Security Documents or such other documents as the Administrative Agent deems necessary or advisable to grant to the Administrative Agent, for the benefit of the Lenders, a security interest in such property and (ii) take all actions necessary or advisable to grant to the Administrative Agent, for the benefit of the Lenders, a perfected first priority security interest in such property, including the filing of Uniform Commercial Code financing statements (or similar filings under applicable law) in such jurisdictions as may be required by the Security Agreement or by law or as may be requested by the Administrative Agent, in each case subject to Section 5.11(e).

 

 

(d)               If, as of the date of the most recently available financial statements delivered pursuant to Section 5.01(a) or (b), as the case may be, any fee interest in any real property having a value (together with improvements thereof) of at least $2,500,000 shall be acquired by any Loan Party (other than any such real property subject to a Lien expressly permitted by Section 6.02), the Parent or the Borrower, as applicable, will, or will cause the applicable Loan Party to, within 60 days (or such longer period of time as the Administrative Agent may agree in its sole discretion) after the delivery of such financial statements (i) execute and deliver a first priority mortgage, in favor of the Administrative Agent, for the benefit of the Lenders, covering such real property, (ii) if reasonably requested by the Administrative Agent, provide the Lenders with (x) title and extended coverage insurance covering such real property in an amount at least equal to the purchase price of such real property (or such other amount as shall be reasonably satisfactory to the Administrative Agent) as well as a current ALTA survey thereof, together with a surveyor’s certificate and (y) any consents or estoppels reasonably deemed necessary by the Administrative Agent in connection with such mortgage, each of the foregoing in form and substance reasonably satisfactory to the Administrative Agent and (iii) if reasonably requested by the Administrative Agent, deliver to the Administrative Agent legal opinions relating to the matters described above, which opinions shall be in form and substance, and from counsel, reasonably satisfactory to the Administrative Agent.

 

(e)               Notwithstanding the foregoing or anything to the contrary in this Agreement, none of the Parent or its Subsidiaries shall be required to take any action to create or perfect any security interest in the Collateral (including the registration of Intellectual Property in, and the execution of any agreement, document or other instrument governed by the law of, and the filing of any agreement, document or other instrument) in any jurisdiction other than (i) the United States, any State thereof or the District of Columbia or (ii) the jurisdiction of organization or incorporation of any Foreign Guarantor. In addition, in no event shall (i) any landlord, mortgagee and bailee waivers be required, or (ii) notices be required to be sent to account debtors or other contractual third parties absent an Event of Default.

 

Section 5.12       Cash Management. The Parent shall, and shall cause each other U.S. Loan Party to, maintain all cash management and treasury business with the Lenders or Permitted Third Party Banks, including, without limitation, all deposit accounts, disbursement accounts, investment accounts and lockbox accounts which, as of the Effective Date, are specified in Schedule 4.2 of the Security Agreement (other than any Unrestricted Account) (each such deposit account, disbursement account, investment account and lockbox account, a “Controlled Account”); provided that within ninety (90) days following the Effective Date (or, if any such Controlled Account is opened after the Effective Date, within ninety (90) days after such account is opened) (or such later time as may be agreed by the Administrative Agent in its reasonable discretion), each such Controlled Account shall be subject to a Control Account Agreement.

 

 

Section 5.13        Further Assurances. Promptly upon the reasonable request by the Administrative Agent, the Borrower will (a) correct any error that may be discovered in any Loan Document or in the execution, acknowledgment, filing or recordation thereof, and (b) do, execute, acknowledge, deliver, record, re-record, file, re-file, register and re-register any and all such further acts, deeds, certificates, assurances and other instruments as the Administrative Agent, or any Lender through the Administrative Agent, may reasonably require from time to time in order to (i) perfect and maintain the validity, effectiveness and priority of any of the Security Documents and any of the Liens created thereunder and (ii) assure, preserve, protect and confirm more effectively unto the Lenders, or the Administrative Agent for the benefit of the Lenders, the rights granted to the Lenders, or the Administrative Agent for the benefit of the Lenders, under any Loan Document or under any other instrument executed in connection with any Loan Document to which any Loan Party or any of its Subsidiaries is or is to be a party.

 

Section 5.14        Accuracy of Information. The Borrower will ensure that any information, including financial statements or other documents, furnished to the Administrative Agent or the Lenders in connection with this Agreement or any amendment or modification hereof or waiver hereunder contains no material misstatement of fact or omits to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not materially misleading.

 

Article 6
NEGATIVE COVENANTS

 

Until each of (i) the Commitments have expired or been terminated, (ii) the principal of and interest on each Loan and all other Obligations hereunder (including unreimbursed LC Disbursements, but excluding contingent obligations as to which no claim has been asserted) shall have been paid in full or otherwise satisfied, and (iii) all Letters of Credit shall have (x) expired or terminated, in each case, without any pending draw, (y) been backstopped or Cash Collateralized in an amount not less than the Minimum Collateral Amount or (z) been deemed reissued under another agreement reasonably acceptable to the applicable Issuing Bank, the Parent and the Borrower, as applicable, covenant and agree with the Lenders that:

 

Section 6.01        Indebtedness. The Borrower will not, and will not permit any Subsidiary to, create, incur, assume or permit to exist any Indebtedness other than:

 

(a)               Indebtedness existing on the date hereof and set forth in Schedule 6.01 and any Permitted Refinancing thereof;

 

(b)               (i) Indebtedness of the Borrower owing to any Subsidiary and of any Subsidiary owing to the Borrower or any other Subsidiary; provided that such Indebtedness is permitted by Section 6.04 and (ii) Indebtedness of the Borrower owing to Parent;

 

 

(c)               Guarantees by the Borrower of Indebtedness of any Subsidiary and by any Subsidiary of Indebtedness of the Borrower or any other Subsidiary; provided that such Guarantees are permitted by Section 6.04;

 

(d)               Indebtedness of the Borrower or any Subsidiary constituting Capital Lease Obligations and Purchase Money Indebtedness; provided that the aggregate principal amount of Indebtedness pursuant to this clause (d) shall not exceed in an aggregate principal amount at any time outstanding the greater of (i) $17,500,000 and (ii) 2.5% of the Total Assets at any time outstanding;

 

(e)               Indebtedness of the Borrower or any Subsidiary in an aggregate principal amount at any time outstanding not to exceed the greater of (i) $69,500,000 and (ii) 10% of the Total Assets at any time outstanding; provided that such Indebtedness is (x) if incurred or guaranteed only by Loan Parties, is either unsecured or secured by a Lien permitted pursuant to Section 6.02(o), and (y) if incurred or guaranteed by any Subsidiary that is not a Guarantor, the aggregate principal amount thereof shall not exceed the greater of (i) $10,500,000 and (ii) 1.5% of the Total Assets at any time outstanding;

 

(f)                Indebtedness of the Borrower or any Subsidiary so long as the Consolidated Leverage Ratio does not exceed 2.50:1.00 after giving Pro Forma Effect thereto; provided that any Indebtedness incurred or guaranteed pursuant to this clause (f) (i) is incurred or guaranteed solely by Loan Parties, (ii) is unsecured, (iii) shall not mature prior to the Maturity Date, (iv) either (x) shall not require any payment of principal prior to the Maturity Date or (y) shall not require payments of principal in an aggregate amount per annum in excess of 1.0% of the principal amount thereof and (v) contains terms customary for similar issuances of Indebtedness at such time (as determined in good faith by the Borrower) (it being understood that, other than in the case of any issuance of a debt security, such terms shall be no more restrictive, taken as a whole (as determined in good faith by the Borrower), than the Loans, and in any event no such Indebtedness (including any debt securities) shall contain a financial maintenance covenant more restrictive than any financial maintenance covenant contained herein));

 

(g)               unsecured Indebtedness of the Borrower or any Subsidiary in an aggregate principal amount not to exceed the greater of (i) $17,500,000 and (ii) 2.5% of the Total Assets at any time outstanding;

 

(h)               Indebtedness of Subsidiaries that are not Loan Parties in an aggregate principal amount not to exceed the greater of (i) $8,750,000 and (ii) 1.25% of the Total Assets at any time outstanding;

 

(i)                 Indebtedness incurred pursuant to any agreement or arrangement to provide ordinary course facilities or services related to cash management, including treasury, depository, overdraft, credit or debit card, purchase card, electronic funds transfer and other cash management arrangements;

 

(j)                 Obligations under the Loan Documents;

 

 

(k)               Indebtedness incurred under the Citi Supplier Financing Agreement, only to the extent (i) such agreement pertains to ordinary course supplier financing arrangements and (ii) the aggregate principal amount of Indebtedness outstanding thereunder does not exceed $200.0 million at any time; provided, however, that (I) the Borrower shall be in compliance with Section 6.10 on a Pro Forma Basis on each date that it incurs Indebtedness under the Citi Supplier Financing Agreement that results in the outstanding amount thereunder exceeding $100.0 million (such excess amount, the “Supplier Financing Excess Amount”), it being understood and agreed that solely for the purposes of such pro forma calculation the amount of “Total Liquidity” shall be deemed reduced by the Supplier Financing Excess Amount then outstanding and (II) the Supplier Financing Excess Amount outstanding during any fiscal quarter of the Parent shall not be greater than (x) $25.0 million plus (y) the highest Supplier Financing Excess Amount that was outstanding in compliance with this Section 6.01(k) during the immediately preceding fiscal quarter of the Parent;

 

(l)                 Indebtedness of the Borrower or any Subsidiary in connection with one or more letters of credit, bankers’ acceptances, worker’s compensation claims, surety bonds, appeal bonds, performance bonds or completion guarantees issued in the ordinary course of business or pursuant to self-insurance and similar obligations and not in connection with the borrowing of money or the obtaining of advances or credit;

 

(m)             Subject to the Borrower being in compliance with Section 6.10 on a Pro Forma Basis, (i) Indebtedness of any Person acquired by, or merged into or consolidated or amalgamated with, the Borrower or any Subsidiary after the Effective Date as part of an Investment otherwise permitted by Section 6.04 (provided that such Indebtedness exists at the time such Person becomes a Subsidiary and is not created in contemplation of, or in connection with, such Person becoming a Subsidiary); and (ii) any Permitted Refinancing thereof;

 

(n)               obligations under Swap Agreements entered into by the Borrower or its Subsidiaries not for speculative purposes;

 

(o)               Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against insufficient funds in the ordinary course of business or other cash management services in the ordinary course of business;

 

(p)               Indebtedness arising from agreements of the Borrower or any Subsidiary providing for deferred purchase price for goods or services, earnouts, indemnification, adjustment of purchase price, seller notes or similar obligations, in each case, incurred or assumed in connection with the acquisition or Disposition of any business, assets or Person otherwise permitted by this Agreement;

 

(q)               Indebtedness consisting of the financing of insurance premiums or take-or-pay obligations contained in supply arrangements; and

 

(r)                Indebtedness representing deferred compensation to employees, consultants or independent contractors of the Borrower or any Subsidiary incurred in the ordinary course of business.

 

Notwithstanding the foregoing, any Indebtedness owed by a Loan Party to a Subsidiary that is not a Loan Party shall be permitted only to the extent subordinated to the Obligations on customary terms reasonably satisfactory to the Administrative Agent.

 

 

Section 6.02        Liens. The Borrower will not, and will not permit any Subsidiary to, create, incur, assume or permit to exist any Lien on any property or asset now owned or hereafter acquired by it except:

 

(a)               Permitted Encumbrances;

 

(b)               any Lien on any property or asset of the Borrower or any Subsidiary existing on the Effective Date and set forth in Schedule 6.02 and any modifications, renewals and extensions thereof and any Lien granted as a replacement or substitute therefor; provided that (i) such Lien shall not apply to any other property or asset of the Borrower or any Subsidiary other than improvements thereon or proceeds thereof and (ii) such Lien shall secure only those obligations which it secures on the Effective Date and any refinancing, extension, renewal or replacement thereof that does not increase the outstanding principal amount thereof except by an amount equal to a reasonable premium or other reasonable amount paid, and fees and expenses reasonably incurred, in connection with such refinancing, extensions, renewals or replacements;

 

(c)               any Lien existing on any property or asset prior to the acquisition thereof by the Borrower or any Subsidiary or existing on any property or asset of any Person that becomes a Subsidiary after the Effective Date prior to the time such Person becomes a Subsidiary; provided that (i) such Lien is not created in contemplation of or in connection with such acquisition or such Person becoming a Subsidiary, as the case may be, (ii) such Lien shall not apply to any other property or assets of the Borrower or any Subsidiary and (iii) such Lien shall secure only those obligations which it secures on the date of such acquisition or the date such Person becomes a Subsidiary, as the case may be, and any Permitted Refinancing thereof;

 

(d)               Liens on fixed or capital assets acquired, constructed or improved by the Borrower or any Subsidiary; provided that (i) such security interests secure Indebtedness that is permitted by Section 6.01(d), (ii) such security interests and the Indebtedness secured thereby are initially incurred prior to or within 180 days after such acquisition or the completion of such construction or improvement and (iii) such security interests shall not apply to any other property or assets of the Borrower or any Subsidiary other than the property financed by such Indebtedness and any additions, accessions, parts, attachments or improvements thereon or proceeds and products hereof and customary security deposits and related property; provided that individual financings provided by one lender may be cross-collateralized to other financings provided by such lender;

 

(e)               licenses, sublicenses, leases or subleases granted to others in the ordinary course of business not interfering in any material respect with the business of the Borrower and its Subsidiaries, taken as a whole;

 

(f)                the interest and title of a lessor under any lease or sublease entered into by the Borrower or any Subsidiary in the ordinary course of its business and other statutory and common law landlords’ Liens under leases;

 

(g)               the rights reserved or vested in any Person (including any Governmental Authority) by the terms of any lease, sublease, license, or sublicense held by the Parent or any of its Subsidiaries or by a statutory provision, to terminate any such lease, sublease, license, or sublicense, or to require annual or periodic payments as a condition to the continuance thereof;

 

 

(h)               the interests of licensors and sublicensors under license and sublicense agreements;

 

(i)                 in connection with the sale or transfer of any assets in a transaction not prohibited hereunder, customary rights and restrictions contained in agreements relating to such sale or transfer pending the completion thereof;

 

(j)                 Liens securing Indebtedness to finance insurance premiums owing in the ordinary course of business to the extent such financing is not prohibited hereunder;

 

(k)               Liens on earnest money deposits of cash or cash equivalents made in connection with any acquisition not prohibited hereunder;

 

(l)                 bankers’ Liens, rights of setoff and other similar Liens existing solely with respect to cash and Cash Equivalents on deposit in one or more accounts maintained by the Borrower or any Subsidiary, in each case granted in the ordinary course of business in favor of the banks, securities intermediaries or other depository institutions with which such accounts are maintained, securing amounts owing to such institutions with respect to cash management and operating account arrangements;

 

(m)             Liens in the nature of the right of setoff in favor of counterparties to contractual agreements not otherwise prohibited hereunder with the Borrower or any of its Subsidiaries in the ordinary course of business;

 

(n)               Liens created pursuant to the Security Documents;

 

(o)               other Liens securing obligations in an aggregate amount at any time outstanding not to exceed the greater of (i) $69,500,000 and (ii) 10% of the Total Assets at any time outstanding; provided that (A) any such Liens on the Collateral shall be subordinated to the Liens of the Administrative Agent under the Security Documents pursuant to a customary intercreditor agreement that is reasonably acceptable to the Administrative Agent and (B) any such Liens on assets that are not Collateral shall secure obligations in an aggregate amount at any time not to exceed the greater of (x) $10,500,000 and (ii) 1.50% of the Total Assets at any time outstanding;

 

(p)               Liens on assets of Excluded Subsidiaries securing Indebtedness incurred by Excluded Subsidiaries; provided that such security interests secure Indebtedness that is permitted by Section 6.01;

 

(q)               any customary encumbrance or restriction (including put and call arrangements) with respect to capital stock of any joint venture or similar customary arrangement pursuant to any joint venture or similar agreement;

 

(r)                Liens on Equity Interests not required to be pledged pursuant hereto;

 

 

(s)                rights reserved to or vested in any Governmental Authority to control or regulate, or obligations or duties to any Governmental Authority with respect to (i) the use of any real property or vessel, or (ii) any right, power, franchise, grant, license, or permit, including present or future zoning laws, building codes and ordinances, zoning restrictions, or other laws and ordinances restricting the occupancy, use, or enjoyment of real property or vessel;

 

(t)                 Liens on assets of a Person existing at the time such Person is acquired or merged with or into or consolidated with the Borrower or any Subsidiary (and not created in connection with or in anticipation or contemplation thereof); provided, however, that such Liens do not extend to assets not subject to such Liens at the time of acquisition (other than improvements and attachments thereon, accessions thereto and proceeds thereof

 

(u)               Liens ratably secured by the Collateral in favor of counterparties to Swap Agreements permitted under Section 6.01(n);

 

(v)               Liens securing Indebtedness incurred pursuant to Section 6.01(c);

 

(w)             Liens on cash and Cash Equivalents (and on the related escrow accounts or similar accounts, if any) required to be paid to the lessors (or lenders to such lessors) under leases or maintained in an escrow account or similar account pending application of such proceeds in accordance with the applicable lease;

 

(x)               Liens encumbering deposits made to secure obligations arising from statutory or regulatory requirements of that Person or its Subsidiaries;

 

(y)               any encumbrance or restriction (including put and call arrangements) with respect to the Equity Interests of any joint venture or similar arrangement pursuant to any joint venture or similar agreement; and

 

(z)               Liens securing Indebtedness permitted under Section 6.01(l) (i) on cash collateral or (ii) arising from a backstop letter of credit arrangement.

 

Section 6.03        Fundamental Changes.

 

(a)               The Borrower will not, and will not permit any Subsidiary to, (x) merge into or consolidate with any other Person, or permit any other Person to merge into or consolidate with it, (y) otherwise Dispose of (in one transaction or in a series of transactions) all or substantially all of its assets, or all or substantially all of the stock of any of its Subsidiaries (in each case, whether now owned or hereafter acquired), or (z) liquidate or dissolve, except that, if at the time thereof and immediately after giving effect thereto no Default shall have occurred and be continuing:

 

(i)                 any Subsidiary or any other Person (except the Parent) may merge into or consolidate with the Borrower in a transaction in which the Borrower is the surviving corporation;

 

(ii)              any Person (other than the Borrower or the Parent) may merge into or consolidate with any Subsidiary in a transaction in which the surviving entity is a Subsidiary (provided that any such merger or consolidation involving a Guarantor must result in a Guarantor as the surviving entity or the surviving entity becoming a Guarantor as part of the transaction);

 

 

(iii)            any Excluded Subsidiary may Dispose of its assets to any Loan Party (other than the Parent) or to any other Excluded Subsidiary;

 

(iv)             any Loan Party may Dispose of its assets to any other Loan Party (other than the Parent);

 

(v)               in connection with any Investment permitted under Section 6.04, any Loan Party may merge into or consolidate with any other Person (other than the Parent), so long as the Person surviving such merger or consolidation shall be a Loan Party (provided that (x) any such merger or consolidation involving a Guarantor must result in a Guarantor as the surviving entity or the surviving entity becoming a Guarantor as part of the transaction and (y) any such merger or consolidation involving the Borrower must result in the Borrower as the surviving entity);

 

(vi)             subject to compliance with Section 6.04(d), any Loan Party may Dispose of its assets in order to effect any Investment permitted under Section 6.04(d); and

 

(vii)          any Subsidiary may liquidate or dissolve if the Borrower determines in good faith that such liquidation or dissolution is in the best interests of the Borrower and is not materially disadvantageous to the Lenders; and any Subsidiary may consummate a Division as the Dividing Person if, immediately upon the consummation of the Division, all the assets of the applicable Dividing Person are held by one or more Subsidiaries at such time; provided that, if the applicable Dividing Person is a Loan Party, all of the assets of such Dividing Person shall be held by one or more Loan Parties at such time;

 

provided that any such any such merger involving a Person that is not a wholly owned Subsidiary immediately prior to such merger shall not be permitted unless also permitted by Section 6.04.

 

(b)               The Borrower will not, and will not permit any of its Subsidiaries to, engage to any material extent in any material line of business substantially different from those lines of businesses conducted or proposed to be conducted by the Borrower and its Subsidiaries on the Effective Date and businesses substantially related or incidental thereto.

 

Section 6.04        Investments, Loans, Advances, Guarantees and Acquisitions. The Borrower will not, and will not permit any of its Subsidiaries to, purchase, hold or acquire (including pursuant to any merger with any Person that was not a wholly owned Subsidiary prior to such merger) any capital stock, evidences of indebtedness or other securities (including any option, warrant or other right to acquire any of the foregoing) of, make or permit to exist any loans or advances to, Guarantee any obligations of, any other Person, or purchase or otherwise acquire (in one transaction or a series of transactions) any assets of any other Person constituting a business unit (the foregoing activities are collectively referred to herein as “Investments”), except:

 

 

(a)               Investments in cash and Cash Equivalents;

 

(b)               (i) Investments by the Borrower existing on the date hereof in the capital stock of its Subsidiaries; and (ii) Investments in existence, contemplated or made pursuant to binding commitments in effect on the Effective Date and identified on Schedule 6.04(b)(ii);

 

(c)               (i) Investments made by the Borrower or any Subsidiary, in the Borrower or any other Subsidiary that is a Loan Party; and (ii) Investments by Excluded Subsidiaries in other Excluded Subsidiaries;

 

(d)               Investments made by the Borrower in any Excluded Subsidiary, or by any Subsidiary that is a Loan Party in any Excluded Subsidiary, provided that the aggregate amount of such Investments shall not exceed the greater of (i) $24,500,000 and (ii) 3.5% of the Total Assets at any time outstanding;

 

(e)               Investments in an aggregate amount at any time outstanding not to exceed the greater of (i) $10,500,000 and (ii) 1.5% of the Total Assets at any time outstanding;

 

(f)                [reserved];

 

(g)               Investments received in settlement of debts, claims or disputes owed to the Borrower or any Subsidiary that arose out of transactions in the ordinary course of business;

 

(h)               advances and extensions of credit in the nature of accounts receivable arising from the sale or lease of goods or services or the licensing of property in the ordinary course of business;

 

(i)                 Investments made by the Borrower or any Subsidiary in the Parent to the extent permitted to be made as a Restricted Payment by Section 6.05;

 

(j)                 Investments in joint ventures to the extent required by, or made pursuant to customary buy/sell arrangements, drag-along rights, put rights, call rights or similar arrangements between, the joint venture parties set forth in joint venture arrangements and similar binding arrangements;

 

(k)               Investments among Loan Parties and their Subsidiaries pursuant to any agreement or arrangement to provide ordinary course facilities or services related to cash management, including treasury, depository, overdraft, credit or debit card, purchase card, electronic funds transfer and other cash management arrangements;

 

(l)                 Guarantees constituting Indebtedness permitted by Section 6.01;

 

(m)             so long as no Default or Event of Default then exists or would result therefrom, the Borrower may make Investments (except in the Parent) and other acquisitions if the Borrower is in compliance with Section 6.10 on a Pro Forma Basis after giving effect to such Investment or acquisition;

 

(n)               Investments funded with (i) Equity Interests of the Parent (or any parent company thereof) or the Borrower or (ii) net cash proceeds from (x) the issuance of the Equity Interests of the Parent (or any parent company thereof) and contributed as common equity to the Borrower or (y) the issuance of the Equity Interests of the Borrower;

 

 

(o)               Investments consisting of the licensing, sublicensing or contribution of any Intellectual Property pursuant to joint marketing, collaboration or other similar arrangements with other Persons;

 

(p)               advances up to an aggregate principal amount of $500,000 per year to officers, directors and employees of the Borrower and its Subsidiaries for travel, entertainment, relocation and analogous ordinary business purposes;

 

(q)               purchases or redemption of the Parent’s or the Borrower’s Equity Interests to the extent permitted by Section 6.05;

 

(r)                Investments consisting of extensions of credit in the nature of accounts receivable or notes receivable arising from the grant of trade credit in the ordinary course of business, and Investments received in satisfaction or partial satisfaction thereof from financially troubled account debtors to the extent reasonably necessary in order to prevent or limit loss (including in connection with the bankruptcy or reorganization of such account debtors);

 

(s)                capital expenditures and Investments consisting of or to finance purchases and acquisitions of inventory, supplies, materials, services or equipment or purchases of contract rights or licenses or leases of intellectual property in the ordinary course of business;

 

(t)                 Investments representing all or a portion of the sales price for property sold to another Person;

 

(u)               any Investment made in lieu of payment of a Tax or in consideration of a reduction in Tax;

 

(v)               Investments of a Person existing at the time such Person is acquired, becomes a Subsidiary or is amalgamated, merged or consolidated with or into the Borrower or any Subsidiary after the Effective Date to the extent that such Investments were not made in contemplation of or in connection with such acquisition, designation, redesignation, amalgamation, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation;

 

(w)             Investments resulting from pledges and deposits under clauses (c), (d), (e), (l) and (n) of Permitted Encumbrances and Sections 6.02(u), (w) and (x);

 

(x)               Investments constituting non-cash consideration for Dispositions permitted under Section 6.09;

 

(y)               Investments in connection with Swap Agreements permitted under Section 6.01; and

 

(z)               to the extent constituting Investments, transactions permitted under Section 6.03.

 

 

For purposes of this Section 6.04, the amount of any Investment shall be the amount actually invested, without adjustment for subsequent increases or decreases in the value of such Investment, but, except to the extent the Borrower shall otherwise elect, deducted by the amount of any repayment, interest, return, profit, distribution, income or similar amount in respect of such Investment which has actually been received in cash or Cash Equivalents or has been converted into cash or Cash Equivalents.

 

Section 6.05        Restricted Payments. The Borrower will not, and will not permit any of its Subsidiaries to, declare or make any Restricted Payments with respect to the Borrower or any of its Subsidiaries, except:

 

(i)                 (A) any Subsidiary of the Borrower may make Restricted Payments to the Borrower or to any direct or indirect wholly-owned Subsidiary of the Borrower that is a Loan Party, and (B) any non-wholly-owned Subsidiary may make Restricted Payments to the Borrower or any of its other Subsidiaries that are Loan Parties and to each other owner of Equity Interests of such Subsidiary ratably based on their relative ownership interests of the relevant class of Equity Interests;

 

(ii)              the Borrower may declare and make dividends payable solely in the form of additional shares of the Borrower’s or the Parent’s Equity Interests;

 

(iii)            the Borrower may repurchase fractional shares of its Equity Interests (or Equity Interests of the Parent) arising out of stock dividends, splits or combinations, business combinations or conversions of convertible securities or, so long as no Default or Event of Default then exists or would result therefrom, make cash settlement payments upon the exercise of warrants to purchase its Equity Interests (or Equity Interests of the Parent), or “net exercise” or “net share settle” warrants;

 

(iv)             the Borrower may redeem or otherwise cancel Equity Interests or rights in respect thereof granted to (or make payments on behalf of) directors, officers, employees or other providers of services to the Parent, the Borrower and the Subsidiaries in an amount required to satisfy tax withholding obligations relating to the vesting, settlement or exercise of such Equity Interests or rights;

 

(v)               the Borrower may make any Restricted Payment that has been declared by the Parent or the Borrower, so long as (A) such Restricted Payment would be otherwise permitted under clause (ix) of this Section 6.05 at the time so declared (and shall be deemed to be a utilization of such capacity from and after such time) and (B) such Restricted Payment is made within 60 days of such declaration;

 

(vi)             the Borrower may make any repurchase (or deemed repurchase) of Equity Interests pursuant to any accelerated stock repurchase or similar agreement (each, an “ASR Agreement”) publicly announced by the Parent or the Borrower and specifying the maximum aggregate amount of the stock to be repurchased pursuant to such ASR Agreement (the “Maximum ASR Amount”); provided that, at the time such ASR Agreement is publicly announced, the Borrower would be in compliance with Section 6.10 immediately after giving Pro Forma Effect to the Maximum ASR Amount;

 

 

(vii)          the Borrower may make Restricted Payments pursuant to and in accordance with stock option plans or other benefit plans or agreements for directors, management, employees or other eligible service providers of the Borrower, the Parent or its Subsidiaries, including the repurchase of Equity Interests or rights in respect thereof granted to directors, management, employees or other eligible service providers of the Borrower or its Subsidiaries pursuant to a right of repurchase set forth in any such stock option plans or other benefit plans or agreements in connection with a cessation of service;

 

(viii)        so long as no Default or Event of Default then exists or would result therefrom, the Borrower may make Restricted Payments not otherwise permitted under this Section 6.05 in an amount not to exceed the amount of proceeds of any substantially concurrent issuance of Equity Interests of the Parent (or any parent company thereof) which have been contributed as common equity to the Borrower or of any substantially concurrent issuance of Equity Interests of the Borrower;

 

(ix)             so long as no Default or Event of Default then exists or would result therefrom, the Borrower may make Restricted Payments not otherwise permitted under this Section 6.05 in an unlimited amount (a) if, prior to the Trigger Date, Total Liquidity immediately after giving Pro Forma Effect to such Restricted Payment is equal to or greater than $600,000,000 or (b) if, on or after the Trigger Date, the Consolidated Leverage Ratio immediately after giving Pro Forma Effect to such Restricted Payment is less than or equal to 2.00:1.00; and

 

(x)               the Borrower may make and pay Restricted Payments to the Parent (and in the cases of clauses (A) and (B), to the other equity owners of the Borrower):

 

(A)             (1) with respect to any taxable period (x) for which the Borrower and/or any of its Subsidiaries are members of a consolidated, combined, affiliated, unitary or similar income tax group for U.S. federal and/or applicable state or local income Tax purposes of which the Parent or any holding company of the Parent is the common parent, or (y) for which the Borrower is a partnership or disregarded entity for U.S. federal income tax purposes that is wholly owned (directly or indirectly) by a C corporation for U.S. federal and/or applicable state or local income Tax purposes, in an amount not to exceed the amount of any U.S. federal, state and/or local income Taxes that the Borrower and/or its Subsidiaries, as applicable, would have paid for such taxable period had the Borrower and/or its Subsidiaries, as applicable, been a stand-alone corporate taxpayer or a stand-alone corporate group and (2) such amounts as are needed to pay any amounts owed by the Parent under the Tax Receivable Agreement but which shall not include any amounts required to be paid due to a change of control or any early termination payments; provided that distributions pursuant to clause (A)(1) in respect of an Excluded Subsidiary shall be permitted only to the extent that cash distributions were made by such Excluded Subsidiary to the Borrower or any other Subsidiary that is a Loan Party for such purpose;

 

 

(B)              (1) with respect to any taxable period ending after the Effective Date for which the Borrower is a partnership or disregarded entity for U.S. federal income Tax purposes (other than a partnership or disregarded entity described in clause (x)(A)(1)(y) above), distributions to its owners in amounts not to exceed (x) the taxable income of the Borrower and its Subsidiaries for such fiscal year (as determined based on such assumptions as may be made by the managing member (or equivalent governing body) of Borrower, including, without limitation, not taking into account for this purpose for any such taxable period any adjustments under Sections 743(b) of the Code), multiplied by (y) the highest combined federal, state and local tax rates applicable to the income of individuals or corporations, resident of New York, New York, whichever is higher and (2) if payments to the Parent pursuant to the foregoing clause (1) are not sufficient for the Parent to pay its income tax liabilities and also the amounts owed by the Parent under the Tax Receivable Agreement, such additional amounts as are needed to pay any amounts owed by the Parent under the Tax Receivable Agreement but which shall not include any amounts required to be paid due to a change of control or any early termination payments; provided that no payment may be made pursuant to both this subclause (B) and subclause (A) of this clause (x) with respect to any period ;

 

(C)              the proceeds of which shall be used to allow the Parent to pay its operating costs and expenses incurred in the ordinary course of business and other corporate overhead costs and expenses (including administrative, legal, accounting and other professional costs and expenses) to the extent attributable to the ownership or operation of the Borrower and its Subsidiaries;

 

(D)             [intentionally omitted];

 

(E)              the proceeds of which shall be used to allow the Parent to pay fees and expenses related to any equity issuance or offering or debt issuance, incurrence or offering, Disposition or acquisition or investment transaction permitted by this Agreement, whether or not consummated;

 

(F)              the proceeds of which shall be used to pay fees and expenses (including real and personal property Taxes, and franchise, excise or similar taxes) required to maintain its corporate existence or good standing under applicable law, travel expenses, customary salary, bonus, long-term incentive plan awards, severance and other benefits payable to, and indemnities provided on behalf of, directors, officers, members of management, employees and consultants of the Parent, and any payroll, social security or similar taxes thereof, to the extent such fees, expenses, salaries, bonuses, other benefits and indemnities are attributable to the ownership or operation of the Borrower and its Subsidiaries;

 

(G)             so long as no Default or Event of Default then exists or would result therefrom and subject to the Borrower being in compliance with Section 6.10 immediately after giving Pro Forma Effect to such Restricted Payment, the proceeds of which shall be used to pay interest payments on the Parent Convertible Notes;

 

(H)             to pay monitoring, consulting, management, transaction, advisory, termination or similar fees relating to the ownership or operations of the Borrower and/or its subsidiaries;

 

 

(I)                to pay audit and other accounting and reporting expenses at the Parent to the extent relating to the ownership or operations of the Borrower and/or its subsidiaries;

 

(J)                to pay insurance premiums to the extent relating to the ownership or operations of the Borrower and/or its subsidiaries; and

 

(K)             the proceeds of which shall be used by the Parent to make payments and consummate other transactions otherwise contemplated to be Restricted Payments permitted to be made by the Borrower for the purposes set forth in this Section 6.05 (and shall be deemed to be a utilization of such capacity from and after such time); and

 

(xi)             the Borrower may make Restricted Payments in accordance with [Article IX] of the Third Amended and Restated Limited Liability Company Agreement of the Borrower, so long as such Restricted Payments are funded with Equity Interests of the Parent or the proceeds from an issuance of Equity Interests of the Parent to the extent such proceeds were contributed to the Borrower.

 

Section 6.06        Restrictive Agreements. The Borrower will not, and will not permit any of its Subsidiaries to, directly or indirectly, enter into, incur or permit to exist any agreement or other arrangement that prohibits, restricts or imposes any condition upon (a) the ability of the Borrower or any Subsidiary to create, incur or permit to exist any Lien upon any of its property or assets to secure the Obligations, or (b) the ability of any Subsidiary to pay dividends or other distributions with respect to any shares of its capital stock or to make or repay loans or advances to the Borrower or any other Subsidiary or of any Subsidiary to Guarantee Indebtedness of the Borrower or any other Subsidiary under the Loan Documents; provided that (i) the foregoing shall not apply to restrictions and conditions imposed by law or by this Agreement or any other Loan Document, (ii) the foregoing shall not apply to restrictions and conditions existing on the Effective Date identified on Schedule 6.06 (and shall apply to any extension or renewal of, or any amendment or modification materially expanding the scope of, any such restrictions or conditions taken as a whole), (iii) the foregoing shall not apply to customary restrictions and conditions contained in agreements relating to the sale of a Subsidiary or assets of the Borrower or any Subsidiary pending such sale, provided such restrictions and conditions apply only to the Subsidiary or assets to be sold and such sale is not prohibited hereunder, (iv) the foregoing shall not apply to any agreement or restriction or condition in effect at the time any Subsidiary becomes a Subsidiary of the Borrower, so long as such agreement was not entered into solely in contemplation of such Person becoming a Subsidiary of the Borrower, (v) the foregoing shall not apply to customary provisions in joint venture agreements and other similar agreements applicable to joint ventures, (vi) clause (a) of the foregoing shall not apply to restrictions or conditions imposed by any agreement relating to secured Indebtedness permitted by this Agreement if such restrictions or conditions apply only to the property or assets securing such Indebtedness, (vii) clause (a) of the foregoing shall not apply to customary provisions in leases, licenses, subleases and sublicenses and other contracts, (viii) the foregoing shall not apply to restrictions or conditions set forth in any agreement governing Indebtedness not prohibited by Section 6.01; provided that such restrictions and conditions are customary for such Indebtedness, and (ix) the foregoing shall not apply to restrictions on cash or other deposits (including escrowed funds) imposed under contracts entered into in the ordinary course of business.

 

 

Section 6.07        Transactions with Affiliates. The Borrower will not, and will not permit any of its Subsidiaries to, sell, lease or otherwise transfer any property or assets to, or purchase, lease or otherwise acquire any property or assets from, or otherwise engage in any other transactions with, any of its Affiliates (other than between or among the Borrower and its Subsidiaries to the extent otherwise permitted hereunder), except (a) on terms and conditions not less favorable to the Borrower or such Subsidiary than could be obtained on an arm’s-length basis from unrelated third parties, (b) payment of customary directors’ fees, reasonable out-of-pocket expense reimbursement, indemnities (including the provision of directors and officers insurance) and compensation arrangements for members of the board of directors, officers or other employees of the Borrower or any of its Subsidiaries, (c) transactions approved by a majority of the disinterested directors of the Borrower’s board of directors, (d) any transaction involving amounts less than, in the aggregate, the greater of (i) $17,500,000 and (ii) 2.50% of the Total Assets at any time outstanding, (e) any Restricted Payment permitted by Section 6.05 and (f) the agreements listed on Schedule 6.07 hereto.

 

Section 6.08        Use of Proceeds. The Borrower will not request any Borrowing or Letter of Credit, and the Borrower shall not use, and shall procure that its Subsidiaries and its or their respective directors, officers, employees and agents shall not use, the proceeds of any Borrowing or Letter of Credit (a) in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, to any Person in violation of any Anti-Corruption Laws, (b) for the purpose of funding, financing or facilitating any activities, business or transaction of or with any Sanctioned Person, or in any Sanctioned Country, or (c) in any manner that would result in the violation of any Sanctions applicable to any party hereto.

 

Section 6.09        Disposition of Property. The Borrower will not, and will not permit any of its Subsidiaries to, Dispose of any of its property, whether now owned or hereafter acquired, in each case, except:

 

(a)               Dispositions of obsolete or worn out property in the ordinary course of business or property that is no longer used or useful in the Borrower’s or its Subsidiaries’ business and the leasing or subleasing in the ordinary course of business of owned or leased properties which are excess properties or are no longer used or useful in the Borrower’s or its Subsidiaries’ businesses;

 

(b)               the sale of inventory and other assets in the ordinary course of business;

 

(c)               (i) Dispositions to a Loan Party (other than the Parent), (ii) Dispositions by an Excluded Subsidiary to any other Excluded Subsidiary, and (iii) Dispositions by a Loan Party to an Excluded Subsidiary that are otherwise permitted under Section 6.04;

 

(d)               (i) Dispositions that constitute Investments that are permitted under Section 6.04 and (ii) Dispositions that constitute Restricted Payments that are permitted under Section 6.05;

 

(e)               [reserved];

 

(f)                Dispositions permitted by clause (iii), (iv) or (vi) of Section 6.03(a);

 

 

(g)               the grant in the ordinary course of business of any non-exclusive license of patents, trademarks, registrations therefor and other similar intellectual property;

 

(h)               the lapse, abandonment, or other Dispositions of Intellectual Property of the Parent or any of its Subsidiaries that, in the good faith determination of the Parent or such Subsidiary, is no longer economically desirable to maintain or useful in the conduct of the business of the such Person;

 

(i)                 the sale or issuance of any Subsidiary’s Equity Interests to the Borrower or any Guarantor that is a wholly owned Subsidiary;

 

(j)                 the Disposition of other property having a fair market value not to exceed $5,000,000 in the aggregate for each fiscal year of the Parent;

 

(k)               Dispositions of other property having a fair market value not to exceed $10,000,000 in the aggregate; provided that (i) at the time of such Disposition (other than any such Disposition made pursuant to a legally binding commitment entered into at a time when no Event of Default exists or would result therefrom), no Event of Default then exists or would result from such Disposition, (ii) such Disposition is for fair market value as reasonably determined by the Borrower, and (iii) not less than 75% of the purchase price for the asset or property sold in such Disposition shall be in the form of cash or Cash Equivalents (with (A) any debt secured by such property assumed by the purchaser of such property, (B) any consideration received in the form of Indebtedness that is converted into cash within 90 days after the Disposition of such property, and (C) aggregate non-cash consideration received by the Borrower or applicable Subsidiary having an aggregate fair market value (determined as of the closing of the applicable Disposition for which such non-cash consideration is received) not to exceed in the aggregate the greater of (i) $17,500,000 and (ii) 2.50% of the Total Assets at any time outstanding, in each case deemed to be cash for purposes of this provision);

 

(l)                 Dispositions of Investments in joint ventures to the extent required by, or made pursuant to customary buy/sell arrangements, drag-along rights, put rights, call rights or similar arrangements between, the joint venture parties set forth in joint venture arrangements and similar binding arrangements;

 

(m)             Dispositions, terminations or non-renewals of leases or subleases or licensing or sublicensing agreements (i) the Disposition, termination or non-renewal of which will not materially interfere with the business of the Borrower and their Subsidiaries or (ii) which relate to closed facilities or the discontinuation of any product line to the extent such closing or discontinuation is permitted pursuant to the terms herein, or (iii) is made in the ordinary course of business;

 

(n)               Dispositions of cash, Cash Equivalents and short-term marketable securities;

 

(o)               Dispositions of equipment or real property to the extent that (i) such property is exchanged for credit against the purchase price of similar replacement property or (ii) the proceeds of such Disposition are reasonably promptly applied to the purchase price of such replacement property;

 

 

(p)               Disposition of receivables in connection with the compromise, settlement or collection thereof; and

 

(q)               any surrender or waiver of contractual rights or the settlement, release, recovery on or surrender of contract, tort or other claims of any kind that occur in the ordinary course of the Borrower’s or any Subsidiary’s business.

 

Section 6.10        Financial Covenants. The Parent and the Borrower will not, and will not permit any of its respective Subsidiaries to, (i) from the Effective Date until the Trigger Date, (x) permit Total Liquidity to be less than $350,000,000 as of the last day of any fiscal quarter of the Parent or on any date on which any Borrowing of a Loan or issuance of any Letter of Credit is made pursuant to Section 4.02 and (y) permit Total Revenues for any Measurement Period ending on any date set forth below to be less than the amount set forth below opposite such date:

 

Date of Determination			Minimum Revenue
December 31, 2021			$	570,000,000
March 31, 2022			$	635,000,000
June 30, 2022			$	690,000,000
September 30, 2022			$	880,000,000
December 31, 2022			$	950,000,000
March 31, 2023			$	985,000,000
June 30, 2023			$	1,140,000,000
September 30, 2023			$	1,185,000,000
December 31, 2023			$	1,345,000,000
March 31, 2024			$	1,445,000,000
June 30, 2024			$	1,675,000,000
September 30, 2024			$	1,890,000,000
December 31, 2024			$	2,020,000,000
March 31, 2025			$	2,100,000,000
June 30, 2025			$	2,285,000,000

 

; and

 

(ii) from and after the Trigger Date, (x) permit the Consolidated Leverage Ratio to exceed 3.50:1.00 and (y) permit the Interest Coverage Ratio to be less than 3.00:1.00, in each case, as of the last day of each Measurement Period.

 

Section 6.11        Swap Agreements. Neither the Borrower nor any other Guarantor will enter into any Swap Agreement for purely speculative purposes.

 

Section 6.12        Permitted Activities of Parent. Parent shall not:

 

(a)               incur any Indebtedness for borrowed money other than (i) Guarantees of Indebtedness or other obligations of the Borrower and/or any Subsidiary, which Indebtedness or other obligations are otherwise permitted hereunder, (ii) Indebtedness owed to the Borrower or any Subsidiary otherwise permitted hereunder and (iii) Parent Convertible Notes, subject to the Parent being in compliance with Section 6.10 immediately after giving Pro Forma Effect to the issuance of any such Parent Convertible Notes;

 

 

(b)               create or suffer to exist any Lien on any property or asset now owned or hereafter acquired by it other than (i) the Liens created under the Security Documents and (ii) Liens of the type permitted under Section 6.02 (other than in respect of Indebtedness for borrowed money not referred to in clause (a) of this Section 6.12); or

 

(c)               engage in any material business activity or own any material assets other than (i) holding the Equity Interest of the Borrower, and, indirectly, any other subsidiary of the Borrower (and/or any joint venture of any thereof) or Indebtedness owing by, the Borrower, (ii) performing its obligations under the Loan Documents and other Indebtedness, Liens (including the granting of Liens) and Guarantees permitted hereunder; (iii) issuing its own Equity Interests (including, for the avoidance of doubt, the making of any dividend or distribution on account of, or any redemption, retirement, sinking fund or similar payment, purchase or other acquisition for value of, any shares of any class of Equity Interest permitted hereunder) and the maintenance and administration of equity subscriptions, stock option and stock ownership plans and activities incidental thereto; (iv) filing tax reports and paying Taxes, including tax distributions made pursuant to Section 6.05(x) and other customary obligations in the ordinary course (and contesting any Taxes); (v) preparing reports to Governmental Authorities and to its shareholders; (vi) holding director and shareholder meetings, preparing organizational records and other organizational activities required to maintain its separate organizational structure or to comply with applicable laws; (vii) effecting any public offering of its Equity Interests; (viii) holding (A) cash, Cash Equivalents and other assets received in connection with permitted distributions or dividends received from, or permitted Investments or permitted Dispositions made by, any of its subsidiaries or permitted contributions to the capital of, or proceeds from the issuance of Equity Interest of, Parent pending the application thereof, or otherwise received and held so long as such other assets are not “operated” and (B) the proceeds of Indebtedness permitted by Section 6.01; (ix) providing indemnification for its officers, directors, members of management, employees and advisors or consultants and other ordinary course obligations; (x) participating in tax, accounting and other administrative matters; (xi) the performance of its obligations under any document, agreement and/or investment contemplated by the Transactions or otherwise not prohibited under this Agreement, including the preparation of financial statements and other reporting obligations required under this Agreement; (xii) complying with applicable laws (including with respect to the maintenance of its corporate existence and activities incidental thereto); (xiii) financing activities, including the receipt and payment of dividends and distributions and the making of certain other Restricted Payments, making contributions to the capital of its Subsidiaries and guaranteeing the obligations of the Borrower and the Borrower’s Subsidiaries to the extent permitted hereunder; (xiv) activities incidental to acquisitions permitted hereunder or similar investments consummated by the Borrower and/or any Subsidiaries, including the formation of acquisition vehicle entities and intercompany loans and/or investments incidental to such acquisitions permitted hereunder or similar investments; (xv) the maintenance of its legal existence (including the ability to incur and pay, as applicable, fees, costs and expenses and taxes related to such maintenance); (xvi) any transaction expressly permitted pursuant to clauses (a), (b) and/or (d) of this Section 6.12, (xvii) the obtainment of, and the payment of any fees and expenses for, management, consulting, investment banking and advisory services to the extent otherwise permitted under this Agreement, (xviii) entry into Permitted Bond Hedge Transactions and Permitted Warrant Transactions, (xix) participation and the making of payments under the Tax Receivable Agreement, and (xx) activities incidental or reasonably related to any of the foregoing; or

 

 

(d)               consolidate or amalgamate with, or merge with or into, or convey, sell or otherwise transfer all or substantially all of its assets to, any Person; provided that, so long as no Default or Event of Default exists or would result therefrom, Parent may consolidate or amalgamate with, or merge with or into, any other Person (other than the Borrower and any of its Subsidiaries) so long as (i) Parent is the continuing or surviving Person or (ii) if the Person formed by or surviving any such consolidation, amalgamation or merger is not Parent, (x) (A) the successor Person expressly assumes all obligations of Parent under this Agreement and the other Loan Documents to which Parent is a party pursuant to a supplement hereto and/or thereto in a form reasonably satisfactory to the Administrative Agent and (B) the successor Person will be a Person organized or existing under the laws of the United States of America, any State of the United States or the District of Columbia or any territory thereto, and (y) the Administrative Agent shall have received all documentation and other information required by regulatory authorities with respect to the successor Person under applicable “know your customer” and anti-money laundering rules and regulations, including without limitation the USA PATRIOT Act reasonably requested by the Lenders.

 

Article 7
EVENTS OF DEFAULT

 

Section 7.01        Events of Default. If any of the following events (each, an “Event of Default”) shall occur:

 

(a)               the Borrower shall fail to pay any principal of any Loan or any reimbursement obligation in respect of any LC Disbursement when and as the same shall become due and payable and in the Agreed Currency required hereunder, whether at the due date thereof or at a date fixed for prepayment thereof or otherwise;

 

(b)               the Borrower shall fail to pay any interest on any Loan or any fee or any other amount (other than an amount referred to in clause (a) of this Article) payable under any of the Loan Documents, when and as the same shall become due and payable and in the Agreed Currency required hereunder, and such failure shall continue unremedied for a period of five Business Days;

 

(c)               any representation or warranty made or deemed made by or on behalf of the Parent, the Borrower or any Loan Party in this Agreement or any other Loan Document or any amendment or modification hereof or thereof or waiver hereunder or thereunder, or in any report, certificate, financial statement or other document furnished pursuant to or in connection with this Agreement, any other Loan Document or any amendment or modification hereof or thereof or waiver hereunder or thereunder, shall prove to have been incorrect in any material respect when made or deemed made;

 

 

(d)               the Parent or the Borrower, as applicable, shall fail to observe or perform any covenant, condition or agreement contained in Section 5.02(a), Section 5.03 (solely with respect to the Parent’s or the Borrower’s existence), Section 5.10 or in Article 6;

 

(e)               the Parent or the Borrower, as applicable, shall fail to observe or perform any covenant, condition or agreement contained in any of the Loan Documents (other than those specified in clause (a), (b) or (d) of this Article of this Agreement), and such failure shall continue unremedied for a period of 30 days after notice thereof from the Administrative Agent to the Borrower;

 

(f)                the Parent, the Borrower or any Subsidiary shall fail to make any payment (whether of principal or interest and regardless of amount) in respect of any Material Indebtedness, when and as the same shall become due and payable (whether by scheduled maturity, required prepayment, acceleration, demand, or otherwise) and such failure shall have continued after the applicable notice or cure period, if any;

 

(g)               any event or condition occurs that results in any Material Indebtedness becoming due prior to its scheduled maturity or that enables or permits (with or without the giving of notice, the lapse of time or both, but with all applicable grace periods in respect of such event or condition under the documentation representing such Material Indebtedness having expired) the holder or holders of any Material Indebtedness or any trustee or agent on its or their behalf to cause any Material Indebtedness to become due, or to require the prepayment, repurchase, redemption or defeasance thereof, prior to its scheduled maturity; provided that this clause (g) shall not apply to (w) any requirement to, or any offer, to repurchase, prepay or redeem Indebtedness of a Person acquired in an acquisition permitted hereunder, to the extent such offer is required as a result of, or in connection with, such acquisition, so long as such requirement is satisfied at the time of such acquisition, (x) secured Indebtedness that becomes due as a result of the voluntary sale or transfer of the property or assets securing such Indebtedness, (y) any redemption, repurchase, conversion or settlement with respect to any convertible debt instrument including the Parent Convertible Notes (including any termination of any related Swap Agreement) pursuant to its terms unless such redemption, repurchase, conversion or settlement results from a default thereunder or an event of the type that constitutes an Event of Default or (z) an early payment requirement, unwinding or termination with respect to any Swap Agreement except (i) an early payment, unwinding or termination that results from a default or non-compliance thereunder by the Parent, the Borrower or any Subsidiary, or another event of the type that would constitute an Event of Default or (ii) an early termination of such Swap Agreement by the counterparty thereto;

 

(h)               an involuntary proceeding shall be commenced or an involuntary petition shall be filed seeking (i) liquidation, reorganization or other relief in respect of the Parent, the Borrower or any Subsidiary or of a substantial part of its assets, under any Debtor Relief Law or (ii) the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for the Parent, the Borrower or any Subsidiary or for a substantial part of its assets, and, in any such case, such proceeding or petition shall continue undismissed for 60 days or an order or decree approving or ordering any of the foregoing shall be entered;

 

 

(i)                 except as may otherwise be permitted under Section 6.03, the Parent, the Borrower or any Subsidiary shall (i) voluntarily commence any proceeding or file any petition seeking liquidation, reorganization or other relief under any Debtor Relief Law, (ii) consent to the institution of, or fail to contest in a timely and appropriate manner, any proceeding or petition described in clause (h) of this Section 7.01, (iii) apply for or consent to the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for the Parent, the Borrower or any Subsidiary or for a substantial part of its assets, (iv) file an answer admitting the material allegations of a petition filed against it in any such proceeding, (v) make a general assignment for the benefit of creditors or (vi) take any action for the purpose of effecting any of the foregoing;

 

(j)                 the Parent, the Borrower or any Subsidiary shall become unable and admit in writing its inability or fail generally to pay its debts as they become due;

 

(k)               one or more judgments for the payment of money in excess of $15,000,000 in the aggregate shall be rendered against the Parent, the Borrower, any Subsidiary or any combination thereof (to the extent not paid or covered by a reputable and solvent independent third-party insurance company which has not disputed coverage) and the same shall remain undischarged for a period of 30 consecutive days during which execution shall not be effectively stayed, or any action shall be legally taken by a judgment creditor to attach or levy upon any assets of the Parent, the Borrower or any Subsidiary to enforce any such judgment and such action shall not be stayed;

 

(l)                 one or more ERISA Events shall have occurred that would reasonably be expected to result, individually or in the aggregate, in a Material Adverse Effect;

 

(m)             a Change in Control shall occur; or

 

(n)               any Loan Document, at any time after its execution and delivery and for any reason other than as expressly permitted hereunder or thereunder or satisfaction in full of all the obligations hereunder or thereunder, ceases to be in full force and effect thereto; or any Loan Party contests in any manner the validity or enforceability of any Loan Document; or any Lien created by any of the Security Documents shall cease to be enforceable on a material portion of the Collateral and of the same effect and priority (subject to Liens permitted by Section 6.02) to be created thereby for any reason other than as expressly permitted hereunder or satisfaction in full of all the Obligations; then, and in every such event (other than an event with respect to the Parent or the Borrower described in clause (h) or (i) of this Article and subject to Section 7.02), and at any time thereafter during the continuance of such event, the Administrative Agent may, and at the request of the Required Lenders shall, by notice to the Borrower, take any or all of the following actions, at the same or different times: (i) terminate the Commitments, and thereupon the Commitments shall terminate immediately, (ii) Cash Collateralize any outstanding Letters of Credit and (iii) declare the Loans then outstanding to be due and payable in whole (or in part, in which case any principal not so declared to be due and payable may thereafter be declared to be due and payable), and thereupon the principal of the Loans so declared to be due and payable, together with accrued interest thereon and all fees and other obligations of the Borrower accrued hereunder, shall become due and payable immediately, without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrower; and in case of any event with respect to the Parent or the Borrower described in clause (h) or (i) of this Article, the Commitments shall automatically terminate and the principal of the Loans then outstanding, together with accrued interest thereon and all fees and other obligations of the Borrower accrued hereunder, shall automatically become due and payable, without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrower.

 

 

 

 

Section 7.02        Right to Cure.

 

(a)               Notwithstanding anything to the contrary contained in Section 7.01, but subject to Sections 7.02(b), 7.02(c) and 7.02(d), for the purpose of determining whether an Event of Default resulting from a failure to comply with Section 6.10 as of the last day of any fiscal quarter has occurred, the Borrower may on one or more occasions, during the period from the commencement of the relevant fiscal quarter through the Cure Expiration Date (as defined below), designate any portion of the net cash proceeds from a sale or issuance of Equity Interests of Parent or the Borrower or of any cash contribution to the equity capital of Parent (which, in turn, will be contributed in cash to the common equity capital of the Borrower) or the Borrower (the “Cure Right”), and upon the receipt by the Borrower of such cash (the “Cure Amount”), pursuant to the exercise by the Borrower of such Cure Right, as an increase to Consolidated EBITDA or Total Revenue, as applicable, for the applicable fiscal quarter; provided that (i) such amounts to be designated are actually received by the Borrower on or prior to the fifteenth Business Day after the date on which a certificate is or is required to be delivered pursuant to Section 5.01(c) with respect to such applicable fiscal quarter (the “Cure Expiration Date”), (ii) such amounts to be designated do not exceed the minimum aggregate amount necessary to cure any Event of Default resulting from a failure to comply with Section 6.10 as of such date and (iii) the Borrower shall have provided written notice to the Administrative Agent on the date such amounts are designated as a “Cure Amount” (it being understood that to the extent such notice is provided in advance of delivery of a certificate pursuant to Section 5.01(c) for the applicable period, the amount of such net cash proceeds that is designated as the Cure Amount may be lower than the amount specified in such notice to the extent that the amount actually necessary to cure any Event of Default resulting from a failure to comply with Section 6.10 is less than the full amount of such originally designated amount). The Cure Amount used to increase Consolidated EBITDA or Total Revenue, as applicable, for the applicable fiscal quarter shall be used and included when calculating Consolidated EBITDA or Total Revenue, as applicable, for each period that includes such fiscal quarter. The parties hereby acknowledge that the Cure Amount (1) may not be relied on for purposes of calculating Consolidated EBITDA or Total Revenue, as applicable, other than as applicable to Section 6.10 (and shall not be included in Consolidated EBITDA or Total Revenue, as applicable, for any other purposes) and (2) shall not result in any adjustment to any amounts (including the amount of Indebtedness) or increase in cash with respect to the fiscal quarter with respect to which such Cure Amount was made. Notwithstanding anything to the contrary contained in Section 7.01, (A) upon designation of the Cure Amount by the Borrower, to the extent applicable, Section 6.10 shall be deemed satisfied and complied with as of the end of the relevant fiscal quarter with the same effect as though there had been no failure to comply with Section 6.10 and any Event of Default resulting from a failure to comply with Section 6.10 (and any other Default as a result thereof) shall be deemed not to have occurred for purposes of the Loan Documents, and (B) neither the Administrative Agent nor any Lender may exercise any rights or remedies under this Agreement or any other Loan Document on the basis of any actual or purported Event of Default resulting from a failure to comply with Section 6.10 (and any other Default as a result thereof) with respect to the applicable period until and unless the Cure Expiration Date has occurred without the Cure Amount having been received by the Borrower in at least the amount required to cure the applicable Event of Default, in which case such Event of Default shall be reinstated as though the Borrower had not designated such Cure Amount. For the avoidance of doubt, no portion of any Cure Amount may be used to make a Restricted Payment.

 

 

(b)               In each period of four consecutive fiscal quarters there shall be at least two fiscal quarters in which no cure set forth in Section 7.02(a) is made.

 

(c)               The cure rights set forth in Section 7.02(a) may not be exercised with respect to more than four fiscal quarters during the term of this Agreement.

 

(d)               Notwithstanding anything herein to the contrary, upon the designation of any Cure Amount until the receipt by the Borrower thereof in an amount sufficient to cure the relevant Event of Default, Borrower shall not be permitted to request (and none of the Administrative Agent, the Lenders or the Issuing Banks shall be obligated to extend any Commitments or issue any Letters of Credit, as applicable) any Commitments (including any issuance or extension (including automatic renewals) of any Letter of Credit).

 

(e)               To the extent a fiscal quarter in respect of which a Cure Amount for an Event of Default resulting from a failure to comply with Section 6.10 is received (such fiscal quarter a “Cure Quarter”) is included in the calculation of Consolidated EBITDA or Total Revenue for a subsequent fiscal period, the Consolidated EBITDA or Total Revenue attributable solely to such Cure Quarter shall be deemed permanently increased by such amount for purposes of calculating Consolidated EBITDA or Total Revenue for a subsequent fiscal period including such Cure Quarter; provided, that the Cure Amount shall be included in the calculation of Consolidated EBITDA or Total Revenue solely for the purpose of determining compliance with the financial covenant contained in Section 6.10 and not for any other purposes.

 

Section 7.03        Application of Proceeds. If an Event of Default shall have occurred and be continuing, after the acceleration of the Obligations pursuant to Section 7.01 or the exercise of other remedies provided for in Section 7.01, the Administrative Agent shall apply all or any part of any proceeds of the Collateral (including all Proceeds) and all payments received by it in respect of any of the Obligations in the following order:

 

First, to pay incurred and unpaid fees and expenses of the Administrative Agent under the Loan Documents in its capacity as such;

 

Second, to the Administrative Agent, for application by it towards payment of amounts remaining unpaid in respect of the Obligations, pro rata among the Secured Parties according to the amounts of such Obligations then due and owing and remaining unpaid to the Secured Parties;

 

Third, to the Administrative Agent, for application by it towards payment of all other Obligations, pro rata among the Secured Parties according to the amounts of such Obligations then held by the Secured Parties; and

 

 

Fourth, any balance remaining after the Obligations shall have been paid in fullshall be paid over to the Borrower, the Loan Parties or to whomsoever may be lawfully entitled to receive the same.

 

Notwithstanding the foregoing, no amounts received from any Guarantor shall be applied to any Excluded Swap Obligations of such Guarantor.

 

Article 8
THE AGENTS

 

Section 8.01        Appointment of Administrative Agent. JPMorgan Chase Bank, N.A. is hereby appointed Administrative Agent hereunder and under the other Loan Documents and each Lender hereby authorizes JPMorgan Chase Bank, N.A. to act as Administrative Agent in accordance with the terms hereof and the other Loan Documents. Each Agent hereby agrees to act in its capacity as such upon the express conditions contained herein and the other Loan Documents, as applicable. The provisions of this Article 8 are solely for the benefit of the Agents and Lenders and no Loan Party shall have any rights as a third party beneficiary of any of the provisions thereof. In performing its functions and duties hereunder, each Agent shall act solely as an agent of Lenders and does not assume and shall not be deemed to have assumed any obligation towards or relationship of agency or trust with or for the Borrower, the Parent or any of its Subsidiaries. As of the Effective Date, none of the Arrangers, Syndication Agent or the Documentation Agents in such capacity shall have any obligations but shall be entitled to all benefits of this Article 8. The Arrangers, the Syndication Agent and the Documentation Agents may resign from such role at any time, with immediate effect, by giving prior written notice thereof to the Administrative Agent and the Borrower.

 

Section 8.02        Powers and Duties. Each Lender irrevocably authorizes each Agent to take such action on such Lender’s behalf and to exercise such powers, rights and remedies hereunder and under the other Loan Documents as are specifically delegated or granted to such Agent by the terms hereof and thereof, together with such powers, rights and remedies as are reasonably incidental thereto. Each Agent shall have only those duties and responsibilities that are expressly specified herein and the other Loan Documents. Each Agent may exercise such powers, rights and remedies and perform such duties by or through its agents or employees. No Agent shall have, by reason hereof or any of the other Loan Documents, a fiduciary relationship in respect of any Lender or any other Person; and nothing herein or any of the other Loan Documents, expressed or implied, is intended to or shall be so construed as to impose upon any Agent any obligations in respect hereof or any of the other Loan Documents except as expressly set forth herein or therein.

 

 

Section 8.03        General Immunity.

 

(a)               No Agent shall be responsible to any Lender for the execution, effectiveness, genuineness, validity, enforceability, collectability or sufficiency hereof or any other Loan Document or for any representations, warranties, recitals or statements made herein or therein or made in any written or oral statements or in any financial or other statements, instruments, reports or certificates or any other documents furnished or made by any Agent to Lenders or by or on behalf of any Loan Party to any Agent or any Lender in connection with the Loan Documents and the transactions contemplated thereby or for the financial condition or business affairs of any Loan Party or any other Person liable for the payment of any Obligations, nor shall any Agent be required to ascertain or inquire as to the performance or observance of any of the terms, conditions, provisions, covenants or agreements contained in any of the Loan Documents or as to the use of the proceeds of the Loans or as to the existence or possible existence of any Event of Default or Default or to make any disclosures with respect to the foregoing. Anything contained herein to the contrary notwithstanding, the Administrative Agent shall not have any liability arising from confirmations of the amount of outstanding Loans, the Revolving Credit Exposures or the component amounts thereof or any Dollar Equivalent.

 

(b)               No Agent nor any of its officers, partners, directors, employees or agents shall be liable to Lenders for any action taken or omitted by any Agent under or in connection with any of the Loan Documents except to the extent caused by such Agent’s gross negligence or willful misconduct, as determined by a final, non-appealable judgment of a court of competent jurisdiction. Each Agent shall be entitled to refrain from any act or the taking of any action (including the failure to take an action) in connection herewith or any of the other Loan Documents or from the exercise of any power, discretion or authority vested in it hereunder or thereunder unless and until such Agent shall have received instructions in respect thereof from Required Lenders (or such other Lenders as may be required to give such instructions under Section 10.02) and, upon receipt of such instructions from Required Lenders (or such other Lenders, as the case may be), such Agent shall be entitled to act or (where so instructed) refrain from acting, or to exercise such power, discretion or authority, in accordance with such instructions, including for the avoidance of doubt refraining from any action that, in its opinion or the opinion of its counsel, may be in violation of the automatic stay under any Debtor Relief Law or that may effect a forfeiture, modification or termination of property of a Defaulting Lender in violation of any Debtor Relief Law. Without prejudice to the generality of the foregoing, (i) each Agent shall be entitled to rely, and shall be fully protected in relying, upon any communication, instrument or document believed by it to be genuine and correct and to have been signed or sent by the proper Person or Persons, and shall be entitled to rely and shall be protected in relying on opinions and judgments of attorneys (who may be attorneys for the Parent and its Subsidiaries), accountants, experts and other professional advisors selected by it; and (ii) no Lender shall have any right of action whatsoever against any Agent as a result of such Agent acting or (where so instructed) refraining from acting hereunder or any of the other Loan Documents in accordance with the instructions of Required Lenders (or such other Lenders as may be required to give such instructions under Section 10.02).

 

 

(c)               The Administrative Agent may perform any and all of its duties and exercise its rights and powers under this Agreement or under any other Loan Document by or through any one or more sub-agents appointed by the Administrative Agent. The Administrative Agent and any such sub-agent may perform any and all of its duties and exercise its rights and powers by or through their respective Affiliates. The exculpatory, indemnification and other provisions of this Section 8.03 and of Section 8.06 shall apply to any the Affiliates of the Administrative Agent and shall apply to their respective activities in connection with the syndication of the credit facilities provided for herein as well as activities as the Administrative Agent. All of the rights, benefits, and privileges (including the exculpatory and indemnification provisions) of this Section 8.03 and of Section 8.06 shall apply to any such sub-agent and to the Affiliates of any such sub-agent, and shall apply to their respective activities as sub-agent as if such sub-agent and Affiliates were named herein. Notwithstanding anything herein to the contrary, with respect to each sub-agent appointed by the Administrative Agent, (i) such sub-agent shall be a third party beneficiary under this Agreement with respect to all such rights, benefits and privileges (including exculpatory rights and rights to indemnification) and shall have all of the rights and benefits of a third party beneficiary, including an independent right of action to enforce such rights, benefits and privileges (including exculpatory rights and rights to indemnification) directly, without the consent or joinder of any other Person, against any or all of Loan Parties and the Lenders, (ii) such rights, benefits and privileges (including exculpatory rights and rights to indemnification) shall not be modified or amended without the consent of such sub-agent, and (iii) such sub-agent shall only have obligations to the Administrative Agent and not to any Loan Party, Lender or any other Person and no Loan Party, Lender or any other Person shall have any rights, directly or indirectly, as a third party beneficiary or otherwise, against such sub-agent.

 

Section 8.04        Administrative Agent Entitled to Act as Lender. The agency hereby created shall in no way impair or affect any of the rights and powers of, or impose any duties or obligations upon, any Agent in its individual capacity as a Lender hereunder. With respect to its participation in the Loans, each Agent shall have the same rights and powers hereunder as any other Lender and may exercise the same as if it were not performing the duties and functions delegated to it hereunder, and the term “Lender” shall, unless the context clearly otherwise indicates, include each Agent in its individual capacity. Any Agent and its Affiliates may accept deposits from, lend money to, own securities of, and generally engage in any kind of banking, trust, financial advisory or other business with the Parent, the Borrower or any of their respective Affiliates as if it were not performing the duties specified herein, and may accept fees and other consideration from the Parent or the Borrower, as applicable, for services in connection herewith and otherwise without having to account for the same to Lenders.

 

Section 8.05        Lenders’ Representations, Warranties and Acknowledgment.

 

(a)               Each Lender represents and warrants that it has made its own independent investigation of the financial condition and affairs of the Parent and its Subsidiaries in connection with Loans hereunder and that it has made and shall continue to make its own appraisal of the creditworthiness of the Parent and its Subsidiaries. No Agent shall have any duty or responsibility, either initially or on a continuing basis, to make any such investigation or any such appraisal on behalf of Lenders or to provide any Lender with any credit or other information with respect thereto, whether coming into its possession before the making of the Loans or at any time or times thereafter, and no Agent shall have any responsibility with respect to the accuracy of or the completeness of any information provided to Lenders.

 

(b)               Each Lender, by delivering its signature page to this Agreement, an Assignment and Assumption or a Joinder Agreement and funding its Loans on or after the Effective Date or by the funding of any New Loans, as the case may be, shall be deemed to have acknowledged receipt of, and consented to and approved, each Loan Document and each other document required to be approved by any Agent, Issuing Bank or Lender, as applicable on the Effective Date or as of the date of funding of such New Loans.

 

 

Section 8.06        Right to Indemnity. Each Lender, in proportion to its Applicable Percentage, severally agrees to indemnify each Agent, to the extent that such Agent shall not have been reimbursed by any Loan Party, for and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses (including counsel fees and disbursements) or disbursements of any kind or nature whatsoever which may be imposed on, incurred by or asserted against such Agent in exercising its powers, rights and remedies or performing its duties hereunder or under the other Loan Documents or otherwise in its capacity as such Agent in any way relating to or arising out of this Agreement or the other Loan Documents; provided, no Lender shall be liable for any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements resulting from such Agent’s gross negligence or willful misconduct, as determined by a final, non-appealable judgment of a court of competent jurisdiction. If any indemnity furnished to any Agent for any purpose shall, in the opinion of such Agent, be insufficient or become impaired, such Agent may call for additional indemnity and cease, or not commence, to do the acts indemnified against until such additional indemnity is furnished; provided, in no event shall this sentence require any Lender to indemnify any Agent against any liability, obligation, loss, damage, penalty, action, judgment, suit, cost, expense or disbursement in excess of such Lender’s Applicable Percentage thereof; and provided further, this sentence shall not be deemed to require any Lender to indemnify any Agent against any liability, obligation, loss, damage, penalty, action, judgment, suit, cost, expense or disbursement described in the proviso in the immediately preceding sentence.

 

Section 8.07        Successor Administrative Agent. The Administrative Agent shall have the right to resign at any time by giving prior written notice thereof to Lenders and the Borrower. The Administrative Agent shall have the right to appoint a financial institution to act as the Administrative Agent hereunder, subject to the reasonable satisfaction of (i) except if an Event of Default has occurred and is continuing, the Borrower and (ii) the Required Lenders, and the Administrative Agent’s resignation shall become effective on the earliest of (i) 30 days after delivery of the notice of resignation (regardless of whether a successor has been appointed or not), (ii) the acceptance of such successor Administrative Agent by the Borrower and the Required Lenders or (iii) such other date, if any, agreed to by the Required Lenders. Upon any such notice of resignation, if a successor Administrative Agent has not already been appointed by the retiring Administrative Agent, Required Lenders shall have the right, in consultation with the Borrower, to appoint a successor Administrative Agent. If neither the Required Lenders nor the Administrative Agent have appointed a successor Administrative Agent, the Required Lenders shall be deemed to have succeeded to and become vested with all the rights, powers, privileges and duties of the retiring Administrative Agent. Upon the acceptance of any appointment as Administrative Agent hereunder by a successor Administrative Agent, that successor Administrative Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring Administrative Agent and the retiring Administrative Agent shall promptly (i) transfer to such successor Administrative Agent all sums held under the Loan Documents, together with all records and other documents necessary or appropriate in connection with the performance of the duties of the successor Administrative Agent under the Loan Documents, and (ii) take such other actions, as may be necessary or appropriate in connection with the assignment to such successor Administrative Agent of the Loan Documents, whereupon such retiring Administrative Agent shall be discharged from its duties and obligations hereunder or under the other Loan Documents (if not already discharged therefrom as provided above in this Article). After any retiring Administrative Agent’s resignation hereunder as Administrative Agent, the provisions of this Article 8 and Section 10.03 shall inure to its benefit as to any actions taken or omitted to be taken by it while it was Administrative Agent hereunder.

 

 

Section 8.08        Guaranty and Security Documents.

 

(a)               Each Lender hereby further authorizes the Administrative Agent, on behalf of and for the benefit of the Lenders, to be the agent for and representative of the Lenders with respect to the Guaranty and the Loan Documents. Subject to Section 10.02, without further written consent or authorization from any Lender, the Administrative Agent may execute any documents or instruments necessary to release any Guarantor from the Guaranty pursuant to Section 10.17 or with respect to which Required Lenders (or such other Lenders as may be required to give such consent under Section 10.02) have otherwise consented.

 

(b)               Anything contained in any of the Loan Documents to the contrary notwithstanding, the Borrower, the Administrative Agent and each Lender hereby agree that no Lender shall have any right individually to enforce the Guaranty or the Security Documents, it being understood and agreed that all powers, rights and remedies hereunder and under any of the Loan Documents may be exercised solely by the Administrative Agent, for the benefit of the Lenders in accordance with the terms hereof and thereof.

 

(c)               Notwithstanding anything to the contrary contained herein or any other Loan Document, when all Obligations (including unreimbursed LC Disbursements, but excluding contingent obligations as to which no claim has been asserted) have been paid in full and all Commitments have terminated or expired and no Letter of Credit shall be outstanding or subject to any pending draw (or otherwise Cash Collateralized or backstopped or deemed reissued under another agreement reasonably acceptable to the applicable Issuing Bank), upon request of the Borrower, the Administrative Agent shall take such actions as shall be required to release all guarantee obligations provided for in and Liens created by any Loan Document. Any such release of guarantee obligations shall be deemed subject to the provision that such guarantee obligations shall be reinstated if after such release any portion of any payment in respect of the Obligations guaranteed thereby shall be rescinded or must otherwise be restored or returned upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of the Borrower or any Guarantor, or upon or as a result of the appointment of a receiver, intervenor or conservator of, or trustee or similar officer for, the Borrower or any Guarantor or any substantial part of its property, or otherwise, all as though such payment had not been made.

 

Section 8.09        Withholding Taxes. To the extent required by any applicable law, the Administrative Agent may withhold from any payment to any Lender an amount equivalent to any applicable withholding Tax. If the Internal Revenue Service or any other Governmental Authority asserts a claim that the Administrative Agent did not properly withhold Tax from amounts paid to or for the account of any Lender because the appropriate form was not delivered or was not properly executed or because such Lender failed to notify the Administrative Agent of a change in circumstance which rendered the exemption from, or reduction of, withholding Tax ineffective or for any other reason, or if the Administrative Agent reasonably determines that a payment was made to a Lender pursuant to this Agreement without deduction of applicable withholding tax from such payment, such Lender shall indemnify the Administrative Agent fully for all amounts paid, directly or indirectly, by the Administrative Agent as Tax or otherwise, including any penalties or interest and together with all expenses (including legal expenses, allocated internal costs and out-of-pocket expenses) incurred.

 

 

Section 8.10        Administrative Agent May File Bankruptcy Disclosure and Proofs of Claim. In case of the pendency of any proceeding under any Debtor Relief Laws relative to any Loan Party, the Administrative Agent (irrespective of whether the principal of any Loan or Obligation under a Letter of Credit shall then be due and payable as herein expressed or by declaration or otherwise and irrespective of whether the Administrative Agent shall have made any demand on the Borrower) shall be entitled and empowered (but not obligated) by intervention in such proceeding or otherwise:

 

(a)               to file a verified statement pursuant to rule 2019 of the Federal Rules of Bankruptcy Procedure that, in its sole opinion, complies with such rule’s disclosure requirements for entities representing more than one creditor;

 

(b)               to file and prove a claim for the whole amount of the principal and interest owing and unpaid in respect of the Loans and all other Obligations that are owing and unpaid and to file such other documents as may be necessary or advisable in order to have the claims of the Lenders, the Issuing Banks and the Administrative Agent (including any claim for the reasonable compensation, expenses, disbursements and advances of the Administrative Agent and its respective agents and counsel and all other amounts due Administrative Agent under Sections 2.09 and 9.03 allowed in such judicial proceeding); and

 

(c)               to collect and receive any monies or other property payable or deliverable on any such claims and to distribute the same;

 

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Lender and Issuing Bank to make such payments to Administrative Agent and, in the event that Administrative Agent shall consent to the making of such payments directly to the Lenders and the Issuing Banks, to pay to the Administrative Agent any amount due for the reasonable compensation, expenses, disbursements and advances of the Administrative Agent and its agents and counsel, and any other amounts due to the Administrative Agent under Sections 2.09 and 9.03. To the extent that the payment of any such compensation, expenses, disbursements and advances of the Administrative Agent, its agents and counsel, and any other amounts due to the Administrative Agent under Sections 2.09 and 9.03 out of the estate in any such proceeding, shall be denied for any reason, payment of the same shall be secured by a Lien on, and shall be paid out of, any and all distributions, dividends, money, securities and other properties that the Lenders or the Issuing Banks may be entitled to receive in such proceeding whether in liquidation or under any plan of reorganization or arrangement or otherwise.

 

Nothing contained herein shall be deemed to authorize the Administrative Agent to authorize or consent to or accept or adopt on behalf of any Lender any plan of reorganization, arrangement, adjustment or composition affecting the Obligations or the rights of any Lender or to authorize the Administrative Agent to vote in respect of the claim of any Lender in any such proceeding.

 

 

Section 8.11        Acknowledgment of Lenders and Issuing Banks.

 

(a)               Each Lender hereby agrees that (x) if the Administrative Agent notifies such Lender that the Administrative Agent has determined in its sole discretion that any funds received by such Lender from the Administrative Agent or any of its Affiliates (whether as a payment, prepayment or repayment of principal, interest, fees or otherwise; individually and collectively, a “Payment”) were erroneously transmitted to such Lender (whether or not known to such Lender), and demands the return of such Payment (or a portion thereof), such Lender shall promptly, but in no event later than one Business Day thereafter, return to the Administrative Agent the amount of any such Payment (or portion thereof) as to which such a demand was made in same day funds, together with interest thereon in respect of each day from and including the date such Payment (or portion thereof) was received by such Lender to the date such amount is repaid to the Administrative Agent at the greater of the NYFRB Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation from time to time in effect, and (y) to the extent permitted by applicable law, such Lender shall not assert, and hereby waives, as to the Administrative Agent, any claim, counterclaim, defense or right of set-off or recoupment with respect to any demand, claim or counterclaim by the Administrative Agent for the return of any Payments received, including without limitation any defense based on “discharge for value” or any similar doctrine. A notice of the Administrative Agent to any Lender under this Section 8.11(a) shall be conclusive, absent manifest error.

 

(b)               Each Lender hereby further agrees that if it receives a Payment from the Administrative Agent or any of its Affiliates (x) that is in a different amount than, or on a different date from, that specified in a notice of payment sent by the Administrative Agent (or any of its Affiliates) with respect to such Payment (a “Payment Notice”) or (y) that was not preceded or accompanied by a Payment Notice, it shall be on notice, in each such case, that an error has been made with respect to such Payment.  Each Lender agrees that, in each such case, or if it otherwise becomes aware a Payment (or portion thereof) may have been sent in error, such Lender shall promptly notify the Administrative Agent of such occurrence and, upon demand from the Administrative Agent, it shall promptly, but in no event later than one Business Day thereafter, return to the Administrative Agent the amount of any such Payment (or portion thereof) as to which such a demand was made in same day funds, together with interest thereon in respect of each day from and including the date such Payment (or portion thereof) was received by such Lender to the date such amount is repaid to the Administrative Agent at the greater of the NYFRB Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation from time to time in effect.

 

(c)               The Borrower and each other Loan Party hereby agrees that (x) in the event an erroneous Payment (or portion thereof) is not recovered from any Lender that has received such Payment (or portion thereof) for any reason, the Administrative Agent shall be subrogated to all the rights of such Lender with respect to such amount and (y) an erroneous Payment shall not pay, prepay, repay, discharge or otherwise satisfy any Obligations owed by the Borrower or any other Loan Party; provided that this Section 8.11(c) shall not be interpreted to increase (or accelerate the due date for), or have the effect of increasing (or accelerating the due date for), the Obligations of the Borrower relative to the amount (and/or timing for payment) of the Obligations that would have been payable had such erroneous Payment not been made by the Administrative Agent; provided, further, that for the avoidance of doubt, immediately preceding clauses (x) and (y) shall not apply to the extent any such erroneous Payment is, and solely with respect to the amount of such erroneous Payment that is, comprised of funds received by the Administrative Agent from the Borrower for the purpose of making such Erroneous Payment.

 

 

Each party’s obligations under this Section 8.11(a) shall survive the resignation or replacement of the Administrative Agent or any transfer of rights or obligations by, or the replacement of, a Lender, the termination of the Commitments or the repayment, satisfaction or discharge of all Obligations under any Loan Document.

 

Section 8.12        Authorization of the Administrative Agent under German Law.

 

For the purposes of any German Security, in addition to the provisions set out in this Article 8, the specific provisions set out in paragraph (a) through (h) below of this Section 8.12 shall be applicable. With respect to German Security, in the case of any inconsistency, the provisions set forth in this Section 8.12 shall prevail.

 

(a)               Subject to German law, with respect to any German Security constituted by non– accessory (nicht akzessorische) security interests, the Administrative Agent shall hold, administer and, as the case may be, enforce or release such German Security in its own name, but for the benefit of the Secured Parties.

 

(b)               Subject to German law, the Administrative Agent shall administer and (subject to the same having become enforceable and to the terms of this Agreement) realise any German Security which is pledged (Verpfändung) to it and/or the Secured Parties (or any of them) under an accessory security right (akzessorische Sicherheit) for the benefit of the Secured Parties.

 

(c)               If and when acting in its capacity as creditor of the Parallel Debt, the Administative Agent shall hold:

 

(i)

any German Security which is created in favour of the Administrative Agent as creditor of the Parallel Debt by way of a pledge (Verpfändung) or any other German law accessory security right (akzessorische Sicherheit);

 

(ii)           any proceeds of such German Security; and

 

(iii)          the benefit of this paragraph (c) and of the Parallel Debt,

 

as creditor in its own right but (also) for the benefit of the (other) Secured Parties in accordance with this Agreement.

 

(d)               With regard to any Security Document creating any accessory (akzessorische) German Security and for the purposes of entering into any such Security Document, performing the rights and obligations thereunder, amending, enforcing and/or releasing such Security Document, each Secured Party hereby instructs and authorizes the Administrative Agent to act as its agent (Stellvertreter), and releases the Administrative Agent from the restrictions imposed by Section 181 German Civil Code (Bürgerliches Gesetzbuch) and similar restrictions applicable to it pursuant to any other applicable law, in each case (i) with the right of sub-delegation and the right to release the sub-delegates from the restrictions of such Section 181 of the German Civil Code (Bürgerliches Gesetzbuch) and similar restrictions applicable to it pursuant to any other applicable law and (ii) limited to the extent legally possible to such Secured Party. A Secured Party which is barred by its constitutional documents or bylaws from granting such exemption shall notify the Administrative Agent accordingly.

 

 

(e)               At the request of the Administrative Agent, each Secured Party shall provide the Administrative Agent with a separate written power of attorney (Spezialvollmacht) for the purposes of executing any relevant agreements and documents on their behalf. Each Secured Party hereby ratifies and approves all acts previously done by the Administrative Agent on such Secured Party’s behalf.

 

(f)                The Administrative Agent accepts its appointment as agent and administrator of the German Security on the terms and subject to the conditions set out in this Agreement and the Secured Parties (other than the Administrative Agent), the Administrative Agent and all other parties to this Agreement agree that, in relation to the German Security, no Secured Party (other than the Administrative Agent) shall exercise any independent power to enforce any German Security or take any other action in relation to the enforcement of the German Security, or make or receive any declarations in relation thereto.

 

(g)               Each Secured Party (other than the Administrative Agent) hereby instructs the Administrative Agent (with the right of sub-delegation and the right to release the sub-delegates from the restrictions of such Section 181 of the German Civil Code (Bürgerliches Gesetzbuch) and similar restrictions applicable to it pursuant to any other applicable law) to enter into any documents evidencing German Security and to make and accept all declarations and take all actions it considers necessary or useful in connection with any German Security on behalf of such Secured Party (other than the Administrative Agent). The Administrative Agent shall further be entitled to rescind, release, amend and/or execute new and different documents representing/relating to the German Security.

 

(h)               If and to the extent that the Administrative Agent has already made any statements or declarations or taken any other actions (including, but not limited to, the granting of sub-powers of attorney (including any indemnifications, waivers and consents on behalf of each Secured Party as reasonably agreed upon by the Administrative Agent) and the release of any sub-representatives from the restrictions of Section 181 of the German Civil Code (Bürgerliches Gesetzbuch) and similar restrictions applicable to it pursuant to any other applicable law) which fall within the scope of this Section 8.12, such statements, declarations and actions are hereby ratified and approved (genehmigt).

 

 

Article 9
GUARANTY

 

Section 9.01        Guaranty.

 

(a)               Each Guarantor hereby irrevocably and unconditionally guarantees, jointly with the other Guarantors and severally, as a primary obligor and not merely as a surety, the Obligations of the Borrower. Each Guarantor further agrees that the due and punctual payment of the Obligations of the Borrower may be extended or renewed, in whole or in part, without notice to or further assent from it, and that it will remain bound upon its guarantee hereunder notwithstanding any such extension or renewal of any Obligation.

 

(b)               To the maximum extent permitted by applicable law, each Guarantor waives presentment to, demand of payment from and protest to the Borrower of any of the Obligations, and also waives notice of acceptance of its obligations and notice of protest for nonpayment. The obligations of each Guarantor hereunder shall not be affected by (i) the failure of any Lender to assert any claim or demand or to enforce any right or remedy against the Borrower under the provisions of this Agreement, any other Loan Document or otherwise; (ii) any extension or renewal of any of the Obligations; (iii) any rescission, waiver, amendment or modification of, or release from, any of the terms or provisions of this Agreement or any other Loan Document or other agreement; (iv) the failure or delay of any Lender to exercise any right or remedy against any other guarantor of the Obligations; (v) the failure of any Lender to assert any claim or demand or to enforce any remedy under any Loan Document or any other agreement or instrument; (vi) any default, failure or delay, willful or otherwise, in the performance of the Obligations; or (vii) any other act, omission or delay to do any other act which may or might in any manner or to any extent vary the risk of such Guarantor or otherwise operate as a discharge of such Guarantor as a matter of law or equity or which would impair or eliminate any right of any Guarantor to subrogation (other than payment in full of the Obligations (excluding contingent obligations as to which no claim has been made) or release pursuant to Section 10.17).

 

(c)               Each Guarantor further agrees that its guarantee hereunder constitutes a promise of payment when due (whether or not any bankruptcy or similar proceeding shall have stayed the accrual or collection of any of the Obligations or operated as a discharge thereof) and not merely of collection, and waives any right to require that any resort be had by any Lender or any Issuing Bank to any balance of any deposit account or credit on the books of any Lender or any Issuing Bank in favor of the Borrower or any Subsidiary or any other Person.

 

(d)               Except for the release or termination of a Guarantor’s obligations hereunder as provided in Section 10.17, the obligations of each Guarantor hereunder shall not be subject to any reduction, limitation, impairment or termination for any reason other than the payment in full in cash of the Obligations (excluding contingent obligations as to which no claim has been made), and shall not be subject to any defense or setoff, counterclaim, recoupment or termination whatsoever, by reason of the invalidity, illegality or unenforceability of the Obligations, any impossibility in the performance of the Obligations or otherwise.

 

(e)               Each Guarantor further agrees that its obligations hereunder shall continue to be effective or be reinstated, as the case may be, if at any time payment, or any part thereof, of any Obligation is rescinded or must otherwise be restored by any Lender upon the bankruptcy or reorganization of the Borrower or otherwise.

 

 

(f)                In furtherance of the foregoing and not in limitation of any other right which any Lender may have at law or in equity against any Guarantor by virtue hereof, upon the failure of the Borrower to pay any Obligation when and as the same shall become due, whether at maturity, by acceleration, after notice of prepayment or otherwise, each Guarantor hereby promises to and will, upon receipt of written demand by the Administrative Agent, forthwith pay, or cause to be paid, to the Administrative Agent for distribution to the applicable Lenders in cash an amount equal to the unpaid principal amount of such Obligation.

 

(g)               Notwithstanding anything to the contrary in this Agreement, each Guarantor shall be liable under this Agreement only for amounts aggregating up to the largest amount that would not render its obligations hereunder subject to avoidance under Section 548 of the United States Bankruptcy Code or any comparable provision of any other applicable law.

 

(h)               Upon payment in full by any Guarantor of any Obligation of the Borrower, each Lender and Issuing Bank shall, in a reasonable manner, assign to such Guarantor the amount of such Obligation owed to such Lender or Issuing Bank and so paid, such assignment to be pro tanto to the extent to which the Obligation in question was discharged by such Guarantor, or make such disposition thereof as such Guarantor shall direct (all without recourse to any Lender or Issuing Bank and without any representation or warranty by any Lender or Issuing Bank). Upon payment by any Guarantor of any sums as provided above, all rights of such Guarantor against the Borrower arising as a result thereof by way of right of subrogation or otherwise shall in all respects be subordinated and junior in right of payment to the prior payment in full of all the Obligations owed by the Borrower to the Lenders and Issuing Banks (it being understood that, after the discharge of all the Obligations due and payable from the Borrower, such rights may be exercised by such Guarantor notwithstanding that the Borrower may remain contingently liable for indemnity or other Obligations).

 

(i)                 Each Qualified Keepwell Provider hereby jointly and severally absolutely, unconditionally, and irrevocably undertakes to provide such funds or other support as may be needed from time to time by each other Loan Party to honor all of such Loan Party’s obligations under this guarantee in respect of any obligation to pay or perform under any Swap Agreement (a “Swap Obligation”) (provided, however, that each Qualified Keepwell Provider shall only be liable under this Section 9.01(i) for the maximum amount of such liability that can be hereby incurred without rendering its obligations under this Section 9.01(i), or otherwise under this guarantee, voidable under applicable law relating to fraudulent conveyance or fraudulent transfer, and not for any greater amount). The obligations of each Qualified Keepwell Provider under this Section 9.01(i) shall remain in full force and effect until termination of this Agreement. A “Qualified Keepwell Provider” shall mean, in respect of any Swap Obligation, each Loan Party that, at the time the relevant guarantee (or grant of the relevant security interest, as applicable) becomes effective with respect to such Swap Obligation, has total assets exceeding $10,000,000 or otherwise constitutes an “eligible contract participant” under the Commodity Exchange Act or any regulations promulgated thereunder and can cause another person to qualify as an “eligible contract participant” with respect to such Swap Obligation at such time by entering into a keepwell or guarantee pursuant to Section 1a(18)(A)(v)(II) of the Commodity Exchange Act. Each Qualified Keepwell Provider intends that this Section 9.01(i) constitute, and this Section 9.01(i) shall be deemed to constitute, a “keepwell, support, or other agreement” for the benefit of each other Loan Party for all purposes of section 1a(18)(A)(v)(II) of the Commodity Exchange Act.

 

 

Section 9.02        Additional Agreements.

 

(a)               Until the Commitments have expired or terminated and all Obligations (excluding contingent obligations as to which no claim has been made) have been paid in full and no Letter of Credit shall be outstanding or subject to any pending draw (or otherwise Cash Collateralized or backstopped or deemed reissued under another agreement reasonably acceptable to the applicable Issuing Bank), each Guarantor covenants and agrees with the Administrative Agent for the benefit of the Lenders and Issuing Banks that it will be bound by each of the covenants contained herein to the extent applicable to such Guarantor.

 

(b)               Each Guarantor hereby agrees that upon the occurrence of any Event of Default, any Indebtedness of the Parent, Borrower or any other Guarantor now or hereafter owing to it, whether heretofore, now or hereafter created (the “Guaranty Subordinated Debt”), is hereby subordinated to all of the Obligations under this Agreement and the Notes, and that, except as expressly permitted by this Agreement, the Guaranty Subordinated Debt shall not be paid in whole or in part until such Obligations (excluding contingent obligations as to which no claim has been made) have been paid in full and this Agreement is terminated and of no further force or effect. No Guarantor shall accept any payment of or on account of any Guaranty Subordinated Debt at any time in contravention of the foregoing. Upon the occurrence and during the continuance of an Event of Default, the Parent, the Borrower and any other applicable Guarantor shall pay to the Administrative Agent any payment of all or any part of the Guaranty Subordinated Debt and any amount so paid to the Administrative Agent shall be applied to payment of the Obligations under this Agreement and the Notes as provided herein. Each payment on the Guaranty Subordinated Debt received in violation of any of the provisions hereof shall be deemed to have been received by the Guarantors as trustee for the Administrative Agent and the Lenders and shall be paid over to the Administrative Agent immediately on account of the Obligations, but without otherwise affecting in any manner the Guarantors’ liability under this Agreement. Each Guarantor agrees to file all claims against the Parent, the Borrower or any other applicable Guarantor in any bankruptcy or other proceeding in which the filing of claims is required by law in respect of any Guaranty Subordinated Debt, and the Administrative Agent shall be entitled to all of such Guarantor’s rights thereunder. If for any reason any Guarantor fails to file such claim at least ten (10) Business Days prior to the last date on which such claim should be filed, such Guarantor hereby irrevocably appoints the Administrative Agent as its true and lawful attorney-in-fact and is hereby authorized to act as attorney-in-fact in such Guarantor’s name to file such claim or, in the Administrative Agent’s discretion, to assign such claim to and cause proof of claim to be filed in the name of the Administrative Agent or its nominee. In all such cases, whether in administration, bankruptcy or otherwise, the person or persons authorized to pay such claim shall pay to the Administrative Agent the full amount payable on the claim in the proceeding, and, to the full extent necessary for that purpose, each Guarantor hereby assigns to the Administrative Agent all of such Guarantor’s rights to any payments or distributions to which such Guarantor otherwise would be entitled. If the amount so paid is greater than such Guarantor’s liability hereunder, the Administrative Agent shall pay the excess amount to the party entitled thereto.

 

Section 9.03        Information. Each Guarantor assumes all responsibility for being and keeping itself informed of the Borrower’s financial condition and assets, and of all other circumstances bearing upon the risk of nonpayment of the Obligations and the nature, scope and extent of the risks that such Guarantor assumes and incurs hereunder, and agrees that neither the Administrative Agent nor any Lender will have any duty to advise such Guarantor of information known to it or any of them regarding such circumstances or risks.

 

 

Section 9.04        Guarantor Notices. All communications and notices to any Guarantor shall be given to it in care of the Borrower as provided in Section 10.01.

 

Section 9.05        Termination. The Guarantees set forth in this Article IX shall terminate when all the Obligations (excluding contingent obligations as to which no claim has been made) have been paid in full and no Letter of Credit shall be outstanding or subject to any pending draw (or otherwise Cash Collateralized or backstopped or deemed reissued under another agreement reasonably acceptable to the applicable Issuing Bank), and the Lenders have no further commitment to lend and the Issuing Banks has no further obligation to issue Letters of Credit.

 

Section 9.06        Right of Set Off. If an Event of Default shall have occurred and be continuing, each Lender and each of its Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or demand, provisional or final) at any time held by, and other obligations at any time owing by such Lender or Affiliate to or for the credit or the account of any Guarantor against any of and all the obligations of such Guarantor now or hereafter existing under this Agreement held by such Lender, irrespective of whether or not such Lender shall have made any demand under this Agreement and although such obligations may be unmatured; provided that in the event that any Defaulting Lender shall exercise any such right of setoff, (x) all amounts so set off shall be paid over immediately to the Administrative Agent for further application in accordance with the provisions of Section 2.15 and, pending such payment, shall be segregated by such Defaulting Lender from its other funds and deemed held in trust for the benefit of the Administrative Agent and the Lenders, and (y) the Defaulting Lender shall provide promptly to the Administrative Agent a statement describing in reasonable detail the obligations owing to such Defaulting Lender as to which it exercised such right of setoff. The rights of each Lender under this Section 9.06 are in addition to other rights and remedies (including other rights of setoff) which such Lender may have. Each Lender agrees to notify such Guarantor and the Administrative Agent promptly after any such setoff and application; provided, that the failure to give such notice shall not affect the validity of such setoff and application.

 

Section 9.07        Additional Guarantors. It is understood and agreed that any Subsidiary of the Parent that is required to execute a counterpart of, or joinder to, this Agreement after the date hereof pursuant to Section 5.11 shall become a Guarantor hereunder by (x) executing and delivering a guaranty supplement in the form of Exhibit E hereto and delivering the same to the Administrative Agent and (y) taking all actions as specified in this Agreement as would have been taken by such Guarantor had it been an original party to this Agreement, in each case with all documents and actions required to be taken above to be taken to the reasonable satisfaction of the Administrative Agent.

 

Section 9.08        Article IX Severability. In the event any one or more of the provisions contained in this Article IX should be held invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained in this Article IX shall not in any way be affected or impaired thereby (it being understood that the invalidity of a particular provision in a particular jurisdiction shall not in and of itself affect the validity of such provision in any other jurisdiction). The parties shall endeavor in good-faith negotiations to replace the invalid, illegal or unenforceable provisions with valid provisions the economic effect of which comes as close as possible to that of the invalid, illegal or unenforceable provisions.

 

 

Article 10
MISCELLANEOUS

 

Section 10.01      Notices.

 

(a)               Except in the case of notices and other communications expressly permitted to be given by telephone (and subject to paragraph (b) below), all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by telecopy, as follows:

 

(i)           if to the Borrower, to it at:

 

Fluence Energy, LLC

4601 Fairfax Drive, Suite 600

Arlington, VA 22203

United States
Attention: Samuel Chong and Jie Yuan
Email: samuel.chong@fluenceenergy.com; jie.yuan@fluenceenergy.com

 

(ii)          if to the Administrative Agent, to it at:

 

JPMorgan Chase Bank, N.A.
500 Stanton Christiana Road
NCC 5, 1st Floor

Newark, DE 19713
Attention: Bryan Cook

Telephone: (302) 455-3768

Email: bryan.a.cook@jpmchase.com

 

(iii)         if to any other Lender, to it at its address (or telecopy number) set forth in its Administrative Questionnaire.

 

(iv)         if to JPMorgan Chase Bank, N.A., as an Issuing Bank, to it at:

 

JPMorgan Chase Bank, N.A.
10420 Highland Manor Dr. 4th Floor
Tampa, FL 33610
Attention: Standby LC Unit

Tel: 800-364-1969

Fax: 856-294-5267

Email: GTS.Client.Services@jpmchase.com

 

 

With a copy to:

 

JPMorgan Chase Bank, N.A.
500 Stanton Christiana Rd.
NCC5 / 1st Floor
Newark, DE 19713
Attention: Loan & Agency Services Group
Tel: 1 302 455 3768
Fax: 12012443629@tls.ldsprod.com
Email: bryan.a.cook@jpmchase.com

 

(v)               With respect to any other Issuing Bank, at its address provided by notice to the other parties hereto.

 

Notices and other communications sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemed to have been given when received; notices and other communications sent by telecopier shall be deemed to have been given when sent (except that, if not given during normal business hours for the recipient, shall be deemed to have been given at the opening of business on the next business day for the recipient). Notices and other communications delivered through electronic communications to the extent provided in subsection (b) below, shall be effective as provided in such subsection (b).

 

(b)               Notices and other communications to the Lenders and the Issuing Banks hereunder may be delivered or furnished by electronic communications pursuant to procedures approved by the Administrative Agent; provided that the foregoing shall not apply to notices pursuant to Article 2 unless otherwise agreed by the Administrative Agent and the applicable Lender. The Administrative Agent or the Borrower may, in its discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it; provided that approval of such procedures may be limited to particular notices or communications. Unless the Administrative Agent otherwise prescribes, (i) notices and other communications sent to an e-mail address shall be deemed received upon the sender’s receipt of an acknowledgement from the intended recipient (such as by the “return receipt requested” function, as available, return e-mail or other written acknowledgement), and (ii) notices or communications posted to an Internet or intranet website shall be deemed received upon the deemed receipt by the intended recipient, at its e-mail address as described in the foregoing clause (i), of notification that such notice or communication is available and identifying the website address therefor; provided that, for both clauses (i) and (ii) above, if such notice, email or other communication is not sent during the normal business hours of the recipient, such notice or communication shall be deemed to have been sent at the opening of business on the next Business Day for the recipient.

 

(c)               Any party hereto may change its address or telecopy number for notices and other communications hereunder by notice to the other parties hereto.

 

 

(d)               The Borrower agrees that the Administrative Agent may make the Communications (as defined below) available to the Lenders and the Issuing Banks by posting the Communications on Debt Domain, IntraLinks, Syndtrak, or another similar electronic system (the “Platform”). THE PLATFORM IS PROVIDED “AS IS” AND “AS AVAILABLE.” The Agent Parties (as defined below) do not warrant the adequacy of the Platform and expressly disclaim liability for errors or omissions in the communications effected thereby (the “Communications”). No warranty of any kind, express, implied or statutory, including any warranty of merchantability, fitness for a particular purpose, non-infringement of third-party rights or freedom from viruses or other code defects, is made by any Agent Party in connection with the Communications or the Platform. In no event shall the Administrative Agent or any of its Related Parties (collectively, the “Agent Parties”) be responsible or liable for damages arising from the unauthorized use by others of information or other materials obtained through internet, electronic, telecommunications or other information transmission, except to the extent that such damages have resulted from the willful misconduct or gross negligence of such Agent Party (as determined in a final, non-appealable judgment by a court of competent jurisdiction).

 

Section 10.02      Waivers; Amendments.

 

(a)               No failure or delay by the Administrative Agent, any Issuing Bank or any Lender in exercising any right or power hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such a right or power, preclude any other or further exercise thereof or the exercise of any other right or power. The rights and remedies of the Administrative Agent, the Issuing Banks and the Lenders hereunder are cumulative and are not exclusive of any rights or remedies that they would otherwise have. No waiver of any provision of this Agreement or any other Loan Document or consent to any departure by any Guarantor therefrom shall in any event be effective unless the same shall be permitted by paragraph (b) of this Section, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given. No notice or demand on any Guarantor in any case shall entitle such Guarantor to any other or further notice or demand in similar or other circumstances. Without limiting the generality of the foregoing, the making of a Loan or issuance of a Letter of Credit shall not be construed as a waiver of any Default, regardless of whether the Administrative Agent, any Issuing Bank or any Lender may have had notice or knowledge of such Default at the time.

 

(b)               Subject to Section 2.11(b) and (d), Section 10.02(c) and Section 10.02(d) below, none of this Agreement, any other Loan Document or any provision hereof or thereof may be waived, amended or modified except pursuant to an agreement or agreements in writing entered into by the Borrower and the Required Lenders or by the Borrower and the Administrative Agent with the consent of the Required Lenders; provided, however, that no such amendment, waiver or consent shall: (i) amend the definition of “Applicable Percentage” without the consent of each Lender, or extend or increase the Commitment of any Lender without the written consent of such Lender, (ii) reduce the principal amount of any Loan or LC Disbursement or reduce the rate of interest thereon, or reduce any fees payable hereunder, without the written consent of each Lender directly affected thereby, (iii) postpone the scheduled date of payment of the principal amount of any Loan or LC Disbursement, or any interest thereon, or any fees payable hereunder, or reduce the amount of, waive or excuse any such payment, or postpone the scheduled date of expiration of any Commitment, without the written consent of each Lender directly affected thereby; provided, however, that notwithstanding clause (ii) or (iii) of this Section 10.02(b), only the consent of the Required Lenders shall be necessary to waive any obligation of the Borrower to pay interest at the default rate set forth in Section 2.10(d), (iv) change Section 2.15(b), Section 2.15(c) or any other Section hereof providing for the ratable treatment of the Lenders, in each case in a manner that would alter the pro rata sharing of payments required thereby, without the written consent of each Lender, (v) release all or substantially all of the value of the Guaranty or release all or substantially all of the Collateral, without the written consent of each Lender, except to the extent the release of any Guarantor or the Collateral is permitted pursuant to Article 8 or Section 10.17 (in which case such release may be made by the Administrative Agent acting alone), (vi) change any of the provisions of this Section or the percentage referred to in the definition of “Required Lenders” or any other provision hereof specifying the number or percentage of Lenders required to waive, amend or modify any rights hereunder or make any determination or grant any consent hereunder, without the written consent of each Lender, (vii) subordinate the Liens on all or substantially all the value of the Collateral to the Liens securing any other Indebtedness, or contractually subordinate with respect to payment any Obligations, without the written consent of each Lender adversely affected thereby, provided that any Lender that is provided a bona fide offer to participate on a ratable basis and on substantially the same terms offered to each other Lender in the issuance of such Indebtedness shall be deemed not to be adversely affected, (viii) amend Section 7.03 without the written consent of the Administrative Agent and each Lender adversely affected thereby or (ix) amend the definition of “Alternative Currency” without the written consent of the Administrative Agent and each Lender adversely affected thereby. Notwithstanding anything to the contrary herein, no such agreement shall amend, modify or otherwise affect the rights or duties of the Administrative Agent or any Issuing Bank hereunder without the prior written consent of the Administrative Agent or such Issuing Bank, as the case may be.

 

 

(c)               This Agreement may be amended as contemplated by Section 2.18 to effect New Commitments pursuant to a Joinder Agreement with the consent only of the Administrative Agent, the Borrower and the New Lenders providing New Commitments. If the Administrative Agent and the Borrower acting together identify any ambiguity, omission, mistake, typographical error or other defect in any provision of this Agreement or any other Loan Document, then the Administrative Agent and the Borrower shall be permitted to amend, modify or supplement such provision to cure such ambiguity, omission, mistake, typographical error or other defect, and such amendment shall become effective without any further action or consent of any other party to this Agreement.

 

(d)               Except as provided in Section 9.07, no provision of Article IX may be waived, amended or modified except pursuant to an agreement or agreements in writing entered into between the Administrative Agent and each Guarantor with respect to which such waiver, amendment or modification is to apply, in accordance with this Section 10.02.

 

Section 10.03    Expenses; Indemnity; Damage Waiver.

 

(a)               The Borrower shall pay (i) all reasonable and documented out-of-pocket expenses incurred by the Administrative Agent and its Affiliates, including the reasonable and documented fees, disbursements and other charges of one firm of counsel for all such Persons taken as a whole (and, if reasonably necessary, of one local counsel in any relevant material jurisdiction to all such persons, taken as a whole and, solely in the case of a conflict of interest, one additional local counsel to all affected indemnified persons, taken as a whole, in each such relevant material jurisdiction) in connection with the syndication of the credit facilities provided for herein, the preparation, execution, delivery and administration of this Agreement, any other Loan Document or any amendments, modifications or waivers of the provisions hereof or thereof (whether or not the transactions contemplated hereby or thereby shall be consummated), (ii) costs, expenses, Taxes, assessments and other charges incurred by any Lender in connection with any filing, registration, recording, or perfection of any security interest contemplated by this Agreement, (iii) all reasonable out-of-pocket expenses incurred by any Issuing Bank in connection with the issuance, amendment, renewal or extension of any Letter of Credit or any demand for payment thereunder and (iv) all out-of-pocket expenses incurred by the Administrative Agent, any Issuing Bank or any Lender, including the fees, disbursements and other charges of one firm of counsel for all such Persons taken as a whole (and, if reasonably necessary, of one local counsel in any relevant material jurisdiction to all such persons, taken as a whole and, solely in the case of a conflict of interest, one additional local counsel to all affected indemnified persons, taken as a whole, in each such relevant material jurisdiction), in connection with the enforcement or protection of its rights in connection with this Agreement or any other Loan Document, including its rights under this Section, or in connection with the Loans made or Letters of Credit issued hereunder, including all such out-of-pocket expenses incurred during any workout, restructuring or negotiations in respect of such Loans or Letters of Credit.

 

 

(b)               Each Loan Party, jointly and severally, shall indemnify the Administrative Agent, the Arrangers, any Issuing Bank and each Lender, and each Related Party, successor, partner, representative or assign of any of the foregoing Persons (each such Person being called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and related expenses, including the reasonable and documented out-of-pocket fees, charges and disbursements of one firm of counsel for all such Persons taken as a whole (and, if reasonably necessary, of one local counsel in any relevant material jurisdiction to all such persons, taken as a whole and, solely in the case of a conflict of interest, one additional local counsel to all affected indemnified persons, taken as a whole, in each such relevant material jurisdiction) for any Indemnitee, incurred by or asserted against any Indemnitee arising out of, in connection with, or as a result of (i) the execution or delivery of this Agreement, any other Loan Document or any agreement or instrument contemplated hereby or thereby, the performance by the parties hereto of their respective obligations hereunder or thereunder or the consummation of the Transactions or any other transactions contemplated hereby, or, in the case of the Administrative Agent (and any sub-agent thereof) and its Related Parties only, the administration of this Agreement and the other Loan Documents, (ii) any Loan or Letter of Credit or the use of the proceeds therefrom (including any refusal by any Issuing Bank to honor a demand for payment under a Letter of Credit if the documents presented in connection with such demand do not strictly comply with the terms of such Letter of Credit), (iii) any actual or alleged presence or release of Hazardous Materials on or from any property owned, leased or operated by the Parent or any of its Subsidiaries, or any Environmental Liability related in any way to the Parent or any of its Subsidiaries, or (iv) any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether or not such claim, litigation, investigation or proceeding is brought by the Parent, the Borrower or their respective equity holders, Affiliates, creditors or any other third Person and whether based on contract, tort or any other theory and regardless of whether any Indemnitee is a party thereto; provided that such indemnity shall not, as to any Indemnitee, be available, (x) with respect to Taxes and amounts relating thereto (other than any Taxes that represent losses, claims, damages, etc. arising from any non-Tax claim), the indemnification for which shall be governed solely and exclusively by Section 2.14, (y) to the extent that such losses, claims, damages, liabilities or related expenses are determined by a court of competent jurisdiction by final and non-appealable judgment to have resulted from the bad faith, gross negligence, willful misconduct or material breach of the Loan Documents by such Indemnitee or (z) to the extent that such losses, claims, damages, liabilities or related expenses arise from any proceeding that does not involve the Parent, the Borrower or any of their respective Affiliates and that is brought by an Indemnitee against any other Indemnitee, other than any proceeding against the Administrative Agent or any Arranger, in each case acting in such capacity.

 

 

 

(c)          To the extent that the Borrower or any other Guarantor, as applicable, fails to pay any amount required to be paid by it to the Administrative Agent or any Issuing Bank under paragraph (a) or (b) of this Section, each Lender severally agrees to pay to the Administrative Agent and the applicable Issuing Bank, as the case may be, such Lender’s Applicable Percentage (determined as of the time that the applicable unreimbursed expense or indemnity payment is sought) of such unpaid amount; provided that the unreimbursed expense or indemnified loss, claim, damage, liability or related expense, as the case may be, was incurred by or asserted against the Administrative Agent or such Issuing Bank in their capacity as such; provided, further, that, notwithstanding anything to the contrary herein, no Lender shall be liable for any portion of any such unreimbursed expenses or indemnified loss, claim, damage, liability or related expense, as the case may be, of the Administrative Agent and/or the Issuing Banks (or, in each case, any Affiliate thereof) as a result of the bad faith, gross negligence or willful misconduct of the relevant Person or Persons, as determined by a court of competent jurisdiction by a final or non-appealable judgment.

 

(d)          Without limiting in any way the indemnification obligations of the Guarantors pursuant to Section 10.03(b) or of the Lenders pursuant to Section 8.06, to the extent permitted by applicable law, each party hereto shall not assert, and hereby waives, any claim against any Indemnitee or the Borrower or any of its Subsidiaries, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement, any other Loan Document or any agreement or instrument contemplated hereby or thereby, the Transactions or any Loan or Letter of Credit or the use of the proceeds thereof; provided that nothing in this clause (d) shall relieve any Guarantor of any obligation it may have to indemnify an Indemnitee against special, indirect, consequential or punitive damages asserted against such Indemnitee by a third party. No Indemnitee shall be liable for any damages arising from the use by unintended recipients of any information or other materials distributed to such unintended recipients by such Indemnitee through telecommunications, electronic or other information transmission systems in connection with this Agreement or the other Loan Documents or the transactions contemplated hereby or thereby other than for direct or actual damages resulting from the gross negligence or willful misconduct of such Indemnitee as determined by a final and non-appealable judgment of a court of competent jurisdiction.

 

(e)          All amounts due under this Section shall be payable promptly after written demand therefor.

 

 

Section 10.04     Successors and Assigns.

 

(a)          The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby (including any Affiliate of any Issuing Bank that issues any Letter of Credit), except that (i) the Borrower may not assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of each Lender (and any attempted assignment or transfer by the Borrower without such consent shall be null and void), (ii) no Guarantor shall have the right to assign or transfer any of its rights or obligations hereunder or any interest herein (and any such assignment or transfer shall be void) except as expressly contemplated by this Agreement and (iii) no Lender may assign or otherwise transfer its rights or obligations hereunder except in accordance with this Section. Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby, Participants (to the extent provided in paragraph (c) of this Section) and, to the extent expressly contemplated hereby (including any Affiliate of any Issuing Bank that issues any Letter of Credit), the Related Parties of each of the Administrative Agent, the Issuing Banks and the Lenders) any legal or equitable right, remedy or claim under or by reason of this Agreement.

 

(b)          (i)         Subject to the conditions set forth in paragraph (b)(ii) below, any Lender may assign to one or more assignees (but not to the Borrower or an Affiliate thereof) all or a portion of its rights and obligations under this Agreement (including all or a portion of its Commitment, participations in Letters of Credit and the Loans at the time owing to it) with the prior written consent (such consent not to be unreasonably withheld or delayed) of:

 

(A)      the Borrower; provided that no consent of the Borrower shall be required for an assignment to a Lender, an Affiliate of a Lender, an Approved Fund or, if an Event of Default has occurred and is continuing, any other assignee; and provided further that the Borrower shall be deemed to have consented to any such assignment unless it shall object thereto by written notice to the Administrative Agent within 10 Business Days after having received notice thereof;

 

(B)       the Administrative Agent; provided that no consent of the Administrative Agent shall be required for an assignment of any Commitment to an assignee that is a Lender with a Commitment immediately prior to giving effect to such assignment, an Affiliate of a Lender, or an Approved Fund; and

 

(C)       each Issuing Bank.

 

(ii)       Assignments shall be subject to the following additional conditions:

 

(A)      except in the case of an assignment to a Lender or an Affiliate of a Lender or an assignment of the entire remaining amount of the assigning Lender’s Commitment or Loans, the amount of the Commitment or Loans of the assigning Lender subject to each such assignment (determined as of the date the Assignment and Assumption with respect to such assignment is delivered to the Administrative Agent) shall not be less than $5,000,000 (or a greater amount that is an integral multiple of $1,000,000) unless each of the Borrower and the Administrative Agent otherwise consent; provided that no such consent of the Borrower shall be required if an Event of Default has occurred and is continuing;

 

(B)       each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender’s rights and obligations under this Agreement;

 

 

(C)       the parties to each assignment shall execute and deliver to the Administrative Agent an Assignment and Assumption, together with a processing and recordation fee of $3,500;

 

(D)      the assignee, if it shall not be a Lender, shall deliver to the Administrative Agent an Administrative Questionnaire in which the assignee designates one or more credit contacts to whom all syndicate-level information (which may contain material non-public information about the Parent, the Borrower and their respective Related Parties or their respective securities) will be made available and who may receive such information in accordance with the assignee’s compliance procedures and applicable laws, including Federal and state securities laws;

 

(E)       no such assignment shall be made to (i) any Loan Party nor any Affiliate of a Loan Party, and (ii) any Defaulting Lender or any of its subsidiaries, or any Person, who, upon becoming a Lender hereunder, would constitute any of the foregoing Persons described in this subsection (E)(ii);

 

(F)       in connection with any assignment of rights and obligations of any Defaulting Lender hereunder, no such assignment shall be effective unless and until, in addition to the other conditions thereto set forth herein, the parties to the assignment shall make such additional payments to the Administrative Agent in an aggregate amount sufficient, upon distribution thereof as appropriate (which may be outright payment, purchases by the assignee of participations or subparticipations, or other compensating actions, including funding, with the consent of the Borrower and the Administrative Agent, the applicable pro rata share of Loans previously requested but not funded by the Defaulting Lender, to each of which the applicable assignee and assignor hereby irrevocably consent), to (x) pay and satisfy in full all payment liabilities then owed by such Defaulting Lender to the Administrative Agent or any Lender hereunder (and interest accrued thereon), and (y) acquire (and fund as appropriate) its full pro rata share of all Loans in accordance with its Applicable Percentage. Notwithstanding the foregoing, in the event that any assignment of rights and obligations of any Defaulting Lender hereunder shall become effective under applicable Law without compliance with the provisions of this paragraph, then the assignee of such interest shall be deemed to be a Defaulting Lender for all purposes of this Agreement until such compliance occurs; and

 

(G)       no assignment shall be made to any Disqualified Lender; provided that notwithstanding anything in this Agreement or any other Loan Document to the contrary, each Loan Party and the Lenders acknowledge and agree that the Administrative Agent shall not be responsible or have any liability for, or have any duty to ascertain, inquire into, monitor or enforce, compliance with the provisions hereof relating to Disqualified Lenders. Without limiting the generality of the foregoing, the Administrative agent shall not (x) be obligated to ascertain, monitor or inquire as to whether any Lender or Participant or potential Lender or Participant is a Disqualified Lender or (y) have any liability with respect to or arising out of any assignment or participation of Loans, or disclosure of confidential information, to, or the restrictions on any exercise of rights or remedies of, any Disqualified Lender.

 

 

(iii)      Subject to acceptance and recording thereof pursuant to paragraph (b)(iv) of this Section, from and after the effective date specified in each Assignment and Assumption the assignee thereunder shall be a party hereto and, to the extent of the interest assigned by such Assignment and Assumption, have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption, be released from its obligations under this Agreement (and, in the case of an Assignment and Assumption covering all of the assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to be a party hereto but shall continue to be entitled to the benefits of Section 2.12, Section 2.13, Section 2.14 and Section 10.03); provided, that except to the extent otherwise expressly agreed by the affected parties, no assignment by a Defaulting Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender. Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this Section shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with paragraph (c) of this Section.

 

(iv)      The Administrative Agent, acting for this purpose as an agent of the Borrower, shall maintain at one of its offices a copy of each Assignment and Assumption delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Commitment of, and amounts (including interest) on the Loans and LC Disbursements owing to, each Lender pursuant to the terms hereof from time to time (the “Register”). The entries in the Register shall be conclusive (absent manifest error), and the Borrower, the Administrative Agent, the Issuing Banks and the Lenders shall treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary. The Register shall be available for inspection by the Borrower, any Issuing Bank and any Lender, at any reasonable time and from time to time upon reasonable prior notice. The Loans (including principal and interest) are registered obligations and the right, title, and interest of any Lender or its assigns in and to such Loans shall be transferable only upon notation of such transfer in the Register.

 

(v)       Upon its receipt of a duly completed Assignment and Assumption executed by an assigning Lender and an assignee, the assignee’s completed Administrative Questionnaire (unless the assignee shall already be a Lender hereunder), the processing and recordation fee referred to in paragraph (b) of this Section and any written consent to such assignment required by paragraph (b) of this Section, the Administrative Agent shall accept such Assignment and Assumption and record the information contained therein in the Register; provided that if either the assigning Lender or the assignee shall have failed to make any payment required to be made by it pursuant to Section 2.04(b), Section 2.15(d) or Section 8.06, the Administrative Agent shall have no obligation to accept such Assignment and Assumption and record the information therein in the Register unless and until such payment shall have been made in full, together with all accrued interest thereon. No assignment shall be effective for purposes of this Agreement unless it has been recorded in the Register as provided in this paragraph.

 

 

(c)          (i)          Any Lender may, without the consent of, or notice to, the Borrower or the Administrative Agent or any Issuing Bank, sell participations to one or more banks or other entities (but not to the Borrower, an Affiliate thereof or to a Disqualified Lender) (a “Participant”) in all or a portion of such Lender’s rights and obligations under this Agreement (including all or a portion of its Commitment and the Loans owing to it); provided that (A) such Lender’s obligations under this Agreement shall remain unchanged, (B) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations and (C) the Borrower, the Administrative Agent, the Issuing Banks and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement. Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this Agreement; provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, modification or waiver described in the first proviso to Section 10.02(b) that affects such Participant. Subject to paragraph (c)(ii) of this Section, the Borrower agrees that each Participant shall be entitled to the benefits of Sections 2.12, 2.13 and 2.14 to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to paragraph (b) of this Section. To the extent permitted by law, each Participant also shall be entitled to the benefits of Section 10.08 as though it were a Lender, provided such Participant agrees to be subject to Section 2.15(c) as though it were a Lender.

 

(ii)       A Participant shall not be entitled to receive any greater payment under Sections 2.12 or 2.14 than the applicable Lender would have been entitled to receive with respect to the participation sold to such Participant except to the extent such entitlement to receive a greater payment results from a Change in Law requiring a payment under Section 2.12 that occurs after the Participant acquired the applicable participation. Participants entitled to the benefits of Sections 2.12, 2.13 and 2.14 are entitled to such benefits subject to the requirements and limitations therein, including the requirements under Section 2.14(f) (it being understood that the documentation required under Section 2.14(f) shall be delivered to the participating Lender).

 

(iii)      Each Lender that sells a participation shall, acting solely for this purpose as a nonfiduciary agent of the Borrower, maintain a register on which it enters the name and address of each Participant and the principal amounts (and stated interest) of each Participant’s interest in the Loans or other obligations under the Loan Documents (the “Participant Register”); provided that no Lender shall have any obligation to disclose all or any portion of the Participant Register (including the identity of any Participant or any information relating to a Participant’s interest in any commitments, loans, letters of credit or its other obligations under any Loan Document) to any Person except to the extent that such disclosure is necessary to establish that such commitment, loan, letter of credit or other obligation is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations and Proposed Treasury Regulations Section 1.163-5(b) (and, in each case, any amended or successor version). The entries in the Participant Register shall be conclusive absent manifest error, and such Lender shall treat each Person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary. For the avoidance of doubt, the Administrative Agent (in its capacity as Administrative Agent) shall have no responsibility for maintaining a Participant Register.

 

 

(d)          Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure obligations of such Lender, including without limitation any pledge or assignment to secure obligations to a Federal Reserve Bank or any other central bank having jurisdiction over such Lender, and this Section shall not apply to any such pledge or assignment of a security interest; provided that no such pledge or assignment of a security interest shall release a Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.

 

Section 10.05    Survival. All covenants, agreements, representations and warranties made by the Parent, the Borrower, or the Guarantors as applicable, herein and in the certificates or other instruments delivered in connection with or pursuant to this Agreement or any other Loan Document shall be considered to have been relied upon by the other parties hereto and shall survive the execution and delivery of this Agreement, the other Loan Documents and the making of any Loans and issuance of any Letters of Credit, regardless of any investigation made by any such other party or on its behalf and notwithstanding that the Administrative Agent, any Issuing Bank or any Lender may have had notice or knowledge of any Default or incorrect representation or warranty at the time any credit is extended hereunder, and shall continue in full force and effect as long as the principal of or any accrued interest on any Loan or any fee or any other amount payable under this Agreement is outstanding and unpaid or any Letter of Credit is outstanding or subject to any pending draw and so long as the Commitments have not expired or terminated. The provisions of Section 2.12, Section 2.13, Section 2.14 and Section 10.03 and Article 8 shall survive and remain in full force and effect regardless of the consummation of the transactions contemplated hereby, the repayment of the Loans, the expiration or termination of the Letters of Credit and the Commitments, the resignation of the Administrative Agent, the replacement of any Lender, or the termination of this Agreement or any provision hereof.

 

Section 10.06     Counterparts; Integration; Effectiveness.

 

(a)          This Agreement may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. This Agreement, the other Loan Documents and any separate letter agreements with respect to fees payable to the Administrative Agent constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof. Except as provided in Section 4.01, this Agreement shall become effective when it shall have been executed by the Administrative Agent and when the Administrative Agent shall have received counterparts hereof which, when taken together, bear the signatures of each of the other parties hereto, and thereafter shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. This Agreement shall be construed as a separate agreement with respect to each Guarantor and may be amended, modified, supplemented, waived or released with respect to any Guarantor without the approval of any other Guarantor and without affecting the obligations of any other Guarantor hereunder.

 

 

(b)          Delivery of an executed counterpart of a signature page of (x) this Agreement, (y) any other Loan Document and/or (z) any document, amendment, approval, consent, information, notice (including, for the avoidance of doubt, any notice delivered pursuant to Section 9.01), certificate, request, statement, disclosure or authorization related to this Agreement, any other Loan Document and/or the transactions contemplated hereby and/or thereby (each an “Ancillary Document”) that is an Electronic Signature transmitted by telecopy, emailed pdf. or any other electronic means that reproduces an image of an actual executed signature page shall be effective as delivery of a manually executed counterpart of this Agreement, such other Loan Document or such Ancillary Document, as applicable. The words “execution,” “signed,” “signature,” “delivery,” and words of like import in or relating to this Agreement, any other Loan Document and/or any Ancillary Document shall be deemed to include Electronic Signatures, deliveries or the keeping of records in any electronic form (including deliveries by telecopy, emailed pdf. or any other electronic means that reproduces an image of an actual executed signature page), each of which shall be of the same legal effect, validity or enforceability as a manually executed signature, physical delivery thereof or the use of a paper-based recordkeeping system, as the case may be; provided that nothing herein shall require the Administrative Agent to accept Electronic Signatures in any form or format without its prior written consent and pursuant to procedures approved by it; provided, further, without limiting the foregoing, (i) to the extent the Administrative Agent has agreed to accept any Electronic Signature, the Administrative Agent and each of the Lenders shall be entitled to rely on such Electronic Signature purportedly given by or on behalf of the Borrower or any other Loan Party without further verification thereof and without any obligation to review the appearance or form of any such Electronic signature and (ii) upon the request of the Administrative Agent or any Lender, any Electronic Signature shall be promptly followed by a manually executed counterpart. Without limiting the generality of the foregoing, the Borrower and each Loan Party hereby (A) agree that, for all purposes, including without limitation, in connection with any workout, restructuring, enforcement of remedies, bankruptcy proceedings or litigation among the Administrative Agent, the Lenders, the Borrower and the Loan Parties, Electronic Signatures transmitted by telecopy, emailed pdf. or any other electronic means that reproduces an image of an actual executed signature page and/or any electronic images of this Agreement, any other Loan Document and/or any Ancillary Document shall have the same legal effect, validity and enforceability as any paper original, (B) agree that the Administrative Agent and each of the Lenders may, at its option, create one or more copies of this Agreement, any other Loan Document and/or any Ancillary Document in the form of an imaged electronic record in any format, which shall be deemed created in the ordinary course of such Person’s business, and destroy the original paper document (and all such electronic records shall be considered an original for all purposes and shall have the same legal effect, validity and enforceability as a paper record), (C) waive any argument, defense or right to contest the legal effect, validity or enforceability of this Agreement, any other Loan Document and/or any Ancillary Document based solely on the lack of paper original copies of this Agreement, such other Loan Document and/or such Ancillary Document, respectively, including with respect to any signature pages thereto and (D) waive any claim against any Person for any Liabilities arising solely from the Administrative Agent’s and/or any Lender’s reliance on or use of Electronic Signatures and/or transmissions by telecopy, emailed pdf. or any other electronic means that reproduces an image of an actual executed signature page, including any Liabilities arising as a result of the failure of the Borrower and/or any Loan Party to use any available security measures in connection with the execution, delivery or transmission of any Electronic Signature.

 

 

Section 10.07    Severability. Subject to Section 9.08, any provision of this Agreement held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining provisions hereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction. Without limiting the foregoing provisions of this Section, if and to the extent that the enforceability of any provisions in this Agreement relating to Defaulting Lenders shall be limited by Debtor Relief Laws, as determined in good faith by the Administrative Agent, then such provisions shall be deemed to be in effect only to the extent not so limited.

 

Section 10.08    Right of Setoff. If an Event of Default shall have occurred and be continuing, each Lender and each of its Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or demand, provisional or final, in whatever currency) at any time held by, and other obligations (in whatever currency) at any time owing by such Lender or Affiliate to or for the credit or the account of the Borrower against any of and all the obligations of the Borrower now or hereafter existing under this Agreement held by such Lender, irrespective of whether or not such Lender shall have made any demand under this Agreement and although such obligations may be unmatured; provided that in the event that any Defaulting Lender shall exercise any such right of setoff, (x) all amounts so set off shall be paid over immediately to the Administrative Agent for further application in accordance with the provisions of Section 2.15 and, pending such payment, shall be segregated by such Defaulting Lender from its other funds and deemed held in trust for the benefit of the Administrative Agent and the Lenders, and (y) the Defaulting Lender shall provide promptly to the Administrative Agent a statement describing in reasonable detail the obligations owing to such Defaulting Lender as to which it exercised such right of setoff. The rights of each Lender under this Section are in addition to other rights and remedies (including other rights of setoff) which such Lender may have. Each Lender agrees to notify the Borrower and the Administrative Agent promptly after any such setoff and application; provided that the failure to give such notice shall not affect the validity of such setoff and application. Notwithstanding the foregoing, to the extent prohibited by applicable law as described in the definition of “Excluded Swap Obligation,” no amounts received from, or set off with respect to, any Guarantor shall be applied to any Excluded Swap Obligations of such Guarantor.

 

Section 10.09     Governing Law; Jurisdiction; Consent to Service of Process.

 

(a)          This Agreement shall be construed in accordance with and governed by the law of the State of New York.

 

(b)          Each of the parties hereto hereby irrevocably and unconditionally submits, for itself and its property, to the exclusive jurisdiction of any Federal court of the United States of America sitting in New York County, Borough of Manhattan (or, in the event such court lacks subject matter jurisdiction, the Supreme Court of the State of New York sitting in New York County, Borough of Manhattan) and any appellate court from any thereof, in any action or proceeding arising out of or relating to this Agreement, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such New York State or, to the extent permitted by law, in such Federal court. Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Agreement shall affect any right that the Administrative Agent, any Issuing Bank or any Lender may otherwise have to bring any action or proceeding relating to this Agreement against any Guarantor or its properties in the courts of any jurisdiction.

 

 

(c)          Each of the parties hereto hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement in any court referred to in paragraph (b) of this Section. Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.

 

(d)          Each party to this Agreement irrevocably consents to service of process in the manner provided for notices in Section 10.01. Nothing in this Agreement will affect the right of any party to this Agreement to serve process in any other manner permitted by law.

 

Section 10.10    Waiver Of Jury Trial. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

 

Section 10.11    Headings. Article and Section headings and the Table of Contents used herein are for convenience of reference only, are not part of this Agreement and shall not affect the construction of, or be taken into consideration in interpreting, this Agreement.

 

 

Section 10.12     Confidentiality.

 

(a)          Each of the Administrative Agent, the Issuing Banks and the Lenders agrees to maintain the confidentiality of the Information (as defined below) and to not use the Information for any purpose except in connection with the Loan Documents, except that Information may be disclosed (i) to its and its Affiliates’ directors, officers, employees, and agents, including accountants, legal counsel and other professionals, experts or advisors, or to any credit insurance provider relating to the Borrower and its obligations, in each case whom it reasonably determines needs to know such information in connection with this Agreement and the transactions contemplated hereby and who are informed of the confidential nature of such Information and instructed to keep such Information confidential, (ii) to the extent requested by any regulatory authority, examiner regulating banks or banking, or other self-regulatory authority having oversight over the Administrative Agent, any Issuing Bank, any Lender or any of their respective Affiliates, (iii) pursuant to the order of any court or administrative agency or in any pending legal, judicial or administrative proceeding, or otherwise as required by applicable laws or regulations or by any subpoena or similar legal process based on the advice of counsel (in which case the Administrative Agent, such Issuing Bank or such Lender, as applicable, agrees, to the extent permitted by applicable law, to inform the Borrower promptly thereof), (iv) to any other party to this Agreement, (v) in connection with the exercise of any remedies hereunder or any suit, action or proceeding relating to this Agreement or the enforcement of rights hereunder, (vi) subject to an agreement containing provisions substantially the same as those of this Section, to (A) any assignee of or Participant in, or any prospective assignee of or prospective Participant in, any of its rights or obligations under this Agreement, or (B) any actual or prospective counterparty (or its advisors) to any swap or derivative transaction relating to the Borrower and its obligations, (vii) with the consent of the Borrower, (viii) to the extent such Information (A) becomes publicly available other than as a result of a breach of this Section, (B) becomes available to the Administrative Agent, any Issuing Bank or any Lender on a nonconfidential basis from a source other than the Borrower or (C) is independently developed by the Administrative Agent, an Issuing Bank or a Lender without use of or reference to any such confidential information and otherwise without violating this Section 10.12, (ix) on a confidential basis to any rating agency in connection with rating the Borrower or any of its Subsidiaries or the Loans hereunder, (x) to the CUSIP bureau, solely to the extent such confidential information is necessary to obtain CUSIP numbers and in consultation with the Borrower or (xi) for purposes of establishing a “due diligence” defense. In addition, the Administrative Agent, the Issuing Banks and the Lenders may disclose the existence of this Agreement and information about this Agreement to market data collectors, similar service providers to the lending industry and service providers to the Administrative Agent, the Issuing Banks and the Lenders in connection with the administration of this Agreement, the other Loan Documents, the Letters of Credit and the Loans. For the purposes of this Section, “Information” means all memoranda or other information received from or on behalf of the Parent, the Borrower or any of its Subsidiary relating to the Parent, the Borrower or any Subsidiary or any of their respective business that is identified by the Borrower as confidential, other than any such information that is available to the Administrative Agent, any Issuing Bank or any Lender on a nonconfidential basis prior to disclosure by the Borrower. Any Person required to maintain the confidentiality of Information as provided in this Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.

 

(b)          EACH LENDER ACKNOWLEDGES THAT INFORMATION AS DEFINED IN SECTION 10.12(A) FURNISHED TO IT PURSUANT TO THIS AGREEMENT MAY INCLUDE MATERIAL NON-PUBLIC INFORMATION CONCERNING THE BORROWER AND ITS RELATED PARTIES OR THEIR RESPECTIVE SECURITIES, AND CONFIRMS THAT IT HAS DEVELOPED COMPLIANCE PROCEDURES REGARDING THE USE OF MATERIAL NON-PUBLIC INFORMATION AND THAT IT WILL HANDLE SUCH MATERIAL NON-PUBLIC INFORMATION IN ACCORDANCE WITH THOSE PROCEDURES AND APPLICABLE LAW, INCLUDING FEDERAL AND STATE SECURITIES LAWS.

 

 

(c)          ALL INFORMATION, INCLUDING REQUESTS FOR WAIVERS AND AMENDMENTS, FURNISHED BY THE BORROWER OR THE ADMINISTRATIVE AGENT PURSUANT TO, OR IN THE COURSE OF ADMINISTERING, THIS AGREEMENT WILL BE SYNDICATE-LEVEL INFORMATION, WHICH MAY CONTAIN MATERIAL NON-PUBLIC INFORMATION ABOUT THE BORROWER AND ITS RELATED PARTIES OR ITS SECURITIES. ACCORDINGLY, EACH LENDER REPRESENTS TO THE BORROWER AND THE ADMINISTRATIVE AGENT THAT IT HAS IDENTIFIED IN ITS ADMINISTRATIVE QUESTIONNAIRE A CREDIT CONTACT WHO MAY RECEIVE INFORMATION THAT MAY CONTAIN MATERIAL NON-PUBLIC INFORMATION IN ACCORDANCE WITH ITS COMPLIANCE PROCEDURES AND APPLICABLE LAW.

 

Section 10.13    Interest Rate Limitation. Notwithstanding anything herein to the contrary, if at any time the interest rate applicable to any Loan, together with all fees, charges and other amounts which are treated as interest on such Loan under applicable law (collectively the “Charges”), shall exceed the maximum lawful rate (the “Maximum Rate”) which may be contracted for, charged, taken, received or reserved by the Lender holding such Loan in accordance with applicable law, the rate of interest payable in respect of such Loan hereunder, together with all Charges payable in respect thereof, shall be limited to the Maximum Rate and, to the extent lawful, the interest and Charges that would have been payable in respect of such Loan but were not payable as a result of the operation of this Section shall be cumulated and the interest and Charges payable to such Lender in respect of other Loans or periods shall be increased (but not above the Maximum Rate therefor) until such cumulated amount, together with interest thereon at the Federal Funds Effective Rate to the date of repayment, shall have been received by such Lender.

 

Section 10.14    No Advisory or Fiduciary Responsibility. In connection with all aspects of each Transaction contemplated hereby (including in connection with any amendment, waiver or other modification hereof or of any other Loan Document), the Parent and the Borrower acknowledge and agree, and acknowledge their respective Subsidiaries’ understanding, that: (a) (i) the arranging and other services regarding this Agreement provided by the Administrative Agent, the Arrangers, the Syndication Agent, the Documentation Agents, the Issuing Banks and the Lenders are arm’s-length commercial transactions between the Parent, the Borrower and their respective Affiliates, on the one hand, and the Administrative Agent, the Arrangers, the Syndication Agent, the Documentation Agents, the Issuing Banks and the Lenders, on the other hand, (ii) each of the Parent and the Borrower has consulted its own legal, accounting, regulatory and tax advisors to the extent it has deemed appropriate, and (iii) each of the Parent and the Borrower is capable of evaluating, and understands and accepts, the terms, risks and conditions of the Transactions contemplated hereby and by the other Loan Documents; (b) (i) each of the Administrative Agent, the Arrangers, the Syndication Agent, the Documentation Agents, the Issuing Banks and the Lenders is and has been acting solely as a principal and, except as expressly agreed in writing by the relevant parties, has not been, is not, and will not be acting as an advisor, agent or fiduciary for the Parent, the Borrower or any of their respective Subsidiaries, or any other Person and (ii) neither the Administrative Agent, any Arranger, the Syndication Agent, any Documentation Agent, any Issuing Bank, nor any Lender has any obligation to the Parent, the Borrower or any of their respective Affiliates with respect to the Transactions contemplated hereby except those obligations expressly set forth herein and in the other Loan Documents; and (c) the Administrative Agent, the Arrangers, the Syndication Agent, the Documentation Agents, the Issuing Banks and the Lenders and their respective Affiliates may be engaged in a broad range of transactions that involve interests that differ from those of the Parent, the Borrower and their respective Affiliates, and neither the Administrative Agent, any Arranger, the Syndication Agent, any Documentation Agent, any Issuing Bank, nor any Lender has any obligation to disclose any of such interests to the Borrower or its Affiliates. Each of the Parent and the Borrower, on behalf of itself and each of its Subsidiaries, agrees that nothing in the Loan Documents or otherwise will be deemed to create an advisory, fiduciary or agency relationship or fiduciary or other implied duty between the Administrative Agent, any Arranger, the Syndication Agent, any Documentation Agent, any Issuing Bank or any Lender, on the one hand, and the Parent, the Borrower, any of their respective Subsidiaries, or their respective stockholders or affiliates, on the other.

 

 

Section 10.15    Electronic Execution of Assignments and Certain Other Documents. The words “execution,” “signed,” “signature,” and words of like import in any Assignment and Assumption or in any amendment or other modification hereof (including waivers and consents) shall be deemed to include Electronic Signatures or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state laws based on the Uniform Electronic Transactions Act.

 

Section 10.16    USA PATRIOT Act. Each Lender and each Issuing Bank that is subject to the requirements of the USA Patriot Act hereby notifies the Borrower and each Guarantor that pursuant to the requirements of the USA Patriot Act, it is required to obtain, verify and record information that identifies the Borrower and each Guarantor, which information includes the name and address of the Borrower and each Guarantor and other information that will allow such Lender or such Issuing Bank to identify the Borrower and each Guarantor in accordance with the USA Patriot Act. The Borrower and each Guarantor shall, promptly following a request by the Administrative Agent, any Issuing Bank or any Lender, provide all documentation and other information that the Administrative Agent, such Issuing Bank or such Lender requests in order to comply with its ongoing obligations under applicable “know your customer” and anti-money laundering rules and regulations, including the USA Patriot Act.

 

Section 10.17     Releases of Guarantors and Liens.

 

(a)          In the event that (i) all the Equity Interests in any Guarantor are sold, transferred or otherwise disposed of to a Person other than the Borrower or its Subsidiaries in a transaction permitted under this Agreement, or (ii) a Guarantor ceases to be a Subsidiary or becomes an Excluded Subsidiary (including as a result of any Change in Law that could reasonably be expected to result in adverse tax consequences and which the Borrower has determined shall become an Excluded Subsidiary in accordance with the definition thereof and has notified the Administrative Agent), then (x) such Guarantor shall be immediately, automatically and irrevocably released from its guarantee under the Loan Documents without any action of any Person and (y) the Administrative Agent shall, at the Borrower’s expense, promptly take such action and execute such documents as the Borrower may reasonably request to terminate the guarantee of such Guarantor and to release the Collateral owned by such Guarantor from the Liens created by the Security Documents.

 

 

(b)          If (i) any of the Collateral shall be sold, transferred or otherwise disposed of by any Loan Party to a Person other than the Borrower or its Subsidiaries in a transaction permitted under Section 6.09 of this Agreement, (ii) any of the Collateral constitutes or becomes Excluded Property, (iii) any of the Collateral is owned by a Guarantor that is released from the Guaranty in accordance with the terms hereof or (iv) otherwise approved, authorized or ratified in writing in accordance with Section 10.02, then (x) the Lien on such Collateral in favor of the Administrative Agent pursuant to the Loan Documents shall be immediately, automatically and irrevocably terminated and released without any action of any Person and (y) the Administrative Agent shall, at the Borrower’s expense, promptly take such action and execute such documents as the Borrower may reasonably request to release the Liens created by the Security Documents on such Collateral.

 

(c)          At such time as all Obligations (including unreimbursed LC Disbursements, but excluding contingent obligations as to which no claim has been asserted) have been paid in full and all Commitments have terminated or expired and no Letter of Credit shall be outstanding or subject to any pending draw (or otherwise Cash Collateralized or backstopped or deemed reissued under another agreement reasonably acceptable to the applicable Issuing Bank), the Collateral shall be released from the Liens created by the Security Documents, and the Security Documents and all obligations (other than those expressly stated to survive such termination) of the Administrative Agent and each Loan Party under the Security Documents shall terminate, all without delivery of any instrument or performance of any act by any Person.

 

(d)          The Administrative Agent may subordinate or release any Lien on any property granted to or held by the Administrative Agent under any Loan Document to the holder of any Lien on such property that is permitted by clause (d) of the “Permitted Encumbrances”, clauses (c), (d) and (r) of Section 6.02 to the extent the documents governing such Indebtedness do not permit any other Lien (or any senior Lien, as applicable) on such property, and consent to and enter into (and execute documents permitting the filing and recording, where appropriate) the grant of easements and covenants and subordination rights with respect to real property, conditions, restrictions and declarations on customary terms, and subordination, non-disturbance and attornment agreements on customary terms reasonably requested by the Borrower with respect to leases entered into by the Parent and its Subsidiaries, to the extent requested by the Borrower and reasonably acceptable to the Administrative Agent.

 

Section 10.18    Acknowledgement Regarding Any Supported QFCs. To the extent that the Loan Documents provide support, through a guarantee or otherwise, for Swap Agreements or any other agreement or instrument that is a QFC (such support “QFC Credit Support” and each such QFC a “Supported QFC”), the parties acknowledge and agree as follows with respect to the resolution power of the Federal Deposit Insurance Corporation under the Federal Deposit Insurance Act and Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act (together with the regulations promulgated thereunder, the “U.S. Special Resolution Regimes”) in respect of such Supported QFC and QFC Credit Support (with the provisions below applicable notwithstanding that the Loan Documents and any Supported QFC may in fact be stated to be governed by the laws of the State of New York and/or of the United States or any other state of the United States):

 

 

In the event a Covered Entity that is party to a Supported QFC (each, a “Covered Party”) becomes subject to a proceeding under a U.S. Special Resolution Regime, the transfer of such Supported QFC and the benefit of such QFC Credit Support (and any interest and obligation in or under such Supported QFC and such QFC Credit Support, and any rights in property securing such Supported QFC or such QFC Credit Support) from such Covered Party will be effective to the same extent as the transfer would be effective under the U.S. Special Resolution Regime if the Supported QFC and such QFC Credit Support (and any such interest, obligation and rights in property) were governed by the laws of the United States or a state of the United States. In the event a Covered Party or a BHC Act Affiliate of a Covered Party becomes subject to a proceeding under a U.S. Special Resolution Regime, Default Rights under the Loan Documents that might otherwise apply to such Supported QFC or any QFC Credit Support that may be exercised against such Covered Party are permitted to be exercised to no greater extent than such Default Rights could be exercised under the U.S. Special Resolution Regime if the Supported QFC and the Loan Documents were governed by the laws of the United States or a state of the United States. Without limitation of the foregoing, it is understood and agreed that rights and remedies of the parties with respect to a Defaulting Lender shall in no event affect the rights of any Covered Party with respect to a Supported QFC or any QFC Credit Support.

 

Section 10.19    Acknowledgement and Consent to Bail-In of Affected Financial Institutions. Notwithstanding anything to the contrary in any Loan Document or in any other agreement, arrangement or understanding among any such parties, each party hereto acknowledges that any liability of any Affected Financial Institution arising under any Loan Document, to the extent such liability is unsecured, may be subject to the Write-Down and Conversion Powers of the applicable Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:

 

(a)          the application of any Write-Down and Conversion Powers by the applicable Resolution Authority to any such liabilities arising hereunder which may be payable to it by any party hereto that is an Affected Financial Institution; and

 

(b)          the effects of any Bail-In Action on any such liability, including, if applicable:

 

(i)        a reduction in full or in part or cancellation of any such liability;

 

(ii)       a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such Affected Financial Institution, its parent entity, or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Agreement or any other Loan Document; or

 

(iii)      the variation of the terms of such liability in connection with the exercise of the Write-Down and Conversion Powers of the applicable Resolution Authority.

 

 

Section 10.20     [Parallel Debt (Covenant to pay the Administrative Agent).

 

(a)          Each Loan Party, by way of an independent payment obligation, hereby irrevocably and unconditionally undertakes to pay to the Administrative Agent, as creditor in its own right and not as representative of the other Secured Parties, amounts equal to and in the currency of each amount payable by such Loan Party to each of the Secured Parties under any Loan Document as and when that amount falls due for payment under the relevant Loan Document or would have fallen due but for any discharge from failure of another Secured Party to take appropriate steps, in insolvency proceedings affecting that Loan Party, to preserve its entitlement to be paid that amount (the “Parallel Debt”).

 

(b)          Each Loan Party and the Administrative Agent acknowledge that the obligations of each Loan Party under paragraph (a) above are several and are separate and independent from, and shall not in any way limit or affect, the corresponding obligations of that Loan Party to any Secured Party under any Loan Document (its “Corresponding Debt”) nor shall the amounts for which each Loan Party is liable under paragraph (a) above (its Parallel Debt) be limited or affected in any way by its Corresponding Debt provided that: (i) the Administrative Agent shall not demand payment with regard to the Parallel Debt of any Loan Party to the extent that such Loan Party’s Corresponding Debt has been irrevocably paid or (in the case of guarantee obligations) discharged; and (ii) neither the Administrative Agent nor any Secured Party shall demand payment with regard to the Corresponding Debt of any Loan Party to the extent that such Loan Party’s Parallel Debt has been irrevocably paid or (in the case of guarantee obligations) discharged.

 

(c)          For the purpose of this Section 10.20, the Administrative Agent acts in its own name and not as a trustee, and it shall have its own independent right to demand payment of the amounts payable by each Loan Party under this Section 10.20, irrespective of any discharge of such Loan Party’s obligation to pay those amounts to the other Secured Parties resulting from failure by them to take appropriate steps, in insolvency proceedings affecting that Loan Party, to preserve their entitlement to be paid those amounts.

 

(d)          The rights of the Secured Parties (other than the Administrative Agent) to receive payment of amounts payable by each Loan Party under the Loan Documents are several and are separate and independent from, and without prejudice to, the rights of the Administrative Agent to receive payment under this Section 10.20.

 

(e)          Without limiting or affecting the Administrative Agent’s rights against the Loan Parties (whether under this Section 10.20 or under any other provision of the Loan Documents), each Loan Party acknowledges that: (i) nothing in this Section 10.20 shall impose any obligation on the Administrative Agent to advance any sum to any Loan Party or otherwise under any Loan Document, except in its capacity as a Lender (other than as Administrative Agent); and (ii) for the purpose of any vote taken under any Loan Document, the Administrative Agent shall not be regarded as having any participation or commitment other than those which it has in its capacity as a Lender (other than as Administrative Agent).

 

Section 10.21     Subordinated Lender.

 

(a)          If the Distributed Amount is less than the Maximum Amount, then, upon application of the Distributed Amount (or any part thereof) pursuant to Section 2.15(b) towards the discharge of the obligations of a Loan Party under the Loan Documents (including principal, interest, fees and commissions), the amount which would otherwise be required to be applied towards any such obligations under the Loan Documents owed to a Subordinated Lender shall be reduced by the Shortfall Amount attributable to that Subordinated Lender and such amount shall in addition be applied towards the discharge of the obligations (including principal, interest, fees, commission) towards the other Lenders pro rata in accordance with Section 2.15(b).

 

 

(b)          Any risk of a shortfall between the Maximum Amount and the Distributed Amount (whether arising from the prohibition and/or reduction of payments to the Subordinated Lender and/or from any contestation (Anfechtung) under applicable law) shall for all purposes of the Loan Documents be borne by the relevant Subordinated Lender.

 

(c)          A Subordinated Lender shall not have the benefit, but only the obligations, of any sharing provisions under the Loan Documents, including under Section 2.15(c), and shall not be entitled to receive any payment, and the Administrative Agent shall not be required to make any payment to any Subordinated Lender under or in connection with the Loan Documents in respect of the Shortfall Amount.

 

Section 10.22     Restricted Lender.

 

(a)          In relation to each Lender resident in Germany (Inländer) within the meaning of section 2 paragraph 15 German Foreign Trade Law (Außenwirtschaftsgesetz) or that otherwise notifies the Administrative Agent that it is a “Restricted Lender” for the purpose of this Section 10.22 (each a “Restricted Lender”), the representations and undertakings under Section 3.15, 3.16 and 5.09 (together, the “Sanctions Provisions”) shall only apply for the benefit of that Restricted Lender to the extent that it would not result in any violation of, conflict with or liability under (i) section 7 of the German Foreign Trade Regulation (Außenwirtschaftsverordnung) (in conjunction with section 4 paragraph 1 a no 3 German Foreign Trade Law (Außenwirtschaftsgesetz), (ii) any provision of the Council Regulation (EC) No 2271/96 of 22 November 1996 protecting against the effects of the extra-territorial application of legislation adopted by a third country, and actions based thereon or resulting therefrom and/or (iii) any other applicable anti-boycott laws or regulations.

 

(b)          In connection with any amendment, waiver, determination or direction relating to any part of a Sanctions Provision of which a Restricted Lender does not have the benefit pursuant to paragraph (a) above, the Commitments of that Restricted Lender will be excluded for the purpose of determining whether the consent of the Required Lenders has been obtained or whether the determination or direction by the Required Lenders has been made.]

 

[Remainder of page intentionally left blank; signature pages follow]

 

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective authorized officers as of the day and year first above written.

 

	FLUENCE ENERGY, LLC, a Delaware limited liability company, as Borrower
	By:
		Name:
		Title:

 

[Signature Page to Revolving Credit Agreement]

 

 

	FLUENCE ENERGY, INC., a Delaware corporation, as Parent
	By:
		Name:
		Title:

 

[Signature Page to Revolving Credit Agreement]

 

 

Signed, sealed and delivered by FLUENCE ENERGY PTY LTD in accordance with section 127 of the Corporations Act 2001 (Cth) by:
Signature of director		Signature of director/secretary
Name of director (print)		Name of director/secretary (print)

 

[Signature Page to Revolving Credit Agreement]

 

 

	FLUENCE ENERGY GMBH, a German corporation, as a Guarantor
	By:
		Name:
		Title:

 

[Signature Page to Revolving Credit Agreement]

 

 

	FLUENCE ENERGY GLOBAL PRODUCTION OPERATION, LLC, a Delaware limited liability company, as a Guarantor
	By:
		Name:
		Title:

 

[Signature Page to Revolving Credit Agreement]

 

 

	FLUENCE ENERGY, INC., a Philippine corporation, as a Guarantor
	By:
		Name:
		Title:

 

[Signature Page to Revolving Credit Agreement]

 

 

	JPMORGAN CHASE BANK, N.A., as Administrative Agent, an Issuing Bank and a Lender
	By:
		Name:
		Title: Authorized Officer

 

[Signature Page to Revolving Credit Agreement]

 

 

	[_], as a Lender
	By:
		Name:
		Title: Authorized Signatory

 

[Signature Page to Revolving Credit Agreement]

 

 

 

Exhibit 10.19

 

Execution Version

 

INTELLECTUAL PROPERTY ASSIGNMENT

 

THIS ASSIGNMENT, dated as of September 9, 2021 (the “Effective Date”), by The AES Corporation (hereinafter referred to as “the Assignor”) having its principal place of business at 4300 Wilson Blvd, Arlington, VA 22203, respectively, witnesseth:

 

WHEREAS, the Assignor is the owner of certain new and useful improvements set forth in the patents and patent applications set forth on Exhibit A to this IP Assignment (collectively, “Assigned IP”).

 

WHEREAS, Fluence Energy, LLC, (hereinafter referred to as “the Assignee”) having its principal place of business at 4601 N. Fairfax Drive, Suite 600, Arlington, VA 22203, is desirous of acquiring all of Assignor’s right, title, and interest in and to said Assigned IP.

 

NOW, THEREFORE, for good and sufficient consideration, the receipt and sufficiency of which are hereby acknowledged, the Assignor and Assignee agree as follows:

 

1.

Assignor has sold, assigned, transferred, conveyed and delivered, and hereby sells, assigns, transfers, conveys, and delivers, to Assignee and its successors and assigns, and Assignee hereby acquires and accepts from Assignor, all of Assignor’s right, title and interest in, to and under the Assigned IP.

 

2.

The foregoing assignment of the Assigned IP includes (a) all rights to file for and maintain registrations for the Assigned IP, including all rights to seek and obtain corrections and extensions thereon, including continuation, divisional, continuation-in-part, reexamination and reissue applications, (b) all rights of action accrued, accruing and to accrue under and by virtue of the Assigned IP; and (c) all right to sue or otherwise recover for past, present and future infringement and to receive all damages, payments, costs and fees associated therewith.

 

3.

To the extent applicable, Assignor hereby authorizes Assignee to request the applicable Governmental Entities to record Assignee as the assignee and owner of the Assigned IP, and hereby consents to such recordal.

 

4.

At Assignee’s request and for no additional consideration, Assignor agrees to execute and deliver any additional documents and other instruments and do such other acts as may be reasonably necessary to effect such assignment and transfer.

 

5.

This IP Assignment may be executed in one or more counterparts, and by the different parties hereto in separate counterparts, each of which when executed shall be deemed to be an original but all of which taken together shall constitute one and the same agreement. Delivery of an executed counterpart of a signature page to this IP Assignment by facsimile, email or other electronic transfer shall be effective as delivery of a manually executed counterpart to this IP Assignment.

 

[Signature page follows]

 

 

IN WITNESS WHEREOF, the parties have executed this Intellectual Property Assignment as of the Effective Date.

 

ASSIGNOR:			ASSIGNEE:
The AES Corporation			Fluence Energy, LLC
By:	/s/ Chris Shelton		By:
Name: Chris Shelton			Name:
Title: Senior Vice President and Chief Product Officer			Title:

 

[Signature Page to Intellectual Property Assignment]

 

 

IN WITNESS WHEREOF, the parties have executed this Intellectual Property Assignment as of the Effective Date.

 

ASSIGNOR:			ASSIGNEE:
The AES Corporation			Fluence Energy, LLC
By:			By:	/s/ Brett L Galura
Name:			Name:	Brett L Galura
Title:			Title:	SVP & Chief Technology Officer
			/s/ Francis A. Fuselier
			Francis A. Fuselier
			SVP, General Counsel and Secretary

 

[Signature Page to Intellectual Property Assignment]

 

 

Exhibit A

 

ASSIGNED IP

 

[see attached]

 

 

MLB Reference No.	Title	Country	Status	Appl. Number	Filing Date	Patent Number	Issue Date
042785-04-5002	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Brazil	Closed		07-Dec-2012
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5002	METHOD AND SYSTEM FOR CONTROLLING A STATE	Chile	Granted	2014-01491	07-Dec-2012	56.090	04-Apr-2018
	OF CHARGE (SOC) OF AN ENERGY STORAGE DEVICE
	AND FOR ADJUSTING A RATE OF CHANGE OF AN
	OUTPUT OF A VARIABLE ENERGY GENERATION
	SOURCE WITH AN ENERGY STORAGE UNIT BY
	ADJUSTING RESPONSES TO GRID OPERATOR
	COMMANDS IN...
042785-04-5002	FREQUENCY RESPONSIVE CHARGE SUSTAINING	China (People's Republic)	Closed		07-Dec-2012
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5002	FREQUENCY RESPONSIVE CHARGE SUSTAINING	European Patent Convention	Closed		07-Dec-2012
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5002	FREQUENCY RESPONSIVE CHARGE SUSTAINING	India	Closed		07-Dec-2012
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5002	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Patent Cooperation Treaty	Completed	PCT/US12/68566	07-Dec-2012
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5002	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Russian Federation	Closed		07-Dec-2012
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5002	METHOD AND SYSTEM FOR PERFORMANCE	United States of America	Allowed	14/362,856	04-Jun-2014
	MANAGEMENT OF AN ENERGY STORAGE DEVICE
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Austria	Granted	09819560.5	08-Oct-2009	2351189	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Belgium	Granted	09819560.5	08-Oct-2009	2351189	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Brazil	Pending	PI0919662-5	08-Oct-2009
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Chile	Granted	801-2011	08-Oct-2009	53.438	23-Sep-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	China (People's Republic)	Granted	200980149553.0	08-Oct-2009	ZL200980149553.0	14-Jan-2015
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Czech Republic	Granted	09819560.5	08-Oct-2009	2351189	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Denmark	Granted	09819560.5	08-Oct-2009	2351189	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	European Patent Convention	Granted	09819560.5	08-Oct-2009	2351189	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Finland	Granted	09819560.5	08-Oct-2009	2351189	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	France	Granted	09819560.5	08-Oct-2009	2351189	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Germany	Granted	09819560.5	08-Oct-2009	602009038270.5	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Hungary	Granted	09819560.5	08-Oct-2009	2351189	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	India	Pending	3128/DELNP/2011	08-Oct-2009
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID

 

 

042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Ireland	Granted	09819560.5	08-Oct-2009	2351189	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Italy	Granted	09819560.5	08-Oct-2009	502016000074213	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Netherlands	Granted	09819560.5	08-Oct-2009	2351189	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Norway	Granted	09819560.5	08-Oct-2009	2351189	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Patent Cooperation Treaty	Completed	PCT/US09/005511	08-Oct-2009
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	METHOD AND SYSTEM FOR MANAGING THE STATE	Peru	Granted	870-2011	08-Oct-2009	7689	30-Dec-2015
	OF CHARGE OF ENERGY STORAGE DEVICES FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID AND IN RESPONSE TO OPERATION FREQUENCY
	PARAMETER CHANGES ON THE ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Poland	Granted	09819560.5	08-Oct-2009	2351189	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Russian Federation	Granted	2011117931	08-Oct-2009	2492566	10-Sep-2013
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Spain	Granted	09819560.5	08-Oct-2009	2351189	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Sweden	Granted	09819560.5	08-Oct-2009	2351189	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Switzerland	Granted	09819560.5	08-Oct-2009	2351189	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Turkey	Granted	09819560.5	08-Oct-2009	201610194	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	United Kingdom	Granted	09819560.5	08-Oct-2009	2351189	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	United States of America	Granted	12/248,106	09-Oct-2008	7,839,027	23-Nov-2010
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Argentina	Granted	20110100769	11-Mar-2011	AR080498B1	30-Aug-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Austria	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Belgium	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Brazil	Granted	112012022923-0	10-Mar-2011	112012022923-0	11/26/2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Chile	Granted	2505-2012	10-Mar-2011	52.075	10-Mar-2011
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	China (People's Republic)	Granted	201180020603.2	10-Mar-2011	ZL201180020603.2	01-Mar-2017
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Czech Republic	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Denmark	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	European Patent Convention	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Finland	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	France	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Germany	Granted	11753720.9	10-Mar-2011	602011062906.9	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Hungary	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	India	Granted	8239/DELNP/2012	10-Mar-2011	373173	29-Jul-2021
	ENERGY SOURCES TO POWER GRID

 

 

042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Ireland	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Italy	Granted	11753720.9	10-Mar-2011	502020000002638	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Netherlands	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Norway	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Patent Cooperation Treaty	Completed	PCT/US11/000446	10-Mar-2011
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Poland	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Portugal	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Russian Federation	Granted	2012143401	10-Mar-2011	2565235	16-Sep-2015
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Slovakia	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Spain	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Sweden	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Switzerland	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Turkey	Granted	11753720.9	10-Mar-2011	201922033	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	United Kingdom	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	United States of America	Granted	12/722,271	11-Mar-2010	8,914,158	16-Dec-2014
	ENERGY SOURCES TO POWER GRID
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Austria	Granted	12803361.0	19-Jun-2012	2721710	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Belgium	Granted	12803361.0	19-Jun-2012	2721710	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Brazil	Pending	BR112013032742-1	19-Jun-2012
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Chile	Granted	2013-03690	19-Jun-2012	53104	04-Aug-2016
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	China (People's Republic)	Granted	201280040497.9	19-Jun-2012	ZL 201280040497.9	08-Sep-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Czech Republic	Granted	12803361.0	19-Jun-2012	2721710	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Denmark	Granted	12803361.0	19-Jun-2012	2721710	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	European Patent Convention	Granted	12803361.0	19-Jun-2012	2721710	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Finland	Granted	12803361.0	19-Jun-2012	2721710	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	France	Granted	12803361.0	19-Jun-2012	2721710	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Germany	Granted	12803361.0	19-Jun-2012	602012039284.3	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Hungary	Granted	12803361.0	19-Jun-2012	2721710	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	India	Pending	11066/DELNP/2013	19-Jun-2012
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Ireland	Granted	12803361.0	19-Jun-2012	2721710	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM

 

 

042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Italy	Granted	12803361.0	19-Jun-2012	502018000003240	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Netherlands	Granted	12803361.0	19-Jun-2012	2721710	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Norway	Granted	12803361.0	19-Jun-2012	2721710	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Patent Cooperation Treaty	Completed	PCT/US12/43138	19-Jun-2012
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Poland	Granted	12803361.0	19-Jun-2012	2721710	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Russian Federation	Granted	2014101451	19-Jun-2012	2642422	25-Jan-2018
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Spain	Granted	12803361.0	19-Jun-2012	2721710	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Sweden	Granted	12803361.0	19-Jun-2012	2721710	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Switzerland	Granted	12803361.0	19-Jun-2012	2721710	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Turkey	Granted	12803361.0	19-Jun-2012	201801202	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	United Kingdom	Granted	12803361.0	19-Jun-2012	2721710	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	United States of America	Granted	13/527,290	19-Jun-2012	9,559,520	31-Jan-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005 / 01	HYBRID ELECTRIC GENERATING POWER PLANT THAT	United States of America	Granted	15/394,400	29-Dec-2016	9,847,648	19-Dec-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5006	METHOD AND APPARATUS FOR CONTROLLING	Brazil	Pending	BR112013032908-4	19-Jun-2012
	ENERGY SERVICES BASED ON MARKET DATA
042785-04-5006	METHOD AND APPARATUS FOR CONTROLLING	Chile	Granted	3689-2013	19-Jun-2012	52531	10-Mar-2016
	ENERGY SERVICES BASED ON MARKET DATA
042785-04-5006	METHOD AND APPARATUS FOR CONTROLLING	China (People's Republic)	Granted	201280040458.9	19-Jun-2012	ZL201280040458.9	02-Mar-2016
	ENERGY SERVICES BASED ON MARKET DATA
042785-04-5006	METHOD AND APPARATUS FOR CONTROLLING	European Patent Convention	Published	12803431.1	19-Jun-2012
	ENERGY SERVICES BASED ON MARKET DATA
042785-04-5006	METHOD AND APPARATUS FOR CONTROLLING	India	Pending	11069/DELNP/2013	19-Jun-2012
	ENERGY SERVICES BASED ON MARKET DATA
042785-04-5006	METHOD AND APPARATUS FOR CONTROLLING	Patent Cooperation Treaty	Completed	PCT/US12/43143	19-Jun-2012
	ENERGY SERVICES BASED ON MARKET DATA
042785-04-5006	METHOD AND APPARATUS FOR CONTROLLING	Russian Federation	Granted	2014101450	19-Jun-2012	2601957	18-Oct-2016
	ENERGY SERVICES BASED ON MARKET DATA
042785-04-5006	METHOD AND APPARATUS FOR CONTROLLING	United States of America	Granted	13/527,354	19-Jun-2012	9,020,800	28-Apr-2015
	ENERGY SERVICES BASED ON MARKET DATA
042785-04-5007	AUTOMATED ROBOTIC BATTERY TUG	Brazil	Pending	BR102016011590-6	20-May-2016
042785-04-5007	AUTOMATED ROBOTIC BATTERY TUG	Chile	Allowed	2016-01237	23-May-2016	59861	4/22/2020
042785-04-5007	AUTOMATED ROBOTIC BATTERY TUG	China (People's Republic)	Abandoned	201610363480.7	26-May-2016
042785-04-5007	AUTOMATED ROBOTIC BATTERY TUG	European Patent Convention	Abandoned	16171154.4	24-May-2016
042785-04-5007	AUTOMATED ROBOTIC BATTERY TUG	India	Pending	201614017856	24-May-2016
042785-04-5007	AUTOMATED ROBOTIC BATTERY TUG	Korea, Republic of	Published	10-2016-63992	25-May-2016
042785-04-5007	AUTOMATED ROBOTIC BATTERY TUG	Philippines	Published	1-2016-000205	26-May-2016
042785-04-5007	AUTOMATED ROBOTIC BATTERY TUG	Russian Federation	Abandoned	2016120583	25-May-2016
042785-04-5007	AUTOMATED ROBOTIC BATTERY TUG	United States of America	Granted	14/721,522	26-May-2015	10,272,567	30-Apr-2019
042785-04-5007 / 01	AUTOMATED ROBOTIC BATTERY TUG	United States of America	Published	16/399,549	30-Apr-2019
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Austria	Granted	16171170.0	24-May-2016	3098927	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Belgium	Granted	16171170.0	24-May-2016	3098927	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Brazil	Pending	BR102016011934-0	25-May-2016
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Chile	Allowed	2016-01259	24-May-2016	60540	6/8/2020

 

 

042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	China (People's Republic)	Allowed	201610362322.X	26-May-2016
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Czech Republic	Granted	16171170.0	24-May-2016	3098927	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Denmark	Granted	16171170.0	24-May-2016	3098927	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	European Patent Convention	Granted	16171170.0	24-May-2016	3098927	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Finland	Granted	16171170.0	24-May-2016	3098927	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	France	Granted	16171170.0	24-May-2016	3098927	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Germany	Granted	16171170.0	24-May-2016	602016033379.1	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Hungary	Granted	16171170.0	24-May-2016	3098927	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	India	Pending	201614017858	24-May-2016
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Ireland	Granted	16171170.0	24-May-2016	3098927	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Italy	Granted	16171170.0	24-May-2016	502020000054988	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Korea, Republic of	Published	10-2016-64825	26-May-2016
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Netherlands	Granted	16171170.0	24-May-2016	3098927	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Norway	Granted	16171170.0	24-May-2016	3098927	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Philippines	Allowed	1-2016-000207	26-May-2016
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Poland	Granted	16171170.0	24-May-2016	3098927	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Russian Federation	Granted	2016120358	25-May-2016	2690003	30-May-2019
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Spain	Granted	16171170.0	24-May-2016	3098927	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Sweden	Granted	16171170.0	24-May-2016	3098927	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Switzerland	Granted	16171170.0	24-May-2016	3098927	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Turkey	Granted	16171170.0	24-May-2016	202010481	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	United Kingdom	Granted	16171170.0	24-May-2016	3098927	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	United States of America	Granted	14/721,582	26-May-2015	9,929,594	27-Mar-2018
042785-04-5009	BATTERY BACKUP CAPACITY METHOD AND SYSTEM	Brazil	Abandoned	BR102016019472-5	24-Aug-2016
042785-04-5009	BATTERY BACKUP CAPACITY METHOD AND SYSTEM	Chile	Granted	2016-02139	24-Aug-2016	57.927	05-Jun-2019
042785-04-5009	BATTERY BACKUP CAPACITY METHOD AND SYSTEM	China (People's Republic)	Published	201610730320.1	25-Aug-2016
042785-04-5009	BATTERY BACKUP CAPACITY METHOD AND SYSTEM	European Patent Convention	Published	16185831.1	26-Aug-2016
042785-04-5009	BATTERY BACKUP CAPACITY METHOD AND SYSTEM	India	Abandoned	201614027513	11-Aug-2016
042785-04-5009	BATTERY BACKUP CAPACITY METHOD AND SYSTEM	Korea, Republic of	Published	10-2016-107556	24-Aug-2016
042785-04-5009	BATTERY BACKUP CAPACITY METHOD AND SYSTEM	Philippines	Abandoned	1-2016-000301	25-Aug-2016
042785-04-5009	BATTERY BACKUP CAPACITY METHOD AND SYSTEM	Russian Federation	Granted	2016134797	25-Aug-2016	2690507	04-Jun-2019
042785-04-5009	BATTERY BACKUP CAPACITY METHOD AND SYSTEM	United States of America	Abandoned	14/836,340	26-Aug-2015
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Austria	Granted	16171174.2	24-May-2016	3098926	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Belgium	Granted	16171174.2	24-May-2016	3098926	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Brazil	Published	BR102016011925-1	25-May-2016
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Chile	Allowed	2016-01270	25-May-2016	59869	30-Apr-2020
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	China (People's Republic)	Published	201610363604.1	26-May-2016
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Czech Republic	Granted	16171174.2	24-May-2016	3098926	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Denmark	Granted	16171174.2	24-May-2016	3098926	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	European Patent Convention	Granted	16171174.2	24-May-2016	3098926	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Finland	Granted	16171174.2	24-May-2016	3098926	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	France	Granted	16171174.2	24-May-2016	3098926	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Germany	Granted	16171174.2	24-May-2016	602016022441.0	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Hungary	Granted	16171174.2	24-May-2016	3098926	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	India	Pending	201614017857	24-May-2016
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Ireland	Granted	16171174.2	24-May-2016	3098926	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Italy	Granted	16171174.2	24-May-2016	502020000001282	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Korea, Republic of	Published	10-2016-64208	25-May-2016
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES

 

 

042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Netherlands	Granted	16171174.2	24-May-2016	3098926	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Norway	Granted	16171174.2	24-May-2016	3098926	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Philippines	Allowed	1-2016-000206	26-May-2016
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Poland	Granted	16171174.2	24-May-2016	3098926	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Russian Federation	Granted	2016120585	25-May-2016	2713427	05-Feb-2020
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Spain	Granted	16171174.2	24-May-2016	3098926	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Sweden	Granted	16171174.2	24-May-2016	3098926	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Switzerland	Granted	16171174.2	24-May-2016	3098926	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Turkey	Granted	16171174.2	24-May-2016	201919625	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	United Kingdom	Granted	16171174.2	24-May-2016	3098926	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	United States of America	Granted	14/721,533	26-May-2015	9,819,708	14-Nov-2017
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5017	UTILITY-SCALE RENEWABLE PEAKER PLANT, TIGHTLY	Brazil	Published	1120200197602	22-Oct-2020
	COUPLED SOLAR PV AND ENERGY STORAGE
042785-04-5017	UTILITY-SCALE RENEWABLE PEAKER PLANT, TIGHTLY	Chile	Published	202002527	30-Sep-2020
	COUPLED SOLAR PV AND ENERGY STORAGE
042785-04-5017	UTILITY-SCALE RENEWABLE PEAKER PLANT, TIGHTLY	China (People's Republic)	Published	201980023823.7	30-Sep-2020
	COUPLED SOLAR PV AND ENERGY STORAGE
042785-04-5017	UTILITY-SCALE RENEWABLE PEAKER PLANT, TIGHTLY	European Patent Convention	Published	19775922.8	30-Oct-2020
	COUPLED SOLAR PV AND ENERGY STORAGE
042785-04-5017	UTILITY-SCALE RENEWABLE PEAKER PLANT, TIGHTLY	India	Pending	202017046127	22-Oct-2020
	COUPLED SOLAR PV AND ENERGY STORAGE
042785-04-5017	UTILITY-SCALE RENEWABLE PEAKER PLANT, TIGHTLY	Korea, Republic of	Published	2020-7031277	29-Oct-2020
	COUPLED SOLAR PV AND ENERGY STORAGE
042785-04-5017	UTILITY-SCALE RENEWABLE PEAKER PLANT, TIGHTLY	Philippines	Pending	12020551563	25-Sep-2020
	COUPLED SOLAR PV AND ENERGY STORAGE
042785-04-5017	UTILITY-SCALE RENEWABLE PEAKER PLANT, TIGHTLY	Russian Federation	Pending	2020135633	29-Oct-2020
	COUPLED SOLAR PV AND ENERGY STORAGE
042785-04-5017	UTILITY-SCALE RENEWABLE PEAKER PLANT, TIGHTLY	United States of America	Published	16/369,600	29-Mar-2019
	COUPLED SOLAR PV AND ENERGY STORAGE

 

 

 

Exhibit 10.20

 

Execution Version

 

LICENSE AGREEMENT

 

This LICENSE AGREEMENT (this “Agreement”), dated as of September 9, 2021 (the “Effective Date”), in entered into by and between Fluence Energy, LLC, a limited liability company duly organized and validly existing under the laws of the State of Delaware (“FLUENCE”) (“LICENSOR”) and The AES Corporation, a corporation duly formed and validly existing under the laws of the State of Delaware (“AES”) (“LICENSEE”) . Each of LICENSOR, and LICENSEE is sometimes referred to herein as a “Party” and, together, as the “Parties.”

 

WITNESSETH

 

WHEREAS, AES having assigned to FLUENCE and FLUENCE having taken assignment from AES of certain patents and patent applications (the “Patent Transfer”); and

 

WHEREAS, as a condition to such Patent Transfer, FLUENCE has agreed to grant to AES, and AES wishes to receive, a license under the Licensed Intellectual Property on the terms and conditions set forth below and as necessary to accomplish the purposes of this Agreement.

 

NOW, THEREFORE, in consideration of the foregoing premises and the respective covenants and agreements hereinafter contained, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows:

 

ARTICLE 1 DEFINITIONS

 

1.1

“Affiliates” means, with respect to any Person, any other Person that, directly or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, such Person, and the term “control” (including the terms “controlled by” and “under common control with”) means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through ownership of voting securities, by contract or otherwise.

 

1.2

“Stationary Energy Storage Field” means the development, manufacturing, marketing, and/or sale of stationary energy storage systems and solutions based on battery technology for utility-scale and commercial industrial applications and residential applications, together with such other lawful activities as a limited liability company may undertake in connection therewith, and includes energy storage mediums such as supercapacitors, primary batteries, and secondary batteries such as lithium, Li-Ion, flow batteries, sodium-ion, and metal-air but excludes developing or producing the technology for the storage medium itself (e.g., battery chemistry) and inverters.

 

1.3

“Exclusive Field” means the Stationary Energy Storage Field.

 

1.4

“Improvement” means any improvement, enhancement, modification, or other derivative work of the Licensed Patents, the Licensed Process, the Licensed Product or the Licensed Know-How after the Effective Date, including all Intellectual Property rights therein.

 

1.5

“Intellectual Property” means any and all Patents, copyrights, trademarks, trade dress, know-how, trade secrets, industrial design rights, inventions (whether or not patentable), processes, methodologies, procedures, works of authorship, moral rights, Software, domain names, specifications, production tools, designs and models as well as any applications therefor and any related rights in or to any of the foregoing, confidential information, and any other corresponding rights and all other intellectual property rights (whether registered or unregistered) anywhere in the world.

 

 

1.6

“Know-How” means trade secrets, know-how, and all other confidential or proprietary information, including but not limited to: design Software, manufacturing Software, inspection Software, repair Software, process specifications, material specifications, bills of material, drawings, methodologies, design procedures, manufacturing procedures, inspection procedures, repair procedures, parameters and/or specifications for machines, special tools, and/or fixtures, and undocumented expertise.

 

1.7

“Licensed Intellectual Property” means the Licensed Patents, the Licensed Process, the Licensed Product. the Licensed Know-How, and the Improvement Intellectual Property licensed under Section 3.1.

 

1.8

“Licensed Know-How” means Know-How related to the Licensed Patents or that is necessary or useful for implementing the Licensed Patents.

 

1.9

“Licensed Patents” shall mean all Patents set forth in Exhibit A.

 

1.10

“Licensed Process” means any process that is covered by a Licensed Patent.

 

1.11

“Licensed Product” means any service or product that (i) is covered by the Licensed Patents; or (ii)  is manufactured using a Licensed Process.

 

1.12

“Non-Exclusive Field” means all fields excluding the Exclusive Field. For avoidance of doubt, the Non-Exclusive Field includes (i) uninterruptable power supply (UPS) systems (other than for use in Applications), (ii) a virtual energy storage network built out of individual, connected, geographically distributed product units of less than 150 kilowatts per unit (a “swarm”), (iii) static synchronous compensators (Statcom), (iv) supercapacitors, (v) the technology for the storage medium (e.g. batteries), (vi) energy storage inverters, (vii) stationary storage systems sold as part of an integrated product in conjunction with the sale of energy storage systems on board of vessels, vehicles or locomotives, where the main purpose of the stationary storage system is to charge or to be charged by such on-board energy storage system or the vehicle brake energy and (viii)  stationary storage systems providing power directly and primarily to electric vehicle charging stations.

 

1.13

“Patents” means any patents (utility and design, or their equivalents) together with any extensions, reexaminations and reissues of such patents, patents of addition, patent applications (including provisional patent applications), divisions, continuations, continuations-in-part, and any subsequent filings in any country or jurisdiction claiming priority therefrom.

 

1.14

“Person” means any natural person, business trust, corporation, partnership, limited liability company, joint stock company, proprietorship, association, trust, joint venture, unincorporated association or organization, labor union, group (as defined in the Securities Exchange Act of 1934, as amended) or any other legal entity of whatever nature.

 

1.15

“Software” means any computer program, operating system, applications system, firmware or software of any nature, whether operational, under development or inactive, including all object code, source code, data files, rules, custom databases, libraries, compilations, tool sets, compilers, higher level or “proprietary” languages, definitions or methodology derived from the foregoing and any derivations, updates, enhancements and customization of any of the foregoing, processes, know-how, operating procedures, methods and all other Intellectual Property embodied in the foregoing, technical manuals, user manuals and other documentation and materials related thereto, whether in machine-readable form, programming language or any other language or symbols and whether stored, encoded, recorded or written on disk, tape, film, memory device, paper or other media of any nature.

 

 

ARTICLE 2 LICENSE RIGHTS

 

2.1

Exclusive Patent License Grant. LICENSOR hereby grants, in each case for the life of each of the Licensed Patents, to LICENSEE and its Affiliates a worldwide, exclusive (except with respect to LICENSOR, LICENSOR’s subsidiaries and Fluence Energy, Inc., a Delaware corporation), perpetual, irrevocable, sublicensable, non-transferable (except in connection with a permitted transfer of this Agreement as a whole), royalty-free, fully paid up license under the Licensed Patents to develop, improve, make, have made, sell, offer for sale, distribute, import and use Licensed Products and Licensed Processes, and otherwise commercially exploit the Licensed Patents in the Non-Exclusive Field.

 

2.2

Exclusive Know-How License Grant. LICENSOR hereby grant to LICENSEE and its Affiliates a worldwide, exclusive (except with respect to LICENSOR, LICENSOR’s subsidiaries and Fluence Energy, Inc., a Delaware corporation), perpetual, irrevocable, sublicensable, non-transferable (except in connection with a permitted transfer of this Agreement as a whole), royalty-free, fully paid up license under the Licensed Know-How, including any copyright rights and moral rights contained therein, in each case as necessary to develop, improve, make, have made, sell, offer for sale, distribute, import, use, reproduce, modify, make derivative works, and otherwise commercially exploit (i) all current service and products developed, manufactured, marketed, and sold by LICENSEE and its Affiliates in the Non-Exclusive Field as of the Effective Date (“Current Products”) and (ii) any improvements to the Current Products as permitted hereunder. To the extent LICENSOR, as of the Effective Date, are contractually or otherwise legally prohibited from granting any of the exclusive licenses in this Article 2.2, then such a license shall be non-exclusive but otherwise on identical terms, and LICENSOR hereby grants such a non-exclusive license. In the event any exclusive license grant is converted to a non-exclusive license grant pursuant to this section, LICENSOR shall not grant any future licenses in the Non-Exclusive Field on any such licensed Know-How.

 

2.3

Moral Rights. For the avoidance of doubt, to the extent any of the Licensed Intellectual Property may be subject to a claim of moral rights under any law, LICENSOR agrees to waive, and does hereby unconditionally waive, such rights including, but not limited to, the rights of attribution and integrity, and LICENSOR expressly acknowledges that LICENSEE has the right to make changes to the Licensed Intellectual Property.

 

ARTICLE 3 IMPROVEMENTS AND FUTURE TECHNOLOGY

 

3.1

Ownership of Improvements. All right, title and interest in or to all Improvements together with all Intellectual Property and other proprietary rights arising therefrom (“Improvement Intellectual Property”, shall be owned and held solely and exclusively by LICENSOR. LICENSEE and its Affiliates shall have a right to a worldwide, exclusive or non-exclusive (to be determined), perpetual, irrevocable, sublicensable, non-transferable (except in connection with a permitted transfer of this Agreement as a whole) license (“Licensee Back-License to Improvements”) under fair, reasonable and non-discriminatory (“FRAND”) royalty terms, and subject to the Exclusive Field and Non-Exclusive Field restrictions herein, to be negotiated by the Parties before such Licensee Back-License to Improvements is exercised. Such Licensee Back-License to Improvements shall include the right to obtain technical assistance from the developing Party on terms to be negotiated. If such Improvement is developed jointly by LICENSOR and a third party, then (i) if LICENSOR is not contractually or legally prevented from licensing such Improvements to LICENSEE, then LICENSEE shall have the right to a license pursuant to this Article 3.1 or (ii) if LICENSOR is contractually or legally prevented from licensing or disclosing such Improvements to LICENSEE, then LICENSOR agrees to cooperate with LICENSEE in obtaining access to such Improvements, including executing any multiparty agreements, the negotiation of which shall be done in good faith

 

 

3.2

All Improvement Intellectual Property licensed to LICENSEE and its Affiliates under this Article 3 shall be afforded the same rights, remedies, and obligations provided for Licensed Intellectual Property under this Agreement. For avoidance of doubt, this includes all rights, remedies, and obligations under Articles 4 through 9.

 

ARTICLE 4 PATENT PROSECUTION AND MAINTENANCE

 

4.1

Obligation of LICENSOR. LICENSOR shall use commercially reasonable efforts to prosecute and maintain all Licensed Patents. To the extent that any inventor of a Licensed Patent is an employee of LICENSEE, LICENSEE shall, at the applicable LICENSOR’S request and cost, make reasonable accommodations to permit such employee to take actions reasonably necessary to perfect that LICENSOR’S title in and/or to enforce such Licensed Patent.

 

4.2

Rights of LICENSEE. If, following exercise of all commercially reasonable efforts, LICENSOR elects not to, or to abandon its efforts to, file, prosecute or maintain one or more of the Licensed Patents, LICENSOR shall provide LICENSEE with written notice thereof, which notice shall be provided at least forty-five (45) calendar days before the date on which (i) any filing concerning the Licensed Patent must be made in order to avoid a material adverse effect on the Patent rights at issue, or (ii) any hearing or other proceeding concerning the Licensed Patent is scheduled to be conducted before the U.S. Patent and Trademark Office, or any foreign counterpart thereof. Following such notice, LICENSEE shall have the right, but not the obligation, to file, prosecute or maintain such Licensed Patents in such country, either, on behalf of and in the name of LICENSOR or LICENSEE, at LICENSEE’S sole expense. In such event, LICENSOR shall execute and deliver to LICENSEE all such instruments and other documents, including assignment of the Licensed Patent, and shall take such other actions as may be necessary or reasonably requested by LICENSEE, in connection therewith. Any fees payable by LICENSEE pursuant to this Section 4.2 shall be (x) paid directly by LICENSEE or (y) if paid by LICENSOR following a request by LICENSEE to LICENSOR, be reimbursed to LICENSOR within thirty (30) calendar days following any written request for such reimbursement. In the event that LICENSEE elects to prosecute or maintain a Licensed Patent pursuant to this Section 4.2, upon written notice from LICENSEE, LICENSOR shall, within thirty (30) calendar days, assign the applicable Licensed Patent to LICENSEE at no further cost or expense to LICENSEE.

 

4.3

Right of First Refusal. Except in connection with the sale of LICENSOR’S business as a whole, LICENSEE has a Right of First Refusal (“ROFR”) with respect to the sale of any Licensed Patent (“ROFR Patents”), which must be exercised within forty-five (45) calendar days of notice to LICENSEE by LICENSOR of such sale or intent to sell. If LICENSEE exercises its ROFR, the Parties agree to conduct good-faith negotiations for ninety (90) calendar days from the expiration of Licensee’s 45-calendar day response period to enter into a purchase agreement for the ROFR Patents. If the Parties are unable to enter into an agreement during the 90-calendar day good-faith negotiation period, LICENSOR shall be entitled to enter into a sale or similar transfer agreement with a third party in connection with such ROFR Patents, provided that, prior to executing such agreement with such third party, LICENSOR is required to make the identical offer to LICENSEE, and LICENSEE shall have twenty (20) business days to accept such offer.

 

 

4.4

If, after making commercial best efforts, any of the notice deadlines in Articles 4.2 to 4.3 are not met, then the relevant notice shall be provided as soon as possible, but in no event shall such notice be less than thirty (30) calendar days.

 

ARTICLE 5 ENFORCEMENT

 

5.1

Obligation to Notify. Should either Party become aware of any infringement or potential infringement of the Licensed Intellectual Property by a third party (each, an “Infringement”), such Party shall provide the other Party with prompt written notification thereof, including in such notification all known or reasonably ascertainable details and facts relating thereto.

 

5.2

LICENSEE Enforcement Right. LICENSEE shall, at its own expense, have the right (but not the obligation) to engage in proceedings involving the Infringement of the Licensed Intellectual Property in the Non-Exclusive Field or to take such steps as may be necessary in order to terminate such improper use by unauthorized Persons. Should LICENSEE proceed with any such action, (i) LICENSEE shall keep LICENSOR reasonably informed of the status of, and its activities regarding, such action; and (ii) LICENSOR shall reasonably cooperate with LICENSEE in any such action, including joining the action as a party if necessary to maintain standing, at LICENSEE’s expense. If LICENSOR becomes a party to any action pursuant to this Section 5.2, they shall have the right to be represented by their own counsel if they so choose, at their own expense. Any award, or portion of an award, recovered by LICENSEE in any action commenced by it pursuant to this Section 5.2 shall belong solely to LICENSEE after recovery by the Parties of their respective actual out-of-pocket costs.

 

5.3

LICENSOR Enforcement Right. LICENSOR shall, at their own expense, have the right (but not the obligation) to engage in proceedings involving Infringement of the Licensed Intellectual Property or to take such steps as may be necessary in order to terminate such improper use by unauthorized Persons. Should LICENSOR proceed with any such action, (i) LICENSOR shall keep LICENSEE reasonably informed of the status of, and their activities regarding, such action; and (ii) LICENSEE shall reasonably cooperate with LICENSOR in any such action, including joining the action as a party if necessary to maintain standing, at LICENSOR’S expense. If LICENSEE becomes a party to any action pursuant to this 5.3, it shall have the right to be represented by its own counsel if it so chooses, at its own expense. Any award, or portion of an award, recovered by LICENSOR in any action commenced by them pursuant to this Section 5.3 shall belong solely to LICENSOR after recovery by the Parties of their respective actual out-of-pocket costs.

 

5.4

Additional Enforcement Rights. If the Party with the original right to engage in enforcement activities pursuant to Section 5.2 or Section 5.3 (in each case, the “First Right Party”) refuses to take action against an Infringement within ninety (90) calendar days of the Notice provided by either Party pursuant to Section 5.1, such First Right Party shall notify the other Party (the “Second Right Party”) of such decision and the Second Right Party may, at its sole risk, cost and expense, commence and prosecute legal proceedings in its own name. Should the Second Right Party proceed with any such action, (i) the Second Right Party shall keep the First Right Party reasonably informed of the status of, and its activities regarding, such action; and (ii) the First Right Party shall reasonably cooperate with the Second Right Party in any such action, including joining the action as a party if necessary to maintain standing, at the Second Right Party’s expense. If the First Right Party becomes a party to any action pursuant to this Section 5.4, it shall have the right to be represented by its own counsel if it so chooses, at its own expense. Any award, or portion of an award, recovered by the Second Right Party in any action commenced by it pursuant to this Section 5.4 shall belong solely to the Second Right Party after recovery by both Parties of their respective actual out-of-pocket costs.

 

 

5.5

Settlement. LICENSOR will not settle any dispute with any third party at any time regarding the Licensed Intellectual Property that in any way affects LICENSEE’s rights under this Agreement without the prior written consent of LICENSEE. LICENSEE will not settle any dispute with any third party at any time regarding the Licensed Intellectual Property without the prior written consent of LICENSOR.

 

ARTICLE 6 REPRESENTATIONS AND WARRANTIES; ADDITIONAL COVENANTS

 

6.1

Representations and Warranties of Both Parties. Each Party represents and warrants to the other Party as follows:

 

(a)

Such Party is duly organized, validly existing and in good standing under the laws of its place of incorporation or registration.

 

(b)

The execution and delivery of this Agreement have been duly authorized by all necessary corporate action on the part of such Party.

 

(c)

This Agreement constitutes a legal, valid and binding obligation of such Party, enforceable against such Party in accordance with its terms, subject to applicable bankruptcy, insolvency and other similar laws relating to or affecting the rights and remedies of creditors generally and to general principles of equity.

 

(d)

The execution and delivery of this Agreement, and the performance by such Party of its obligations hereunder, will not (i) contravene or result in the breach or violation of, or a default under, any agreement or understanding by which such Party is bound, or (ii) violate any law, rule, regulation, statute, order or decree to which such Party or any of its Affiliates is a party or by which any of them, or any of their property, is subject or bound.

 

6.2

Specific Assurances: If there is any material third-party Intellectual Property licensed to or otherwise made available to a LICENSOR that (i) cannot be sublicensed or disclosed to LICENSEE under this Agreement, and (ii) is used in or necessary for the operation of the business of the LICENSEE and its Affiliates in the Non-Exclusive Field as of the Effective Date (“Material Third-Party IP”), and, during the term of this Agreement, either Party becomes aware of Material Third-Party IP, then LICENSOR agree to use commercial best efforts to assist LICENSEE in obtaining access to such Material Third-Party IP, including executing any multiparty agreements, the negotiation of which shall be done in good faith.

 

6.3

Further Assurances. Each of the Parties hereto shall, and shall cause their respective Affiliates to, execute and deliver such additional documents, instruments, conveyances and assurances, and take such further actions as may be reasonably required to carry out the provisions hereof and give effect to the Agreement. Without limiting the generality of the foregoing, LICENSOR agrees to fully cooperate with the LICENSEE and shall take all actions reasonably requested by the LICENSEE to perfect, confirm, register, or record any of its rights in and to the Licensed Intellectual Property under this Agreement, as well as this Agreement, with apportionment of reasonable expenses to be determined by the Parties.

 

 

ARTICLE 7 DISCLAIMERS AND LIMITATIONS OF LIABILITY

 

7.1

No Additional Warranties. EXCEPT AS EXPRESSLY SET FORTH IN ARTICLE 5, NEITHER PARTY MAKES ANY WARRANTIES TO THE OTHER, EXPRESS, IMPLIED, STATUTORY OR OTHERWISE, CONCERNING THE LICENSED INTELLECTUAL PROPERTY OR ANY OTHER MATTER COVERED BY THIS AGREEMENT. SPECIFICALLY, BUT WITHOUT LIMITING THE FOREGOING, EACH PARTY DISCLAIMS ANY IMPLIED WARRANTIES OF TITLE, NON-INFRINGEMENT, MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.

 

7.2

Limitation on Damages. IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER OR ANY OF ITS AFFILIATES FOR ANY INCIDENTAL, SPECIAL, SPECULATIVE, INDIRECT, CONSEQUENTIAL, OR PUNITIVE DAMAGES (INCLUDING, WITHOUT LIMITATION, LOST PROFITS, BUSINESS OR GOODWILL) SUFFERED OR INCURRED BY SUCH OTHER PARTY OR ITS AFFILIATES IN CONNECTION WITH A BREACH OR ALLEGED BREACH OF THIS AGREEMENT, EVEN IF THE FIRST PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.

 

7.3

Acknowledgment. Each Party hereby acknowledges and agrees that the foregoing disclaimer and limitation of liability represent bargained for allocations of risk, and that the economies, terms and conditions of this agreement reflect such allocations.

 

ARTICLE 8 TERM

 

8.1

Term. The term of this Agreement shall commence on the Effective Date and shall continue perpetually thereafter. For the avoidance of doubt: (i) the licenses granted in this Agreement may not be terminated for any reason and no Party shall have the right to terminate, rescind, revoke or otherwise cancel or void this Agreement or any license granted herein for any reason whatsoever, and no remedy permitting or requiring the same shall be imposed for any reason whatsoever; and (ii) the sole and exclusive remedies in the event of a breach (material or otherwise) of this Agreement shall be monetary damages, an injunction or other equitable relief (which, for the avoidance of doubt, may not include termination, revocation, rescission or other cancellation or voiding of this Agreement) with respect to any breach of this Agreement. Each Party acknowledges and agrees that the foregoing limitation on remedies is a necessary inducement for the other Party to enter into this Agreement and such limitation shall not cause this Agreement to, and no Party shall claim that this Agreement does, fail of its essential purpose for lack of remedy or otherwise.

 

ARTICLE 9 MISCELLANEOUS

 

9.1

Confidentiality. LICENSEE agrees to keep confidential, and shall cause its sublicensees and instruct their officers, directors, employees and advisors to keep confidential, all non-public information relating to any Know-How included in the Licensed Intellectual Property, except to the extent such information (i) is or becomes generally known to and available for use by the public other than as a result of LICENSEE's breach or the breach of any other Person bound by a duty of confidentiality to the LICENSEE or its sublicensees, (ii) which is demonstrated by LICENSEE to be or to have been independently developed by LICENSEE without reference to the confidential information relating to the Know-How included in the Licensed Intellectual Property or (iii) is or was lawfully acquired by LICENSEE from sources other than LICENSOR or its Affiliates which are not prohibited from disclosing such information by a legal, contractual or fiduciary obligation. If LICENSEE or any of its sublicensees or their respective representatives are legally required to disclose any such information by judicial or administrative process or by other requirements of law, such Person shall reasonably promptly notify LICENSOR in writing and shall disclose only that portion of such information which such Person is advised by its legal counsel is legally required to be disclosed.

 

 

9.2

Entire Agreement. This Agreement contains the entire understanding among the Parties hereto with respect to the transactions contemplated hereby and supersedes and replaces all prior and contemporaneous agreements and understandings, oral or written, with regard to such transactions. All exhibits and schedules hereto are expressly made a part of this Agreement as fully as though completely set forth herein.

 

9.3

Amendment; Waiver. This Agreement may be amended or modified, and any of the terms, covenants, representations, warranties or conditions hereof may be waived, only by a written instrument executed by all of the Parties hereto, or in the case of a waiver, by the Party waiving compliance. Any waiver by any Party of any condition, or of the breach of any provision, term, covenant, representation or warranty contained in this Agreement, in any one or more instances, shall not be deemed to be nor construed as a further or continuing waiver of any such condition, or of the breach of any other provision, term, covenant, representation or warranty of this Agreement.

 

9.4

Severability. In the event that any part of this Agreement is declared by any court or other judicial or administrative body to be null, void or unenforceable, said provision shall survive to the extent it is not so declared, and all of the other provisions of this Agreement shall remain in full force and effect. To the extent permitted by law, each Party hereto waives any provision of law that renders any such provision prohibited or unenforceable in any respect.

 

9.5

Notices. All notices, requests, demands and other communications under this Agreement shall be in writing and shall be deemed to have been duly given (a) on the date of service if served personally on the Party to whom notice is to be given; (b) on the day of transmission if sent via email transmission to the email address given below; (c) on the day after deposit for next day delivery to Federal Express or similar overnight courier or the Express Mail service maintained by the United States Postal Service; or (d) on the fifth day after mailing, if mailed to the Party to whom notice is to be given, by first class mail, registered or certified, postage prepaid, return receipt requested and properly addressed, to the Party as follows:

 

if to LICENSOR:
	Fluence Energy, LLC.
	Brett Galura, CTO
	4601 N. Fairfax Drive, Suite 600
	Arlington, VA 22203
	Brett.galura@fluenceenergy.com
With a copy to:	Francis A. Fuselier
	General Counsel
	Frank.fuselier@fluenceenergy.com

 

 

if to LICENSEE:
	Ms. Jennifer Gillcrist
	The AES Corporation
	4300 Wilson Blvd
	Arlington, VA 22203
With a copy to:	Morgan Lewis & Bockius LLP
	1111 Pennsylvania Ave, NW
	Washington, DC 20004-2541
	Attn: Jeffrey G. Killian

 

Any Party may change its address for the purpose of this Section by giving the other Party written notice of its new address in the manner set forth above. Any notice to LICENSEE required by Article 4 may be satisfied by email addressed to all of the following:

 

jennifer.gillcrist@aes.com

 

9.6

No Joint Venture. This Agreement does not constitute a partnership, joint venture or agency between the Parties hereto, nor shall either of the Parties hold itself out as such contrary to the terms hereof by advertising or otherwise, nor shall either of the Parties become bound or become liable because of any representation, action, or omission of the other.

 

9.7

No Third-Party Beneficiaries; Performance by Affiliates. Except to the extent that a license under this Agreement extends to Affiliates or to permitted sublicensees, this Agreement is not intended to, and shall not, provide any Person not a party hereto with any rights of any nature whatsoever against any of the Parties hereto, and no Person not a party hereto shall have any right, power, or privilege in respect of any party hereto, or have any benefit or interest, arising out of this Agreement. For the avoidance of doubt, any LICENSEE obligation under this Agreement shall be deemed satisfied if such obligation is performed by an Affiliate of LICENSEE.

 

9.8

Negotiated Agreement. The Parties hereby acknowledge that the terms and language of this Agreement were the result of negotiations among the Parties and, as a result, there shall be no presumption that any ambiguities in this Agreement shall be resolved against any particular Party. Any controversy over construction of this Agreement shall be decided without regard to events of authorship or negotiation.

 

9.9

Assignment. This Agreement may not be assigned by a Party, or transferred under operation of law or otherwise by a Party, without the prior written consent of the other Party, which consent shall not be unreasonably withheld, except that this Agreement may be assigned by a Party to any of its Affiliates, or to any successor to all or substantially all of such Party’s stock, assets to which this Agreement relates or business operations to which this Agreement relates, provided that the Affiliate or successor agrees in writing to accept the terms and conditions of this Agreement. This Agreement shall be binding on the successors and permitted assigns of each Party. In the event that any Intellectual Property licensed under this Agreement is sold, assigned, or otherwise transferred to a third party, LICENSOR shall require the successor to such rights to be bound by all of the terms and conditions of this Agreement applicable to such transferred Intellectual Property. Any purported assignment or transfer of this Agreement or the Intellectual Property licensed under this Agreement in violation of this Section 9.9 shall be null and void.

 

 

9.10

Governing Law; Jurisdiction; Waiver of Jury Trial. This Agreement shall be governed by, and construed and enforced in accordance with the laws of the state of Delaware in all respects without giving effect to the conflict of law principles thereof. The sole forum for resolving disputes arising under or relating to this Agreement shall be the state and Federal courts located in the state of Delaware, and all related appellate courts, and the Parties hereby consent to the jurisdiction of such courts and agree that venue shall be in the state of Delaware. Process in any proceeding referred to in the preceding sentence may be served on any Party anywhere in the world. TO THE EXTENT NOT PROHIBITED BY APPLICABLE LAW WHICH CANNOT BE WAIVED, EACH PARTY HERETO HEREBY WAIVES AND COVENANTS THAT IT WILL NOT ASSERT (WHETHER AS PLAINTIFF, DEFENDANT OR OTHERWISE) ANY RIGHT TO TRIAL BY JURY IN ANY FORUM IN RESPECT OF ANY ISSUE OR ACTION, CLAIM, CAUSE OF ACTION OR SUIT (IN CONTRACT, TORT OR OTHERWISE), INQUIRY, PROCEEDING OR INVESTIGATION ARISING OUT OF OR BASED UPON THIS AGREEMENT OR THE SUBJECT MATTER HEREOF OR IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE TRANSACTIONS CONTEMPLATED HEREBY, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING. EACH PARTY HERETO ACKNOWLEDGES THAT IT HAS BEEN INFORMED BY THE OTHER PARTY HERETO THAT THIS SECTION 9.10 CONSTITUTES A MATERIAL INDUCEMENT UPON WHICH THEY ARE RELYING AND WILL RELY IN ENTERING INTO THIS AGREEMENT. ANY PARTY HERETO MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION 9.10 WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF EACH SUCH PARTY TO THE WAIVER OF ITS RIGHT TO TRIAL BY JURY.

 

9.11

Counterparts. This Agreement may be executed and delivered in any number of counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Facsimile, photostatic and PDF copies of signatures to this Agreement (including copies received as attachments to electronic mail) shall be deemed to be originals and may be relied upon with the same force and effect as originals.

 

9.12

Execution and Delivery. This Agreement shall be deemed executed by the Parties when any one or more counterparts hereof, individually or taken together, bears the signatures of each of the Parties hereto. This Agreement, once executed by a Party, may be delivered to the other Party by facsimile transmission of a copy thereof that bears the signature of the Party so delivering it.

 

9.13

Interpretation. Unless the context of this Agreement clearly requires otherwise, (a) references to the plural include the singular, the singular the plural, the part the whole, (b) references to any gender include all genders, (c) “including” has the inclusive meaning frequently identified with the phrase “but not limited to,” (d) references to “hereunder” or “herein” relate to this Agreement, (e) a reference to any party to this Agreement or any other agreement or document shall include such party’s successors and permitted assigns and (e) any reference to any legislation or to any provision of any legislation shall include any modification or re -enactment thereof, any legislative provision substituted therefor and all regulations and statutory instruments issued thereunder or pursuant thereto. The Section and other headings contained in this Agreement are for reference purposes only and shall not control or affect the construction of this Agreement or the interpretation thereof in any respect. Section, paragraph and Exhibit references are to this Agreement unless otherwise specified.

 

[Signature Page Follows]

 

 

IN WITNESS WHEREOF, LICENSOR and LICENSEE have caused this Agreement to be executed as the date first above written, by their respective officers thereunto duly authorized.

 

				LICENSOR
				FLUENCE ENERGY, LLC
	/s/ Francis A. Fuselier		By:	/s/ Brett L Galura
	Francis A. Fuselier		Name:	Brett L Galura
	SVP, General Counsel and Secretary		Title:	SVP & Chief Technology Officer

 

	LICENSEE
	THE AES CORPORATION
	By:
	Name:
	Title:

 

[Signature Page to Fluence License to AES]

 

 

IN WITNESS WHEREOF, LICENSOR and LICENSEE have caused this Agreement to be executed as the date first above written, by their respective officers thereunto duly authorized.

 

	LICENSOR
	FLUENCE ENERGY, LLC
	By:
	Name:
	Title:

 

	LICENSEE
	THE AES CORPORATION
	By:	/s/ Chris Shelton
	Name:	Chris Shelton
	Title:	Senior Vice President and Chief Product Officer

 

[Signature Page to Fluence License to AES]

 

 

Exhibit A

 

LIST OF LICENSED PATENTS

 

[see attached]

 

 

  

MLB Reference No.	Title	Country	Status	Appl. Number	Filing Date	Patent Number	Issue Date
042785-04-5002	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Brazil	Closed		07-Dec-2012
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5002	METHOD AND SYSTEM FOR CONTROLLING A STATE	Chile	Granted	2014-01491	07-Dec-2012	56.090	04-Apr-2018
	OF CHARGE (SOC) OF AN ENERGY STORAGE DEVICE
	AND FOR ADJUSTING A RATE OF CHANGE OF AN
	OUTPUT OF A VARIABLE ENERGY GENERATION
	SOURCE WITH AN ENERGY STORAGE UNIT BY
	ADJUSTING RESPONSES TO GRID OPERATOR
	COMMANDS IN...
042785-04-5002	FREQUENCY RESPONSIVE CHARGE SUSTAINING	China (People's Republic)	Closed		07-Dec-2012
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5002	FREQUENCY RESPONSIVE CHARGE SUSTAINING	European Patent Convention	Closed		07-Dec-2012
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5002	FREQUENCY RESPONSIVE CHARGE SUSTAINING	India	Closed		07-Dec-2012
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5002	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Patent Cooperation Treaty	Completed	PCT/US12/68566	07-Dec-2012
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5002	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Russian Federation	Closed		07-Dec-2012
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5002	METHOD AND SYSTEM FOR PERFORMANCE	United States of America	Allowed	14/362,856	04-Jun-2014
	MANAGEMENT OF AN ENERGY STORAGE DEVICE
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Austria	Granted	09819560.5	08-Oct-2009	2351189	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Belgium	Granted	09819560.5	08-Oct-2009	2351189	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Brazil	Pending	PI0919662-5	08-Oct-2009
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Chile	Granted	801-2011	08-Oct-2009	53.438	23-Sep-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	China (People's Republic)	Granted	200980149553.0	08-Oct-2009	ZL200980149553.0	14-Jan-2015
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Czech Republic	Granted	09819560.5	08-Oct-2009	2351189	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Denmark	Granted	09819560.5	08-Oct-2009	2351189	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	European Patent Convention	Granted	09819560.5	08-Oct-2009	2351189	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Finland	Granted	09819560.5	08-Oct-2009	2351189	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	France	Granted	09819560.5	08-Oct-2009	2351189	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Germany	Granted	09819560.5	08-Oct-2009	602009038270.5	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Hungary	Granted	09819560.5	08-Oct-2009	2351189	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	India	Pending	3128/DELNP/2011	08-Oct-2009
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID

  

 

042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Ireland	Granted	09819560.5	08-Oct-2009	2351189	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Italy	Granted	09819560.5	08-Oct-2009	502016000074213	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Netherlands	Granted	09819560.5	08-Oct-2009	2351189	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Norway	Granted	09819560.5	08-Oct-2009	2351189	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Patent Cooperation Treaty	Completed	PCT/US09/005511	08-Oct-2009
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	METHOD AND SYSTEM FOR MANAGING THE STATE	Peru	Granted	870-2011	08-Oct-2009	7689	30-Dec-2015
	OF CHARGE OF ENERGY STORAGE DEVICES FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID AND IN RESPONSE TO OPERATION FREQUENCY
	PARAMETER CHANGES ON THE ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Poland	Granted	09819560.5	08-Oct-2009	2351189	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Russian Federation	Granted	2011117931	08-Oct-2009	2492566	10-Sep-2013
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Spain	Granted	09819560.5	08-Oct-2009	2351189	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Sweden	Granted	09819560.5	08-Oct-2009	2351189	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Switzerland	Granted	09819560.5	08-Oct-2009	2351189	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	Turkey	Granted	09819560.5	08-Oct-2009	201610194	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	United Kingdom	Granted	09819560.5	08-Oct-2009	2351189	27-Apr-2016
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5003	FREQUENCY RESPONSIVE CHARGE SUSTAINING	United States of America	Granted	12/248,106	09-Oct-2008	7,839,027	23-Nov-2010
	CONTROL OF ELECTRICITY STORAGE SYSTEMS FOR
	ANCILLARY SERVICES ON AN ELECTRICAL POWER
	GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Argentina	Granted	20110100769	11-Mar-2011	AR080498B1	30-Aug-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Austria	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Belgium	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Brazil	Granted	112012022923-0	10-Mar-2011	112012022923-0	11/26/2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Chile	Granted	2505-2012	10-Mar-2011	52.075	10-Mar-2011
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	China (People's Republic)	Granted	201180020603.2	10-Mar-2011	ZL201180020603.2	01-Mar-2017
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Czech Republic	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Denmark	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	European Patent Convention	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Finland	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	France	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Germany	Granted	11753720.9	10-Mar-2011	602011062906.9	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Hungary	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	India	Granted	8239/DELNP/2012	10-Mar-2011	373173	29-Jul-2021
	ENERGY SOURCES TO POWER GRID

 

 

042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Ireland	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Italy	Granted	11753720.9	10-Mar-2011	502020000002638	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Netherlands	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Norway	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Patent Cooperation Treaty	Completed	PCT/US11/000446	10-Mar-2011
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Poland	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Portugal	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Russian Federation	Granted	2012143401	10-Mar-2011	2565235	16-Sep-2015
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Slovakia	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Spain	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Sweden	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Switzerland	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	Turkey	Granted	11753720.9	10-Mar-2011	201922033	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	United Kingdom	Granted	11753720.9	10-Mar-2011	2545632	23-Oct-2019
	ENERGY SOURCES TO POWER GRID
042785-04-5004	REGULATION OF CONTRIBUTION OF SECONDARY	United States of America	Granted	12/722,271	11-Mar-2010	8,914,158	16-Dec-2014
	ENERGY SOURCES TO POWER GRID
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Austria	Granted	12803361.0	19-Jun-2012	2721710	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Belgium	Granted	12803361.0	19-Jun-2012	2721710	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Brazil	Pending	BR112013032742-1	19-Jun-2012
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Chile	Granted	2013-03690	19-Jun-2012	53104	04-Aug-2016
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	China (People's Republic)	Granted	201280040497.9	19-Jun-2012	ZL 201280040497.9	08-Sep-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Czech Republic	Granted	12803361.0	19-Jun-2012	2721710	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Denmark	Granted	12803361.0	19-Jun-2012	2721710	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	European Patent Convention	Granted	12803361.0	19-Jun-2012	2721710	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Finland	Granted	12803361.0	19-Jun-2012	2721710	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	France	Granted	12803361.0	19-Jun-2012	2721710	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Germany	Granted	12803361.0	19-Jun-2012	602012039284.3	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Hungary	Granted	12803361.0	19-Jun-2012	2721710	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	India	Pending	11066/DELNP/2013	19-Jun-2012
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Ireland	Granted	12803361.0	19-Jun-2012	2721710	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM

 

  

 

042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Italy	Granted	12803361.0	19-Jun-2012	502018000003240	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Netherlands	Granted	12803361.0	19-Jun-2012	2721710	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Norway	Granted	12803361.0	19-Jun-2012	2721710	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Patent Cooperation Treaty	Completed	PCT/US12/43138	19-Jun-2012
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Poland	Granted	12803361.0	19-Jun-2012	2721710	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Russian Federation	Granted	2014101451	19-Jun-2012	2642422	25-Jan-2018
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Spain	Granted	12803361.0	19-Jun-2012	2721710	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Sweden	Granted	12803361.0	19-Jun-2012	2721710	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Switzerland	Granted	12803361.0	19-Jun-2012	2721710	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	Turkey	Granted	12803361.0	19-Jun-2012	201801202	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	United Kingdom	Granted	12803361.0	19-Jun-2012	2721710	01-Nov-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005	HYBRID ELECTRIC GENERATING POWER PLANT THAT	United States of America	Granted	13/527,290	19-Jun-2012	9,559,520	31-Jan-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5005 / 01	HYBRID ELECTRIC GENERATING POWER PLANT THAT	United States of America	Granted	15/394,400	29-Dec-2016	9,847,648	19-Dec-2017
	USES A COMBINATION OF REAL-TIME GENERATION
	FACILITIES AND ENERGY STORAGE SYSTEM
042785-04-5006	METHOD AND APPARATUS FOR CONTROLLING	Brazil	Pending	BR112013032908-4	19-Jun-2012
	ENERGY SERVICES BASED ON MARKET DATA
042785-04-5006	METHOD AND APPARATUS FOR CONTROLLING	Chile	Granted	3689-2013	19-Jun-2012	52531	10-Mar-2016
	ENERGY SERVICES BASED ON MARKET DATA
042785-04-5006	METHOD AND APPARATUS FOR CONTROLLING	China (People's Republic)	Granted	201280040458.9	19-Jun-2012	ZL201280040458.9	02-Mar-2016
	ENERGY SERVICES BASED ON MARKET DATA
042785-04-5006	METHOD AND APPARATUS FOR CONTROLLING	European Patent Convention	Published	12803431.1	19-Jun-2012
	ENERGY SERVICES BASED ON MARKET DATA
042785-04-5006	METHOD AND APPARATUS FOR CONTROLLING	India	Pending	11069/DELNP/2013	19-Jun-2012
	ENERGY SERVICES BASED ON MARKET DATA
042785-04-5006	METHOD AND APPARATUS FOR CONTROLLING	Patent Cooperation Treaty	Completed	PCT/US12/43143	19-Jun-2012
	ENERGY SERVICES BASED ON MARKET DATA
042785-04-5006	METHOD AND APPARATUS FOR CONTROLLING	Russian Federation	Granted	2014101450	19-Jun-2012	2601957	18-Oct-2016
	ENERGY SERVICES BASED ON MARKET DATA
042785-04-5006	METHOD AND APPARATUS FOR CONTROLLING	United States of America	Granted	13/527,354	19-Jun-2012	9,020,800	28-Apr-2015
	ENERGY SERVICES BASED ON MARKET DATA
042785-04-5007	AUTOMATED ROBOTIC BATTERY TUG	Brazil	Pending	BR102016011590-6	20-May-2016
042785-04-5007	AUTOMATED ROBOTIC BATTERY TUG	Chile	Allowed	2016-01237	23-May-2016	59861	4/22/2020
042785-04-5007	AUTOMATED ROBOTIC BATTERY TUG	China (People's Republic)	Abandoned	201610363480.7	26-May-2016
042785-04-5007	AUTOMATED ROBOTIC BATTERY TUG	European Patent Convention	Abandoned	16171154.4	24-May-2016
042785-04-5007	AUTOMATED ROBOTIC BATTERY TUG	India	Pending	201614017856	24-May-2016
042785-04-5007	AUTOMATED ROBOTIC BATTERY TUG	Korea, Republic of	Published	10-2016-63992	25-May-2016
042785-04-5007	AUTOMATED ROBOTIC BATTERY TUG	Philippines	Published	1-2016-000205	26-May-2016
042785-04-5007	AUTOMATED ROBOTIC BATTERY TUG	Russian Federation	Abandoned	2016120583	25-May-2016
042785-04-5007	AUTOMATED ROBOTIC BATTERY TUG	United States of America	Granted	14/721,522	26-May-2015	10,272,567	30-Apr-2019
042785-04-5007 / 01	AUTOMATED ROBOTIC BATTERY TUG	United States of America	Published	16/399,549	30-Apr-2019
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Austria	Granted	16171170.0	24-May-2016	3098927	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Belgium	Granted	16171170.0	24-May-2016	3098927	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Brazil	Pending	BR102016011934-0	25-May-2016
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Chile	Allowed	2016-01259	24-May-2016	60540	6/8/2020

 

 

042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	China (People's Republic)	Allowed	201610362322.X	26-May-2016
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Czech Republic	Granted	16171170.0	24-May-2016	3098927	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Denmark	Granted	16171170.0	24-May-2016	3098927	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	European Patent Convention	Granted	16171170.0	24-May-2016	3098927	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Finland	Granted	16171170.0	24-May-2016	3098927	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	France	Granted	16171170.0	24-May-2016	3098927	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Germany	Granted	16171170.0	24-May-2016	602016033379.1	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Hungary	Granted	16171170.0	24-May-2016	3098927	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	India	Pending	201614017858	24-May-2016
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Ireland	Granted	16171170.0	24-May-2016	3098927	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Italy	Granted	16171170.0	24-May-2016	502020000054988	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Korea, Republic of	Published	10-2016-64825	26-May-2016
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Netherlands	Granted	16171170.0	24-May-2016	3098927	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Norway	Granted	16171170.0	24-May-2016	3098927	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Philippines	Allowed	1-2016-000207	26-May-2016
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Poland	Granted	16171170.0	24-May-2016	3098927	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Russian Federation	Granted	2016120358	25-May-2016	2690003	30-May-2019
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Spain	Granted	16171170.0	24-May-2016	3098927	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Sweden	Granted	16171170.0	24-May-2016	3098927	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Switzerland	Granted	16171170.0	24-May-2016	3098927	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	Turkey	Granted	16171170.0	24-May-2016	202010481	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	United Kingdom	Granted	16171170.0	24-May-2016	3098927	08-Apr-2020
042785-04-5008	MODULAR ENERGY STORAGE METHOD AND SYSTEM	United States of America	Granted	14/721,582	26-May-2015	9,929,594	27-Mar-2018
042785-04-5009	BATTERY BACKUP CAPACITY METHOD AND SYSTEM	Brazil	Abandoned	BR102016019472-5	24-Aug-2016
042785-04-5009	BATTERY BACKUP CAPACITY METHOD AND SYSTEM	Chile	Granted	2016-02139	24-Aug-2016	57.927	05-Jun-2019
042785-04-5009	BATTERY BACKUP CAPACITY METHOD AND SYSTEM	China (People's Republic)	Published	201610730320.1	25-Aug-2016
042785-04-5009	BATTERY BACKUP CAPACITY METHOD AND SYSTEM	European Patent Convention	Published	16185831.1	26-Aug-2016
042785-04-5009	BATTERY BACKUP CAPACITY METHOD AND SYSTEM	India	Abandoned	201614027513	11-Aug-2016
042785-04-5009	BATTERY BACKUP CAPACITY METHOD AND SYSTEM	Korea, Republic of	Published	10-2016-107556	24-Aug-2016
042785-04-5009	BATTERY BACKUP CAPACITY METHOD AND SYSTEM	Philippines	Abandoned	1-2016-000301	25-Aug-2016
042785-04-5009	BATTERY BACKUP CAPACITY METHOD AND SYSTEM	Russian Federation	Granted	2016134797	25-Aug-2016	2690507	04-Jun-2019
042785-04-5009	BATTERY BACKUP CAPACITY METHOD AND SYSTEM	United States of America	Abandoned	14/836,340	26-Aug-2015
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Austria	Granted	16171174.2	24-May-2016	3098926	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Belgium	Granted	16171174.2	24-May-2016	3098926	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Brazil	Published	BR102016011925-1	25-May-2016
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Chile	Allowed	2016-01270	25-May-2016	59869	30-Apr-2020
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	China (People's Republic)	Published	201610363604.1	26-May-2016
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Czech Republic	Granted	16171174.2	24-May-2016	3098926	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Denmark	Granted	16171174.2	24-May-2016	3098926	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	European Patent Convention	Granted	16171174.2	24-May-2016	3098926	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Finland	Granted	16171174.2	24-May-2016	3098926	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	France	Granted	16171174.2	24-May-2016	3098926	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Germany	Granted	16171174.2	24-May-2016	602016022441.0	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Hungary	Granted	16171174.2	24-May-2016	3098926	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	India	Pending	201614017857	24-May-2016
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Ireland	Granted	16171174.2	24-May-2016	3098926	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Italy	Granted	16171174.2	24-May-2016	502020000001282	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Korea, Republic of	Published	10-2016-64208	25-May-2016
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES

 

 

042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Netherlands	Granted	16171174.2	24-May-2016	3098926	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Norway	Granted	16171174.2	24-May-2016	3098926	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Philippines	Allowed	1-2016-000206	26-May-2016
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Poland	Granted	16171174.2	24-May-2016	3098926	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Russian Federation	Granted	2016120585	25-May-2016	2713427	05-Feb-2020
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Spain	Granted	16171174.2	24-May-2016	3098926	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Sweden	Granted	16171174.2	24-May-2016	3098926	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Switzerland	Granted	16171174.2	24-May-2016	3098926	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	Turkey	Granted	16171174.2	24-May-2016	201919625	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	United Kingdom	Granted	16171174.2	24-May-2016	3098926	16-Oct-2019
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5010	METHOD AND SYSTEM FOR SELF-REGISTRATION	United States of America	Granted	14/721,533	26-May-2015	9,819,708	14-Nov-2017
	AND SELF-ASSEMBLY OF ELECTRICAL DEVICES
042785-04-5017	UTILITY-SCALE RENEWABLE PEAKER PLANT, TIGHTLY	Brazil	Published	1120200197602	22-Oct-2020
	COUPLED SOLAR PV AND ENERGY STORAGE
042785-04-5017	UTILITY-SCALE RENEWABLE PEAKER PLANT, TIGHTLY	Chile	Published	202002527	30-Sep-2020
	COUPLED SOLAR PV AND ENERGY STORAGE
042785-04-5017	UTILITY-SCALE RENEWABLE PEAKER PLANT, TIGHTLY	China (People's Republic)	Published	201980023823.7	30-Sep-2020
	COUPLED SOLAR PV AND ENERGY STORAGE
042785-04-5017	UTILITY-SCALE RENEWABLE PEAKER PLANT, TIGHTLY	European Patent Convention	Published	19775922.8	30-Oct-2020
	COUPLED SOLAR PV AND ENERGY STORAGE
042785-04-5017	UTILITY-SCALE RENEWABLE PEAKER PLANT, TIGHTLY	India	Pending	202017046127	22-Oct-2020
	COUPLED SOLAR PV AND ENERGY STORAGE
042785-04-5017	UTILITY-SCALE RENEWABLE PEAKER PLANT, TIGHTLY	Korea, Republic of	Published	2020-7031277	29-Oct-2020
	COUPLED SOLAR PV AND ENERGY STORAGE
042785-04-5017	UTILITY-SCALE RENEWABLE PEAKER PLANT, TIGHTLY	Philippines	Pending	12020551563	25-Sep-2020
	COUPLED SOLAR PV AND ENERGY STORAGE
042785-04-5017	UTILITY-SCALE RENEWABLE PEAKER PLANT, TIGHTLY	Russian Federation	Pending	2020135633	29-Oct-2020
	COUPLED SOLAR PV AND ENERGY STORAGE
042785-04-5017	UTILITY-SCALE RENEWABLE PEAKER PLANT, TIGHTLY	United States of America	Published	16/369,600	29-Mar-2019
	COUPLED SOLAR PV AND ENERGY STORAGE

 

 

Exhibit 10.21

 

Amended and Restated

 

Equipment and Services Purchase Agreement

 

by and between

 

Fluence Energy, LLC

 

as Buyer

 

and

 

Siemens Industry, Inc.

 

as Supplier

 

dated [●], 2021

 

 

Table of Contents

 

Page

 

1.		DEFINITIONS; INTERPRETATION		1
	1.1.		Definitions	1
	1.2.		Interpretation	7
2.		TERM AND TERMINATION OF AGREEMENT		8
	2.1.		Term	8
	2.2.		Early Termination	8
3.		SCOPE OF AGREEMENT		8
	3.1.		Scope Generally	8
	3.2.		Further Buyer Contracting Parties	9
	3.3.		Cooperation	9
	3.4.		Interfaces	9
4.		ORDERS		9
	4.1.		Pricing Requests	9
	4.2.		Purchase Orders	10
	4.3.		Most Favored Nation Pricing	10
	4.4.		Payment Terms	10
	4.5.		Disputed Payments	11
	4.6.		Late Payments	11
	4.7.		Taxes; Export and Import Duties	11
5.		DELIVERY		11
	5.1.		Delivery Terms; Inspection	11
	5.2.		Guaranteed Delivery Date	11
	5.3.		Delay Liquidated Damages	12
6.		TITLE, RISK OF LOSS AND CARE, CUSTODY AND CONTROL		12
	6.1.		Transfer of Title and Risk of Loss	12
	6.2.		Warranty of Title	12
7.		INSPECTION AND QUALITY CONTROL.		12
	7.1.		Inspection Rights	12
	7.2.		Quality Control	13
8.		WARRANTIES		13
	8.1.		Equipment Warranty	13
	8.2.		Services Warranty	13
	8.3.		Notification Requirements	13
	8.4.		Corrective Action	13
	8.5.		Warranty Exclusions	14
	8.6.		NO IMPLIED WARRANTIES	14
	8.7.		Reserved Rights	14
9.		BUYER FURNISHED PROPERTY		15
10.		PACKAGING		15
11.		FORCE MAJEURE		15
	11.1.		Effect of Force Majeure	15
	11.2.		Procedures	15
	11.3.		Termination for Extended Force Majeure	16
12.		CHANGE ORDERS		16
	12.1.		Change Order	16
	12.2.		Change Order Process	16
	12.3.		Change Order Restrictions	17
	12.4.		No Change	17

 

 

13.		INTELLECTUAL PROPERTY		17
	13.1.		Grant of License	17
	13.2.		No Copies	17
	13.3.		Proprietary Notices	18
	13.4.		Security	18
	13.5.		No Reverse Engineering	18
	13.6.		Open Source Software	18
	13.7.		Reporting	18
	13.8.		Relief	18
	13.9.		Improvements	18
	13.10.		Ownership	19
	13.11.		Enforcement	20
	13.12.		Duration and Transfers	20
	13.13.		Government End Users	21
	13.14.		Reservation of Rights	21
14.		DEFAULTS AND REMEDIES.		21
	14.1.		Supplier Defaults	21
	14.2.		Buyer Defaults	21
	14.3.		Remedies	22
15.		INDEMNIFICATION		22
	15.1.		General	22
	15.2.		Infringement Indemnification by Supplier	23
	15.3.		Infringement Indemnification by Buyer	24
	15.4.		Indemnification Procedures	25
	15.5.		Limited Waiver of Certain Immunities	25
	15.6.		Survival	26
16.		LIMITATIONS OF LIABILITY		26
	16.1.		WAIVER OF CERTAIN DAMAGES	26
	16.2.		MAXIMUM LIABILITY	26
	16.3.		EFFECTIVENESS	26
	16.4.		Commencement of Claims	26
17.		CONFIDENTIALITY.		27
	17.1.		Confidential Information	27
	17.2.		Non-Disclosure	27
	17.3.		Exceptions	27
	17.4.		Representatives Bound	27
	17.5.		Survival	27
18.		REPRESENTATIONS AND WARRANTIES		28
	18.1.		Representations of the Parties	28
	18.2.		Additional Representations of Supplier	28
19.		ENVIRONMENT, HEALTH AND SAFETY		29
	19.1.		Compliance and Related Matters	29
	19.2.		On-Site Environmental and Safety Responsibility	30
	19.3.		Health and Safety Plan	30
20.		OPEN SOURCE SOFTWARE.		31
21.		EXPORT CONTROL AND FOREIGN TRADE REGULATIONS		31
	21.1.		Acknowledgement and Compliance	31
	21.2.		Export Licenses	31
	21.3.		Provision of Trade Data	31
	21.4.		Changes	32
	21.5.		Additional Buyer’s Obligations	32
	21.6.		Certain Relief	32

 

 

22.		CODE OF CONDUCT		32
23.		COMPLIANCE WITH LAWS AND PERMITS		32
24.		DISPUTE RESOLUTION		33
	24.1.		Referral to Senior Management	33
	24.2.		Referral to Arbitration	33
	24.3.		Neutral Arbitrators	33
	24.4.		Procedures and Costs	33
	24.5.		Award	34
	24.6.		Confidentiality	34
	24.7.		Continued Performance; Provisional Remedies	34
	24.8.		Waiver of Jury Trial	34
25.		MISCELLANEOUS		34
	25.1.		Governing Law	34
	25.2.		Records	34
	25.3.		Intentionally Omitted	35
	25.4.		Insurance	35
	25.5.		Assignment; Successors	35
	25.6.		Subcontracting	35
	25.7.		Other Terms and Amendments	35
	25.8.		Government Contracts	35
	25.9.		Relationship of the Parties	35
	25.10.		Publicity	35
	25.11.		Non-Exclusive Remedies and Non-Waivers	36
	25.12.		Severability	36
	25.13.		Survival	36
	25.14.		Affirmative Action	36
	25.15.		Complete Agreement and Counterparts	36
	25.16.		Counterparts	36
	25.17.		No Pre-Printed Terms	36
	25.18.		Priority	37
	25.19.		Notices	37
	25.20.		Joint Effort	38
	25.21.		Language of the Agreement, Correspondence, Documentation	38

 

Exhibits

 

Exhibit A	Form of Purchase Order
Exhibit B	Form of Joinder Agreement
Exhibit C	Substance Declaration
Exhibit D	Code of Conduct
Exhibit E	Insurance
Exhibit F	Affirmative Action

 

Attachment A Description of Supplier’s Equipment and Services

 

 

THIS AMENDED AND RESTATED EQUIPMENT AND SERVICES PURCHASE AGREEMENT (this “Agreement”) is made and entered into on [●], 2021, between Siemens Industry, Inc., whose principal place of business is at 100 Technology Drive, Alpharetta, Georgia 30005 hereinafter referred to as “Supplier” and Fluence Energy, LLC, whose principal place of business is 4601 N. Fairfax Drive, Suite 600, Arlington, Virginia 22203 hereinafter referred to as “Buyer”. Each of Supplier and Buyer are referred to herein as a “Party” and collectively are referred to herein as the “Parties.”

 

WHEREAS, Buyer sells electrical storage solutions to Customers;

 

WHEREAS, Supplier sells electrical balance of plant equipment and related services which Buyer may want to purchase to incorporate within its energy storage equipment and related services projects;

 

WHEREAS, Supplier wishes to cooperate with Buyer in order to fulfill Buyer’s requirements and provide preferred purchasing conditions to Buyer for those electrical balance of plant equipment and related services;

 

WHEREAS, Supplier and Buyer are parties to that certain Equipment and Services Purchase Agreement, dated as of January 1, 2018, by and between Supplier and Buyer (the “Prior Agreement”); and

 

WHEREAS, Supplier is party to the Second Amended and Restated Limited Liability Company Agreement of Buyer, dated as of June 9, 2021(the “LLC Agreement”);

 

WHEREAS, Supplier, Buyer and certain other parties are entering into a series of transactions in connection with the formation of Fluence Energy, Inc., a Delaware corporation (“Issuer”) to serve as the vehicle through which the public will own indirect interests in Buyer through an initial public offering; and

 

WHEREAS, in connection with the closing of initial public offering, the LLC Agreement is being amended and restated in its entirety by the Third Amended and Restated Limited Liability Company Agreement, dated on or about the date hereof (the “Restated LLC Agreement”), to, among other things, reflect Issuer’s ownership of Supplier and the restructuring of Supplier and its Affiliates.

 

NOW, THEREFORE, the Parties agree that on the Effective Date, the Prior Agreement is hereby amended and restated in its entirety by this Agreement, and further agree as follows:

 

1.

DEFINITIONS; INTERPRETATION.

 

1.1.

Definitions. Initially-capitalized terms used in this Agreement (including the preamble and Recitals hereto) and not otherwise defined herein shall have the meanings specified below.

 

“Affiliate” means, at any time, and with respect to any Person or group of Persons, a Person that at such time directly or indirectly through one or more intermediaries, Controls, is Controlled by, or is under common Control with such Person or group of Persons. No Person shall be considered an Affiliate of another Person or under the Control of such other Person so long as (i) it is owned less than 50% by such other Person, (ii) such other Person has no capacity to elect or appoint the majority of the board of directors or similar governing body of the subject Person, (iii) such other Person does not consolidate the subject Person in its financial reporting and (iv) there is no other management or services agreement pursuant to which such other Person exerts control over the subject Person. With respect to Supplier, none of Gamesa Corporación Technológica S.A., Siemens Healthineers AG nor any of their respective Subsidiaries shall be considered an Affiliate of Supplier.

 

 

“Agreement” has the meaning set forth in the Preamble hereto.

 

“Applicable Law” means any applicable constitutional provision, statute, act, code, law, regulation, rule, ordinance, order, decree, ruling, proclamation, resolution, judgment, decision or declaration of a Governmental Authority having valid jurisdiction.

 

“Business Day” means any day except a Saturday, Sunday or other day on which commercial banks in New York, New York are authorized or required by law to close.

 

“Buyer” has the meaning set forth in the Preamble hereto.

 

“Buyer Event of Default” has the meaning set forth in Section 14.2.

 

“Buyer Furnished Property” has the meaning set forth in Article 9.

 

“Change Order” has the meaning set forth in Section 12.1.

 

“Change Order Information” has the meaning set forth in Section 12.2.

 

“Claims” has the meaning set forth in Section 15.1.

 

“Confidential Information” has the meaning set forth in Section 17.1.

 

“Control” means, with respect to the relationship between two or more Persons, the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through ownership of voting securities, as trustee or executor, by contract or otherwise. The terms “Controlled” or “under common Control with” have correlative meanings.

 

“Defect” means any material defect in design, manufacturing, materials or workmanship in or to the Equipment, or any failure of the Equipment to materially comply with the Technical Specifications, excluding in all cases any of the foregoing attributable to or caused by ordinary wear and tear of the Warranted Equipment.

 

“Deliver”, “Delivered” or “Delivery” means that Supplier has caused the delivery of the applicable Equipment to the Delivery Point in accordance with the terms of this Agreement.

 

“Delivery Point” means the delivery location set forth in a Pricing Notice, provided that, if no such location is specified in the applicable Pricing Notice, the Delivery Point for the Equipment shall be the location of Supplier’s facility.

 

“Derivative Software” has the meaning set forth in Article 20.

 

“EAR” has the meaning set forth in Section 21.1.

 

 

“Effective Date” shall have the meaning assigned to such term in Section 2.1.

 

“EHS Laws” has the meaning set forth in Section 19.1.

 

“Enforcement Action” has the meaning set forth in Section 13.11.

 

“Equipment” means any electrical balance of plant equipment offered by Supplier pursuant to this Agreement, as set forth in Attachment A.

 

“Equipment Warranty” has the meaning set forth in Section 8.1.

 

“Equipment Warranty Period” has the meaning set forth in Section 8.1.

 

“Export Controls and Sanctions Laws” has the meaning set forth in Section 21.1.

 

“Force Majeure” means any event which is not within the reasonable control of the Party affected and with the exercise of due diligence could not reasonably be prevented, avoided or removed by such Party, which causes the affected Party to be delayed, in whole or in part, or unable, using commercially reasonable efforts, to partially or wholly perform its obligations under this Agreement (other than an obligation for the payment of money) and is not caused by or resulting from the negligence or breach or failure of such Party to perform its obligations under this Agreement, which, subject to the foregoing, may include: acts of God or the public enemy, natural disasters, war, terrorism, insurrection, sabotage, unavoidable accidents, orders, decrees, rulings and policies of any Governmental Authority, fires, floods, earthquakes, volcanic activity, severe weather conditions not reasonably foreseeable taking into account the location of performance and the climate patterns applicable thereto, explosions, riots, general strikes and area lockouts. Force Majeure shall not include a Party’s financial inability to perform under this Agreement or any Purchase Order.

 

“Further Buyer Contracting Parties” has the meaning set forth in Section 3.2.

 

“Governmental Authority” means a federal, state, local or foreign governmental authority (including any regulatory authority); a state, province, commonwealth, territory or district thereof; a county; a city, town, township, or other municipality; a district, ward or other subdivision of any of the foregoing; any executive, legislative or other governing body of any of the foregoing; any agency, authority, board, department, system, service, office, commission, committee, council or other administrative body of any of the foregoing; any court or other judicial body; and any officer, official or other representative of any of the foregoing.

 

“Guaranteed Delivery Date” has the meaning set forth in Section 5.2.

 

“Hazardous Materials” has the meaning set forth in Section 19.1.

 

“Indemnified Party” has the meaning set forth in Section 15.1.

 

“Indemnifying Party” has the meaning set forth in Section 15.1.

 

 

“Infringement Claim Costs” means any and all judgments, damages, fines, awards, penalties, and interest associated with any of the foregoing, that, in each case, are finally awarded in a claim for which an Indemnifying Party is obligated to indemnify an Indemnified Party under Section 15.2 or 15.3, as applicable, and costs and expenses, including reasonable attorneys’ fees, court costs and other reasonable costs of suit, arbitration, dispute resolution or other similar proceedings, associated with such claim.

 

“Initial Term” has the meaning set forth in Section 2.1.

 

“Intellectual Property” means United States and foreign: (a) Patents; (b) Trademarks; (c) copyrights, whether registered or unregistered, and all applications and registrations therefor, web sites, proprietary domain names, mask works, and all applications and registrations therefor; (d) Know-How; (e) Software; and (f) similar or other intellectual property rights, subject matter of any of the foregoing, tangible embodiments of any of the foregoing, licenses in, to and under any of the foregoing.

 

“Know-How” means all proprietary and confidential information and data (irrespective as to whether such information or data is available by way of documentation, orally or in electronic format, or protected by copyrights), including business and trade secrets, technical and business information and data, know-how and similar proprietary rights in confidential information and processes, discoveries, analytic models, improvements, techniques, devices, methods, patterns, formulations and specifications, all to the extent that such information and data are proprietary and confidential and neither Software nor a Patent.

 

“License” has the meaning set forth in Section 13.1.

 

“Licensed Technology” means, collectively, all of the following to the extent owned by, or licensed (with the right to grant sublicenses) to, Supplier, relating to the Equipment or the uses and purposes contemplated in connection with this Agreement or any Purchase Order issued hereunder for such Equipment: (a) Software embedded in or integrated with the Equipment, (b) any other trade secrets, proprietary information, know-how or other Intellectual Property incorporated into or embedded within the Equipment or necessary for the installation, operation, maintenance, and ownership of the Equipment, (c) any improvements of or updates to any of the foregoing provided to Buyer pursuant to this Agreement, if any, and (d) all Intellectual Property rights of Supplier in the Licensed Technology listed in any of clauses (a) through (d) above, in each case, for use solely in connection with the installation, commissioning, operation and maintenance of the Equipment at the Project Site or such other site as Buyer shall elect.

 

“LLC Agreement” has the meaning set forth in the Recitals hereto.

 

“OFAC” means the Office of Foreign Assets Control of the U.S. Department of the Treasury.

 

“Open License Terms” has the meaning set forth in Article 20.

 

“Open Source Software” has the meaning set forth in Article 20.

 

“Party” has the meaning set forth in the Preamble hereto.

 

“Parties” has the meaning set forth in the Preamble hereto.

 

 

“Patents” means all patents, utility models, patent and utility model applications, and all priorities and rights related thereto, including all reissues, reexaminations, divisions, continuations, continuations-in-part, provisionals, continued prosecution applications, substitutions, extensions, additions or renewals of any of the foregoing.

 

“Person” means any natural person, corporation, partnership, joint venture, trust, estate, unincorporated association, limited liability company or any other entity (whether or not having separate legal personality), and shall include any successor (by merger or otherwise) of such entity.

 

“Pricing Notice” has the meaning set forth in Section 4.1.

 

“Pricing Request” has the meaning set forth in Section 4.1.

 

“Prohibited Person” means (i) any individual or entity that has been determined by competent authority to be the subject of a prohibition in any law, regulation, rule, or executive order administered by OFAC or the U.S. Department of State; (ii) the government, including any political subdivision, agency or instrumentality thereof, of a Sanctioned Country; (iii) any individual or entity that acts on behalf of or is owned or controlled by the government of a Sanctioned Country; (iv) any individual or entity that has been identified on the OFAC Specially Designated Nationals and Blocked Persons List (Appendix A to 31 C.F.R. Ch. V) or any other similar list published by OFAC, including, but not limited to, the Foreign Sanctions Evaders List, the Part 561 List, and the Non SDN Iranian Sanctions List; (v) any individual or entity that has been designated on any similar list or order published by the United States government, including, without limitation, the Denied Persons List, Entity List, or Unverified List of the U.S. Department of Commerce, or the Debarred List or Nonproliferation Sanctions List of the U.S. Department of State; or (vi) any entity beneficially owned or controlled, directly or indirectly, by, any of the individuals or entities listed in subparagraphs (i)-(v) above.

 

“Prudent Industry Practices” means those practices, methods, specifications and standards of safety, performance, dependability, efficiency and economy generally recognized by electrical utility industry members, including Supplier, in the U.S. as good and proper, and such other practices, methods or acts which, in the exercise of reasonable judgment by those reasonably experienced in the industry in light of the facts known at the time a decision is made, would be expected to accomplish the result intended at a reasonable cost and consistent with Applicable Laws, reliability, safety and expedition. Prudent Industry Practices are not intended to be limited to the optimum practices, methods or acts to the exclusion of all others, but rather to be a spectrum of good and proper practices, methods and acts.

 

“Purchase Order” means a purchase order in the form attached hereto as Exhibit A issued for the purchase of Equipment and Services pursuant to and in accordance with the terms and conditions of this Agreement.

 

“Representatives” means, with respect to any Person, such Person’s shareholders, members, officers, directors, employees, accountants, consultants, legal counsel, financial advisors and other representatives and agents.

 

 

“Sanctioned Country” means any country or territory against which the United States maintains comprehensive economic sanctions or embargoes, including, without limitation, Crimea, Cuba, Iran, North Korea, Sudan and Syria.

 

“Services” means any Equipment related services offered for sale by Supplier pursuant to this Agreement, as set forth in Attachment A.

 

“Services Warranty” has the meaning set forth in Section 8.2.

 

“Services Warranty Period” has the meaning set forth in Section 8.2.

 

“Software” means all computer programs, operating systems, applications, systems, firmware, and software of any nature, whether operational, active, under development, or design, non-operational or inactive, including all object code, source code, comment code, algorithms, processes, formulae, interfaces, navigational devices, menu structures or arrangements, icons, operational instructions, scripts, commands, syntax, screen designs, reports, designs, concepts, visual expressions, technical manuals, test scripts, user manuals, and other documentation therefore, whether in machine-readable form, programming language, or any other language or symbols, and whether stored, encoded, recorded, or written on disk, tape, film, memory device, paper, or other media of any nature and all databases necessary or appropriate to operate any such computer program, operating system, applications system, firmware, or software.

 

“Subsidiary” means, with respect to any Person, any corporation, limited liability company, partnership, association or business entity of which (a) if a corporation, a majority of the total voting power of shares of stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person or a combination thereof, or (b) if a limited liability company, partnership, association or other business entity (other than a corporation), a majority of partnership or other similar ownership interest thereof is at the time owned or controlled, directly or indirectly, by any Person or one or more Subsidiaries of that Person or a combination thereof. For purposes hereof, a Person or Persons shall be deemed to have a majority ownership interest in a limited liability company, partnership, association or other business entity (other than a corporation) if such Person or Persons shall be allocated a majority of limited liability company, partnership, association or other business entity gains or losses or shall be or control any managing member, general partner or analogous controlling Person of such limited liability company, partnership, association or other business entity. For purposes hereof, references to a “Subsidiary” of any Person shall be given effect only at such times that such Person has one or more Subsidiaries.

 

“Supplier” has the meaning set forth in the Preamble hereto.

 

“Supplier Documents” means the documents and deliverables to be provided by Supplier to Buyer to the extent reasonably required for the installation, commissioning, operation and maintenance of the Equipment, as more fully set forth in the applicable Purchase Order.

 

“Supplier Event of Default” has the meaning set forth in Section 14.1.

 

 

“Taxes” means any and all forms of taxation, charges, duties, imposts, levies and rates whenever imposed by any Governmental Authority, including income tax, withholding tax, corporation tax, capital gains tax, capital transfer tax, sales tax, business and occupation tax, inheritance tax, water rates, value added tax, customs duties, capital duty, excise duties, betterment levy, stamp duty, stamp duty reserve tax, national insurance, social security or other similar contributions, and generally any tax, duty, impost, levy, rate or other amount and any interest, penalty or fine in connection therewith.

 

“Technical Specifications” means the technical specifications for the Equipment as set forth in the applicable Purchase Order.

 

“Term” has the meaning set forth in Section 2.1.

 

“Territory” means (i) for purposes of the sales and marketing by Buyer of the Equipment, worldwide and (ii) for all other use of the Equipment, the country in which the Equipment is installed for use.

 

“Trademarks” means all trademarks, trademark applications, service marks, service mark applications, trade dress, trade names, identifying symbols, words, colors, designs, product names, company names, slogans, logos or insignia, whether registered or unregistered, and all applications and registrations therefor, and all goodwill associated therewith.

 

“TSCA” has the meaning set forth in Section 19.1.

 

“Work Site” has the meaning set forth in Section 19.2.

 

1.2.

Interpretation.

 

(a)

References to Recitals, Articles, Sections, Exhibits, Annexes and Attachments are, unless otherwise indicated, to Recitals, Articles, Sections, Exhibits, Annexes and Attachments to this Agreement. All Exhibits, Annexes and Attachments to this Agreement are incorporated herein by this reference and made a part hereof for all purposes.

 

(b)

As used in this Agreement, the masculine gender shall include the feminine and neuter and the singular number shall include the plural, and vice versa.

 

(c)

Unless expressly stated otherwise, references to a Person include its successors and permitted assigns and, in the case of a Governmental Authority, any Person succeeding to its functions and capacities.

 

(d)

As used in this Agreement, references to “days” shall mean calendar days, unless the term “Business Days” is used. If the term “Business Days” is used and the time for performing an obligation under this Agreement expires on a day that is not a Business Day, the time shall be extended until that time on the next Business Day.

 

(e)

As used in this Agreement, where a word or phrase is specifically defined, other grammatical forms of such word or phrase have corresponding meanings; the words “herein,” “hereunder” and “hereof” refer to this Agreement, taken as a whole, and not to any particular provision of this Agreement; “including” means “including, for example and without limitation,” and other forms of the verb “to include” are to be interpreted similarly.

 

 

(f)

As used in this Agreement, all references to a given agreement, instrument or other document shall be a reference to that agreement, instrument or other document as modified, amended, supplemented and restated through the date as of which such reference is made. Any term defined or provision incorporated in this Agreement by reference to another document, instrument or agreement shall continue to have the meaning or effect ascribed thereto whether or not such other document, instrument or agreement is in effect.

 

2.

TERM AND TERMINATION OF AGREEMENT.

 

2.1.

Term. This Agreement shall become effective and the term shall commence on the day on which the Class A Common Stock of the Issuer is issued to the underwriters in its initial public offering (the “Effective Date”); provided, that if the Effective Date does not occur on or prior to December 31, 2021, this Agreement shall be deemed terminated as of such date and of no force or effect without further notice or action by the Parties, and the Prior Agreement shall remain in full force and effect without any amendment thereto. The term of this Agreement shall continue until the fourth (4th) anniversary of the Effective Date (the “Initial Term”) and thereafter shall be automatically extended in successive one (1) year increments (the Initial Term together with any such extensions, the “Term”).

 

2.2.

Early Termination. Either Party may terminate this Agreement effective upon the expiration of the Initial Term or the expiration of any extension thereof upon not less than six (6) months prior written notice of termination furnished to the other Party. No termination of this Agreement pursuant to this Section 2.2 shall affect any Purchase Orders executed between the Parties prior to the date of termination. If this Agreement is terminated pursuant to this Section 2.2, the Parties shall attempt, in fair dealing and good faith, to agree on reasonable post-termination procedures in compliance with applicable law and antitrust requirements.

 

3.

SCOPE OF AGREEMENT.

 

3.1.

Scope Generally. This Agreement shall apply to all purchases by Buyer from Supplier of Equipment and Services during the Term. Notwithstanding the foregoing, nothing herein shall be construed to mean that either Buyer or Supplier is committing to any specific level of business or quantity of Equipment and Services to be purchased or supplied other than that specified in Purchase Orders issued to Supplier during the Term of this Agreement by Buyer; provided, however, Buyer shall consider Equipment and Services from Supplier when sourcing Equipment and Services available from Supplier hereunder as long as the “most favored nation” pricing described in Section 4.3 remains in effect. Attachment A hereto sets forth the various standard Equipment and Services offerings of Supplier, it being understood that any project-specific requirements associated with any particular order hereunder shall be as set forth in the applicable Purchase Order therefor. Supplier may from time to time update the Equipment and Services offered for sale hereunder by furnishing to Buyer an update to Attachment A hereto, it being agreed that no such update shall affect any previously issued Purchase Order unless and to the extent set forth in a Change Order thereto.

 

 

3.2.

Further Buyer Contracting Parties. Buyer and its Subsidiary companies (hereinafter referred to as “Further Buyer Contracting Parties”) shall be entitled to conclude individual Purchase Orders under the terms of this Agreement provided that such Further Buyer Contracting Parties either: (a) execute a joinder agreement acceptable to Supplier and otherwise in the form of Exhibit B hereto; or (b) agree that that the terms of this Agreement will govern the subject transaction by including a conspicuous cross-reference in the applicable Purchase Order which confirms that the Terms of the Equipment and Services Purchase Agreement will apply to the Purchase Order.

 

3.3.

Cooperation. The Parties agree to jointly review opportunities to optimize Equipment, Services and Software for inclusion in the Equipment and Services (as such terms are defined in the Storage Core Frame Purchase Agreement entered into by Buyer and Supplier).

 

3.4.

Interfaces. In order to implement Section 3.3, the Parties shall nominate permanent contact persons on both sides to act as liaison for effective cooperation and communication between Supplier and Buyer. These contact persons shall schedule regular meetings. These contact persons include, but are not limited to, the following for day to day interactions on the procurement of Equipment and Services:

 

(a)

Buyer Procurement; and

 

(b)

Supplier MS PA eBoP Program Manager.

 

These contact persons include, but are not limited to, the following for system optimization and market requirement exchange:

 

(a)

Supplier MS PA eBoP Program Manager;

 

(b)

Supplier PLM Inverters (MS PA);

 

(c)

Supplier PLM Microgrid (Digital Grid);

 

(d)

Supplier PLM PSS (Digital Grid);

 

(e)

Buyer PLM (Product Requirement); and

 

(f)

Buyer R&D.

 

4.

ORDERS.

 

4.1.

Pricing Requests. If Buyer desires to purchase Equipment and Services from Supplier during the Term, Buyer shall furnish Supplier with written request (a “Pricing Request”) detailing the Equipment and Services it wishes to purchase and requesting pricing therefor from Supplier, including in such Pricing Request such information as may be reasonably necessary for Supplier to determine pricing therefor and any other project-specific requirements, including Buyer’s requested delivery schedule. Supplier shall provide Buyer with a written notice (a “Pricing Notice”) detailing Supplier’s pricing and delivery schedule for the Equipment and Services that Buyer wishes to purchase (including therein any terms, conditions and specifications required by Supplier in connection with the particular project and/or purchase contemplated by Buyer, which terms and conditions may be different than, and shall supersede, those set forth in this Agreement), which Pricing Notice Supplier shall endeavor to provide within ten (10) Business Days of receipt of Buyer’s Pricing Request. If Buyer does not issue a Purchase Order to Supplier pursuant to Section 4.2 in response to the Pricing Notice within ten (10) Business Days of issuance thereof, the Pricing Notice shall be deemed rejected.

 

 

4.2.

Purchase Orders. If Buyer desires to purchase the Equipment and Services on the terms specified in a Pricing Request, it shall issue a Purchase Order to Supplier in the form attached hereto as Exhibit A, which Purchase Order shall include: (i) the pricing and any other terms, conditions and specifications set forth in Supplier’s Pricing Notice; and (ii) a detailed description of the Equipment and Services to be purchased, consistent with those set forth in the Pricing Request and to the extent modified thereby, the Pricing Notice. Purchase Orders shall only be binding when issued in compliance with the requirements of this Agreement and sent by e-mail, by fax or by electronic data interchange to Supplier. Supplier shall accept or reject a Purchase Order within ten (10) Business Days after receipt. Acceptance or rejection shall be declared in the form of the Purchase Order. If a Purchase Order is neither accepted nor rejected within ten (10) Business Days after receipt, it shall be deemed rejected.

 

4.3.

Most Favored Nation Pricing. Subject to Applicable Law, during the Term, Supplier will offer its Equipment and Services to Buyer at Most Favored Nation Pricing in the Pricing Notice so long as Supplier and its Affiliates collectively own at least a twenty percent (20%) interest in Buyer.  “Most Favored Nation Pricing” shall be reasonably determined by the Supplier by reference to recent (last six (6) months) sales arrangements with customers, resellers or project developers, as applicable, taking into account purchase volumes, regional market conditions, the geographic location of the projects, and the relative size and technology to be used.  Supplier shall not be obligated to provide such pricing if it no longer offers the relevant products or services for sale and Supplier shall have no obligations to offer or continue to offer any such products or services for sale. If requested by Buyer, Supplier shall furnish to Buyer a certificate executed by an executive officer of Supplier and attesting to the methodology used by Supplier in determining the Most Favored Nation Pricing set forth in the applicable Pricing Notice. Supplier shall provide Buyer with supporting information concerning the comparable purchase volumes, regional market conditions, the geographic location of the projects, relative size and technology to be used, and any other variables that Supplier considered when determining the Most Favored Nation Pricing; provided that Suppler may always anonymize information about other customers’ projects, in Supplier’s sole discretion. In the event that Buyer believes the price indicated in the Pricing Notice does not accurately reflect Most Favored Nation Pricing, then the parties shall retain a mutually-agreeable auditing firm to independently and confidentially review Supplier’s methodology and pricing inputs and to render a decision regarding whether Supplier must offer a lower price in order to satisfy its Most Favored Nation Pricing obligation as set forth above. The decision of the independent auditor shall be final and binding on both Parties. The costs of the independent auditor shall be shared equally between Supplier and Buyer.

 

4.4.

Payment Terms. Unless otherwise provided in a Pricing Notice, all payments for Equipment are due and payable net thirty (30) days following invoice based on delivery of the applicable Equipment. Unless otherwise provided in a Purchase Order, all payments for Services are due and payable net thirty (30) days following invoice based on progress of the Services being performed.  Payment(s) shall be by electronic banking method identified on the Purchase Order.  Buyer will not make payments to Supplier in cash or bearer instruments, nor to an account other than that specified in the Purchase Order..  Buyer will make no unlawful payments, nor make payments through any trust, intermediate entity or other party.  Buyer will not make payment(s) to an individual, employee, or other designee of Supplier.

 

 

4.5.

Disputed Payments. If a dispute arises regarding the payments to be made hereunder, Buyer or Supplier, as applicable, shall pay all undisputed amounts, and the Parties shall attempt in good faith to resolve the dispute as promptly as practicable.

 

4.6.

Late Payments. Any amount owed by a Party hereunder beyond the date that such amount first becomes due and payable under this Agreement shall accrue interest from the date that it first became due and payable until the date that it is paid at the lesser of (a) LIBOR plus four percent (4%) per annum or (b) the maximum rate permitted by Applicable Law.

 

4.7.

Taxes; Export and Import Duties. Notwithstanding anything herein to the contrary, (i) Supplier shall collect and withhold any and all sales taxes arising in connection with or relating to the supply, sale or Delivery of the Equipment and imposed by any Governmental Authority having jurisdiction over Supplier at the Delivery Point and (ii) Buyer shall be responsible for any and all other Taxes arising in connection with or relating to the supply, sale or Delivery of the Equipment, any and all export duties from the jurisdiction or jurisdictions in which the Equipment is manufactured or from which the Equipment may be shipped and any and all import duties, in each case, arising in connection with or relating to the supply, sale or Delivery of the Equipment. Buyer shall also be responsible for and pay all Taxes in relation to the operation of its business, including in connection with the use of the Equipment. Buyer and Seller shall cooperate to obtain exemption from, or to minimize, any Taxes.

 

5.

DELIVERY.

 

5.1.

Delivery Terms; Inspection. Unless otherwise provided in a Pricing Notice, delivery of the Equipment shall be made FCA (Incoterms 2010) at Supplier’s facility. Prior to Delivery a representative of Supplier and a representative of Buyer may inspect the Equipment for damage and record such damage, if any.

 

5.2.

Guaranteed Delivery Date. Supplier shall use commercially reasonable efforts to Deliver Equipment to the applicable Delivery Point by the applicable guaranteed Delivery date therefore, if any, as set forth in the applicable Purchase Order, subject to extension as provided under this Agreement (as may be extended hereunder, the “Guaranteed Delivery Date”). Any other dates in a Purchase Order for performance by Supplier of any work and any other obligations of Supplier pursuant to such Purchase Order are estimated, and not guaranteed, dates. The failure of Supplier to timely achieve such other Supplier milestones or obligations by the applicable dates set forth in the Purchase Order shall not be a breach under this Agreement. Neither the Purchase Order nor any milestone date contained therein, including the Guaranteed Delivery Date for the Equipment, may be changed unless the same has been modified by a duly executed Change Order. If an unexcused delay originates with Supplier or its Representatives, Supplier shall be solely responsible for expedited delivery and other charges to meet Delivery dates.

 

 

5.3.

Delay Liquidated Damages. Except as may be otherwise agreed in a Purchase Order, if Delivery of the Equipment has not occurred by the Guaranteed Delivery Date for reasons that are not excused hereunder, and Buyer can prove that as a direct result thereof it must pay delay liquidated damages to its Customer, Supplier shall reimburse Buyer for such delay liquidated damages (such reimbursement not to exceed an amount equal to 0.5% of the price set forth in the Purchase Order allocable to the delayed Equipment for every completed week of delay) for each completed week after the Guaranteed Delivery Date that Buyer pays such liquidated damages to its Customer as a result of Supplier’s delay, provided, however, that the amount of delay liquidated damages payable by Supplier shall be reduced by any amounts received by Buyer under any delay in startup insurance policies providing coverage for any such losses or damages. Payment of the delay liquidated damages shall be the sole and exclusive remedy of Buyer for delay and under no circumstances shall the total aggregate liability of Supplier exceed five percent (5%) of the price set forth in the applicable Purchase Order.

 

5.4

Buyer Caused Delay. If Buyer fails to perform any obligations under a Purchase Order or otherwise causes a delay in the performance by Supplier of its obligations under a Purchase Order, and such failure or delay results in an increase in Supplier’s costs and/or impacts Supplier’s ability to meet any Supplier milestone in accordance with the schedule contemplated by the applicable Purchase Order, Supplier shall be entitled to a Change Order increasing the price payable under the applicable Purchase Order and extending the date for completion of any Supplier milestones commensurate with such delay and added cost, including overtime charges for labor and equipment.

 

6.

TITLE, RISK OF LOSS AND CARE, CUSTODY AND CONTROL.

 

6.1.

Transfer of Title and Risk of Loss. Title, care, custody, control and risk of loss of any portion of the Equipment shall pass to Buyer upon Delivery of the Equipment to the Delivery Point. Notwithstanding the foregoing, in no event will title to the Licensed Technology or any other Intellectual Property used in the Equipment or otherwise provided to Buyer, including any Software, transfer to Buyer.

 

6.2.

Warranty of Title. Supplier warrants to Buyer that, when title to the Equipment or any portion thereof is transferred to Buyer in accordance herewith, Buyer shall have good title to the Equipment or such portion thereof free and clear of all Liens, other than any such Liens which may arise in connection with Buyer’s failure to make payments as they become due under this Agreement. In the event of any nonconformity with the foregoing, Supplier, at its own expense, upon written notice of such failure, shall indemnify Buyer from the consequences of such nonconformity and defend the title to such Equipment, and Supplier shall either promptly replace such Equipment or any affected portion thereof or remedy the title defect.

 

7.

INSPECTION AND QUALITY CONTROL.

 

7.1.

Inspection Rights. Supplier shall permit Buyer, its Representatives and/or customer(s), at Buyer’s expense, to inspect Equipment/Services during manufacture at Supplier’s facilities or during performance and shall use commercially reasonable efforts to facilitate similar inspections at the manufacturing facilities of third party suppliers. Buyer shall provide Supplier with written notice of its intent to make any such inspection not less than ten (10) Business Days prior to the proposed inspection date. Buyer’s inspections/tests will not unduly interfere with Supplier’s business or the business of its third party suppliers.

 

 

7.2.

Quality Control. Supplier shall maintain quality control with respect to the Equipment and Services as mutually agreed upon by the Parties and provide Buyer with quality assurance documentation, manuals or certifications.

 

8.

WARRANTIES.

 

8.1.

Equipment Warranty. Supplier warrants to Buyer that (i) the Equipment as Delivered shall be new at the time of Delivery and shall have been manufactured using new components and (ii) during the Equipment Warranty Period the Equipment shall be free of any Defects (the “Equipment Warranty”). As used herein or otherwise agreed in a Purchase Order, the “Equipment Warranty Period” means the period of time commencing on the earlier to occur of (i) the date that the Equipment is placed into service as evidenced by the operation thereof for commercial purposes and (ii) the day that is sixty (60) days after the date of Delivery of the Equipment and continuing to and ending on (A) the first (1st) anniversary of such date or (B) such longer period as required by Applicable Law applicable to a particular Purchase Order.

 

8.2.

Services Warranty. Supplier warrants to Buyer that any Services shall at the time of performance thereof and during the Services Warranty Period be (i) performed in a good and workmanlike manner and free of any fault, defect or deficiency that would preclude or impair the ability of such Services to fulfill the purposes set forth in the applicable Purchase Order therefor in all material respects, (ii) consistent with a level of care, skill and judgment which conforms with Prudent Industry Practices, and (iii) in compliance with the requirements of this Agreement and the applicable Purchase Order (the “Services Warranty”). As used herein or otherwise agreed in a Purchase Order, the “Services Warranty Period” means the period of time commencing on the date of performance of the applicable Service and continuing to and ending on (A) the first (1st) anniversary of such date or (B) such longer period as required by Applicable Law applicable to a particular Purchase Order.

 

8.3.

Notification Requirements. Buyer shall promptly (but in any event within ten (10) Business Days after obtaining notice or knowledge thereof) notify Supplier of any failure of the Equipment to satisfy the Equipment Warranty or any failure of the Services to satisfy the Services Warranty, in each case by delivering written notice to Supplier of a warranty claim. The written notice of warranty claim shall, to the extent reasonably practicable, identify the applicable failure and the circumstances or conditions observed by Buyer that indicates the presence of such failure.

 

8.4.

Corrective Action. If, at any time prior to the expiration of the Equipment Warranty Period, either Party discovers any Defect, Supplier agrees that it shall Deliver a replacement for the applicable Defective part, without cost or expense to Buyer. When a Defective part has been Delivered to Buyer, such replaced part shall be covered by the Equipment Warranty until the later of (a) twelve (12) months from the time such replacement part was Delivered to Buyer, and (b) the end of the Equipment Warranty Period. All replacement parts shall be of good and workmanlike quality and shall be new or newly refurbished. If, at any time prior to the expiration of the Services Warranty Period, either Party discovers any failure of the Services to satisfy the Services Warranty, Supplier agrees that it shall, in its sole discretion, either correctly re-perform or otherwise correct the defective Services, without cost or expense to Buyer. When a defective Service has been remedied, such remedied Service shall be covered by the Services Warranty until the later of (a) twelve (12) months from the time such remedy was completed, and (b) the end of the Services Warranty Period.

 

 

8.5.

Warranty Exclusions. The Equipment Warranty and the Services Warranty shall not apply if (a) the applicable Defect or failure is attributable to Buyer’s failure to operate, repair or maintain the Equipment in material compliance with the procedures set forth in any Supplier Documents furnished to Buyer, which procedures are identified therein as necessary to maintain the effectiveness of the warranties or (b) the applicable Defect or failure is attributable to Buyer’s or Buyer’s contractor’s misuse or abuse of the Equipment (c) if the Equipment has been used in a manner contrary to Supplier's instructions set forth in the Supplier Documents that are identified therein as necessary to maintain the effectiveness of the warranties; (d) the applicable Defect or failure is attributable to any materials or equipment provided by Buyer; or (e) if the Equipment has failed as a result of ordinary wear and tear.

 

8.6.

NO IMPLIED WARRANTIES. THE WARRANTIES OF SUPPLIER SET FORTH IN THIS AGREEMENT ARE SUPPLIER'S SOLE AND EXCLUSIVE WARRANTIES AND ARE MADE IN LIEU OF ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, STATUTORY OR OTHERWISE. THE REMEDIES SET FORTH HEREIN WITH RESPECT TO SUCH WARRANTIES ARE BUYER'S SOLE AND EXCLUSIVE REMEDIES, AND SUPPLIER'S SOLE AND EXCLUSIVE LIABILITY, FOR ANY BREACH OF SUCH WARRANTIES. OTHER THAN THE WARRANTIES OF SUPPLIER SET FORTH IN THIS AGREEMENT, SUPPLIER HEREBY DISCLAIMS, AND BUYER HEREBY WAIVES, ALL OTHER EXPRESS WARRANTIES AND ALL OTHER WARRANTIES, CONDITIONS, DUTIES AND OBLIGATIONS, STATUTORY OR OTHERWISE, IMPLIED IN LAW, INCLUDING THOSE OF PERFORMANCE, MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT, CUSTOM, USAGE, OR OTHERWISE. THERE ARE NO OTHER WARRANTIES, CONDITIONS, AGREEMENTS, ORAL OR WRITTEN, STATUTORY OR OTHERWISE, OR UNDERSTANDINGS, WHETHER OR NOT IN A CONTEMPORANEOUSLY EXECUTED OR DATED AGREEMENT OR SPECIFICATION, THAT EXTEND BEYOND THOSE SET FORTH HEREIN AND NO OTHER WARRANTIES, CONDITIONS, AGREEMENTS, ORAL OR WRITTEN, STATUTORY OR OTHERWISE, WHICH MIGHT HAVE BEEN GIVEN BY AN EMPLOYEE, AGENT OR REPRESENTATIVE OF SUPPLIER OR ITS AFFILIATES ARE AUTHORIZED BY SUPPLIER.

 

8.7.

Reserved Rights. Without limiting Supplier’s obligations hereunder to remedy Defects, Supplier reserves the right (i) to make changes and improvements in its equipment and products without incurring any obligation to make such changes and improvements to any Equipment previously sold under a Purchase Order pursuant to this Agreement; and (ii) to change the terms of the warranty it provides to other Persons in the future without incurring any right or obligation to make the revised terms applicable to any Equipment previously sold under a Purchase Order pursuant to this Agreement. The provisions of this Section 8.7 shall survive the termination or expiration of this Agreement.

 

 

9.

BUYER FURNISHED PROPERTY.

 

The term “Buyer Furnished Property” shall mean all tools, patterns, equipment, materials or other property which is either supplied by, or purchased by or on behalf of, Buyer or its Representatives to Supplier to perform the Services or furnish the Equipment. Title to Buyer Furnished Property shall remain with Buyer and risk of loss shall be with the Party who has possession. For Buyer Furnished Property in Supplier’s possession, custody or control, Supplier shall insure against loss and damage in an amount equal to full replacement cost. Buyer Furnished Property shall carry no guarantee or warranty, express or implied. Supplier shall not use Buyer Furnished Property on any work other than the Equipment/Services. Supplier shall clearly mark Buyer Furnished Property to show Buyer's ownership and prevent a lien, encumbrance or challenge to Buyer's title thereto. Supplier shall, at its own expense, maintain and repair Buyer Furnished Property returning it to Buyer in the condition in which received, reasonable wear and tear excepted. Upon expiration or termination of the Purchase Order, Supplier shall dispose of Buyer Furnished Property as Buyer directs in writing. Buyer reserves the right to abandon Buyer Furnished Property at no additional cost to Buyer. The applicable Purchase Order pursuant to which Buyer Furnished Property was furnished to Seller shall remain in effect so long as Supplier possesses Buyer Furnished Property.

 

10.

PACKAGING.

 

Except where the Purchase Order includes alternative requirements, Supplier shall be responsible for packaging Equipment, and the clear and conspicuous marking of Equipment and packaging, in accordance with Applicable Law, industry standards and in a manner sufficient to permit efficient handling, to provide adequate protection and comply with requirements of carrier and Applicable Law. Packing slips identifying the Purchase Order number, and part number must accompany each shipment. The exterior of each shipping container or package will be clearly marked with Buyer’s Purchase Order number and country of origin, which shall also be marked on Equipment, in a clear, conspicuous and permanent manner. Supplier shall provide all necessary shipping documents, including, but not limited to, customs invoices and packing lists in accordance with Buyer’s requirements and Applicable Law. Damages and costs incurred by Buyer, its Representative or customer resulting from Supplier or its Representative’s failure to comply with this Article 10 shall be paid by Supplier. If Supplier imports wood packaging materials, in accordance with 7 CFR 319.40, Supplier warrants that such wood packaging material is treated and marked under an official program developed and overseen by the National Plant Protection Organization in the country of export.

 

11.

FORCE MAJEURE.

 

11.1.

Effect of Force Majeure. A Party shall not be considered to be in breach or default of this Agreement or any Purchase Order hereunder if and to the extent that its failure or delay in performance or its efforts to cure are prevented by Force Majeure.

 

11.2.

Procedures. If either Party, as a result of the occurrence of a Force Majeure, is rendered wholly or partially unable to perform its obligations under this Agreement or any Purchase Order, such Party shall comply with the following:

 

(a)

the affected Party shall promptly notify the other Party hereto in writing, and in any event within five (5) Business Days after the affected Party becomes aware of the occurrence of such Force Majeure event, describing in such notice the particulars of the occurrence;

 

(b)

the affected Party shall give the other Party written notice estimating the event’s expected duration and probable impact on the performance of such Party’s obligations under this Agreement, and such affected Party shall continue to furnish timely regular reports with respect thereto during the continuation of the event;

 

 

(c)

the suspension of performance shall be of no greater scope and of no longer duration than is reasonably required by the event;

 

(d)

no liability of either Party which arose before the occurrence of the event causing the suspension of performance shall be excused as a result of the occurrence;

 

(e)

the affected Party shall exercise all reasonable efforts to mitigate or limit damages to the other Party, promptly taking appropriate and sufficient corrective action, including the expenditure of all reasonable sums of money;

 

(f)

the affected Party shall use all reasonable efforts to continue to perform its obligations under this Agreement and to correct or cure the event excusing performance; and

 

(g)

when the affected Party is able to resume performance of the affected obligations under this Agreement, the affected Party shall promptly resume performance and give the other Party written notice to that effect.

 

11.3.

Termination for Extended Force Majeure. If Supplier experiences a Force Majeure Event completely preventing Supplier’s performance for more than forty-five (45) consecutive days, Buyer shall have the right to terminate the applicable Purchase Order and shall be entitled to a refund of all monies advanced to Supplier.

 

12.

CHANGE ORDERS.

 

12.1.

Change Order. A “Change Order” is a written instrument signed by the Parties and stating their mutual agreement upon a change in the obligations of the Parties under this Agreement or any Purchase Order, including if applicable the amount of the adjustment in the purchase price and the extent of any adjustment to the Delivery schedule, including the Guaranteed Delivery Date.

 

12.2.

Change Order Process. In addition to circumstances set forth herein where the Parties are entitled to a Change Order, either Party may request changes in the obligations of the Parties under this Agreement within the scope of this Agreement consisting of additions, deletions, or other revisions to such obligations. If either Buyer or Supplier wishes to change such obligations, it shall submit a change request to the other Party in writing. If the requested change relates to a change to the Equipment supply obligations or results from a condition in which Supplier is entitled to a Change Order under this Agreement, then, within fifteen (15) Business Days following receipt or delivery, as applicable, of the requested change, Supplier shall submit a proposal to Buyer stating (i) the increase or decrease, if any, in the purchase price and changes to the Delivery schedule and/or the Guaranteed Delivery Date, if any, that would result from such change (collectively, the “Change Order Information”). If the proposed change relates to any other matter, the requesting Party, at the time the request for the change is made, shall provide the proposed Change Order Information. Within five (5) Business Days following receipt of the Change Order Information, the Parties shall meet and, acting reasonably, negotiate in good faith a mutually acceptable Change Order in accordance with the principles set forth herein. Following agreement on the terms and conditions of the Change Order, the Parties shall execute the same. If the Parties do not agree upon the terms and conditions of the Change Order, and the proposed change relates to circumstances in which a Party is entitled to a Change Order under this Agreement, then either Party may submit the matter to dispute resolution pursuant to Article 24.

 

 

12.3.

Change Order Restrictions. Notwithstanding anything herein to the contrary, Buyer shall not be entitled reduce the scope of the Equipment supply obligations under any Purchase Order.

 

12.4.

No Change. Supplier shall not be obligated to proceed with any change in the Equipment supply obligations requested by Buyer unless and until a Change Order is executed by the Parties in relation to such change. Further, Supplier shall not be required to implement a requested change in the Equipment supply obligations by Buyer if Supplier reasonably believes the implementation of such change would impair Supplier’s ability to comply with any of the warranties or the covenants set forth in this Agreement or the applicable Purchase Order.

 

13.

INTELLECTUAL PROPERTY.

 

13.1.

Grant of License. Upon transfer of title with respect to any Equipment purchased hereunder and upon providing parts under the Equipment Warranty hereunder, Supplier hereby grants to Buyer a non-exclusive, transferable, fully paid-up with no further royalty obligation, worldwide, license in and to, all Intellectual Property owned or licensed by Supplier which are necessary for the use and enjoyment by Buyer of Equipment hereunder (the “License”) to import into the Territory and use the Licensed Technology (including any Intellectual Property in the Licensed Technology) within the Territory, and solely in accordance with the terms of this Agreement. Such license includes a perpetual license to use software provided for the operation of the Equipment including but not limited to all modifications or additions to software upon payment of commercially reasonable service charges to be negotiated, as well as all related documentation and technical information. With respect to any Confidential Information contained within the Licensed Technology, Buyer may disclose such Confidential Information to third party contractors who have a need to know such parts of the Licensed Technology solely for Buyer’s use and operation of the Equipment and in accordance with the terms of this Agreement; provided that such third parties shall first execute a confidentiality agreement consistent with this Agreement containing restrictions on disclosure and use at least as restrictive as those in Article 17 (and such third party contractors shall not be permitted to disclose the Licensed Technology to any other third party). The Licensed Technology is Confidential Information of Supplier as defined in Section 17.1 even if not marked as “confidential,” “proprietary” or with other such similar language, except where an exception in Section 17.3 applies.

 

13.2.

No Copies. Except as otherwise permitted by this Agreement, Buyer shall not make any copies of the Licensed Technology without first obtaining express written permission from Supplier. Notwithstanding the foregoing, Buyer may make such number of copies of (i) the documentation and manuals for the Equipment or other Intellectual Property licensed hereunder that is not embedded in the Equipment as are required for Buyer’s normal use and operation hereunder (including such copies as may be included in or attached to electronic mail messages by Buyer for delivery to Persons who are otherwise permitted recipients of Supplier’s Confidential Information hereunder) and (ii) the Licensed Technology as are reasonably required for back-up, disaster recovery and archival purposes.

 

 

13.3.

Proprietary Notices. Buyer shall not remove or alter, or permit to be removed or altered, any proprietary notices that appear on or with the Licensed Technology. Buyer shall include on and with the Licensed Technology a written notice stating: “Confidential and Proprietary Information of Siemens Industry, Inc.. Access and Use Restricted by License.” or such other or additional notice as Supplier reasonably may prescribe.

 

13.4.

Security. Buyer shall take all reasonable steps to ensure that no unauthorized persons have access to the Licensed Technology, and to ensure that no persons authorized to have such access shall take any action which would be in violation of this Agreement. Such steps shall include, but shall not be limited to, imposing password restrictions on use of the Licensed Technology securing Buyer’s network on which such Licensed Technology resides from outside intrusion, preventing the making of unauthorized copies of the Licensed Technology and administering and monitoring use of the Licensed Technology.

 

13.5.

No Reverse Engineering. The Licensed Technology includes trade secrets of Supplier or its Affiliates. In order to protect the Licensed Technology, Buyer shall not modify, translate, decompile, reverse engineer, decrypt, extract or disassemble the Licensed Technology or otherwise reduce or attempt to reduce any Software in the Licensed Technology to source code form. Buyer shall ensure, both during and (if Buyer still has possession of the Licensed Technology) after the performance of this Agreement, that (a) Persons who are not bound by a confidentiality agreement consistent with this Agreement shall not have access to the Licensed Technology and (b) Persons who are so bound are put on written notice that the Licensed Technology contains trade secrets, owned by and proprietary to Supplier or its Affiliates.

 

13.6.

Open Source Software. Buyer shall not sell, sublicense, or otherwise make available the Licensed Technology or any part thereof as Open Source Software, nor combine the Licensed Technology with any Open Source Software in a manner that could require the release, disclosure or distribution of the Licensed Technology, or otherwise infect the Licensed Technology so as to impose any obligation on Supplier or diminish any rights Supplier may have therein.

 

13.7.

Reporting. Buyer shall promptly report to Supplier any actual or suspected violation of this Article 13, and shall take such further steps as may reasonably be requested by Supplier to prevent or remedy any such violation.

 

13.8.

Relief. Because unauthorized use or transfer of the Licensed Technology is likely to diminish substantially the value of such Licensed Technology and irreparably harm Supplier and will not be susceptible of cure by the payment of monetary damages, if Buyer breaches the provisions of this Article 13, Supplier shall be entitled to injunctive and/or other equitable relief, in addition to other remedies afforded by law, to prevent or restrain such breach.

 

13.9.

Improvements.

 

(a)

By Supplier. Any improvement hereafter made by or for Supplier or any of its Affiliates in the Licensed Technology (including those set out in (b) and (c) below) that is approved and adopted by Supplier for use by Buyer under this Agreement shall be included in the Licensed Technology for purposes of the License. The Parties agree that Supplier may decide in its sole discretion which improvements it shall approve and adopt for purposes of Buyer’s use under the License; provided, however, that if Supplier makes improvements available to buyers similarly situated to Buyer in terms of project scope and fees paid, Supplier also shall make such improvements available to Buyer on terms at least as favorable to Buyer as the terms generally provided to such similarly situated buyers.

 

 

(b)

By Buyer with respect to Licensed Technology, excluding the Inverter Hardware (“Non-IH Licensed Technology”). Buyer may not modify the Non-IH Licensed Technology except as expressly permitted in this Section 13.9(b). Buyer may suggest modifications in the Non-IH Licensed Technology to Supplier. Any modification or improvement in the Non-IH Licensed Technology suggested by Buyer must first be approved by Supplier in accordance with Section 13.9(a).

 

(c)

By Buyer with respect to Inverter Hardware. Buyer will be permitted to make modifications or improvements to the Inverter Hardware listed in Annex A. Supplier will provide to Buyer Know-How that is reasonably requested by Buyer and that is required to enable Buyer to make modifications or improvements pursuant to this Section 13.9(c). Any modifications or improvements made by Buyer pursuant to this Section 13.9(c) will be owned by Supplier and will be licensed under Section 13.1. Notwithstanding the foregoing, Supplier shall have no liability to Buyer as a result of Buyer’s modifications or improvements to the Inverter Hardware.

 

(d)

With respect to both Section 13.9(b) and 13.9(c), Buyer shall own any modifications or improvements to both the Non-IH Licensed Technology and the Inverter Hardware, only if such ownership is mandated by Applicable Law. If Buyer’s ownership is legally mandated, Buyer hereby grants to Supplier and its Affiliates a non-exclusive, perpetual, worldwide, royalty-free license to make, have made, import, offer for sale, sell, copy, make derivative works, use and sublicense to others the right to use these modifications or improvements.

 

13.10.

Ownership.

 

(a)

Supplier. As between the Parties, Supplier or its Affiliates shall own the Licensed Technology, including any modifications, discoveries, derivative works and improvements derived from or based on it, whether developed by Supplier, by Buyer, or by the Parties jointly, all Intellectual Property therein and any Intellectual Property developed during, or arising out of, the performance of Supplier’s obligations under this Agreement, to the extent permitted by Applicable Law. Buyer acquires only certain rights to use the Licensed Technology under the License, strictly in compliance with the terms of this Agreement, and does not acquire any ownership rights or title to it.

 

(b)

Buyer. As between the Parties, Buyer or its Affiliates shall own (1) any Intellectual Property developed or acquired by Buyer prior to or independently of this Agreement, and (2) all Intellectual Property therein, excluding in each case any of the Licensed Technology incorporated therein or any Intellectual Property in any combination of the Licensed Technology.

 

(c)

Cooperation. Buyer shall reasonably cooperate with Supplier to assist in perfecting Supplier’s ownership in any Intellectual Property in modifications, discoveries, derivative works and improvements to Licensed Technology developed by Supplier or by the Parties jointly, including by executing declarations, oaths, assignments or other formalities documents as needed.

 

 

13.11.

Enforcement. Each Party shall notify the other promptly in writing of any suspected infringement by a third party of the Licensed Technology or any of the Intellectual Property therein. Supplier shall have the exclusive right to enforce and defend the rights appurtenant to the Licensed Technology or the Intellectual Property therein in Supplier’s sole discretion and shall have the sole right of control of any such enforcement action or proceeding it elects to initiate (an “Enforcement Action”), at Supplier’s sole cost and expense. Supplier shall keep Buyer timely and reasonably informed as to significant events during the course of all such Enforcement Actions as would reasonably be expected to affect Buyer’s use of the Licensed Technology whether conducted for Supplier’s or Buyer’s account. Buyer shall provide on Supplier’s written request reasonable assistance in preparing and advancing Supplier’s case, in consideration of which Supplier shall reimburse Buyer’s reasonable out-of-pocket costs incurred in doing so (including reasonable attorneys’ fees). Supplier may retain any monetary damages or other compensation or recovery awarded to it in any Enforcement Action under this Section 13.11. Notwithstanding the foregoing, Buyer may participate and be represented in any Enforcement Action by its own counsel at its own expense, to the extent such participation and representation does not materially interfere with Supplier’s right to control such Enforcement Action. Supplier shall not settle any such Enforcement Action in a manner materially and adversely affecting Buyer’s rights in this Agreement, or in a manner including an admission of wrongdoing by Buyer, without obtaining the prior written consent of Buyer, which consent shall not be unreasonably withheld, conditioned or delayed. Buyer has no right to enforce Supplier’s Intellectual Property in the Licensed Technology against any third parties.

 

13.12.

Duration and Transfers. Subject to termination in accordance with this Agreement, the License (i) shall continue for so long as Buyer or any successor retains ownership of the Equipment and continues operating the same (ii) shall terminate automatically if and when the Equipment is permanently removed from service (subject to earlier termination in accordance herewith) and (iii) shall transfer as part of an assignment that is permitted under Section 25.5. If Buyer sells or transfers the Equipment, or any portion thereof, apart from an Assignment of this Agreement, the License will terminate as to Buyer with respect to the Equipment, or any portion thereof sold or transferred and Buyer must, as a condition thereof, notify Supplier in writing and assign to the transferee thereof the License with respect to the Equipment, or any portion thereof sold or transferred, and procure from the transferee an assumption of such License, on substantially the same terms as set forth in this Article 13 and in form subject to Supplier’s prior reasonable approval, to the extent the License is applicable to the assets being sold or transferred. The License may not be assigned, transferred or sublicensed except as expressly permitted in this Section 13.12. Buyer shall be responsible for, and indemnify, defend and hold harmless Supplier, Supplier’s Parent, Supplier’s Affiliates, and their respective officers, directors, members, agents and employees from and against any damage, injury or loss resulting from the failure of Buyer to comply with the terms of this Article 13. Supplier may terminate the License, except with respect to any Licensed Technology that is integrated in any Equipment as to which title has transferred to Buyer hereunder, on written notice to Buyer if Buyer (a) fails to cure any material breach of an obligation in this Article 13 which is capable of being cured within thirty (30) days after Supplier’s written notice specifying the breach, or (b) on more than two (2) occasions in any five (5) year period, Buyer is found, through resolution of a Dispute, whether by settlement or otherwise, to have materially breached the terms and conditions of this Article 13 in substantially the same manner.

 

 

13.13.

Government End Users. The Software portion of the Licensed Technology is a “commercial item” as that term is defined at 48 CFR 2.101, and includes “commercial computer software” and “commercial computer software documentation” as such terms are used in 48 CFR 12.212 and in the event the Licensed Technology is provided to the US Government, such Licensed Technology shall be provided to the US Government only as a commercial end item. Consistent with 48 CFR 12.212, civilian US Government end users acquire the Software and documentation with only those license rights set forth herein as restricted by 48 CFR 12.212(a)(1) and (a)(2); Department of Defense end users acquire the Software and documentation with only those license rights set forth herein as restricted by 48 CFR 227.7202-1 through 227.7202-4.

 

13.14.

Reservation of Rights. Supplier reserves all rights in the Licensed Technology not expressly granted to Buyer in this Agreement. No right or license is granted (expressly or by implication or estoppel) by Supplier to Buyer or its Affiliates under any tangible, Intellectual Property, or other proprietary right.

 

14.

DEFAULTS AND REMEDIES.

 

14.1.

Supplier Defaults. The occurrence of any one or more of the following events shall constitute an event of default by Supplier hereunder (a “Supplier Event of Default”):

 

(a)

Supplier fails to pay to Buyer any payment required under this Agreement (which is not subject to a good faith dispute) when due, and such failure continues for ten (10) Business Days after receipt of written notice of such failure;

 

(b)

Supplier voluntarily commences bankruptcy, insolvency, reorganization, stay, moratorium or similar debtor-relief proceedings, or shall have become insolvent or generally does not pay its debts as they become due, or admits in writing its inability to pay its debts, or makes an assignment for the benefit of creditors;

 

(c)

Insolvency, receivership, reorganization, bankruptcy, or similar proceedings shall have been commenced against Supplier and such proceedings remain undismissed or unstayed for a period of ninety (90) days;

 

(d)

Supplier fails to deliver Equipment by the date upon which Supplier exhausts its liability for liquidated damages for delayed deliveries under Section 5.3; or

 

(e)

Except as otherwise expressly provided for in this Section 14.1, Supplier is in material breach of its obligations under this Agreement and such material breach continues uncured for sixty (60) days after receipt of written notice from Buyer.

 

14.2.

Buyer Defaults. The occurrence of any one or more of the following events shall constitute an event of default by Buyer hereunder (a “Buyer Event of Default”):

 

(a)

Buyer fails to pay to Supplier any payment required under this Agreement (which is not subject to a good faith dispute) when due, and such failure continues for ten (10) Business Days after receipt of written notice of such failure;

 

 

(b)

Buyer voluntarily commences bankruptcy, insolvency, reorganization, stay, moratorium or similar debtor-relief proceedings, or shall have become insolvent or generally does not pay its debts as they become due, or admits in writing its inability to pay its debts, or makes an assignment for the benefit of creditors;

 

(c)

Insolvency, receivership, reorganization, bankruptcy, or a similar proceeding shall have been commenced against Buyer and such proceeding remains undismissed or unstayed for a period of ninety (90) days;

 

(d)

Any Assignment by Buyer not in conformity with Section 25.5; or

 

(e)

Except as otherwise expressly provided for in this Section 14.2, Buyer is in material breach of its obligations under this Agreement and such material breach continues uncured for sixty (60) days after receipt of written notice from Supplier.

 

14.3.

Remedies. Upon the occurrence of a Supplier Event of Default, Buyer may, by written notice to Supplier, terminate the outstanding Purchase Order(s) under which the Supplier Event of Default has arisen and/or shall be entitled to such rights and remedies as may be available at law or in equity. Upon the occurrence of a Buyer Event of Default, Supplier may, by written notice to Buyer, terminate the outstanding Purchase Order(s) under which the Buyer Event of Default has arisen and/or shall be entitled to such rights and remedies as may be available at law or in equity. Any rights and remedies available under Applicable Law upon termination of this Agreement pursuant to this Section 14.3 shall be limited in all respects by the limitations of liability set forth in Article 16. For sake of clarity, in the event that there are more than one Buyer under this Agreement, (i) a Buyer Event of Default by one such Buyer shall not constitute a Buyer Event of Default by any other Buyer and any remedies available to Supplier shall be exercisable only as against the defaulting Buyer and as regards the non-defaulting Buyer(s) this Agreement and any related Purchase Orders shall continue in full force and effect, and (ii) a Supplier Event of Default with respect to any particular Purchase Order shall only count as a Supplier Event of Default for the applicable Purchase Order and as regards any other Purchase Orders and any other Buyer(s), this Agreement and any related Purchase Orders shall continue in full force and effect.

 

15.

INDEMNIFICATION.

 

15.1.

General. Each Party (the “Indemnifying Party”) shall indemnify, defend and hold harmless the other Party, its Affiliates, and their Representatives and assigns (the “Indemnified Party”) from and against all claims, suits, causes of action, losses, liabilities, liens, damages, assessments, costs, expenses, demands, complaints or actions including but not limited to reasonable attorneys’ fees and court costs (collectively, “Claims”) of third parties concerning: (i) death, personal injury, or property damage of third parties, (ii) nonpayment of wages, benefits, fees, amounts owed, and/or any taxes (including penalties and interest) associated therewith arising from the Indemnifying Party’s Representatives, suppliers, contractors, and/or materialmen which may include liens or encumbrances on the Equipment/Services or the premises on which located and (iii) violations by the Indemnifying Party or any Person for whom the Indemnifying Party is responsible of Applicable Law; in each case to the extent arising or resulting from the Indemnifying Party’s or its Representative’s negligence, willful misconduct, or breach of this Agreement. For sake of clarity, if both Parties are negligent or otherwise at fault or strictly liable without fault, then the obligations of indemnification under this Section 15.1 shall continue, but the Indemnifying Party shall indemnify the Indemnified Party only for the percentage of responsibility for the damage or injuries attributable to the Indemnifying Party.

 

 

15.2.

Infringement Indemnification by Supplier.

 

(a)

Indemnity. If an action is brought or threatened against Buyer claiming that Buyer’s use, as permitted herein, of the Licensed Technology within the Territory infringes any Intellectual Property arising or existing under Applicable Law, Supplier shall defend, indemnify and hold harmless Buyer, its Affiliates, and their Representatives and assigns at Supplier’s expense from and against any and all Infringement Claim Costs of Buyer to the extent arising from such action or claim.

 

(b)

Corrective Actions. If Buyer’s permitted use of the Licensed Technology within the Territory is materially impaired or if Supplier’s performance of the Equipment supply obligations under this Agreement or any other obligation is materially impaired by reason of such third party claim, Supplier shall use commercially reasonable efforts, at its expense, to continue its performance of the Equipment supply obligations under this Agreement or the other affected obligations, including at its own election and expense (i) to substitute an equivalent non-infringing item or process for the allegedly infringing item or process, (ii) to modify the allegedly infringing item or process so that it no longer infringes but remains functionally equivalent or better or (iii) to obtain for Buyer the right to continue using such item or process. Supplier shall, prior to proceeding with any of the foregoing actions, consult with Buyer as to the proposed action and consider in good faith any reasonable request of Buyer in respect thereof. Nothing herein constitutes a guarantee by Supplier that such efforts will succeed in avoiding the infringement claim or that Supplier will be able to replace the infringing item or process with an item or process of comparable functionality or effectiveness. If Supplier reasonably believes that an injunction against use of the Licensed Technology in the Territory may be granted against Buyer, either imminently or with the passage of time, Supplier may at its expense, and upon reasonable prior written notice to Buyer, take any of the foregoing actions in order to minimize its liability.

 

(c)

Exclusions. This Section 15.2 does not apply to, and Supplier assumes no liability with respect to, claims for patent infringement or copyright infringement or improper use of other proprietary rights (including any license or Intellectual Property, whether by way of copyright or otherwise) to the extent that such claims relate, in whole or in part, to (i) Buyer’s modification or alteration of the Licensed Technology (except, subject to clause (iv) below, to the extent permitted by this Agreement) or the Equipment, in either case made without Supplier’s written consent or contrary to Supplier’s instructions, (ii) the combination of the Licensed Technology with other Software, products, materials, equipment, parts or apparatus and not approved in writing by Supplier, (iii) a failure to promptly install an update required by Supplier or (iv) Buyer’s modifications or improvements to the Inverter Hardware pursuant to Section 13.9(c).

 

(d)

Entire Liability. THE FOREGOING PROVISIONS OF THIS SECTION 15.2 STATE THE ENTIRE LIABILITY AND OBLIGATION OF SUPPLIER AND ITS AFFILIATES AND THE EXCLUSIVE REMEDY OF BUYER, WITH RESPECT TO ANY ACTUAL OR ALLEGED INFRINGEMENT OF PATENTS, COPYRIGHTS, TRADEMARKS OR OTHER INTELLECTUAL PROPERTY BY THE EQUIPMENT OR THE LICENSED TECHNOLOGY OR ANY PART THEREOF, EXCEPT TO THE EXTENT THAT SUCH LIABILITY CANNOT BE EXCLUDED IN ACCORDANCE WITH MANDATORY LEGAL REQUIREMENTS.

 

 

(e)

Notifications. Buyer shall promptly notify Supplier in writing following receipt of written notice of any claims alleging infringement of patents or other proprietary rights (including Intellectual Property) in connection with Buyer’s permitted use of the Licensed Technology or Supplier’s performance of the Equipment supply obligations under this Agreement or Equipment Warranty obligations, and shall provide Supplier with all information in its possession relevant to such claim. In turn, Supplier shall notify Buyer as soon as practical in writing of any claims which Supplier may receive alleging infringement of patents or other proprietary rights which may affect Supplier’s performance of the Equipment supply obligations under this Agreement or Equipment Warranty obligations under this Agreement or Buyer’s right to own, operate and maintain the Equipment.

 

15.3.

Infringement Indemnification by Buyer.

 

(a)

Indemnity. If an action is brought or threatened against Supplier claiming that any condition or event described in Section 15.2(c) results in an infringement upon any Intellectual Property within the Territory arising or existing under Applicable Law, Buyer shall defend, indemnify and hold harmless the Supplier Indemnified Parties at Buyer’s expense from and against any and all Infringement Claim Costs of Supplier to the extent arising from such action or claim.

 

(b)

Corrective Actions. If performance of Supplier’s obligations hereunder is enjoined by reason of a claim subject to Section 15.3(a), Buyer shall use commercially reasonable efforts, at its option and expense, at its own election (i) to substitute an equivalent non-infringing item or process for the allegedly infringing item or process, (ii) to modify the allegedly infringing item or process so that it no longer infringes but remains functionally equivalent, or (iii) to obtain for Supplier the right to continue using such item or process. Nothing herein constitutes a guarantee by Buyer that such efforts will succeed in avoiding the infringement claim or that Buyer will be able to replace the infringing item or process with an item or process of comparable functionality or effectiveness.

 

(c)

Exclusions. This Section 15.3 does not apply to, and Buyer assumes no liability with respect to, claims for patent infringement or copyright infringement or improper use of other proprietary rights (including any license or Intellectual Property, whether by way of copyright or otherwise), to the extent that such claims relate, in whole or in part, to (i) a modification to the Licensed Technology or the Equipment requested by Buyer but executed by Supplier or with Supplier’s supervision and control (except for Buyer’s modifications or improvements to Inverter Hardware pursuant to Section 13.9(c) for which Supplier shall have no liability) or (ii) the combination of the Licensed Technology with other products, materials, equipment, parts or apparatus approved in writing by Supplier.

 

 

15.4.

Indemnification Procedures.

 

(a)

If an Indemnified Party receives written notice of a Claim, the Indemnified Party shall give prompt written notice to the Indemnifying Party, including a reasonably detailed description of the facts and circumstances relating to such Claim, a complete copy of all notices, pleadings and other papers related thereto, and a description in reasonable detail of the basis for the potential claim for indemnification with respect thereto. The Indemnified Party’s delay or deficiency in notifying Supplier shall not relieve Supplier of liability or obligation except to the extent (and only to the extent) such delay materially impacts the defense of the Claim.

 

(b)

The Indemnifying Party shall be entitled to assume the defense and to represent the interests of the Indemnified Party, which shall include the right to select and direct legal counsel and other consultants (all of whom shall be reasonably acceptable to the Indemnified Party), appear in proceedings on behalf of the Indemnified Party and to propose, accept or reject offers of settlement, subject to Section 15.4(c) below, all at its sole cost. Nothing herein shall prevent an Indemnified Party from retaining its own legal counsel and other consultants or participating in its own defense at its own cost and expense. Notwithstanding the foregoing, if (i) the claim is primarily for non-monetary damages against the Indemnified Party, or primarily for an injunction or other equitable relief that, if granted, would reasonably be expected to be material to the Indemnified Party, (ii) there is a material actual or potential conflict of interest that makes representation of the Indemnifying Party and the Indemnified Party by the same counsel or the counsel selected by the Indemnifying Party inappropriate, or (iii) the claim is a criminal proceeding, then in each case the Indemnified Party may, upon notice to the Indemnifying Party, assume the exclusive right to defend (and in the case of clause (iii) above, compromise and settle), such claim and the reasonable fees and expenses of the Indemnified Party’s separate counsel shall be borne by the Indemnifying Party; however the settlement of any claim pursuant to clauses (i) and (ii) above shall be governed by Section 15.4(c) below. Notwithstanding anything to the contrary herein, for sake of clarity, the Parties agree that the foregoing provisions shall not be construed so as to permit the Indemnified Party to control or assume the defense of any action, lawsuit, proceeding, investigation, demand or other claim brought against the Indemnifying Party concurrently with or in a joint proceeding in respect of any claim that is the subject of an indemnification claim hereunder by the Indemnified Party.

 

(c)

Notwithstanding anything to the contrary herein, the Indemnifying Party shall not compromise or settle, or admit any liability with respect to any third party Claim without the prior written consent of the Indemnified Party (which consent shall not be unreasonably withheld or delayed), unless the relief consists solely of (i) money damages (all of which the Indemnifying Party shall pay), and (ii) includes a provision whereby the plaintiff or claimant in the matter releases the Indemnified Party from all liability with respect thereto. If the Indemnified Party assumes the defense of or represents their own interests, no settlement shall be made without the prior written consent of the Indemnifying Party (which consent shall not be unreasonably withheld or delayed).

 

15.5.

Limited Waiver of Certain Immunities. Each of the Parties hereby specifically and expressly agrees that with respect to any and all claims against an Indemnified Party by any representative of an Indemnifying Party, any indemnification available hereunder shall not be limited by reason of any immunity to which such Indemnifying Party may be entitled under any workers compensation and/or industrial insurance acts, disability benefit acts, or other employee benefits acts and any limitation on the amount or type of damages, compensation, or benefits payable by or for the Indemnifying Party to such representative with respect to any such claim. For the sake of clarity, the Indemnifying Party’s waiver of immunity by the provisions of this section extends only to indemnification claims against the Indemnifying Party by or on behalf of the Indemnified Party under or pursuant to this Agreement, and does not apply to any claims made by the Indemnifying Party’s representatives directly against the Indemnifying Party.

 

 

15.6.

Survival. The indemnities set forth in this Article 15 shall survive the termination or expiration of this Agreement.

 

16.

LIMITATIONS OF LIABILITY.

 

16.1.

WAIVER OF CERTAIN DAMAGES. NOTWITHSTANDING ANYTHING IN THIS AGREEMENT OR ANY PURCHASE ORDER EXECUTED HEREUNDER TO THE CONTRARY, NEITHER PARTY SHALL BE LIABLE, WHETHER BASED IN CONTRACT, GUARANTY, WARRANTY, TORT (INCLUDING NEGLIGENCE), PRODUCT LIABILITY, STRICT LIABILITY, INDEMNITY OR ANY OTHER LEGAL OR EQUITABLE THEORY, FOR: LOSS OF USE, REVENUE, SAVINGS, PROFIT, INTEREST, GOODWILL OR OPPORTUNITY, COSTS OF CAPITAL, COSTS OF REPLACEMENT OR SUBSTITUTE USE OR PERFORMANCE, LOSS OF INFORMATION AND DATA, LOSS OF POWER, VOLTAGE IRREGULARITIES OR FREQUENCY FLUCTUATION, CLAIMS ARISING FROM BUYER’S THIRD PARTY CONTRACTS, OR FOR ANY TYPE OF INDIRECT, SPECIAL, PUNITIVE, EXEMPLARY, COLLATERAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES, OR FOR ANY OTHER LOSS OR COST OF A SIMILAR TYPE.

 

16.2.

MAXIMUM LIABILITY. SUPPLIER’S MAXIMUM LIABILITY UNDER THIS AGREEMENT SHALL NOT EXCEED THE PURCHASE PRICE SET FORTH IN THE APPLICABLE PURCHASE ORDER PURSUANT TO WHICH THE APPLICABLE CLAIM AROSE.

 

16.3.

EFFECTIVENESS. THE PARTIES AGREE THAT THE EXCLUSIONS AND LIMITATIONS IN THIS ARTICLE 16 WILL PREVAIL OVER ANY CONFLICTING TERMS AND CONDITIONS IN THIS AGREEMENT OR ANY PURCHASE ORDER EXECUTED HEREUNDER AND MUST BE GIVEN FULL FORCE AND EFFECT, WHETHER OR NOT ANY OR ALL SUCH REMEDIES ARE DETERMINED TO HAVE FAILED OF THEIR ESSENTIAL PURPOSE. THESE LIMITATIONS OF LIABILITY ARE EFFECTIVE EVEN IF SUPPLIER HAS BEEN ADVISED BY BUYER OF THE POSSIBILITY OF SUCH DAMAGES. THE WAIVERS AND DISCLAIMERS OF LIABILITY, RELEASES FROM LIABILITY AND LIMITATIONS ON LIABILITY EXPRESSED IN THIS ARTICLE 16 EXTEND TO THE PARTIES’ RESPECTIVE AFFILIATES, PARTNERS, PRINCIPALS, MEMBERS SHAREHOLDERS, DIRECTORS, OFFICERS, EMPLOYEES, SUPPLIERS, AGENTS, AND SUCCESSORS AND ASSIGNS.

 

16.4.

Commencement of Claims. Except with respect to claims arising under Article 13, Article 15 or Article 17, any legal action of either Party arising under this Agreement or any Purchase Order issued hereunder must be commenced within two (2) years after the Delivery of the applicable Equipment or performance of the applicable Service. To the maximum extent permitted by Applicable Law, each Party hereby waives any right to commence any claim or action after such two (2) year period.

 

 

17.

CONFIDENTIALITY.

 

17.1.

Confidential Information. Each Party shall, and shall cause its respective Affiliates and Representatives to, keep confidential any information which it may have or acquire before or after the date of this Agreement, concerning the other Party and its assets, business, operations, affairs, financial condition or such information, “Confidential Information”).

 

17.2.

Non-Disclosure. Neither Party shall use any Confidential Information in any manner detrimental to the other Party nor shall any of them disclose, publish or make accessible, directly or indirectly, any Confidential Information to any person. In addition, the Parties shall exercise all reasonable efforts to prevent any other person from gaining access to such Confidential Information and take such protective measures as may be or become reasonably necessary to preserve the confidentiality of such Confidential Information.

 

17.3.

Exceptions. Notwithstanding Section 17.1 and Section 17.2, either Party may disclose Confidential Information:

 

(a)

to any Representative of such Party, provided that such Representative has a need to know and has been informed of the confidential nature of the information pursuant to Section 17.4;

 

(b)

to the extent required by (i) any Applicable Law of any Governmental Authority (including any rule or regulation of the Securities and Exchange Commission), (ii) any stock exchange rule or regulation or (iii) any binding judgment, order or requirement of any court or other Governmental Authority of competent jurisdiction; provided, that the Party required to disclose Confidential Information, as the case may be, has delivered written notice to and consulted, to the extent practicable, with the other Party prior to disclosure of such Confidential Information; and

 

(c)

to the extent such Confidential Information becomes available within the public domain (otherwise than as a result of a breach of this Article 17).

 

17.4.

Representatives Bound. Each Party shall inform any representative to whom it provides Confidential Information that such information is confidential and shall instruct them (a) to keep such Confidential Information confidential and (b) not to disclose it to any third party (other than those persons to whom such Confidential Information has already been disclosed in accordance with the terms of this Agreement). The disclosing Party shall be responsible for any breach of this Article 17 by the person to whom the Confidential Information is disclosed.

 

17.5.

Survival. Notwithstanding anything herein to the contrary, the provisions of this Article 17 shall survive the termination of this Agreement for a period of three (3) years and, with respect to each Party, shall survive for a period of three (3) years following the date on which such Party is no longer a Party.

 

 

18.

REPRESENTATIONS AND WARRANTIES.

 

18.1.

Representations of the Parties.As of the Effective Date (or, with respect to each Further Buyer Contracting Party that becomes a Buyer hereunder, as of the time of execution of a joinder hereto), and as of the entry into of each Purchase Order hereunder, each Party represents to the other Party as follows:

 

(a)

Due Formation. Such Party (i) is a duly formed, validly existing and in good standing under the laws of the jurisdiction of its formation, (ii) has the requisite power and authority to own its properties and carry on its business as now being conducted and currently proposed to be conducted and to execute, deliver and perform its obligations under this Agreement, and (iii) is qualified to do business in every jurisdiction in which failure so to qualify could be reasonably be expected to have a material adverse effect on such Party’s ability to perform its obligations hereunder.

 

(b)

Authorization; Enforceability. Such Party has taken all action necessary to authorize it to execute, deliver and perform its obligations under this Agreement. This Agreement constitutes a legal, valid and binding obligation of such Party enforceable in accordance with its terms, subject to bankruptcy, reorganization, moratorium or other similar laws affecting the enforcement of the rights of creditors generally and subject to general principles of equity.

 

(c)

No Conflict. The execution, delivery and performance by such Party of this Agreement does not and will not (i) violate any Applicable Law, (ii) result in any breach of such Party’s constituent documents or (iii) conflict with, violate or result in a breach of or constitute a default under any agreement or instrument to which such Party or any of its properties or assets is bound or result in the imposition or creation of any lien or security interest in or with respect to any of such Party’s property or assets, other than in each case any such violations, conflicts, breaches or impositions which could not be reasonably be expected to have a material adverse effect on such Party’s ability to perform its obligations hereunder.

 

(d)

No Authorization. No authorization or approval or other action by, and no notice to or filing with, any Governmental Authority or any third party (other than those which have been obtained) is required for the due execution, delivery and performance by such Party of this Agreement, other than any such authorizations, approvals or actions the failure of which to obtain could not reasonably be expected to have a material adverse effect on such Party’s ability to perform its obligations hereunder.

 

(e)

Litigation. Such Party is not a party to any legal, administrative, arbitration or other proceeding, and, to such Party’s knowledge, no such proceeding is threatened, before any Governmental Authority that seeks to restrain or prohibit or otherwise challenge the consummation, legality or validity of this Agreement, the subject matter hereof, or that which could be reasonably be expected to have a material adverse effect on such Party’s ability to perform its obligations hereunder.

 

18.2.

Additional Representations of Supplier.In addition to representations and warranties set forth elsewhere in this Agreement, Supplier hereby represents and warrants as of the Effective Date and as of the entry into of each Purchase Order hereunder as follows:

 

(a)

None of Supplier, its Affiliates or Representatives is the target of or designated under any sanctions program that is established by statute or regulation of the United States, by Executive Order of the President of the United States, or by designations of any department or agency of the United States government including but not limited to those designations reflected in the “list of Specially Designated Nationals and Blocked Persons” of the Office of Foreign Asset Control, U.S. Department of the Treasury;

 

 

(b)

Supplier’s Representatives are legally authorized to work in the United States and Supplier shall complete as required by Applicable Law the Department of Labor’s Form I-9 and to retain it for the statutorily designated period and, if requested by Buyer, Supplier shall provide copies of such Forms I-9 to Buyer unless such disclosure shall be prohibited by Applicable Law;

 

(c)

For Services provided at Buyer’s, it’s customer or third party’s premises, Supplier has examined the worksite in order to acquaint itself with the local conditions, including applicable regulations codes, permits, licenses, registrations, environmental standards, and notification requirements concerning site safety and/or security;

 

Supplier has not and will not, absent prior written approval from Buyer, take any actions that: (i) create, or purport to create, any obligation on behalf of Buyer, or (ii) grant, or purport to grant, any rights or immunities to any third party under Buyer’s intellectual property or proprietary rights; and

 

(d)

The bank account named by Supplier to Buyer for all payments to be effected in connection with any Purchase Order hereunder is held in Supplier’s name and solely for its account.

 

19.

ENVIRONMENT, HEALTH AND SAFETY.

 

19.1.

Compliance and Related Matters.

 

(a)

Each of the Parties shall, in addition to other obligations set forth in this Agreement, during the course of performance of their respective obligations under this Agreement or any Purchase Order issued hereunder:

 

(i)

comply with Applicable Laws concerning health, the environment, safety, or pertaining to or regulating pollutants, contaminants, or hazardous, toxic or radioactive substances, materials or wastes, including without limitation the handling, transportation and disposal thereof, or governing or regulating the health and safety of personnel, including but not limited to the Occupational Safety and Health Act of 1970, the Resource Conservation and Recovery Act, and the Toxic Substance Control Act (“TSCA”), as amended (collectively referred to as “EHS Laws”) (pollutants, contaminants, or hazardous, toxic or radioactive substances, materials or wastes as defined under EHS Laws shall be referred to collectively as “Hazardous Materials”);

 

(ii)

take reasonable and prudent measures, as appropriate, consistent with applicable industry standards, to mitigate hazards to the environment and to the health and safety of persons;

 

 

(iii)

select and use only equipment, including but not limited to personal protection equipment, that comports with EHS Laws, implement programs to train its Representatives in the use of such equipment in a safe and lawful manner, and maintain such equipment in good working order at all times; and

 

(iv)

promptly notify the other Party of any incident involving death, injury or damage to any person or property in connection with any Equipment or Purchase Order.

 

(b)

Supplier shall, in addition to other obligations set forth in this Agreement, during the course of performance of its obligations under this Agreement or any Purchase Order issued hereunder:

 

(i)

ensure that Equipment/Services comply with EHS Laws;

 

(ii)

ensure the Equipment, and any and all parts, components, or material thereof, as Delivered by Supplier, bear all markings, labels, warnings, notices or other information required under applicable EHS Laws at the time of such Delivery; and

 

(iii)

comply with any applicable substance declarations and other requirements set forth in Exhibit C.

 

19.2.

On-Site Environmental and Safety Responsibility. Where the Purchase Order includes the presence of Supplier or its Representatives on the premises of Buyer, Buyer’s customer, or any other location other than the premises of Supplier (“Work Site”), Supplier shall: (1) be responsible for the safety, health, medical surveillance, industrial hygiene, training and all other matters required under EHS Laws relating to safety and health of its Representatives at the Work Site, (2) appoint a competent person as its representative for environmental, health and safety who shall take part in safety discussions with Buyer, its Representatives, customer, or the owner of the Work Site, (3)  be responsible for the handling, use, transportation and disposal of any and all substances regulated under the EHS Laws which Supplier or its Representatives bring onto the Work Site or generate in the performance of Supplier’s work pursuant to the applicable Purchase Order, including but not limited to excess, waste or residue, containers or any of such substances not consumed, and for any spills, releases or discharges of such substances to the extent attributable to acts or omissions of Supplier or its Representatives, strictly in accordance with EHS Laws, and (4) ensure Supplier’s Representatives participate in any site-specific safety training and comply with all rules and requirements of Buyer, its customer, or such other owner of the Work Site, in each case, of which Buyer provides Supplier advance written notice.

 

19.3.

Health and Safety Plan. Prior to commencing any Services at a Work Site, Supplier shall, in accordance with EHS Laws provide and comply with a site specific health and safety plan, Work Site requirements, and shall make the same available to Buyer or its Representatives at Buyer’s request. If Supplier fails to comply with this Article 19, Buyer may, at its sole option and without limiting its other rights, order Supplier or its Representatives to cease Services until Supplier complies at Supplier’s sole cost and expense. If Supplier is unable or refuses to take corrective action hereunder Buyer may contract with a third party or otherwise continue such Services at the Work Site and charge Supplier any excess cost reasonably incurred by Buyer. Buyer shall have the right, at its sole discretion, to remove Supplier or its Representatives from a Work Site for violation of this Article 19.

 

 

20.

OPEN SOURCE SOFTWARE.

 

Supplier shall inform Buyer no later than ten (10) Business Days following receipt of any written request from Buyer in connection with a Purchase Order, whether the Equipment/Services contemplated thereby include “Open Source Software.” As used herein “Open Source Software” means any Software that is licensed royalty-free (i.e., fees for exercising the licensed rights are prohibited, whereas fees for reimbursement of costs incurred by licensor can be permitted) under any license terms or other contract terms (“Open License Terms”) which require, as a condition of use, modification and/or distribution of such Software and/or any other Software incorporated into, derived from or distributed with such software (“Derivative Software”), either of the following: (i) that the source code of such Software and/or any Derivative Software be made available to third parties; or (ii) that permission for creating derivative works of such software and/or any Derivative Software be granted to third parties. If Open Source Software is included, Supplier shall deliver to Buyer, not later than the date of order confirmation, (A) a schedule of all Open Source Software files known to be used, indicating the relevant license(s) to the extent known by Supplier; and (B) a written notice that Supplier is not aware of any violation of such license(s) due to such Use of Open Source Software.

 

21.

EXPORT CONTROL AND FOREIGN TRADE REGULATIONS.

 

21.1.

Acknowledgement and Compliance. The Parties acknowledge that all Equipment to be delivered and Services to be provided according to this Agreement are subject to export control and sanctions laws and regulations, including, without limitation, the U.S. Export Administration Regulations (“EAR”) (15 C.F.R. §§ 730-774), the U.S. Foreign Trade Regulations (15 C.F.R. Part 30), and the regulations, rules, and executive orders administered by OFAC (collectively, the “Export Controls and Sanctions Laws”). Each Party agrees to comply with all Export Controls and Sanctions Laws applicable to any such Equipment/Services and shall not take any action that will cause the other Party to violate or be subject to penalty under the Export Controls and Sanctions Laws.

 

21.2.

Export Licenses. Supplier shall obtain all necessary export licenses, unless Buyer or any party other than Supplier is required to apply for the export licenses pursuant to the applicable Export Controls and Sanctions Laws. To the extent Supplier is requested to deliver Equipment/Services regulated under the Arms Export Control Act or the Atomic Energy Act, Supplier shall advise Buyer in advance of order or contract acceptance.

 

21.3.

Provision of Trade Data. At the request of Buyer, Supplier shall provide Buyer for Equipment and Services delivered the following trade data as applicable: (i) “Export Control Classification Number” according to the EAR’s Commerce Control List (ECCN) or the Munitions List Category Designation according to the US International Traffic in Arms Regulations, and all other export control list numbers; (ii) the statistical commodity code according to the current commodity classification for foreign trade statistics and the HS (Harmonized System) coding; (iii) the country of origin (non-preferential origin); and (iv) Supplier’s declaration for preferential origin (in case of European suppliers) or preferential certificates, Supplier’s declaration for preferential origin (in case of European suppliers) or preferential certificates (in case of non-European suppliers) such as NAFTA certificates of origin.

 

 

21.4.

Changes. In the event Supplier has knowledge of any alterations to origin and/or characteristics of the Equipment/Services, it shall notify the Buyer not later than ten (10) Business Days after discovery thereof.

 

21.5.

Additional Buyer’s Obligations. Buyer agrees that it will not, in violation of applicable Export Controls and Sanctions Laws:

 

(a)

directly or indirectly, export, reexport, or transfer Equipment or Services to, or transship Equipment or Services through, a Sanctioned Country;

 

(b)

directly or indirectly, release, sell, provide, export, reexport, transfer, divert, loan, lease, consign, allow access to, or otherwise dispose of Equipment or Services to a Prohibited Person; or

 

(c)

use Equipment or Services to produce products that will be shipped, sold, or supplied, directly or indirectly, to a Sanctioned Country or a Prohibited Person.

 

21.6.

Certain Relief. No Party shall be obligated to fulfill this Agreement if such fulfillment is prevented by any impediments arising out of national or international foreign trade or customs requirements or any embargoes or other sanctions.

 

22.

CODE OF CONDUCT.

 

Supplier shall comply with the principles and requirements of the "Code of Conduct" attached hereto as Exhibit D (hereinafter the “Code of Conduct”). If and as requested by Buyer, Supplier shall, not more than once a year (at its option), provide to Buyer either (A) a written self-assessment in substantially the form provided by Buyer or (B) a written report reasonably acceptable to Buyer describing the actions taken or to be taken by Supplier to assure compliance with the Code of Conduct. In addition to any other rights and remedies Buyer may have, in the event of Supplier's material or repeated failure to comply with the Code of Conduct, after providing Supplier reasonable notice and a reasonable opportunity to remedy, Buyer may terminate any outstanding Purchase Orders under this Agreement without any liability whatsoever. Material failures include, but are not limited to, incidents of child labor, corruption and bribery. The notice and remedy provisions herein shall not apply to material failures set forth in the preceding sentence.

 

23.

COMPLIANCE WITH LAWS AND PERMITS.

 

The Parties and their Representatives shall comply with all Applicable Laws in the course of the performance of their respective obligations under this Agreement and any Purchase Orders issued hereunder. In addition, Supplier and Buyer shall each obtain all required licenses, permits, authorizations, registrations or approvals required with respect to the performance of their respective obligations under this Agreement and any Purchase Orders issued hereunder.

 

 

24.

DISPUTE RESOLUTION.

 

24.1.

Referral to Senior Management. Except as otherwise provided by this Agreement, any dispute, controversy or claim arising out of or in connection with, or relating to, this Agreement or any breach or alleged breach hereof (which breach or alleged breach by a Party remains uncured within ten (10) Business Days after receipt of written notice thereof from another Party) or the validity or termination hereof or the relationship created between the Parties by and/or through this Agreement (a “Dispute”) shall first be settled as far as possible by good faith negotiations between the parties to the Dispute, in the form of meetings between senior- management level representatives of such Parties, upon the written request by any such Party to the other parties to the Dispute, which writing shall set forth in reasonable detail the nature and extent of the Dispute.

 

24.2.

Referral to Arbitration. If the parties to the Dispute are unable for any reason to resolve a Dispute within thirty (30) days after receipt by any Party of written notice of a Dispute, then any Party may submit the Dispute to arbitration to be finally and exclusively resolved under the Arbitration Rules of the American Arbitration Association (“AAA”) then in effect, except as modified herein, with respect to Equipment and Services to be provided to a Customer with the United States (as applicable, the “Rules”). There shall be three (3) arbitrators. If there are two (2) parties to the Dispute, each of the parties to the Dispute shall nominate one (1) arbitrator in accordance with the Rules. If there are more than two (2) parties to the Dispute, the arbitrators shall be nominated in accordance with the Rules; provided, however, that any Party and its Affiliates shall be entitled to nominate only one (1) such arbitrator. The arbitrators so nominated, once confirmed by the AAA, shall nominate an additional arbitrator to serve as chairman, such nomination to be made within fifteen (15) days of the confirmation by the AAA of the second arbitrator. If the initial arbitrators shall fail to nominate an additional arbitrator within such fifteen (15) day period, such additional arbitrator shall be appointed by the AAA. The arbitrators shall be required to submit a written statement of their findings and conclusions. Except as otherwise agreed by the parties to such Dispute, exclusive venue of arbitration with the AAA will be Wilmington, Delaware, and the language of the arbitration shall be English. Each of the Parties will submit to the non-exclusive jurisdiction of the state and federal courts located in Wilmington, Delaware for preliminary relief in aid of arbitration and for the enforcement of any arbitral award from AAA. By agreeing to arbitration, the Parties do not intend to deprive any national court of its jurisdiction to issue any pre-arbitral injunction, pre-arbitral attachment or other order in aid of arbitration proceedings.

 

24.3.

Neutral Arbitrators. None of the Parties or the arbitrators shall select any arbitrator for the arbitral tribunal who has any interest in the Dispute or who has, or within the immediately preceding five (5) years has had, any economic or other relationship with any party to the Dispute.

 

24.4.

Procedures and Costs. The arbitrators shall not have the right to award consequential, incidental, indirect, special, treble, multiple or punitive damages. The arbitral tribunal shall not be empowered to decide any dispute ex aequo et bono or amiable compositeur, and the arbitral tribunal shall decide the Dispute under the substantive laws of the State of Delaware, without regard to applicable choice of law provisions thereof. The arbitration award shall be decided by majority opinion and issued in writing in the English language and shall state the reasons upon which it is based. It may be made public only with the consent of each participating Party or as may be required by law or regulatory authority or as necessary for enforcement of such award. The arbitrators shall allocate the fees and costs of the arbitration. The losing Party(ies) shall pay the prevailing Party(ies)’ attorney’s fees and costs and the costs associated with the arbitration, including the expert fees and costs and the arbitrators’ fees and costs borne by the prevailing Party(ies), all as determined by the arbitrators. Each Party shall bear its own fees and costs until the arbitrators determine which, if any, Party is the prevailing Party(ies) and the amount that is due to such prevailing Party(ies).

 

 

24.5.

Award. The award rendered by the arbitrators shall be final and binding on the participating Parties and shall be the sole and exclusive remedy between and among the participating Parties regarding any claims, counterclaims, issues or accounting presented to the arbitral tribunal. The award shall be issued no later than one hundred twenty (120) days from the signing or ratification of the Terms of Reference (as defined in the Rules) or as soon thereafter as practicable. The award shall be paid within thirty (30) days after the date it is issued and shall be paid in U.S. Dollars in immediately available funds, free and clear of any Liens, Taxes or other deductions. A judgment confirming or enforcing such award may be rendered by any court of competent jurisdiction.

 

24.6.

Confidentiality. The arbitration shall be confidential. No Party may disclose the fact of the arbitration, any award relating thereto or any settlement relating to any Dispute without the prior consent of the other Party(ies); provided, that such matters may be disclosed without the prior consent of the other Party(ies) to lenders, auditors, tax or other Governmental Authority or as may be required by law or regulatory authorities or as necessary to enforce any award.

 

24.7.

Continued Performance; Provisional Remedies. Notwithstanding the existence of any Dispute, the Parties shall continue to perform their respective obligations under this Agreement unless the Parties otherwise mutually agree in writing. Notwithstanding anything in this Agreement to the contrary, nothing in this Agreement is intended to, nor shall it, prevent the Parties from seeking temporary injunctive relief at any time as may be available under Law or in equity to preserve its rights pending the outcome of any arbitration. Without prejudice to such provisional remedies as may be available under the jurisdiction of a national court, the arbitral tribunal shall have full authority to grant provisional remedies or order the Parties to request that a court modify or vacate any temporary or preliminary relief issued by a court, and to award damages for the failure of any Party to respect the arbitral tribunal’s orders to that effect. The Parties agree that any issue regarding the arbitrability of any claims or disputes arising under, relating to or in connection with this Agreement is an issue solely for the arbitrators, not a court, to decide.

 

24.8.

Waiver of Jury Trial. THE PARTIES HEREBY EXPRESSLY WAIVE ALL RIGHTS TO TRIAL BY JURY OR OTHERWISE ON ANY CLAIM, CAUSE OF ACTION, SUIT OR PROCEEDING PERMITTED UNDER THIS ARTICLE 24. THE PROVISIONS OF THIS AGREEMENT RELATING TO WAIVER OF TRIAL BY JURY SHALL SURVIVE THE TERMINATION OR EXPIRATION OF THIS AGREEMENT.

 

25.

MISCELLANEOUS.

 

25.1.

Governing Law. This Agreement shall be controlled by and construed in accordance with the substantive laws of the State of Delaware without regard to conflict of laws principles. The United Nations Convention on Contracts for the International Sale of Equipment of April 11, 1980 shall be excluded.

 

25.2.

Records. Supplier and its Representatives shall maintain accurate and complete records of all contracts, papers, correspondence, copybooks, applications, accounts, invoices, and/or other information reasonably relating to this Agreement and any Purchase Orders issued hereunder (collectively, “Records”) in accordance with recognized commercial accounting practices, and shall retain such Records for a period of seven (7) years unless a longer period is required under Applicable Law.

 

 

25.3.

Intentionally Omitted.

 

25.4.

Insurance. Supplier and its Representatives shall comply with the Insurance requirements set forth in Exhibit E attached hereto.

 

25.5.

Assignment; Successors. Neither Party may assign all or any part of this Agreement or any Purchase Order issued hereunder, or any rights or obligations hereunder or thereunder, without the prior written consent of the other Party, which consent shall not be unreasonably withheld. Any purported assignment which fails to comply with the requirements of this Section 25.5 shall be null and void. Notwithstanding the foregoing: (i) either Party may, without the prior written consent of the other Party, assign all or any part of this Agreement or any Purchase Order issued hereunder, or any rights or obligations hereunder or thereunder, to an Affiliate, which will accept such assignment and assume all obligations related to this Agreement and any applicable Purchase Orders (including by executing a joinder to this Agreement in the form of Exhibit B hereto); provided  that, notwithstanding any such assignment, the assigning Party shall not be relieved of any of its obligations hereunder by reason of such assignment and shall remain liable hereunder to the same degree that the assigning Party would be responsible had there been no assignment.

 

25.6.

Subcontracting. Supplier shall be solely responsible for the proper selection, supervision, acts and omissions of its subcontractors.

 

25.7.

Other Terms and Amendments. The terms and conditions contained in any sales order, acknowledgment, invoice, website, letter, writing, software or file (such as “clickwrap”, “shrinkwrap”, or website terms of use), or other document or medium shall not be applicable or amend this Agreement or any Purchase Order issued hereunder nor bind the Parties hereto or their Affiliates or Representatives. This Agreement and any Purchase Order issued hereunder may only be amended by a written instrument signed by authorized Representatives of the Parties.

 

25.8.

Government Contracts. When the Equipment/Services are to be used in the performance of a contract or subcontract with a Governmental Authority, applicable government contract requirements attached to this Agreement shall apply and are incorporated herein by reference.

 

25.9.

Relationship of the Parties. Nothing contained in this Agreement shall be construed as creating a partnership, joint venture, agency, employee-employer relationship, trust or other association of any kind between the Parties and each Party shall be individually responsible only for its obligations as set forth in this Agreement. Any Services provided by Supplier, its Affiliates and Representatives pursuant to this Agreement are provided as independent contractors of Buyer and not in the capacity of an employee or agent of Buyer.

 

25.10.

Publicity. No Party hereto shall refer to or use, or permit any persons to refer to or use, any other Party’s name, trademarks, service marks or logos in any advertising, promotional materials, press releases or other publicity without obtaining the prior written consent of the applicable Party.

 

 

25.11.

Non-Exclusive Remedies and Non-Waivers. No delay or omission by the Parties in exercising any right or remedy provided for herein shall constitute a waiver of such right or remedy nor shall it be construed as a bar to or waiver of any such right or remedy on any future occasion. Any waiver authorized on one occasion must be made in writing and is effective only in that instance and only for the purpose stated, and does not operate as a waiver on any future occasion. The rights and remedies of the Parties herein shall not be exclusive and are in addition to any other rights and remedies provided by Applicable Law or in equity.

 

25.12.

Severability. Any provision of this Agreement or any Purchase Order issued hereunder that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective only to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof (provided the substance of the agreement between the Parties is not thereby materially altered), and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. To the extent permitted by Applicable Laws, the Parties hereto hereby waive any provision of Applicable Law which renders any provision hereof prohibited or unenforceable in any respect.

 

25.13.

Survival. The Title and Risk of Loss, Warranties, Intellectual Property, Defaults and Remedies, Indemnification, Limitations of Liability, Confidentiality, Export Control and Foreign Trade Regulations, Dispute Resolution and Miscellaneous sections of this Agreement, and any provision that contemplates performance or observance subsequent to termination or expiration shall survive termination or expiration of this Agreement.

 

25.14.

Affirmative Action. Supplier shall, to the extent applicable, comply with Buyer’s requirements as promulgated by the U.S. Department of Labor, Office of Federal Contract Compliance Programs set forth in Exhibit F.

 

25.15.

Complete Agreement and Counterparts. This Agreement, together with all Purchase Orders issued hereunder, shall constitute the entire agreement between Buyer and Supplier and shall supersede all previous communications, representations, agreements or understandings, whether oral or written, with respect to the subject matter hereof. The headings used in this Agreement are for reference and shall not limit or affect the meaning or interpretation of any of the terms hereof. Upon the effectiveness of this Agreement, if at all, the Prior Agreement shall be deemed amended and restated and superseded and replaced in its entirety by this Agreement, and shall be of no further force or effect.

 

25.16.

Counterparts. This Agreement may be executed in multiple counterparts, each of which when so executed and delivered shall constitute a duplicate original and all counterparts together shall constitute one and the same instrument. Transmission of the executed signature page of a counterpart of this Agreement by electronic mail shall be effective as delivery of an executed counterpart of this Agreement.

 

25.17.

No Pre-Printed Terms. Pre-printed terms or conditions in any invoice, quotation, shipping notice or order acknowledgement issued by Buyer or Supplier shall be of no force or effect, except to the extent included in a Pricing Notice. The terms and conditions applicable to each Purchase Order issued by Buyer shall be those set forth herein and in such Purchase Order and the applicable Pricing Notice therefor.

 

 

25.18.

Priority. In the event of inconsistency between or among the provisions of this Agreement, a Purchase Order and the applicable Pricing Notice therefor, the following order of precedence, from highest to lowest, shall govern:

 

(a)

mutually agreed Change Orders;

 

(b)

Purchase Order;

 

(c)

this Agreement.

 

25.19.

Notices.

 

(a)

All notices and other communications which either Party is required or may desire to serve upon the other shall be addressed to the Party to be served as follows, unless a different address is designated in writing by the Party to be served:

 

To Supplier:

 

Siemens Industry, Inc.
4800 North Point Parkway
Alpharetta, GA 30005
Attn: Craig Langley, Associate General Counsel
Email: langley.craig@siemens.com

 

To Buyer:

 

Fluence Energy, LLC
4601 N. Fairfax Drive, Suite 600
Arlington, VA 22203
Attn: Marek Wolek, SVP – Strategy & Partnerships
Email: marek.wolek@fluenceenergy.com

 

With a copy to:

 

Fluence Energy, LLC
4601 N. Fairfax Drive, Suite 600
Arlington, VA 22203
Attn: Frank Fuselier, General Counsel

Email: frank.fuselier@fluenceenergy.com

 

 

(b)

All notices, requests, consents and other communications under this Agreement must be in writing and shall be deemed to have been duly given and effective (i) immediately (or, if not delivered or sent on a Business Day, the next Business Day) if delivered or sent and received by electronic mail, (ii) on the date of delivery if by hand delivery (or, if not delivered on a Business Day, the next Business Day) or (iii) on the first Business Day following the date of dispatch (or, if not sent on a Business Day, the next Business Day after the date of dispatch) if by a nationally recognized overnight delivery service (all fees prepaid). In the case of notice via email, each Party shall provide confirmation of receipt or non-receipt upon the request of the transmitting Party.

 

(c)

All notices, requests, consents and other communications under this Agreement shall include reference to the applicable Purchase Order number, if any.

 

25.20.

Joint Effort. Preparation of this Agreement has been a joint effort of the Parties and the resulting document shall not be construed more severely against one of the Parties than against the other. Any rule of construction that ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this Agreement, or any amendments or Exhibits hereto.

 

25.21.

Language of the Agreement, Correspondence, Documentation. The language of this Agreement shall be English. Unless to the extent agreed otherwise, correspondence, technical and commercial documents as well as any other information exchanged between the Consortium Members relating to this Agreement shall be in English.

 

[SIGNATURE PAGE FOLLOWS]

 

 

IN WITNESS WHEREOF, intending to be legally bound, the Parties have caused this Agreement to be executed by their duly authorized representatives as of the date first below above.

 

Siemens Industry, Inc.

 

By:
Name:
Title:
By:
Name:
Title:
Fluence Energy, LLC
By:
Name:
Title:
By:
Name:
Title:

 

[Signature Page to Amended and Restated Equipment and Services Purchase Agreement]

 

 

Exhibit A

 

Form of Purchase Order

 

The following sets forth the minimum terms and conditions to be included on a Purchase Order under this Agreement, which terms and conditions may be modified or supplemented by the mutual agreement of the Parties:

 

Equipment:

 

1. Type of Equipment

 

2. Quantity of Equipment

 

3. Unit Price of Equipment

 

4. Total Price of Equipment on this Purchase Order

 

5. Manufacturing Location

 

6. Incoterms and Delivery Location

 

7. Guaranteed Delivery Date

 

8. Insurance

 

9. Equipment Warranty Period

 

10. IP/Software Terms

 

11. Supplier Documents

 

12. Technical Specifications

 

13. Special Packaging Requirements

 

Services:

 

1. Type of Services

 

2. Amount of Services

 

3. Price of Services

 

4. Total Price of Services on this Purchase Order

 

5. Performance Location

 

6. Performance Date(s)

 

7. Insurance

 

8. Services Warranty Period

 

9. IP/Software Terms

 

10. Supplier Documents

 

11. Specifications

 

Other Terms:

 

1. Electronic Banking Method for Payments

 

2. Buyer Furnished Property

 

 

EXHIBIT B

 

Joinder Agreement Template

 

This Joinder Agreement (the "Joinder Agreement") to the Equipment and Services Purchase Agreement, dated January 1, 2018 between Siemens Industry, Inc. and Fluence Energy, LLC is made and entered into

 

by and between

 

___

 

with its registered seat in [Place], [Country]

 

- hereinafter referred to as "Supplier" -

 

and

 

___,

 

with its registered seat in [Place], [Country]

 

- hereinafter referred to as "Buyer" -

 

- Supplier and Buyer are hereinafter individually
referred to as a "Party" and collectively as the "Parties" -

 

 

WHEREAS, Supplier and Fluence Energy, LLC (“Fluence”) entered on January 1, 2018 into the Equipment and Services Purchase Agreement (the "Agreement") which is attached hereto as Annex 1;

 

WHEREAS, Buyer is an Affiliate of Fluence and wishes to become a party to the Agreement and to adopt the terms and conditions thereof, and consequently Supplier and Buyer wish to enter into this Joinder Agreement.

 

NOW THEREFORE, in consideration of the mutual covenants and premises contained herein, the Parties agree as follows:

 

Adoption of the AGREEMENT

 

a)

Buyer hereby acknowledges, agrees and confirms that, by its execution of this Joinder Agreement, Buyer shall be deemed a party to the Agreement for all purposes of the Agreement, and shall have all of the obligations of a “Buyer” under the Agreement, as though an original party to the Agreement. Buyer hereby ratifies, as of the date hereof, and agrees to be bound by, and subject to, all of the covenants, terms, provisions and conditions applicable to “Buyer” contained in the Agreement. The terms and conditions as set out in the Agreement are incorporated herein by reference and are made applicable between the Parties.

 

b)

Without limiting the generality of the foregoing, Buyer hereby represents and warrants that each of the representations and warranties of “Buyer” contained in the Agreement is true and correct as of the date of the execution and delivery of this Joinder Agreement.

 

c)

This Joinder Agreement shall be controlled by and construed in accordance with the substantive laws of the State of Delaware without regard to conflict of laws principles.

 

d)

This Joinder Agreement contains the entire agreement between the Parties and supersedes any and all prior negotiations, correspondence, understandings between the Parties concerning the subject matter hereof. It may not be changed orally, but only by an agreement in writing signed by both Parties hereto.

 

e)

This Joinder Agreement may be executed in multiple counterparts, each of which when so executed and delivered shall constitute a duplicate original and all counterparts together shall constitute one and the same instrument. Transmission of the executed signature page of a counterpart of this Joinder Agreement by electronic mail shall be effective as delivery of an executed counterpart of this Agreement.

 

 

Specific stipulations under this JOINDER Agreement

 

[ONLY country specific deviations from the Agreement are to be stipulated here.]

 

a)

[Delivery and Payment terms]

 

b)

[Term and Termination]

 

c)

[Country specific regulations (jurisdiction, governing law, tax etc.)]

 

d)

...

 

 

Order of Precedence between the Agreement and the Adoption Agreement

 

In the event of any conflict or inconsistency between the terms of this Joinder Agreement and the Agreement, the Joinder Agreement shall prevail over the Agreement.

 

Supplier				Buyer
Place, Date:				Place, Date:
Name:		Name:		Name:		Name:
(Print)		(Print)		(Print)		(Print)
Title:		Title:		Title:		Title:

 

Annex 1: Equipment and Services Purchase Agreement

 

 

Exhibit C

 

Substance Declaration

 

If Supplier furnishes Equipment that is subject to restrictions, rules or regulations for Hazardous Materials or other substances comprising, part of or contained in such Equipment, including but not limited to (1) EHS Laws, including TSCA, (2) other statutes, rules, regulations, codes, rules, standards and requirements governing, controlling or regulating Hazardous Materials, including but not limited to the Restriction on the Use of Certain Hazardous Substances in Electrical and Electronic Equipment (hereinafter “RoHS”), Directives 2002/96/EC and 2012/19/EU as well as their respective incorporation into EU member states’ legislation including any amendments thereto (hereinafter “WEEE”), (3) the Regulation EC 1907/2006 of the European Parliament and of the Council of the European Union concerning the Registration, Evaluation, Authorization and Restriction of Chemicals including any amendment thereto (hereinafter “REACH”), and/or (4) EC Directive 2006/66/EC on Batteries and Accumulators and Waste Batteries and Accumulators, without limiting Supplier’s obligations under this Agreement, Supplier shall comply with the requirements of this “Substance Declaration”.

 

Supplier shall submit to Buyer with the Equipment, a list of the chemical substances contained therein, and/or Material Safety Data Sheets, Safety Data Sheets or other such documentation as required by Applicable Laws (including without limitation the OSHA Hazardous Communication Standard 29 CFR 1910.1200 et seq.). If Supplier furnishes Equipment that is subject to substance restrictions, rules or regulations including but not limited to those identified in this Exhibit, Supplier shall declare such substances on the Buyer web database BOMcheck (www.BOMcheck.net) or, only if and approved in writing in advance by Buyer, in another reasonable format provided to Buyer no later than first delivery date of the Equipment, and Supplier shall prior to Supplier’s first delivery of Equipment complete and comply with the Declarable Substances-Form (hereinafter “Substance Declaration”) in the Buyer supplier portal “c4seasy” or in hard copy forwarded to Buyer. In addition, for Equipment that is subject to substance restrictions, rules or regulations Supplier shall provide Buyer with a safety data sheet required in Article 31 of the Regulation EC 1907/2006 (REACH ) for Equipment that is or contains substances subject to such substance restrictions, rules or regulations, and Supplier shall keep this Substance Declaration up to date. Should a delivery hereunder contain “dangerous goods” as so classified pursuant to Applicable Laws, Supplier shall notify Buyer in writing in sufficient detail to identify the Equipment, the hazards, and the laws, rules or regulations applicable thereto no later than three (3) business days after receipt of the Purchase Order.

 

 

Exhibit D

 

Code of Conduct

 

This Code of Conduct defines the basic requirements placed on Buyer’s suppliers and third party intermediaries concerning their responsibilities towards their stakeholders and the environment. Buyer reserves the right to reasonably change the requirements of this Code of Conduct. In such event Buyer expects the supplier to accept such reasonable changes.

 

The supplier and/or third party intermediary declares herewith:

 

•      Legal compliance 

o            to comply with the laws of the applicable legal Equipment and Services. 

•      Prohibition of corruption and bribery 

o

to tolerate no form of and not to engage directly or indirectly in any form of corruption or bribery and not to grant, offer or promise anything of value to a government official or to a counterparty in the private sector to influence official action or obtain an improper advantage.

•      Fair competition, anti-trust laws and intellectual property rights 

o

to act in accordance with national and international competition laws and not to participate in price fixing, market or customer allocation, market sharing or bid rigging with competitors;

o            to respect the intellectual property rights of others. 

•      Conflicts of interest 

o            to avoid all conflicts of interest that may adversely influence business relationships. 

•      Respect for the basic human rights of employees 

o

to promote equal opportunities for and treatment of its employees irrespective of skin color, race, nationality, social background, disabilities, sexual orientation, political or religious conviction, sex or age;

o            to respect the personal dignity, privacy and rights of each individual; 

o            to refuse to employ or make anyone work against his will; 

o

to refuse to tolerate any unacceptable treatment of employees, such as mental cruelty, sexual harassment or discrimination;

o

to prohibit behavior including gestures, language and physical contact, that is sexual, coercive, threatening, abusive or exploitative;

o

to provide fair remuneration and to guarantee the applicable national statutory minimum wage;

o

to comply with the maximum number of working hours laid down in the applicable laws;

o

to recognize, as far as legally possible, the right of free association of employees and to neither favor nor discriminate against members of employee organizations or trade unions.

•      Prohibition of child labor 

o

to employ no workers under the age of 15 or, in those countries subject to the developing country exception of the ILO Convention 138, to employ no workers under the age of 14.

•      Health and safety of employees 

o            to take responsibility for the health and safety of its employees; 

o

to control hazards and take the best reasonably possible precautionary measures against accidents and occupational diseases;

 

 

o

to provide training and ensure that employees are educated in health and safety issues;

o

to set up or use a reasonable occupational health & safety management system.

•      Environmental protection

o

to act in accordance with the applicable statutory and international standards regarding environmental protection;

o

to minimize environmental pollution and make continuous improvements in environmental protection;

o            to set up or use a reasonable environmental management system 

•      Supply chain 

o

to use reasonable efforts to promote among its suppliers compliance with this Code of Conduct;

o

to comply with the principles of nondiscrimination with regard to supplier selection and treatment.

•      Conflict Minerals 

o

to take reasonable efforts to avoid in its products the use of raw materials which directly or indirectly finance armed groups who violate human rights.

 

 

Exhibit E

 

Insurance

 

(A)  Supplier shall, at its sole expense, maintain, and shall require its Representatives to maintain, the types of insurance coverage(s) listed below. The coverage limits for each type of insurance listed below shall be the greater of: (i) the coverage limits listed below; or (ii) if the applicable Attachments require Supplier to maintain higher limits, then the coverage limits specified in the Attachments. Evidence of insurance required by this Agreement is to be furnished before any Equipment/Services is commenced. Supplier and its Representatives shall maintain such insurance in full force and effect during the term of this Agreement, and, in addition, for as long as Supplier is under any warranty obligations arising out of this Agreement. All insurers on required insurance coverage(s) shall have an A.M. Best Rating of A- /VIII or better. Buyer and its subsidiaries, affiliates, and its or their Representatives, and/or any other party designated on the Face Page as applicable shall be named as an additional insured, with respect to the Commercial General Liability and Automobile Liability policies/coverage(s). All insurance certificates shall be in a form satisfactory to Buyer. Supplier shall deliver the certificates of insurance, naming Buyer and, if applicable, Buyer’s customer, as the Certificate Holder. All of Supplier’s policies of insurance, except for Workers’ Compensation and Employers Liability, shall be primary insurance and noncontributing with any other insurance maintained by Buyer, Buyer’s customer and/or other parties. All of Supplier’s policies of insurance, except for Worker’s Compensation and Employer’s Liability, shall contain a cross-liability or severability of interest clause. The limits of insurance set forth below may be satisfied by any combination of excess and primary insurance coverage. Supplier shall require all its insurers to waive all rights of subrogation against Buyer, Buyer’s customer, and their respective subsidiaries, affiliates, and Representatives, and any other party designated as an additional insured.

 

B) Supplier shall maintain the following insurance coverage(s):

 

Worker's Compensation Insurance in accordance with the statutory requirements of the location in which the Purchase Order is performed. If there is an exposure to injury to Supplier’s employee under the U.S. Longshoremen’s and Harbor Worker’s Compensation Act, the Jones Act or under laws, regulations or statutes applicable to maritime employees, coverage required by law shall be provided for same.

 

Employer's Liability Insurance with the following limits of liability:

 

·      $1,000,000 for each occurrence;

 

·      $1,000,000 Disease Policy

 

·      $1,000,000 Each Employee.

 

Commercial General Liability Insurance, in occurrence coverage form, with minimum limits of $5 million per occurrence, including the following coverages:

 

·      Products and Completed Operations

 

·      Contractual Liability insuring the obligations assumed by Supplier under this Agreement

 

 

·      Premises/Operations

 

·      Underground, Undermining, Explosion and Collapse (XCU) Hazard,

 

·      Supplier’s Contractor’s Protective Liability

 

·      Broad Form Property Damage (including Completed Operations)

 

Automobile Liability Insurance, including coverage for owned, hired, and non-owned automobiles and trucks used by or on behalf of the Supplier providing insurance for bodily injury, liability and property damage liability with minimum limits for each type of coverage of $5,000,000 per occurrence.

 

(C ) The following are required if a Purchase Order involves such exposures: (i) Exposure to Hazardous Materials, then Environmental Impairment Liability Insurance (including Asbestos) with limits of $5,000,000 per occurrence; (ii) Involves watercraft owned, operated or chartered by Supplier or its Representatives, liability arising out of such watercraft shall be insured by the General Liability or by Protection and Indemnity Insurance with a CSL of no less than $1,000,000 per each occurrence; (iii) Involves the hauling and/or rigging of property in excess of $100,000, Supplier shall carry “All Risk” Transit Insurance, or “All Risk” Motor Truck Cargo Insurance (Such insurance shall provide a limit of not less than the replacement cost of the highest value single lift or highest value being moved, whichever is greater, and insuring the interest of Supplier, Buyer and Buyer’s customer, as their respective interests may appear); (iv) Involves aircraft (fixed wing or helicopter) owned, operated or chartered by Supplier or its Representatives, liability arising out of such aircraft shall be insured for not less than $1,000,000 CSL each occurrence. If required by a Purchase Order, Supplier shall obtain insurance covering loss or damage to Buyer or Buyer’s customer’s property under the care, custody and control of Supplier or Supplier’s Representatives on a 100 percent replacement cost basis, and/or if the Equipment/Services involve access, storage, transmission or processing of Buyer’s, its customer’s, its or their Representatives’ confidential information, a Cyber Liability Errors and Omissions Policy shall be procured by Supplier providing coverage, on a per occurrence basis, for acts, errors, omissions, and negligence of employees and contractors giving rise to potential liability, financial and other losses relating to data security and privacy, including cost of defense and settlement, in an amount of at least $2,000,000.

 

(D)  The procurement, maintenance or acceptance of insurance coverage by Buyer, if any, shall not: (i) relieve Supplier of liability for loss or damage in excess of the policy coverage limits specified herein; or (ii) limit or release Supplier of its obligations or liabilities under the Purchase Order.

 

(E)  No delay or failure in declaring any default or in enforcing any of the requirements of this Section, and no course of dealing between Buyer and Supplier shall constitute a waiver of any of the requirements of this Section.

 

 

Exhibit F

 

Affirmative Action

 

Should Buyer become a federal contractor/subcontractor, Buyer will be required to comply with certain federal regulations, including the regulations promulgated by the U.S. Department of Labor, Office of Federal Contract Compliance Programs (“OFCCP”). Should Buyer become a federal contractor, Buyer will also be required to ensure compliance of the OFCCP by its subcontractors, vendors and suppliers covered under the OFCCP (each, a “Covered Party”). Supplier is hereby notified of Buyer’s policy related to affirmative action and its mutual OFCCP obligations to the extent Supplier, its subcontractors, vendors or suppliers is a Covered Party.

 

Buyer is an equal opportunity/affirmative action employer and does not discriminate on the basis of race, color, creed, religion, national origin, ancestry, sex, age, physical or mental disability, marital status, pregnancy, genetic information, sexual orientation, gender identity, protected veteran or military status, or any other consideration not related to the person’s ability to do the job or otherwise made unlawful by federal, state or local law in the following employment practices, including among others: recruiting, hiring, placement, transfer, promotion, demotion, selection for training, layoff, termination, shift assignment, determination of service, rates of pay, benefit plans, and all forms of compensation and other personnel actions.

 

Should Buyer become a federal contractor/subcontractor, Buyer’s Covered Parties (including Supplier and its Covered Parties, if applicable) will also have an obligation to comply with equal opportunity and affirmative action principles. Therefore, Buyer’s Covered Parties (including Supplier and its Covered Parties, if applicable) will take appropriate action in support of these principles. Through our mutual effort and cooperation, we will continue to provide a working environment that appreciates and encourages diversity, promotes equal employment opportunity and is free from any type of discrimination.

 

Supplier and its Covered Parties, if applicable, shall abide by the requirements of the “Equal Opportunity Clause” in Section 202 of Executive Order 11246. See 41 CFR 60-1.4(a).

 

The following shall also apply if the Supplier is a Covered Party:

 

For contracts of $100,000 or more, Supplier shall comply with the following: This Supplier, contractor and subcontractor shall abide by the requirements of 41 CFR 60-300.5(a). This regulation prohibits discrimination against qualified protected veterans, and requires affirmative action by covered prime contractors and subcontractors to employ and advance in employment qualified protected veterans.

 

For contracts of $10,000 or more, Supplier shall comply with the following: This Supplier, contractor and subcontractor shall abide by the requirements of 41 CFR 60-741.5(a). This regulation prohibits discrimination against qualified individuals on the basis of disability, and requires affirmative action by covered prime contractors and subcontractors to employ and advance in employment qualified individuals with disabilities.

 

 

Attachment A

 

DESCRIPTION OF SUPPLIER’S EQUIPMENT AND SERVICES

 

See attached.¹

 

 

¹ Within sixty (60) days of the Effective Date, the Parties agree to discuss and use reasonable efforts to update Attachment A, if mutually desired, to meet the expectations of the Parties.

 

 

 

 

Exhibit 10.22

 

Amended and Restated

 

Storage Core Frame Purchase Agreement

 

 

by and between

 

 

AES Grid Stability, LLC

 

as Buyer

 

and

 

Fluence Energy, LLC

 

as Supplier

 

 

dated [ ● ], 2021

 

 

Table of Contents

 

Page

 

1.	DEFINITIONS; INTERPRETATION	1
1.1.	Definitions	1
1.2.	Interpretation	8
2.	TERM AND TERMINATION OF AGREEMENT	9
2.1.	Term	9
2.2.	Early Termination	9
3.	SCOPE OF AGREEMENT	10
3.1.	Scope Generally	10
3.2.	Further Buyer Contracting Parties	10
4.	ORDERS	10
4.1.	Pricing Requests	10
4.2.	Purchase Orders	10
4.3.	Exclusivity and Certain Related Priorities	11
4.4.	Non-Competition	13
4.5.	Payment Terms	16
4.6.	Disputed Payments	16
4.7.	Late Payments	16
4.8.	Taxes; Export and Import Duties	16
5.	DELIVERY	16
5.1.	Delivery Terms; Inspection	16
5.2.	Guaranteed Delivery Date	17
5.3.	Delay Liquidated Damages	17
5.4.	Buyer Caused Delay	17
6.	TITLE, RISK OF LOSS AND CARE, CUSTODY AND CONTROL	17
6.1.	Transfer of Title and Risk of Loss	17
6.2.	Warranty of Title	17
7.	INSPECTION AND QUALITY CONTROL	18
7.1.	Inspection Rights	18
7.2.	Quality Control	18
8.	WARRANTIES	18
8.1.	Equipment Warranty	18
8.2.	Services Warranty	18
8.3.	Notification Requirements	18
8.4.	Corrective Action	19
8.5.	Warranty Exclusions	19
8.6.	NO IMPLIED WARRANTIES	19
8.7.	Reserved Rights	19
8.8.	Access to Buyer Data	20
9.	BUYER FURNISHED PROPERTY	20
10.	PACKAGING	20
11.	FORCE MAJEURE	21
11.1.	Effect of Force Majeure	21
11.2.	Procedures	21
11.3.	Termination for Extended Force Majeure	21
12.	CHANGE ORDERS	21
12.1.	Change Order	21
12.2.	Change Order Process	22
12.3.	Change Order Restrictions	22
12.4.	No Change	22

 

 

13.	INTELLECTUAL PROPERTY	22
13.1.	Grant of License	22
13.2.	No Copies	23
13.3.	Proprietary Notices	23
13.4.	Security	23
13.5.	No Reverse Engineering	23
13.6.	Open Source Software	23
13.7.	Reporting	23
13.8.	Relief	24
13.9.	Improvements	24
13.10.	Ownership	24
13.11.	Enforcement	25
13.12.	Duration and Transfers	25
13.13.	Government End Users	26
13.14.	Reservation of Rights	26
14.	DEFAULTS AND REMEDIES	26
14.1.	Supplier Defaults	26
14.2.	Buyer Defaults	27
14.3.	Remedies	27
15.	INDEMNIFICATION	27
15.1.	General	27
15.2.	Infringement Indemnification by Supplier	28
15.3.	Infringement Indemnification by Buyer	29
15.4.	Indemnification Procedures	30
15.5.	Limited Waiver of Certain Immunities	31
15.6.	Survival	31
16.	LIMITATIONS OF LIABILITY	31
16.1.	WAIVER OF CERTAIN DAMAGES	31
16.2.	MAXIMUM LIABILITY	31
16.3.	EFFECTIVENESS	31
16.4.	Commencement of Claims	31
17.	CONFIDENTIALITY	32
17.1.	Confidential Information	32
17.2.	Non-Disclosure	32
17.3.	Exceptions	32
17.4.	Representatives Bound	32
17.5.	Survival	32
18.	REPRESENTATIONS AND WARRANTIES	33
18.1.	Representations of the Parties	33
18.2.	Additional Representations of Supplier	34
19.	ENVIRONMENT, HEALTH AND SAFETY	34
19.1.	Compliance and Related Matters	34
19.2.	On-Site Environmental and Safety Responsibility	35
19.3.	Health and Safety Plan	35
20.	OPEN SOURCE SOFTWARE	36
21.	EXPORT CONTROL AND FOREIGN TRADE REGULATIONS	36
21.1.	Acknowledgement and Compliance	36
21.2.	Export Licenses	36
21.3.	Provision of Trade Data	36
21.4.	Changes	37
21.5.	Additional Buyer’s Obligations	37
21.6.	Certain Relief	37

 

 

22.	BUYER CODE OF CONDUCT	37
23.	COMPLIANCE WITH LAWS AND PERMITS	37
24.	DISPUTE RESOLUTION	38
24.1.	Referral to Senior Management	38
24.2.	Referral to Arbitration	38
24.3.	Neutral Arbitrators	38
24.4.	Procedures and Costs	38
24.5.	Award	39
24.6.	Confidentiality	39
24.7.	Continued Performance; Provisional Remedies	39
24.8.	Waiver of Jury Trial	39
25.	MISCELLANEOUS	39
25.1.	Governing Law	39
25.2.	Records	40
25.3.	Intentionally Omitted	40
25.4.	Insurance	40
25.5.	Assignment; Successors	40
25.6.	Subcontracting	40
25.7.	Other Terms and Amendments	40
25.8.	Government Contracts	40
25.9.	Relationship of the Parties	40
25.10.	Publicity	41
25.11.	Non-Exclusive Remedies and Non-Waivers	41
25.12.	Severability	41
25.13.	Survival	41
25.14.	Affirmative Action	41
25.15.	Complete Agreement and Counterparts	41
25.16.	Counterparts	41
25.17.	No Pre-Printed Terms	41
25.18.	Priority	42
25.19.	Notices	42
25.20.	Joint Effort	43
25.21.	Language of the Agreement, Correspondence, Documentation	43

 

Schedule 1.1(a) Applications

 

Exhibits

 

Exhibit A	Form of Purchase Order
Exhibit B	Form of Joinder Agreement
Exhibit C	Substance Declaration
Exhibit D	Code of Conduct
Exhibit E	Insurance
Exhibit F	Affirmative Action Requirements
Exhibit G	Key Agreements

 

Attachment A Description of Supplier’s Battery Storage Equipment and Services

 

 

THIS AMENDED AND RESTATED STORAGE CORE FRAME PURCHASE AGREEMENT (this “Agreement”) is made and entered into on [ ● ], 2021 (the “Effective Date”), between AES Grid Stability, LLC. hereinafter referred to as “Buyer” and Fluence Energy, LLC, whose principal place of business is 4601 N. Fairfax Drive, Suite 600, Arlington, VA 22203 hereinafter referred to as “Supplier”. Each of Buyer and Supplier are referred to herein as a “Party” and collectively are referred to herein as the “Parties.”

 

WHEREAS, Buyer sells electrical transmission and distribution projects to Customers;

 

WHEREAS, Buyer may want to purchase energy storage equipment and related services to incorporate within its electrical transmission and distribution projects;

 

WHEREAS, Supplier sells energy storage equipment and related services;

 

WHEREAS, Supplier wishes to cooperate with Buyer in order to fulfill Buyer’s requirements and provide preferred purchasing conditions to Buyer for those energy storage equipment and related services;

 

WHEREAS, Supplier and Buyer are parties to that certain Storage Core Frame Purchase Agreement, dated as of January 1, 2018, by and between Supplier and Buyer (the “Prior Agreement”); and

 

WHEREAS, Buyer is party to the Second Amended and Restated Limited Liability Company Agreement of Supplier, dated as of June 9, 2021(the “LLC Agreement”);

 

WHEREAS, Supplier, Buyer and certain other parties are entering into a series of transactions in connection with the formation of Fluence Energy, Inc., a Delaware corporation (“Issuer”) to serve as the vehicle through which the public will own indirect interests in Supplier through an initial public offering;

 

WHEREAS, in connection with the closing of the initial public offering, the LLC Agreement is being amended and restated in its entirety by the Third Amended and Restated Limited Liability Company Agreement, dated on or about the date hereof (the “Restated LLC Agreement”), to, among other things, reflect Issuer’s ownership of Supplier and the restructuring of Supplier and its Affiliates; and

 

NOW, THEREFORE, the Parties agree that on the Effective Date the Prior Agreement is hereby amended and restated in its entirety by this Agreement, and further agree as follows:

 

1.

DEFINITIONS; INTERPRETATION.

 

1.1.

Definitions. Initially-capitalized terms used in this Agreement (including the preamble and Recitals hereto) and not otherwise defined herein shall have the meanings specified below.

 

“Affiliate” means, at any time, and with respect to any Person or group of Persons, a Person that at such time directly or indirectly through one or more intermediaries, Controls, is Controlled by, or is under common Control with such Person or group of Persons. No Person shall be considered an Affiliate of another Person or under the Control of such other Person so long as (i) it is owned less than 50% by such other Person, (ii) such other Person has no capacity to elect or appoint the majority of the board of directors or similar governing body of the subject Person, (iii) such other Person does not consolidate the subject Person in its financial reporting and (iv) there is no other management or services agreement pursuant to which such other Person exerts control over the subject Person.

 

 

“Agreement” has the meaning set forth in the Preamble hereto.

 

“Applicable Law” means any applicable constitutional provision, statute, act, code, law, regulation, rule, ordinance, order, decree, ruling, proclamation, resolution, judgment, decision or declaration of a Governmental Authority having valid jurisdiction.

 

“Application” means one of the stationary, battery based energy storage solutions and services for the grid connected storage market (including systems both in front of and behind the meter) set forth on Schedule 1.1(a).

 

“Battery” means a battery included within the Equipment supplied pursuant to this Agreement.

 

“Business Day” means any day except a Saturday, Sunday or other day on which commercial banks in New York, New York are authorized or required by law to close.

 

“Buyer” has the meaning set forth in the Preamble hereto.

 

“Buyer Data” has the meaning set forth in Section 13.10(b).

 

“Buyer Event of Default” has the meaning set forth in Section 14.2.

 

“Buyer Furnished Property” has the meaning set forth in Article 9.

 

“Change Order” has the meaning set forth in Section 12.1.

 

“Change Order Information” has the meaning set forth in Section 12.2.

 

“Claims” has the meaning set forth in Section 15.1.

 

“Confidential Information” has the meaning set forth in Section 17.1.

 

“Control” means, with respect to the relationship between two or more Persons, the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through ownership of voting securities, as trustee or executor, by contract or otherwise. The terms “Controlled” or “under common Control with” have correlative meanings.

 

“Defect” means any material defect in design, manufacturing, materials or workmanship in or to the Equipment, or any failure of the Equipment to materially comply with the Technical Specifications, excluding in all cases any of the foregoing attributable to or caused by ordinary wear and tear of the Warranted Equipment.

 

“Deliver”, “Delivered” or “Delivery” means that Supplier has caused the delivery of the applicable Equipment to the Delivery Point in accordance with the terms of this Agreement.

 

 

“Delivery Point” means the delivery location set forth in a Pricing Notice, provided that, if no such location is specified in the applicable Pricing Notice, the Delivery Point for Equipment comprised of batteries shall be at the facility of the supplier thereof and the Delivery Point for all other Equipment shall the location of Supplier’s facility.

 

“Derivative Software” has the meaning set forth in Article 20.

 

“EAR” has the meaning set forth in Section 21.1.

 

“Effective Date” shall have the meaning assigned to such term in Section 2.1.

 

“EHS Laws” has the meaning set forth in Section 19.1.

 

“Enforcement Action” has the meaning set forth in Section 13.11.

 

“Equipment” means any energy storage equipment offered for sale by Supplier pursuant to this Agreement, as set forth in Attachment A.

 

“Equipment Warranty” has the meaning set forth in Section 8.1.

 

“Equipment Warranty Period” has the meaning set forth in Section 8.1.

 

“Exclusive Activities” means the development, marketing and sale of an Integrated Solution for one or more Applications, where the size of such Integrated Solution is equal to or greater than 500 kilowatts, including those Integrated Solutions marketed, sold and delivered through a Buyer sales channel or another Supplier sales channel as contemplated in Supplier’s then current business plan.

 

“Export Controls and Sanctions Laws” has the meaning set forth in Section 21.1.

 

“Force Majeure” means any event which is not within the reasonable control of the Party affected and with the exercise of due diligence could not reasonably be prevented, avoided or removed by such Party, which causes the affected Party to be delayed, in whole or in part, or unable, using commercially reasonable efforts, to partially or wholly perform its obligations under this Agreement (other than an obligation for the payment of money) and is not caused by or resulting from the negligence or breach or failure of such Party to perform its obligations under this Agreement, which, subject to the foregoing, may include: acts of God or the public enemy, natural disasters, war, terrorism, insurrection, sabotage, unavoidable accidents, orders, decrees, rulings and policies of any Governmental Authority, fires, floods, earthquakes, volcanic activity, severe weather conditions not reasonably foreseeable taking into account the location of performance and the climate patterns applicable thereto, explosions, riots, general strikes and area lockouts. Force Majeure shall not include a Party’s financial inability to perform under this Agreement or any Purchase Order.

 

“Further Buyer Contracting Parties” has the meaning set forth in Section 3.2.

 

“Governmental Authority” means a federal, state, local or foreign governmental authority (including any regulatory authority); a state, province, commonwealth, territory or district thereof; a county; a city, town, township, or other municipality; a district, ward or other subdivision of any of the foregoing; any executive, legislative or other governing body of any of the foregoing; any agency, authority, board, department, system, service, office, commission, committee, council or other administrative body of any of the foregoing; any court or other judicial body; and any officer, official or other representative of any of the foregoing.

 

 

“Guaranteed Delivery Date” has the meaning set forth in Section 5.2.

 

“Hazardous Materials” has the meaning set forth in Section 19.1.

 

“Indemnified Party” has the meaning set forth in Section 15.1.

 

“Indemnifying Party” has the meaning set forth in Section 15.1.

 

“Infringement Claim Costs” means any and all judgments, damages, fines, awards, penalties, and interest associated with any of the foregoing, that, in each case, are finally awarded in a claim for which an Indemnifying Party is obligated to indemnify an Indemnified Party under Section 15.2 or 15.3, as applicable, and costs and expenses, including reasonable attorneys’ fees, court costs and other reasonable costs of suit, arbitration, dispute resolution or other similar proceedings, associated with such claim.

 

“Integrated Solution” means an integrated, stationary, battery based energy storage solution, comprised of inverters, a control system including software, and electrical battery. Notwithstanding the foregoing, the following will not be considered Integrated Solutions: (i) uninterruptable power supply (UPS) systems (other than for use in Applications), (ii) a virtual energy storage network built out of individual, connected, geographically distributed product units of less than 150 kilowatts per unit (a “swarm”), (iii) static synchronous compensators (Statcom), (iv) supercapacitors, (v) the technology for the storage medium (e.g. batteries), (vi) energy storage inverters, (vii) stationary storage systems sold as part of an integrated product in conjunction with the sale of energy storage systems on board of vessels, vehicles or locomotives, where the main purpose of the stationary storage system is to charge or to be charged by such on board energy storage system or the vehicle brake energy and (viii) stationary storage systems providing power directly and primarily to electric vehicle charging stations.

 

“Intellectual Property” means United States and foreign: (a) Patents; (b) Trademarks; (c) copyrights, whether registered or unregistered, and all applications and registrations therefor, web sites, proprietary domain names, mask works, and all applications and registrations therefor; (d) Know-How; (e) Software; and (f) similar or other intellectual property rights, subject matter of any of the foregoing, tangible embodiments of any of the foregoing, licenses in, to and under any of the foregoing.

 

“Key Agreements” means the various contracts between Supplier and certain of its members or their Affiliates listed on Exhibit G, as the same may be amended and/or restated from time to time.

 

“Know-How” means all proprietary and confidential information and data (irrespective as to whether such information or data is available by way of documentation, orally or in electronic format, or protected by copyrights), including business and trade secrets, technical and business information and data, know-how and similar proprietary rights in confidential information and processes, discoveries, analytic models, improvements, techniques, devices, methods, patterns, formulations and specifications, all to the extent that such information and data are proprietary and confidential and neither Software nor a Patent.

 

 

“License” has the meaning set forth in Section 13.1.

 

“Licensed Technology” means, collectively, all of the following to the extent owned by, or licensed (with the right to grant sublicenses) to, Supplier, relating to the Equipment or the uses and purposes contemplated in connection with this Agreement or any Purchase Order issued hereunder for such Equipment: (a) Software embedded in or integrated with the Equipment, (b) any other trade secrets, proprietary information, know-how or other Intellectual Property incorporated into or embedded within the Equipment or necessary for the installation, operation, maintenance, and ownership of the Equipment, (c) any improvements of or updates to any of the foregoing provided to Buyer pursuant to this Agreement, if any, and (d) all Intellectual Property rights of Supplier in the Licensed Technology listed in any of clauses (a) through (d) above, in each case, for use solely in connection with the installation, commissioning, operation and maintenance of the Equipment at the Project Site or such other site as Buyer shall elect.

 

“LLC Agreement” has the meaning set forth in the Recitals hereto.

 

“OFAC” means the Office of Foreign Assets Control of the U.S. Department of the Treasury.

 

“Open License Terms” has the meaning set forth in Article 20.

 

“Open Source Software” has the meaning set forth in Article 20.

 

“Party” has the meaning set forth in the Preamble hereto.

 

“Parties” has the meaning set forth in the Preamble hereto.

 

“Patents” means all patents, utility models, patent and utility model applications, and all priorities and rights related thereto, including all reissues, reexaminations, divisions, continuations, continuations-in-part, provisionals, continued prosecution applications, substitutions, extensions, additions or renewals of any of the foregoing.

 

“Person” means any natural person, corporation, partnership, joint venture, trust, estate, unincorporated association, limited liability company or any other entity (whether or not having separate legal personality), and shall include any successor (by merger or otherwise) of such entity.

 

“Potential Project” shall have the meaning assigned to such term in Section 4.3(b)(ii).

 

“Pricing Notice” has the meaning set forth in Section 4.1.

 

“Pricing Request” has the meaning set forth in Section 4.1.

 

 

“Prohibited Person” means (i) any individual or entity that has been determined by competent authority to be the subject of a prohibition in any law, regulation, rule, or executive order administered by OFAC or the U.S. Department of State; (ii) the government, including any political subdivision, agency or instrumentality thereof, of a Sanctioned Country; (iii) any individual or entity that acts on behalf of or is owned or controlled by the government of a Sanctioned Country; (iv) any individual or entity that has been identified on the OFAC Specially Designated Nationals and Blocked Persons List (Appendix A to 31 C.F.R. Ch. V) or any other similar list published by OFAC, including, but not limited to, the Foreign Sanctions Evaders List, the Part 561 List, and the Non SDN Iranian Sanctions List; (v) any individual or entity that has been designated on any similar list or order published by the United States government, including, without limitation, the Denied Persons List, Entity List, or Unverified List of the U.S. Department of Commerce, or the Debarred List or Nonproliferation Sanctions List of the U.S. Department of State; or (vi) any entity beneficially owned or controlled, directly or indirectly, by, any of the individuals or entities listed in subparagraphs (i)-(v) above.

 

“Project Bid” shall have the meaning assigned to such term in Section 4.3(c)(iv).

 

“Prudent Industry Practices” means those practices, methods, specifications and standards of safety, performance, dependability, efficiency and economy generally recognized by electrical utility industry members, including Supplier, in the U.S. as good and proper, and such other practices, methods or acts which, in the exercise of reasonable judgment by those reasonably experienced in the industry in light of the facts known at the time a decision is made, would be expected to accomplish the result intended at a reasonable cost and consistent with Applicable Laws, reliability, safety and expedition. Prudent Industry Practices are not intended to be limited to the optimum practices, methods or acts to the exclusion of all others, but rather to be a spectrum of good and proper practices, methods and acts.

 

“Purchase Order” means a purchase order in the form attached hereto as Exhibit A issued for the purchase of Equipment and Services pursuant to and in accordance with the terms and conditions of this Agreement.

 

“Representatives” means, with respect to any Person, such Person’s shareholders, members, officers, directors, employees, accountants, consultants, legal counsel, financial advisors and other representatives and agents.

 

“Revised Project Bid” shall have the meaning assigned to such term in Section 4.3(b)(v).

 

“Sanctioned Country” means any country or territory against which the United States maintains comprehensive economic sanctions or embargoes, including, without limitation, Crimea, Cuba, Iran, North Korea, Sudan and Syria.

 

“Services” means any Equipment related services offered for sale by Supplier pursuant to this Agreement, as set forth in Attachment A.

 

“Services Warranty” has the meaning set forth in Section 8.2.

 

“Services Warranty Period” has the meaning set forth in Section 8.2.

 

“Shares” means (i) the Class A Common Stock of the Issuer, calculated on a fully diluted basis and assuming that all options, warrants and any other rights to purchase shares of Class A Common Stock of the Issuer have been exercised in full, including, for sake of clarity, the Underlying Class A Shares plus (ii) any other equity securities now or hereafter issued by the Issuer, together with any options thereon and any other shares of stock or other equity securities issued or issuable with respect thereto (whether by way of a stock dividend, stock split or in exchange for or in replacement or upon conversion of such shares or otherwise in connection with a combination of shares, recapitalization, merger, consolidation or other corporate reorganization); provided, however, that in no event shall the Shares include the Class B Common Stock of the Issuer.

 

 

“Siemens Storage Core Frame Purchase Agreement” means that certain Amended and Restated Storage Core Frame Purchase Agreement, dated as of even date herewith, between Siemens Industry, Inc. and Supplier.

 

“Software” means all computer programs, operating systems, applications, systems, firmware, and software of any nature, whether operational, active, under development, or design, non-operational or inactive, including all object code, source code, comment code, algorithms, processes, formulae, interfaces, navigational devices, menu structures or arrangements, icons, operational instructions, scripts, commands, syntax, screen designs, reports, designs, concepts, visual expressions, technical manuals, test scripts, user manuals, and other documentation therefore, whether in machine-readable form, programming language, or any other language or symbols, and whether stored, encoded, recorded, or written on disk, tape, film, memory device, paper, or other media of any nature and all databases necessary or appropriate to operate any such computer program, operating system, applications system, firmware, or software.

 

“Subsidiary” means, with respect to any Person, any corporation, limited liability company, partnership, association or business entity of which (a) if a corporation, a majority of the total voting power of shares of stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person or a combination thereof, or (b) if a limited liability company, partnership, association or other business entity (other than a corporation), a majority of partnership or other similar ownership interest thereof is at the time owned or controlled, directly or indirectly, by any Person or one or more Subsidiaries of that Person or a combination thereof. For purposes hereof, a Person or Persons shall be deemed to have a majority ownership interest in a limited liability company, partnership, association or other business entity (other than a corporation) if such Person or Persons shall be allocated a majority of limited liability company, partnership, association or other business entity gains or losses or shall be or control any managing member, general partner or analogous controlling Person of such limited liability company, partnership, association or other business entity. For purposes hereof, references to a “Subsidiary” of any Person shall be given effect only at such times that such Person has one or more Subsidiaries.

 

“Sunset Date” means the earlier to occur of (i) the seventh (7^th) anniversary of the Effective Date and (ii) that date on which Buyer and Affiliates collectively hold Shares representing less than twenty percent (20%) of the then outstanding Voting Power.

 

“Supplier” has the meaning set forth in the Preamble hereto.

 

“Supplier Documents” means the documents and deliverables to be provided by Supplier to Buyer to the extent reasonably required for the installation, commissioning, operation and maintenance of the Equipment, as more fully set forth in the applicable Purchase Order.

 

 

“Supplier Event of Default” has the meaning set forth in Section 14.1.

 

“Taxes” means any and all forms of taxation, charges, duties, imposts, levies and rates whenever imposed by any Governmental Authority, including income tax, withholding tax, corporation tax, capital gains tax, capital transfer tax, sales tax, business and occupation tax, inheritance tax, water rates, value added tax, customs duties, capital duty, excise duties, betterment levy, stamp duty, stamp duty reserve tax, national insurance, social security or other similar contributions, and generally any tax, duty, impost, levy, rate or other amount and any interest, penalty or fine in connection therewith.

 

“Technical Specifications” means the technical specifications for the Equipment as set forth in the applicable Purchase Order.

 

“Term” has the meaning set forth in Section 2.1.

 

“Terminating Event” shall have the meaning assigned to such term in Section 4.3(a)(i).

 

“Territory” means (i) for purposes of the sales and marketing by Buyer of the Equipment, worldwide and (ii) for all other use of the Equipment, the country in which the Equipment is installed for use.

 

“Third Party” means any Person, other than a member of Supplier or such member’s Affiliates.

 

“Trademarks” means all trademarks, trademark applications, service marks, service mark applications, trade dress, trade names, identifying symbols, words, colors, designs, product names, company names, slogans, logos or insignia, whether registered or unregistered, and all applications and registrations therefor, and all goodwill associated therewith.

 

“TSCA” has the meaning set forth in Section 19.1.

 

“Underlying Class A Shares” means all shares of Class A Common Stock of the Issuer issuable upon redemption of Common Units of the Supplier, assuming all such Common Units are redeemed for Class A Common Stock of the Issuer on a one-for-one basis.

 

“Voting Power” means the total voting power of all Shares entitled to vote generally in the election of directors.

 

“Work Site” has the meaning set forth in Section 19.2.

 

1.2.

Interpretation.

 

(a)

References to Recitals, Articles, Sections, Exhibits, Annexes and Attachments are, unless otherwise indicated, to Recitals, Articles, Sections, Exhibits, Annexes and Attachments to this Agreement. All Exhibits, Annexes and Attachments to this Agreement are incorporated herein by this reference and made a part hereof for all purposes.

 

 

(b)

As used in this Agreement, the masculine gender shall include the feminine and neuter and the singular number shall include the plural, and vice versa.

 

(c)

Unless expressly stated otherwise, references to a Person include its successors and permitted assigns and, in the case of a Governmental Authority, any Person succeeding to its functions and capacities.

 

(d)

As used in this Agreement, references to “days” shall mean calendar days, unless the term “Business Days” is used. If the term “Business Days” is used and the time for performing an obligation under this Agreement expires on a day that is not a Business Day, the time shall be extended until that time on the next Business Day.

 

(e)

As used in this Agreement, where a word or phrase is specifically defined, other grammatical forms of such word or phrase have corresponding meanings; the words “herein,” “hereunder” and “hereof” refer to this Agreement, taken as a whole, and not to any particular provision of this Agreement; “including” means “including, for example and without limitation,” and other forms of the verb “to include” are to be interpreted similarly.

 

(f)

As used in this Agreement, all references to a given agreement, instrument or other document shall be a reference to that agreement, instrument or other document as modified, amended, supplemented and restated through the date as of which such reference is made. Any term defined or provision incorporated in this Agreement by reference to another document, instrument or agreement shall continue to have the meaning or effect ascribed thereto whether or not such other document, instrument or agreement is in effect.

 

2.

TERM AND TERMINATION OF AGREEMENT.

 

2.1.

Term. This Agreement shall become effective and the term shall commence on the day on which the Class A Common Stock of the Issuer is issued to the underwriters in its initial public offering (the “Effective Date”); provided, that if the Effective Date does not occur on or prior to December 31, 2021, this Agreement shall be deemed terminated as of such date and of no force or effect without further notice or action by the Parties, and the Prior Agreement shall remain in full force and effect without any amendment thereto. The term of this Agreement shall continue from the Effective Date until the date that the obligations contained in Section 4.4(a) (Non-Competition) cease to apply to Buyer (the “Term”). The expiration or early termination of the Term of this Agreement shall not affect any Purchase Orders executed between the Parties prior to the date of termination or expiration, and in such event the Parties shall attempt, in fair dealing and good faith, to agree on reasonable post-termination or post-expiration procedures in compliance with Applicable Law and antitrust requirements.

 

 

3.

SCOPE OF AGREEMENT.

 

3.1.

Scope Generally. This Agreement shall apply to all purchases by Buyer from Supplier of Equipment and Services during the Term. Notwithstanding the foregoing, nothing herein shall be construed to mean that either Buyer or Supplier is committing to any specific level of business or quantity of Equipment and Services to be purchased or supplied other than that specified in Purchase Orders issued to Supplier during the Term of this Agreement by Buyer. Attachment A hereto sets forth the various standard Equipment and Services offerings of Supplier, it being understood that any project-specific requirements associated with any particular order hereunder shall be as set forth in the applicable Purchase Order therefor. Supplier may from time to time update the Equipment and Services offered for sale hereunder by furnishing to Buyer an update to Attachment A hereto, it being agreed that no such update shall affect any previously issued Purchase Order unless and to the extent set forth in a Change Order thereto.

 

3.2.

Further Buyer Contracting Parties. The AES Corporation and its Subsidiary companies (hereinafter referred to as “Further Buyer Contracting Parties”) shall be entitled to conclude individual Purchase Orders under the terms of this Agreement provided that such Further Buyer Contracting Parties either: (a) execute a joinder agreement acceptable to Supplier and otherwise in the form of Exhibit B hereto or (b) agree that the terms of this Agreement will govern the subject transaction by including a conspicuous cross-reference in the applicable Purchase Order which confirms that the terms of this Agreement will apply to the Purchase Order.

 

4.

ORDERS.

 

4.1.

Pricing Requests. If Buyer desires to purchase Equipment and Services from Supplier during the Term, Buyer shall furnish Supplier with written request (a “Pricing Request”) detailing the Equipment and Services it wishes to purchase and requesting pricing therefor from Supplier, including in such Pricing Request such information as may be reasonably necessary for Supplier to determine pricing therefor and any other project-specific requirements, including Buyer’s requested delivery schedule. Supplier shall endeavor to provide an initial response to any Pricing Request within five (5) Business Days, indicating (i) whether or not Supplier intends to furnish an offer to Buyer for the requested Equipment and Services on the timeline requested by Buyer and (ii) indicating what, if any, additional information Supplier may need in order to furnish such offer. Within fourteen (14) days after a final written scope of work is agreed with Buyer, or one of its Affiliates, Supplier shall provide Buyer with a written notice (a “Pricing Notice”) detailing Supplier’s pricing and delivery schedule for the Equipment and Services that Buyer wishes to purchase (including therein any terms, conditions and specifications required by Supplier in connection with the particular project and/or purchase contemplated by Buyer, which terms and conditions may be different than, and shall supersede, those set forth in this Agreement), which Pricing Notice Supplier shall endeavor to provide within ten (10) Business Days of receipt of Buyer’s Pricing Request. If Buyer does not issue a Purchase Order to Supplier pursuant to Section 4.2 in response to the Pricing Notice within ten (10) Business Days of issuance thereof, the Pricing Notice shall be deemed rejected.

 

4.2.

Purchase Orders. If Buyer desires to purchase the Equipment and Services on the terms specified in a Pricing Request, it shall issue a Purchase Order to Supplier in the form attached hereto as Exhibit A, which Purchase Order shall include: (i) the pricing and any other terms, conditions and specifications set forth in Supplier’s Pricing Notice; and (ii) a detailed description of the Equipment and Services to be purchased, consistent with those set forth in the Pricing Request and to the extent modified thereby, the Pricing Notice. Purchase Orders shall only be binding when issued in compliance with the requirements of this Agreement and sent by e-mail, by fax or by electronic data interchange to Supplier. Supplier shall accept or reject a Purchase Order within ten (10) Business Days after receipt. Acceptance or rejection shall be declared in the form of the Purchase Order. If a Purchase Order is neither accepted nor rejected within ten (10) Business Days after receipt, it shall be deemed rejected.

 

 

4.3.

Exclusivity and Certain Related Priorities.

 

(a)

Subject to Applicable Law, during the period from the Effective Date until the Sunset Date, Buyer shall and shall cause its Affiliates (except certain Affiliates of Buyer that (1) are prohibited from being bound by the exclusivity terms set forth below as a result of rights held by Third Party equity investors in such Affiliates pursuant to the terms of such Affiliate’s organizational or governance documents (including charters, bylaws, and shareholder, partnership, limited liability company, joint venture and similar agreements) or (2) that reasonably determine that compliance with such exclusivity requirements would, due to their status as regulated utilities, cause complications with the applicable regulatory bodies having jurisdiction over such Affiliates) to:

 

(i)            purchase exclusively from Supplier any battery-based energy storage technology systems/solutions that are (A) within the Exclusive Activities (provided that for the purposes of this paragraph only, the term “Application” within Exclusive Activities shall also include power quality and microgrid/island applications (in each case as described on Schedule 1.1(a))) and (B) offered for sale by Supplier; provided, however, it is hereby agreed that the exclusive purchase obligations contained in this Section 4.3(a)(i) shall immediately cease to apply with respect to the particular purchase opportunity in the event that (1) either (x) Supplier fails to provide an initial response within five (5) Business Days following receipt of a Pricing Request from Buyer or one of its Affiliates, or (y) Supplier fails to submit a bona fide Pricing Notice within fourteen (14) days after a final written scope of work is agreed with Buyer, or one of its Affiliates, provided that if a shorter response time is required for a final bid by the customer or project related thereto, the parties will discuss and mutually agree on such shorter time period, or (2) the prerequisite of a public tender specifies using a particular vendor, other than Supplier, to provide such battery-based energy storage technology systems/solutions (the matters set forth in the immediately preceding clause (1) and clause (2), may each individually be referred to herein as a “Terminating Event”); and

 

(ii)           prioritize the purchase of any other battery-based energy storage technology systems/solutions that are offered for sale by Supplier and request that each of its Affiliates notify Supplier if it intends to purchase such systems/solutions, such that Supplier shall have an opportunity to sell such systems/solutions thereto. It is hereby agreed that any opportunity described above is subject to other factors, including that such systems/solutions offered by Supplier are competitive in the discretion of its Affiliates, taking into account economic, financial and technological aspects as well as the ability to perform and deliver in terms of timeframes and logistics, that such systems/solutions comply with specific customer requirements, country-specific requirements or mandatory external regulation and in all cases subject to Applicable Laws.

 

 

In each case of clause (i) and (ii) above, the above provisions shall apply to the extent that such systems/solutions are needed as components of, or parts for, its other products/services or for its own needs or for reselling; excluding, however, inverters, which may be sourced independently.

 

(b)

With respect to Sections 4.3(a)(ii), it is hereby agreed that the following shall apply with respect to any requirement to prioritize the purchase of any battery-based energy storage technology systems/solutions that are offered for sale by Supplier:

 

(i)

(A) any such opportunity described therein is subject to other factors, including that such systems/solutions offered by Supplier are competitive in the discretion of the applicable Affiliate taking into account economic, financial and technological aspects as well as the ability to perform and deliver in terms of timeframes and logistics, that such systems/solutions comply with specific customer requirements, country-specific requirements or mandatory external regulation and in all cases subject to Applicable Laws and (B) the purchase priority obligations contained in Sections 4.3(a)(ii) shall immediately cease to apply with respect to the particular purchase opportunity upon the occurrence of a Terminating Event;

 

(ii)

Buyer shall cause its Affiliates to consult regarding Supplier’s products, solutions and technology and keep regular contact with such applicable Affiliates concerning projects and opportunities for which Supplier’s products, solutions and technology may be suitable (each, a “Potential Project”);

 

(iii)

Buyer shall cause its Affiliates to notify Supplier of each such Potential Project and support Supplier’s preparing bids or proposals therefor, subject to Applicable Law and Third Party contractual restrictions;

 

(iv)

In the event that Supplier makes a formal bid or proposal with respect to a Potential Project (each, a “Project Bid”) and such Project Bid is not accepted by the applicable Affiliate, subject to Applicable Law and Third Party contractual restrictions, Buyer shall cause the applicable Affiliate to inform Supplier of the main considerations of such Affiliate, which led to Supplier’s Project Bid not being accepted with respect to such Potential Project;

 

(v)

If Supplier is able to submit a revised Project Bid to the Affiliate (the “Revised Project Bid”), and such Revised Project Bid is not accepted, subject to Applicable Law and Third Party contractual restrictions, Buyer shall cause the applicable Affiliate to inform Supplier of the main considerations of such Affiliate which led to Supplier’s Revised Project Bid not being accepted with respect to such Potential Project. If Supplier is able to submit a Project Bid and, if applicable, a Revised Project Bid to the applicable Affiliate for the Potential Project and such Revised Project Bid is satisfactory to such Affiliate in all respects and is deemed by such Affiliate in its judgment to be the best bid for the Potential Project, then such Affiliate shall proceed with Supplier’s Revised Project Bid. In the event that Supplier is ultimately not chosen by such Affiliate for such Potential Project based on its initial Project Bid or subsequent Revised Project Bid, Buyer shall cause such Affiliate to discuss with Supplier how Supplier can improve the competitiveness of its products, solutions and technology for future offerings.

 

 

(c)

Subject to Applicable Law, during the period from the Effective Date until the Sunset Date, Supplier will offer its Equipment and Services to Buyer and its Affiliates at Most Favored Nation Pricing in the Pricing Notice.  “Most Favored Nation Pricing” shall be reasonably determined by the Supplier by reference to recent (last six (6) months) sales arrangements with customers, resellers or project developers, as applicable, taking into account purchase volumes, regional market conditions, the geographic location of the projects, and the relative size and technology to be used.  Supplier shall not be obligated to provide such pricing if it no longer offers the relevant products or services for sale and Supplier shall have no obligations to offer or continue to offer any such products or services for sale. If requested by Buyer, Supplier shall furnish to Buyer a certificate executed by an executive officer of Supplier and attesting to the methodology used by Supplier in determining the Most Favored Nation Pricing set forth in the applicable Pricing Notice. Supplier shall provide Buyer with supporting information concerning the comparable purchase volumes, regional market conditions, the geographic location of the projects, relative size and technology to be used, and any other variables that Supplier considered when determining the Most Favored Nation Pricing; provided that Suppler may always anonymize information about other customers’ projects, in Supplier’s sole discretion. In the event that Buyer believes the price indicated in the Pricing Notice does not accurately reflect Most Favored Nation Pricing, then the parties shall retain a mutually-agreeable auditing firm to independently and confidentially review Supplier’s methodology and pricing inputs and to render a decision regarding whether Supplier must offer a lower price in order to satisfy its Most Favored Nation Pricing obligation as set forth above. The decision of the independent auditor shall be final and binding on both Parties. The costs of the independent auditor shall be shared equally between Supplier and Buyer.

 

4.4.

Non-Competition.

 

(a)

Subject to compliance with Applicable Law or regulatory requirements, Buyer agrees that until the earlier to occur of (i) the seventh (7th) anniversary of the Effective Date and (ii) that date on which Buyer and its Affiliates collectively hold Shares representing less than ten percent (10%) of the then outstanding Voting Power, neither it nor its Affiliates will directly or indirectly engage in any Exclusive Activities; provided, however, that beginning on October 1, 2023, if Supplier has not achieved at least $25,000,000 in average annual gross revenues over a rolling period of three fiscal years (such rolling period commencing on October 1, 2020) for Application No. 4 (as set forth on Schedule 1.1(a)), then Buyer, at its sole discretion, may, upon written notice to the other members of Supplier, remove Application No. 4 as an Exclusive Activity for all purposes hereunder). If Buyer removes Application No. 4 as an Exclusive Activity pursuant to this Section 4.4(a), then Application No. 4 shall simultaneously and automatically also be removed as an “Exclusive Activity” under the Siemens Storage Core Frame Purchase Agreement. In addition, if Siemens Industry, Inc. removes Application No. 9 as an “Exclusive Activity” pursuant to the Siemens Storage Core Frame Purchase Agreement, then Application No. 9 shall simultaneously and automatically also be removed as an Exclusive Activity under this Agreement.

 

 

(b)

Notwithstanding the foregoing, the restrictions set forth in this Section 4.4 shall not affect or prohibit Buyer or its Affiliates from:

 

(i)

(A) engaging in activities expressly permitted or contemplated herein or in the Key Agreements, or as otherwise approved by Issuer as Supplier’s managing member, (B) selling Supplier’s Equipment and Services to Buyer’s customers with Supplier acting as a sub-supplier to Buyer, or (C) engaging in the development and sale of larger solutions incorporating an Integrated Solution from a Third Party, which is subject to the provisions of Section 4.3 hereof;

 

(ii)

acquiring and owning, through its venture capital or growth capital activities, a non-controlling interest of up to thirty-five percent (35%) of the equity or debt securities of any legal entity that is engaged in whole or in part in any Exclusive Activity, provided, that the products and/or services of such legal entity that are included within the scope of Exclusive Activities are not sold or marketed by Buyer or its Affiliates;

 

(iii)

acquiring or owning any debt or equity securities of any legal entity engaged in whole or in part in any Exclusive Activities through any employee benefit or pension plan maintained by Buyer or its Affiliates or solely for purposes of asset or treasury management; or

 

(iv)

acquiring control of a business or legal entity (an “Acquired Business”) engaged in whole or in part in any Exclusive Activities (a “Competing Business”) where the annual revenues attributable to the Competing Business of the Acquired Business over its previous fiscal year were less than both (A) twenty-five percent (25%) of the total annual revenues of the Acquired Business for such fiscal year, and (B) twenty-five percent (25%) of the total annual revenues of the Issuer and its’ Subsidiaries for such fiscal year(collectively, the “Non-Triggering Acquisition Thresholds”); provided, that the Non-Triggering Acquisition Threshold set forth in clause (B) above shall only apply in the case where the annual revenues attributable to the Competing Business of the Acquired Business over its previous fiscal year were more than $25.0 million; and provided, further, that in each case where revenue is only available for a part of a fiscal year, references to annual revenues in this Section 4.4(b)(iv) and in Section 4.4(b)(v) shall mean the annualized revenues reasonably determined by extrapolation from such partial fiscal year revenues;

 

 

(v)

either (i) acquiring control of an Acquired Business where at the time of such acquisition the annual revenues attributable to the Competing Business of the Acquired Business over its most recent fiscal year (x) equal or exceed either of the Non-Triggering Acquisition Thresholds and (y) are less than forty percent (40%) of the total annual revenues of the Acquired Business for its most recently completed fiscal year,(ii) acquiring control of an Acquired Business where at the time of such acquisition the annual revenues attributable to the Competing Business of the Acquired Business over its most recent fiscal year (x) equal or exceed forty percent (40%) of the total annual revenues of the Acquired Business for its most recently completed fiscal year and (y) are equal to or less than twenty-five million dollars ($25,000,000) for its most recently completed fiscal year, or (iii) continuing to own and control a Competing Business of an Acquired Business at any time after such acquisition when the non-compete restrictions herein apply, once the annual revenues attributable to the Competing Business of the Acquired Business over its most recent fiscal year equal or exceed both twenty-five percent (25%) of the total annual revenues of the Issuer and its’ Subsidiaries for such fiscal year and twenty-five million dollars ($25,000,000) (either such circumstance as described in clauses (i), (ii) or (iii) above, a “Triggering Event”); provided, that, within thirty (30) days following the occurrence of such Triggering Event, Buyer shall, or shall cause its Affiliate to, (A) offer to sell the equity interests or assets comprising the Competing Business to Issuer for a price not greater than the Fair Market Value thereof (appropriately taking into account the assumption of liabilities and Indebtedness of (to the extent not included in determining or calculating the purchase price or valuation for)), the Competing Business (which, in the case of a Triggering Event existing as of the closing of an acquisition of an Acquired Business, shall not exceed that portion of the price paid by Buyer or its Affiliate that was allocable in good faith to the Competing Business) (each, a “Competing Business Offer”) and (B) provide Issuer with such material information regarding the applicable Competing Business, subject to any restrictions of confidentiality or Applicable Law, that Buyer or its Affiliate determines in good faith will permit Issuer to make an informed decision as to whether to accept or reject such Competing Business Offer.

 

(c)

Buyer or its Affiliate shall provide such additional information regarding the applicable Competing Business, subject to any restrictions of confidentiality or Applicable Law, as may be reasonably requested by Issuer following Issuer’s receipt of the Competing Business Offer that it determines is reasonably necessary to permit Issuer to make an informed decision as to such Competing Business Offer.

 

(d)

In the event that the Issuer accepts a Competing Business Offer, Buyer and Supplier shall (and shall cause their respective Affiliates to) act in good faith to consummate the acquisition of such Competing Business which is the subject of the Competing Business Offer, including with respect to securing financing, either through equity or debt financing, as necessary;

 

(e)

Issuer shall have eighteen (18) months from receipt of such Competing Business Offer to enter into a legally binding commitment with Buyer or its Affiliate to acquire the Competing Business which is the subject of the Competing Business Offer. In addition, Issuer shall have up to six (6) months after entering into such legally binding commitment to consummate such acquisition, or such longer period as may be reasonably required to obtain any required regulatory approvals. Failure to meet either of the timelines set forth above notwithstanding the good faith efforts of Buyer, Supplier, and their respective Affiliates to consummate the transaction will be deemed to be a rejection of the Competing Business Offer.

 

 

(f)

In case of rejection of a Competing Business Offer, Buyer or its Affiliate shall be free to continue to own and control the Competing Business.

 

4.5.

Payment Terms. Unless otherwise provided in a Pricing Notice, all payments for Equipment are due and payable net thirty (30) days following invoice. Payment terms will be mutually agreed in the Purchase Order and may be milestone based such that payments match cost outflow timing and conditions similar to 20%, 30%, 40%, 10% for Order, Delivery, Project Substantial Completion, Project Final Completion. Unless otherwise provided in a Purchase Order, all payments for Services are due and payable net thirty (30) days following invoice based on progress of the Services being performed.  Payment(s) shall be by electronic banking method identified on the Purchase Order.  Buyer will not make payments to Supplier in cash or bearer instruments, nor to an account other than that specified in the Purchase Order..  Buyer will make no unlawful payments, nor make payments through any trust, intermediate entity or other party.  Buyer will not make payment(s) to an individual, employee, or other designee of Supplier.

 

4.6.

Disputed Payments. If a dispute arises regarding the payments to be made hereunder, Buyer or Supplier, as applicable, shall pay all undisputed amounts, and the Parties shall attempt in good faith to resolve the dispute as promptly as practicable.

 

4.7.

Late Payments. Any amount owed by a Party hereunder beyond the date that such amount first becomes due and payable under this Agreement shall accrue interest from the date that it first became due and payable until the date that it is paid at the lesser of (a) LIBOR plus four percent (4%) per annum or (b) the maximum rate permitted by Applicable Law.

 

4.8.

Taxes; Export and Import Duties. Notwithstanding anything herein to the contrary, (i) Supplier shall collect and withhold any and all sales taxes arising in connection with or relating to the supply, sale or Delivery of the Equipment and imposed by any Governmental Authority having jurisdiction over Supplier at the Delivery Point and (ii) Buyer shall be responsible for any and all other Taxes arising in connection with or relating to the supply, sale or Delivery of the Equipment, any and all export duties from the jurisdiction or jurisdictions in which the Equipment is manufactured or from which the Equipment may be shipped and any and all import duties, in each case, arising in connection with or relating to the supply, sale or Delivery of the Equipment. Buyer shall also be responsible for and pay all Taxes in relation to the operation of its business, including in connection with the use of the Equipment. Buyer and Seller shall cooperate to obtain exemption from, or to minimize, any Taxes.

 

5.

DELIVERY.

 

5.1.

Delivery Terms; Inspection. Unless otherwise provided in a Pricing Notice, delivery of Equipment comprised of Batteries shall be made FCA (Incoterms 2010) at facility of the supplier thereof and delivery of all other Equipment shall be FCA (Incoterms 2010) Supplier location. Prior to Delivery a representative of Supplier and a representative of Buyer may inspect the Equipment for damage and record such damage, if any.

 

 

 

5.2.

Guaranteed Delivery Date. Supplier shall use commercially reasonable efforts to Deliver Equipment to the applicable Delivery Point by the applicable guaranteed Delivery date therefore, if any, as set forth in the applicable Purchase Order, subject to extension as provided under this Agreement (as may be extended hereunder, the “Guaranteed Delivery Date”). Any other dates in a Purchase Order for performance by Supplier of any work and any other obligations of Supplier pursuant to such Purchase Order are estimated, and not guaranteed, dates. The failure of Supplier to timely achieve such other Supplier milestones or obligations by the applicable dates set forth in the Purchase Order shall not be a breach under this Agreement. Neither the Purchase Order nor any milestone date contained therein, including the Guaranteed Delivery Date for the Equipment, may be changed unless the same has been modified by a duly executed Change Order. If an unexcused delay originates with Supplier or its Representatives, Supplier shall be solely responsible for expedited delivery and other charges to meet Delivery dates.

 

5.3.

Delay Liquidated Damages. Except as may be otherwise agreed in a Purchase Order, if Delivery of the Equipment has not occurred by the Guaranteed Delivery Date for reasons that are not excused hereunder, and Buyer can prove that as a direct result thereof it must pay delay liquidated damages to its Customer, Supplier shall reimburse Buyer for such delay liquidated damages (such reimbursement not to exceed an amount equal to 0.5% of the price set forth in the Purchase Order allocable to the delayed Equipment for every completed week of delay) for each completed week after the Guaranteed Delivery Date that Buyer pays such liquidated damages to its Customer as a result of Supplier’s delay, provided, however, that the amount of delay liquidated damages payable by Supplier shall be reduced by any amounts received by Buyer under any delay in startup insurance policies providing coverage for any such losses or damages. Payment of the delay liquidated damages shall be the sole and exclusive remedy of Buyer for delay and under no circumstances shall the total aggregate liability of Supplier exceed five percent (5%) of the price set forth in the applicable Purchase Order.

 

5.4.

Buyer Caused Delay. If Buyer fails to perform any obligations under a Purchase Order or otherwise causes a delay in the performance by Supplier of its obligations under a Purchase Order, and such failure or delay results in an increase in Supplier’s costs and/or impacts Supplier’s ability to meet any Supplier milestone in accordance with the schedule contemplated by the applicable Purchase Order, Supplier shall be entitled to a Change Order increasing the price payable under the applicable Purchase Order and extending the date for completion of any Supplier milestones commensurate with such delay and added cost, including overtime charges for labor and equipment.

 

6.

TITLE, RISK OF LOSS AND CARE, CUSTODY AND CONTROL.

 

6.1.

Transfer of Title and Risk of Loss. Title, care, custody, control and risk of loss of any portion of the Equipment shall pass to Buyer upon Delivery of the Equipment to the Delivery Point. Notwithstanding the foregoing, in no event will title to the Licensed Technology or any other Intellectual Property used in the Equipment or otherwise provided to Buyer, including any Software, transfer to Buyer.

 

6.2.

Warranty of Title. Supplier warrants to Buyer that, when title to the Equipment or any portion thereof is transferred to Buyer in accordance herewith, Buyer shall have good title to the Equipment or such portion thereof free and clear of all Liens, other than any such Liens which may arise in connection with Buyer’s failure to make payments as they become due under this Agreement. In the event of any nonconformity with the foregoing, Supplier, at its own expense, upon written notice of such failure, shall indemnify Buyer from the consequences of such nonconformity and defend the title to such Equipment, and Supplier shall either promptly replace such Equipment or any affected portion thereof or remedy the title defect.

 

 

7.

INSPECTION AND QUALITY CONTROL.

 

7.1.

Inspection Rights. Supplier shall permit Buyer, its Representatives and/or customer(s), at Buyer’s expense, to inspect Equipment/Services during manufacture at Supplier’s facilities or during performance and shall use commercially reasonable efforts to facilitate similar inspections at the manufacturing facilities of third party suppliers. Buyer shall provide Supplier with written notice of its intent to make any such inspection not less than ten (10) Business Days prior to the proposed inspection date. Buyer’s inspections/tests will not unduly interfere with Supplier’s business or the business of its third party suppliers.

 

7.2.

Quality Control. Supplier shall maintain quality control with respect to the Equipment and Services as mutually agreed upon by the Parties and provide Buyer with quality assurance documentation, manuals or certifications.

 

8.

WARRANTIES.

 

8.1.

Equipment Warranty. Supplier warrants to Buyer that (i) the Equipment as Delivered shall be new at the time of Delivery and shall have been manufactured using new components and (ii) during the Equipment Warranty Period the Equipment shall be free of any Defects (the “Equipment Warranty”). As used herein, the “Equipment Warranty Period” means the period of time commencing on the earlier to occur of (i) the date that the Equipment is placed into service as evidenced by the operation thereof for commercial purposes and (ii) the day that is sixty (60) days after the date of Delivery of the Equipment and continuing to and ending on the first (1st) anniversary of such date. Notwithstanding the foregoing, (i) the Parties may agree in any particular Purchase Order to address defect warranties with respect to Batteries separately and (ii) any performance guarantees with respect to Batteries shall be solely as set forth in the applicable Purchase Order.

 

8.2.

Services Warranty. Supplier warrants to Buyer that any Services shall at the time of performance thereof and during the Services Warranty Period be (i) performed in a good and workmanlike manner and free of any fault, defect or deficiency that would preclude or impair the ability of such Services to fulfill the purposes set forth in the applicable Purchase Order therefor in all material respects, (ii) consistent with a level of care, skill and judgment which conforms with Prudent Industry Practices, and (iii) in compliance with the requirements of this Agreement and the applicable Purchase Order (the “Services Warranty”). As used herein, the “Services Warranty Period” means the period of time commencing on the date of performance of the applicable Service and continuing to and ending on the first (1st) anniversary of such date.

 

8.3.

Notification Requirements. Buyer shall promptly (but in any event within ten (10) Business Days after obtaining notice or knowledge thereof) notify Supplier of any failure of the Equipment to satisfy the Equipment Warranty or any failure of the Services to satisfy the Services Warranty, in each case by delivering written notice to Supplier of a warranty claim. The written notice of warranty claim shall, to the extent reasonably practicable, identify the applicable failure and the circumstances or conditions observed by Buyer that indicates the presence of such failure.

 

 

8.4.

Corrective Action. If, at any time prior to the expiration of the Equipment Warranty Period, either Party discovers any Defect, Supplier agrees that it shall Deliver a replacement for the applicable Defective part, without cost or expense to Buyer. When a Defective part has been Delivered to Buyer, such replaced part shall be covered by the Equipment Warranty until the later of (a) twelve (12) months from the time such replacement part was Delivered to Buyer, and (b) the end of the Equipment Warranty Period. All replacement parts shall be of good and workmanlike quality and shall be new or newly refurbished. If, at any time prior to the expiration of the Services Warranty Period, either Party discovers any failure of the Services to satisfy the Services Warranty, Supplier agrees that it shall, in its sole discretion, either correctly re-perform or otherwise correct the defective Services, without cost or expense to Buyer. When a defective Service has been remedied, such remedied Service shall be covered by the Services Warranty until the later of (a) twelve (12) months from the time such remedy was completed, and (b) the end of the Services Warranty Period.

  

8.5.

Warranty Exclusions. The Equipment Warranty and the Services Warranty shall not apply if (a) the applicable Defect or failure is attributable to Buyer’s failure to operate, repair or maintain the Equipment in material compliance with the procedures set forth in any Supplier Documents furnished to Buyer, which procedures are identified therein as necessary to maintain the effectiveness of the warranties or (b) the applicable Defect or failure is attributable to Buyer’s or Buyer’s contractor’s misuse or abuse of the Equipment (c) if the Equipment has been used in a manner contrary to Supplier's instructions set forth in the Supplier Documents that are identified therein as necessary to maintain the effectiveness of the warranties; (d) the applicable Defect or failure is attributable to any materials or equipment provided by Buyer; or (e) if the Equipment has failed as a result of ordinary wear and tear.

 

8.6.

NO IMPLIED WARRANTIES. THE WARRANTIES OF SUPPLIER SET FORTH IN THIS AGREEMENT ARE SUPPLIER'S SOLE AND EXCLUSIVE WARRANTIES AND ARE MADE IN LIEU OF ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, STATUTORY OR OTHERWISE. THE REMEDIES SET FORTH HEREIN WITH RESPECT TO SUCH WARRANTIES ARE BUYER'S SOLE AND EXCLUSIVE REMEDIES, AND SUPPLIER'S SOLE AND EXCLUSIVE LIABILITY, FOR ANY BREACH OF SUCH WARRANTIES. OTHER THAN THE WARRANTIES OF SUPPLIER SET FORTH IN THIS AGREEMENT, SUPPLIER HEREBY DISCLAIMS, AND BUYER HEREBY WAIVES, ALL OTHER EXPRESS WARRANTIES AND ALL OTHER WARRANTIES, CONDITIONS, DUTIES AND OBLIGATIONS, STATUTORY OR OTHERWISE, IMPLIED IN LAW, INCLUDING THOSE OF PERFORMANCE, MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT, CUSTOM, USAGE, OR OTHERWISE. THERE ARE NO OTHER WARRANTIES, CONDITIONS, AGREEMENTS, ORAL OR WRITTEN, STATUTORY OR OTHERWISE, OR UNDERSTANDINGS, WHETHER OR NOT IN A CONTEMPORANEOUSLY EXECUTED OR DATED AGREEMENT OR SPECIFICATION, THAT EXTEND BEYOND THOSE SET FORTH HEREIN AND NO OTHER WARRANTIES, CONDITIONS, AGREEMENTS, ORAL OR WRITTEN, STATUTORY OR OTHERWISE, WHICH MIGHT HAVE BEEN GIVEN BY AN EMPLOYEE, AGENT OR REPRESENTATIVE OF SUPPLIER OR ITS AFFILIATES ARE AUTHORIZED BY SUPPLIER.

 

8.7.

Reserved Rights. Without limiting Supplier’s obligations hereunder to remedy Defects, Supplier reserves the right (i) to make changes and improvements in its equipment and products without incurring any obligation to make such changes and improvements to any Equipment previously sold under a Purchase Order pursuant to this Agreement; and (ii) to change the terms of the warranty it provides to other Persons in the future without incurring any right or obligation to make the revised terms applicable to any Equipment previously sold under a Purchase Order pursuant to this Agreement. The provisions of this Section 8.7 shall survive the termination or expiration of this Agreement.

 

 

8.8.

Access to Buyer Data. Real time access on a 24/7 basis to all Buyer Data shall be determined on a case by case basis and set forth in the applicable Purchase Order.

 

9.

BUYER FURNISHED PROPERTY.

 

The term “Buyer Furnished Property” shall mean all tools, patterns, equipment, materials or other property which is either supplied by, or purchased by or on behalf of, Buyer or its Representatives to Supplier to perform the Services or furnish the Equipment. Title to Buyer Furnished Property shall remain with Buyer and risk of loss shall be with the Party who has possession. For Buyer Furnished Property in Supplier’s possession, custody or control, Supplier shall insure against loss and damage in an amount equal to full replacement cost. Buyer Furnished Property shall carry no guarantee or warranty, express or implied. Supplier shall not use Buyer Furnished Property on any work other than the Equipment/Services. Supplier shall clearly mark Buyer Furnished Property to show Buyer's ownership and prevent a lien, encumbrance or challenge to Buyer's title thereto. Supplier shall, at its own expense, maintain and repair Buyer Furnished Property returning it to Buyer in the condition in which received, reasonable wear and tear excepted. Upon expiration or termination of the Purchase Order, Supplier shall dispose of Buyer Furnished Property as Buyer directs in writing. Buyer reserves the right to abandon Buyer Furnished Property at no additional cost to Buyer. The applicable Purchase Order pursuant to which Buyer Furnished Property was furnished to Seller shall remain in effect so long as Supplier possesses Buyer Furnished Property.

 

10.

PACKAGING.

 

Except where the Purchase Order includes alternative requirements, Supplier shall be responsible for packaging Equipment, and the clear and conspicuous marking of Equipment and packaging, in accordance with Applicable Law, industry standards and in a manner sufficient to permit efficient handling, to provide adequate protection and comply with requirements of carrier and Applicable Law. Packing slips identifying the Purchase Order number, and part number must accompany each shipment. The exterior of each shipping container or package will be clearly marked with Buyer’s Purchase Order number and country of origin, which shall also be marked on Equipment, in a clear, conspicuous and permanent manner. Supplier shall provide all necessary shipping documents, including, but not limited to, customs invoices and packing lists in accordance with Buyer’s requirements and Applicable Law. Damages and costs incurred by Buyer, its Representative or customer resulting from Supplier or its Representative’s failure to comply with this Article 10 shall be paid by Supplier. If Supplier imports wood packaging materials, in accordance with 7 CFR 319.40, Supplier warrants that such wood packaging material is treated and marked under an official program developed and overseen by the National Plant Protection Organization in the country of export.

  

 

11.

FORCE MAJEURE.

 

11.1.

Effect of Force Majeure. A Party shall not be considered to be in breach or default of this Agreement or any Purchase Order hereunder if and to the extent that its failure or delay in performance or its efforts to cure are prevented by Force Majeure.

  

11.2.

Procedures. If either Party, as a result of the occurrence of a Force Majeure, is rendered wholly or partially unable to perform its obligations under this Agreement or any Purchase Order, such Party shall comply with the following:

 

(a)

the affected Party shall promptly notify the other Party hereto in writing, and in any event within five (5) Business Days after the affected Party becomes aware of the occurrence of such Force Majeure event, describing in such notice the particulars of the occurrence;

 

(b)

the affected Party shall give the other Party written notice estimating the event’s expected duration and probable impact on the performance of such Party’s obligations under this Agreement, and such affected Party shall continue to furnish timely regular reports with respect thereto during the continuation of the event;

 

(c)

the suspension of performance shall be of no greater scope and of no longer duration than is reasonably required by the event;

 

(d)

no liability of either Party which arose before the occurrence of the event causing the suspension of performance shall be excused as a result of the occurrence;

 

(e)

the affected Party shall exercise all reasonable efforts to mitigate or limit damages to the other Party, promptly taking appropriate and sufficient corrective action, including the expenditure of all reasonable sums of money;

 

(f)

the affected Party shall use all reasonable efforts to continue to perform its obligations under this Agreement and to correct or cure the event excusing performance; and

 

(g)

when the affected Party is able to resume performance of the affected obligations under this Agreement, the affected Party shall promptly resume performance and give the other Party written notice to that effect.

 

11.3.

Termination for Extended Force Majeure. If Supplier experiences a Force Majeure Event completely preventing Supplier’s performance for more than forty-five (45) consecutive days, Buyer shall have the right to terminate the applicable Purchase Order and shall be entitled to a refund of all monies advanced to Supplier.

 

12.

CHANGE ORDERS.

 

12.1.

Change Order. A “Change Order” is a written instrument signed by the Parties and stating their mutual agreement upon a change in the obligations of the Parties under this Agreement or any Purchase Order, including if applicable the amount of the adjustment in the purchase price and the extent of any adjustment to the Delivery schedule, including the Guaranteed Delivery Date.

 

 

12.2.

Change Order Process. In addition to circumstances set forth herein where the Parties are entitled to a Change Order, either Party may request changes in the obligations of the Parties under this Agreement within the scope of this Agreement consisting of additions, deletions, or other revisions to such obligations. If either Buyer or Supplier wishes to change such obligations, it shall submit a change request to the other Party in writing. If the requested change relates to a change to the Equipment supply obligations or results from a condition in which Supplier is entitled to a Change Order under this Agreement, then, within fifteen (15) Business Days following receipt or delivery, as applicable, of the requested change, Supplier shall submit a proposal to Buyer stating (i) the increase or decrease, if any, in the purchase price and changes to the Delivery schedule and/or the Guaranteed Delivery Date, if any, that would result from such change (collectively, the “Change Order Information”). If the proposed change relates to any other matter, the requesting Party, at the time the request for the change is made, shall provide the proposed Change Order Information. Within five (5) Business Days following receipt of the Change Order Information, the Parties shall meet and, acting reasonably, negotiate in good faith a mutually acceptable Change Order in accordance with the principles set forth herein. Following agreement on the terms and conditions of the Change Order, the Parties shall execute the same. If the Parties do not agree upon the terms and conditions of the Change Order, and the proposed change relates to circumstances in which a Party is entitled to a Change Order under this Agreement, then either Party may submit the matter to dispute resolution pursuant to Article 24.

 

12.3.

Change Order Restrictions. Notwithstanding anything herein to the contrary, Buyer shall not be entitled reduce the scope of the Equipment supply obligations under any Purchase Order.

 

12.4.

No Change. Supplier shall not be obligated to proceed with any change in the Equipment supply obligations requested by Buyer unless and until a Change Order is executed by the Parties in relation to such change. Further, Supplier shall not be required to implement a requested change in the Equipment supply obligations by Buyer if Supplier reasonably believes the implementation of such change would impair Supplier’s ability to comply with any of the warranties or the covenants set forth in this Agreement or the applicable Purchase Order.

 

13.

INTELLECTUAL PROPERTY.

 

13.1.

Grant of License. Upon transfer of title with respect to any Equipment purchased hereunder and upon providing parts under the Equipment Warranty hereunder, Supplier hereby grants to Buyer a non-exclusive, transferable, fully paid-up with no further royalty obligation, worldwide, license in and to, all Intellectual Property owned or licensed by Supplier which are necessary for the use and enjoyment by Buyer of Equipment hereunder (the “License”) to import into the Territory and use the Licensed Technology (including any Intellectual Property in the Licensed Technology) within the Territory, and solely in accordance with the terms of this Agreement. Such license includes a perpetual license to use software provided for the operation of the Equipment, including but not limited to all modifications or additions to software upon payment of commercially reasonable service charges to be negotiated, as well as all related documentation and technical information. With respect to any Confidential Information contained within the Licensed Technology, Buyer may disclose such Confidential Information to third party contractors who have a need to know such parts of the Licensed Technology solely for Buyer’s use and operation of the Equipment and in accordance with the terms of this Agreement; provided that such third parties shall first execute a confidentiality agreement consistent with this Agreement containing restrictions on disclosure and use at least as restrictive as those in Article 17 (and such third party contractors shall not be permitted to disclose the Licensed Technology to any other third party). The Licensed Technology is Confidential Information of Supplier as defined in Section 17.1 even if not marked as “confidential,” “proprietary” or with other such similar language, except where an exception in Section 17.3 applies.

 

 

13.2.

No Copies. Except as otherwise permitted by this Agreement, Buyer shall not make any copies of the Licensed Technology without first obtaining express written permission from Supplier. Notwithstanding the foregoing, Buyer may make such number of copies of (i) the documentation and manuals for the Equipment or other Intellectual Property licensed hereunder that is not embedded in the Equipment as are required for Buyer’s normal use and operation hereunder (including such copies as may be included in or attached to electronic mail messages by Buyer for delivery to Persons who are otherwise permitted recipients of Supplier’s Confidential Information hereunder) and (ii) the Licensed Technology as are reasonably required for back-up, disaster recovery and archival purposes.

 

13.3.

Proprietary Notices. Buyer shall not remove or alter, or permit to be removed or altered, any proprietary notices that appear on or with the Licensed Technology. Buyer shall include on and with the Licensed Technology a written notice stating: “Confidential and Proprietary Information of Supplier. Access and Use Restricted by License.” or such other or additional notice as Supplier reasonably may prescribe.

 

13.4.

Security. Buyer shall take all reasonable steps to ensure that no unauthorized persons have access to the Licensed Technology, and to ensure that no persons authorized to have such access shall take any action which would be in violation of this Agreement. Such steps shall include, but shall not be limited to, imposing password restrictions on use of the Licensed Technology securing Buyer’s network on which such Licensed Technology resides from outside intrusion, preventing the making of unauthorized copies of the Licensed Technology and administering and monitoring use of the Licensed Technology.

 

13.5.

No Reverse Engineering. The Licensed Technology includes trade secrets of Supplier or its Affiliates. In order to protect the Licensed Technology, Buyer shall not modify, translate, decompile, reverse engineer, decrypt, extract or disassemble the Licensed Technology or otherwise reduce or attempt to reduce any Software in the Licensed Technology to source code form. Buyer shall ensure, both during and (if Buyer still has possession of the Licensed Technology) after the performance of this Agreement, that (a) Persons who are not bound by a confidentiality agreement consistent with this Agreement shall not have access to the Licensed Technology and (b) Persons who are so bound are put on written notice that the Licensed Technology contains trade secrets, owned by and proprietary to Supplier or its Affiliates.

 

13.6.

Open Source Software. Buyer shall not sell, sublicense, or otherwise make available the Licensed Technology or any part thereof as Open Source Software, nor combine the Licensed Technology with any Open Source Software in a manner that could require the release, disclosure or distribution of the Licensed Technology, or otherwise infect the Licensed Technology so as to impose any obligation on Supplier or diminish any rights Supplier may have therein.

 

13.7.

Reporting. Buyer shall promptly report to Supplier any actual or suspected violation of this Article 13, and shall take such further steps as may reasonably be requested by Supplier to prevent or remedy any such violation.

 

 

13.8.

Relief. Because unauthorized use or transfer of the Licensed Technology is likely to diminish substantially the value of such Licensed Technology and irreparably harm Supplier and will not be susceptible of cure by the payment of monetary damages, if Buyer breaches the provisions of this Article 13, Supplier shall be entitled to injunctive and/or other equitable relief, in addition to other remedies afforded by law, to prevent or restrain such breach.

 

13.9.

Improvements.

 

(a)

By Supplier. Any improvement hereafter made by or for Supplier or any of its Affiliates in the Licensed Technology that is approved and adopted by Supplier for use by Buyer under this Agreement shall be included in the Licensed Technology for purposes of the License. The Parties agree that Supplier may decide in its sole discretion which improvements it shall approve and adopt for purposes of Buyer’s use under the License; provided, however, that if Supplier makes improvements available to buyers similarly situated to Buyer in terms of project scope and fees paid, Supplier also shall make such improvements available to Buyer on terms at least as favorable to Buyer as the terms generally provided to such similarly situated buyers.

 

(b)

By Buyer. Buyer may not modify the Licensed Technology except as expressly permitted in this Section 13.9(b). Buyer may suggest modifications in the Licensed Technology to Supplier. Any modification in the Licensed Technology suggested by Buyer must first be approved by Supplier in its sole discretion in writing before it is used by Buyer hereunder. If Buyer develops any material modification or improvement in the Licensed Technology (whether permitted or not), it shall promptly disclose it to Supplier in writing. If and only if, and to the extent, Applicable Law mandates that Buyer own any modifications to or improvements in the Licensed Technology, in whole or in part, and notwithstanding the terms of this Agreement, Buyer hereby grants to Supplier and its Affiliates a non-exclusive, perpetual, worldwide, royalty-free license to make, have made, import, offer for sale, sell, copy, make derivative works, use and sublicense others to use these modifications or improvements.

 

13.10.

Ownership.

 

(a)

Supplier. As between the Parties, Supplier or its Affiliates shall own the Licensed Technology, including any modifications, discoveries, derivative works and improvements derived from or based on it, whether developed by Supplier, by Buyer, or by the Parties jointly, all Intellectual Property therein and any Intellectual Property developed during, or arising out of, the performance of Supplier’s obligations under this Agreement, to the extent permitted by Applicable Law. Buyer acquires only certain rights to use the Licensed Technology under the License, strictly in compliance with the terms of this Agreement, and does not acquire any ownership rights or title to it.

 

(b)

Buyer. As between the Parties, Buyer or its Affiliates shall own (1) any Intellectual Property developed or acquired by Buyer prior to or independently of this Agreement, (2) all data generated or collected by the Equipment or Buyer or its customer during the commercial use of the Equipment (the “Buyer Data”), and (3) all Intellectual Property therein, excluding in each case any of the Licensed Technology incorporated therein or any Intellectual Property in any combination of the Licensed Technology and Buyer Data.

 

 

(c)

Cooperation. Buyer shall reasonably cooperate with Supplier to assist in perfecting Supplier’s ownership in any Intellectual Property in modifications, discoveries, derivative works and improvements to Licensed Technology developed by Supplier or by the Parties jointly, including by executing declarations, oaths, assignments or other formalities documents as needed.

 

13.11.

Enforcement. Each Party shall notify the other promptly in writing of any suspected infringement by a third party of the Licensed Technology or any of the Intellectual Property therein. Supplier shall have the exclusive right to enforce and defend the rights appurtenant to the Licensed Technology or the Intellectual Property therein in Supplier’s sole discretion and shall have the sole right of control of any such enforcement action or proceeding it elects to initiate (an “Enforcement Action”), at Supplier’s sole cost and expense. Supplier shall keep Buyer timely and reasonably informed as to significant events during the course of all such Enforcement Actions as would reasonably be expected to affect Buyer’s use of the Licensed Technology whether conducted for Supplier’s or Buyer’s account. Buyer shall provide on Supplier’s written request reasonable assistance in preparing and advancing Supplier’s case, in consideration of which Supplier shall reimburse Buyer’s reasonable out-of-pocket costs incurred in doing so (including reasonable attorneys’ fees). Supplier may retain any monetary damages or other compensation or recovery awarded to it in any Enforcement Action under this Section 13.11. Notwithstanding the foregoing, Buyer may participate and be represented in any Enforcement Action by its own counsel at its own expense, to the extent such participation and representation does not materially interfere with Supplier’s right to control such Enforcement Action. Supplier shall not settle any such Enforcement Action in a manner materially and adversely affecting Buyer’s rights in this Agreement, or in a manner including an admission of wrongdoing by Buyer, without obtaining the prior written consent of Buyer, which consent shall not be unreasonably withheld, conditioned or delayed. Buyer has no right to enforce Supplier’s Intellectual Property in the Licensed Technology against any third parties.

 

13.12.

Duration and Transfers. Subject to termination in accordance with this Agreement, the License (i) shall continue for so long as Buyer or any successor retains ownership of the Equipment and continues operating the same (ii) shall terminate automatically if and when the Equipment is permanently removed from service (subject to earlier termination in accordance herewith) and (iii) shall transfer as part of an assignment that is permitted under Section 25.5. If Buyer sells or transfers the Equipment, or any portion thereof, apart from an Assignment of this Agreement, the License will terminate as to Buyer with respect to the Equipment, or any portion thereof sold or transferred and Buyer must, as a condition thereof, notify Supplier in writing and assign to the transferee thereof the License with respect to the Equipment, or any portion thereof sold or transferred, and procure from the transferee an assumption of such License, on substantially the same terms as set forth in this Article 13 and in form subject to Supplier’s prior reasonable approval, to the extent the License is applicable to the assets being sold or transferred. The License may not be assigned, transferred or sublicensed except as expressly permitted in this Section 13.12. Buyer shall be responsible for, and indemnify, defend and hold harmless Supplier, Supplier’s Parent, Supplier’s Affiliates, and their respective officers, directors, members, agents and employees from and against any damage, injury or loss resulting from the failure of Buyer to comply with the terms of this Article 13. Supplier may terminate the License, except with respect to any Licensed Technology that is integrated in any Equipment as to which title has transferred to Buyer hereunder, on written notice to Buyer if Buyer (a) fails to cure any material breach of an obligation in this Article 13 which is capable of being cured within thirty (30) days after Supplier’s written notice specifying the breach, or (b) on more than two (2) occasions in any five (5) year period, Buyer is found, through resolution of a Dispute, whether by settlement or otherwise, to have materially breached the terms and conditions of this Article 13 in substantially the same manner.

 

 

13.13.

Government End Users. The Software portion of the Licensed Technology is a “commercial item” as that term is defined at 48 CFR 2.101, and includes “commercial computer software” and “commercial computer software documentation” as such terms are used in 48 CFR 12.212 and in the event the Licensed Technology is provided to the US Government, such Licensed Technology shall be provided to the US Government only as a commercial end item. Consistent with 48 CFR 12.212, civilian US Government end users acquire the Software and documentation with only those license rights set forth herein as restricted by 48 CFR 12.212(a)(1) and (a)(2); Department of Defense end users acquire the Software and documentation with only those license rights set forth herein as restricted by 48 CFR 227.7202-1 through 227.7202-4.

 

13.14.

Reservation of Rights. Supplier reserves all rights in the Licensed Technology not expressly granted to Buyer in this Agreement. No right or license is granted (expressly or by implication or estoppel) by Supplier to Buyer or its Affiliates under any tangible, Intellectual Property, or other proprietary right.

 

14.

DEFAULTS AND REMEDIES.

 

14.1.

Supplier Defaults. The occurrence of any one or more of the following events shall constitute an event of default by Supplier hereunder (a “Supplier Event of Default”):

 

(a)

Supplier fails to pay to Buyer any payment required under this Agreement (which is not subject to a good faith dispute) when due, and such failure continues for ten (10) Business Days after receipt of written notice of such failure;

 

(b)

Supplier voluntarily commences bankruptcy, insolvency, reorganization, stay, moratorium or similar debtor-relief proceedings, or shall have become insolvent or generally does not pay its debts as they become due, or admits in writing its inability to pay its debts, or makes an assignment for the benefit of creditors;

 

(c)

Insolvency, receivership, reorganization, bankruptcy, or similar proceedings shall have been commenced against Supplier and such proceedings remain undismissed or unstayed for a period of ninety (90) days;

 

(d)

Supplier fails to deliver Equipment by the date upon which Supplier exhausts its liability for liquidated damages for delayed deliveries under Section 5.3; or

 

(e)

Except as otherwise expressly provided for in this Section 14.1, Supplier is in material breach of its obligations under this Agreement and such material breach continues uncured for sixty (60) days after receipt of written notice from Buyer.

 

 

14.2.

Buyer Defaults. The occurrence of any one or more of the following events shall constitute an event of default by Buyer hereunder (a “Buyer Event of Default”):

 

(a)

Buyer fails to pay to Supplier any payment required under this Agreement (which is not subject to a good faith dispute) when due, and such failure continues for ten (10) Business Days after receipt of written notice of such failure;

  

(b)

Buyer voluntarily commences bankruptcy, insolvency, reorganization, stay, moratorium or similar debtor-relief proceedings, or shall have become insolvent or generally does not pay its debts as they become due, or admits in writing its inability to pay its debts, or makes an assignment for the benefit of creditors;

 

(c)

Insolvency, receivership, reorganization, bankruptcy, or a similar proceeding shall have been commenced against Buyer and such proceeding remains undismissed or unstayed for a period of ninety (90) days;

 

(d)

Any Assignment by Buyer not in conformity with Section 25.5; or

 

(e)

Except as otherwise expressly provided for in this Section 14.2, Buyer is in material breach of its obligations under this Agreement and such material breach continues uncured for sixty (60) days after receipt of written notice from Supplier.

 

14.3.

Remedies. Upon the occurrence of a Supplier Event of Default, Buyer may, by written notice to Supplier, terminate the outstanding Purchase Order(s) under which the Supplier Event of Default has arisen and/or shall be entitled to such rights and remedies as may be available at law or in equity. Upon the occurrence of a Buyer Event of Default, Supplier may, by written notice to Buyer, terminate the outstanding Purchase Order(s) under which the Buyer Event of Default has arisen and/or shall be entitled to such rights and remedies as may be available at law or in equity. Any rights and remedies available under Applicable Law upon termination of this Agreement pursuant to this Section 14.3 shall be limited in all respects by the limitations of liability set forth in Article 16. For sake of clarity, in the event that there are more than one Buyer under this Agreement, (i) a Buyer Event of Default by one such Buyer shall not constitute a Buyer Event of Default by any other Buyer and any remedies available to Supplier shall be exercisable only as against the defaulting Buyer and as regards the non-defaulting Buyer(s) this Agreement and any related Purchase Orders shall continue in full force and effect, and (ii) a Supplier Event of Default with respect to any particular Purchase Order shall only count as a Supplier Event of Default for the applicable Purchase Order and as regards any other Purchase Orders and any other Buyer(s), this Agreement and any related Purchase Orders shall continue in full force and effect.

 

15.

INDEMNIFICATION.

 

15.1.

General. Each Party (the “Indemnifying Party”) shall indemnify, defend and hold harmless the other Party, its Affiliates, and their Representatives and assigns (the “Indemnified Party”) from and against all claims, suits, causes of action, losses, liabilities, liens, damages, assessments, costs, expenses, demands, complaints or actions including but not limited to reasonable attorneys’ fees and court costs (collectively, “Claims”) of third parties concerning: (i) death, personal injury, or property damage of third parties, (ii) nonpayment of wages, benefits, fees, amounts owed, and/or any taxes (including penalties and interest) associated therewith arising from the Indemnifying Party’s Representatives, suppliers, contractors, and/or materialmen which may include liens or encumbrances on the Equipment/Services or the premises on which located and (iii) violations by the Indemnifying Party or any Person for whom the Indemnifying Party is responsible of Applicable Law; in each case to the extent arising or resulting from the Indemnifying Party’s or its Representative’s negligence, willful misconduct, or breach of this Agreement. For sake of clarity, if both Parties are negligent or otherwise at fault or strictly liable without fault, then the obligations of indemnification under this Section 15.1 shall continue, but the Indemnifying Party shall indemnify the Indemnified Party only for the percentage of responsibility for the damage or injuries attributable to the Indemnifying Party.

 

 

15.2.

Infringement Indemnification by Supplier.

 

(a)

Indemnity. If an action is brought or threatened against Buyer claiming that Buyer’s use, as permitted herein, of the Licensed Technology within the Territory infringes any Intellectual Property arising or existing under Applicable Law, Supplier shall defend, indemnify and hold harmless Buyer, its Affiliates, and their Representatives and assigns at Supplier’s expense from and against any and all Infringement Claim Costs of Buyer to the extent arising from such action or claim.

 

(b)

Corrective Actions. If Buyer’s permitted use of the Licensed Technology within the Territory is materially impaired or if Supplier’s performance of the Equipment supply obligations under this Agreement or any other obligation is materially impaired by reason of such third party claim, Supplier shall use commercially reasonable efforts, at its expense, to continue its performance of the Equipment supply obligations under this Agreement or the other affected obligations, including at its own election and expense (i) to substitute an equivalent non-infringing item or process for the allegedly infringing item or process, (ii) to modify the allegedly infringing item or process so that it no longer infringes but remains functionally equivalent or better or (iii) to obtain for Buyer the right to continue using such item or process. Supplier shall, prior to proceeding with any of the foregoing actions, consult with Buyer as to the proposed action and consider in good faith any reasonable request of Buyer in respect thereof. Nothing herein constitutes a guarantee by Supplier that such efforts will succeed in avoiding the infringement claim or that Supplier will be able to replace the infringing item or process with an item or process of comparable functionality or effectiveness. If Supplier reasonably believes that an injunction against use of the Licensed Technology in the Territory may be granted against Buyer, either imminently or with the passage of time, Supplier may at its expense, and upon reasonable prior written notice to Buyer, take any of the foregoing actions in order to minimize its liability.

 

(c)

Exclusions. This Section 15.2 does not apply to, and Supplier assumes no liability with respect to, claims for patent infringement or copyright infringement or improper use of other proprietary rights (including any license or Intellectual Property, whether by way of copyright or otherwise) to the extent that such claims relate, in whole or in part, to (i) Buyer’s modification or alteration of the Licensed Technology (except to the extent permitted by this Agreement) or the Equipment, in either case made without Supplier’s written consent or contrary to Supplier’s instructions, (ii) the combination of the Licensed Technology with other Software, products, materials, equipment, parts or apparatus and not approved in writing by Supplier or (iii) a failure to promptly install an update required by Supplier.

 

 

(d)

Entire Liability. THE FOREGOING PROVISIONS OF THIS SECTION 15.2 STATE THE ENTIRE LIABILITY AND OBLIGATION OF SUPPLIER AND ITS AFFILIATES

 

		AND THE EXCLUSIVE REMEDY OF BUYER, WITH RESPECT TO ANY ACTUAL OR ALLEGED INFRINGEMENT OF PATENTS, COPYRIGHTS, TRADEMARKS OR OTHER INTELLECTUAL PROPERTY BY THE EQUIPMENT OR THE LICENSED TECHNOLOGY OR ANY PART THEREOF, EXCEPT TO THE EXTENT THAT SUCH LIABILITY CANNOT BE EXCLUDED IN ACCORDANCE WITH MANDATORY LEGAL REQUIREMENTS.
	(e)	Notifications. Buyer shall promptly notify Supplier in writing following receipt of written notice of any claims alleging infringement of patents or other proprietary rights (including Intellectual Property) in connection with Buyer’s permitted use of the Licensed Technology or Supplier’s performance of the Equipment supply obligations under this Agreement or Equipment Warranty obligations, and shall provide Supplier with all information in its possession relevant to such claim. In turn, Supplier shall notify Buyer as soon as practical in writing of any claims which Supplier may receive alleging infringement of patents or other proprietary rights which may affect Supplier’s performance of the Equipment supply obligations under this Agreement or Equipment Warranty obligations under this Agreement or Buyer’s right to own, operate and maintain the Equipment.

 

15.3.

Infringement Indemnification by Buyer.

 

(a)

Indemnity. If an action is brought or threatened against Supplier claiming that any condition or event described in Section 15.2(c) results in an infringement upon any Intellectual Property within the Territory arising or existing under Applicable Law, Buyer shall defend, indemnify and hold harmless the Supplier Indemnified Parties at Buyer’s expense from and against any and all Infringement Claim Costs of Supplier to the extent arising from such action or claim.

 

(b)

Corrective Actions. If performance of Supplier’s obligations hereunder is enjoined by reason of a claim subject to Section 15.3(a), Buyer shall use commercially reasonable efforts, at its option and expense, at its own election (i) to substitute an equivalent non-infringing item or process for the allegedly infringing item or process, (ii) to modify the allegedly infringing item or process so that it no longer infringes but remains functionally equivalent, or (iii) to obtain for Supplier the right to continue using such item or process. Nothing herein constitutes a guarantee by Buyer that such efforts will succeed in avoiding the infringement claim or that Buyer will be able to replace the infringing item or process with an item or process of comparable functionality or effectiveness.

 

(c)

Exclusions. This Section 15.3 does not apply to, and Buyer assumes no liability with respect to, claims for patent infringement or copyright infringement or improper use of other proprietary rights (including any license or Intellectual Property, whether by way of copyright or otherwise), to the extent that such claims relate, in whole or in part, to (i) a modification to the Licensed Technology or the Equipment requested by Buyer but executed by Supplier or with Supplier’s supervision and control or (ii) the combination of the Licensed Technology with other products, materials, equipment, parts or apparatus approved in writing by Supplier.

 

 

15.4.

Indemnification Procedures.

 

(a)

If an Indemnified Party receives written notice of a Claim, the Indemnified Party shall give prompt written notice to the Indemnifying Party, including a reasonably detailed description of the facts and circumstances relating to such Claim, a complete copy of all notices, pleadings and other papers related thereto, and a description in reasonable detail of the basis for the potential claim for indemnification with respect thereto. The Indemnified Party’s delay or deficiency in notifying Supplier shall not relieve Supplier of liability or obligation except to the extent (and only to the extent) such delay materially impacts the defense of the Claim.

 

(b)

The Indemnifying Party shall be entitled to assume the defense and to represent the interests of the Indemnified Party, which shall include the right to select and direct legal counsel and other consultants (all of whom shall be reasonably acceptable to the Indemnified Party), appear in proceedings on behalf of the Indemnified Party and to propose, accept or reject offers of settlement, subject to Section 15.4(c) below, all at its sole cost. Nothing herein shall prevent an Indemnified Party from retaining its own legal counsel and other consultants or participating in its own defense at its own cost and expense. Notwithstanding the foregoing, if (i) the claim is primarily for non-monetary damages against the Indemnified Party, or primarily for an injunction or other equitable relief that, if granted, would reasonably be expected to be material to the Indemnified Party, (ii) there is a material actual or potential conflict of interest that makes representation of the Indemnifying Party and the Indemnified Party by the same counsel or the counsel selected by the Indemnifying Party inappropriate, or (iii) the claim is a criminal proceeding, then in each case the Indemnified Party may, upon notice to the Indemnifying Party, assume the exclusive right to defend (and in the case of clause (iii) above, compromise and settle), such claim and the reasonable fees and expenses of the Indemnified Party’s separate counsel shall be borne by the Indemnifying Party; however the settlement of any claim pursuant to clauses (i) and (ii) above shall be governed by Section 15.4(c) below. Notwithstanding anything to the contrary herein, for sake of clarity, the Parties agree that the foregoing provisions shall not be construed so as to permit the Indemnified Party to control or assume the defense of any action, lawsuit, proceeding, investigation, demand or other claim brought against the Indemnifying Party concurrently with or in a joint proceeding in respect of any claim that is the subject of an indemnification claim hereunder by the Indemnified Party.

 

(c)

Notwithstanding anything to the contrary herein, the Indemnifying Party shall not compromise or settle, or admit any liability with respect to any third party Claim without the prior written consent of the Indemnified Party (which consent shall not be unreasonably withheld or delayed), unless the relief consists solely of (i) money damages (all of which the Indemnifying Party shall pay), and (ii) includes a provision whereby the plaintiff or claimant in the matter releases the Indemnified Party from all liability with respect thereto. If the Indemnified Party assumes the defense of or represents their own interests, no settlement shall be made without the prior written consent of the Indemnifying Party (which consent shall not be unreasonably withheld or delayed).

 

 

15.5.

Limited Waiver of Certain Immunities. Each of the Parties hereby specifically and expressly agrees that with respect to any and all claims against an Indemnified Party by any representative of an Indemnifying Party, any indemnification available hereunder shall not be limited by reason of any immunity to which such Indemnifying Party may be entitled under any workers compensation and/or industrial insurance acts, disability benefit acts, or other employee benefits acts and any limitation on the amount or type of damages, compensation, or benefits payable by or for the Indemnifying Party to such representative with respect to any such claim. For the sake of clarity, the Indemnifying Party’s waiver of immunity by the provisions of this section extends only to indemnification claims against the Indemnifying Party by or on behalf of the Indemnified Party under or pursuant to this Agreement, and does not apply to any claims made by the Indemnifying Party’s representatives directly against the Indemnifying Party.

 

15.6.

Survival. The indemnities set forth in this Article 15 shall survive the termination or expiration of this Agreement.

 

16.

LIMITATIONS OF LIABILITY.

 

16.1.

WAIVER OF CERTAIN DAMAGES. NOTWITHSTANDING ANYTHING IN THIS AGREEMENT OR ANY PURCHASE ORDER EXECUTED HEREUNDER TO THE CONTRARY, NEITHER PARTY SHALL BE LIABLE, WHETHER BASED IN CONTRACT, GUARANTY, WARRANTY, TORT (INCLUDING NEGLIGENCE), PRODUCT LIABILITY, STRICT LIABILITY, INDEMNITY OR ANY OTHER LEGAL OR EQUITABLE THEORY, FOR: LOSS OF USE, REVENUE, SAVINGS, PROFIT, INTEREST, GOODWILL OR OPPORTUNITY, COSTS OF CAPITAL, COSTS OF REPLACEMENT OR SUBSTITUTE USE OR PERFORMANCE, LOSS OF INFORMATION AND DATA, LOSS OF POWER, VOLTAGE IRREGULARITIES OR FREQUENCY FLUCTUATION, CLAIMS ARISING FROM BUYER’S THIRD PARTY CONTRACTS, OR FOR ANY TYPE OF INDIRECT, SPECIAL, PUNITIVE, EXEMPLARY, COLLATERAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES, OR FOR ANY OTHER LOSS OR COST OF A SIMILAR TYPE.

 

16.2.

MAXIMUM LIABILITY. SUPPLIER’S MAXIMUM LIABILITY UNDER THIS AGREEMENT SHALL NOT EXCEED THE PURCHASE PRICE SET FORTH IN THE APPLICABLE PURCHASE ORDER PURSUANT TO WHICH THE APPLICABLE CLAIM AROSE.

 

16.3.

EFFECTIVENESS. THE PARTIES AGREE THAT THE EXCLUSIONS AND LIMITATIONS IN THIS ARTICLE 16 WILL PREVAIL OVER ANY CONFLICTING TERMS AND CONDITIONS IN THIS AGREEMENT OR ANY PURCHASE ORDER EXECUTED HEREUNDER AND MUST BE GIVEN FULL FORCE AND EFFECT, WHETHER OR NOT ANY OR ALL SUCH REMEDIES ARE DETERMINED TO HAVE FAILED OF THEIR ESSENTIAL PURPOSE. THESE LIMITATIONS OF LIABILITY ARE EFFECTIVE EVEN IF SUPPLIER HAS BEEN ADVISED BY BUYER OF THE POSSIBILITY OF SUCH DAMAGES. THE WAIVERS AND DISCLAIMERS OF LIABILITY, RELEASES FROM LIABILITY AND LIMITATIONS ON LIABILITY EXPRESSED IN THIS ARTICLE 16 EXTEND TO THE PARTIES’ RESPECTIVE AFFILIATES, PARTNERS, PRINCIPALS, MEMBERS SHAREHOLDERS, DIRECTORS, OFFICERS, EMPLOYEES, SUPPLIERS, AGENTS, AND SUCCESSORS AND ASSIGNS.

 

16.4.

Commencement of Claims. Except with respect to claims arising under Article 13, Article 15 or Article 17, any legal action of either Party arising under this Agreement or any Purchase Order issued hereunder must be commenced within two (2) years after the Delivery of the applicable Equipment or performance of the applicable Service. To the maximum extent permitted by Applicable Law, each Party hereby waives any right to commence any claim or action after such two (2) year period.

 

 

17.

CONFIDENTIALITY.

 

17.1.

Confidential Information. Each Party shall, and shall cause its respective Affiliates and Representatives to, keep confidential any information which it may have or acquire before or after the date of this Agreement, concerning the other Party and its assets, business, operations, affairs, financial condition or such information, “Confidential Information”).

 

17.2.

Non-Disclosure. Neither Party shall use any Confidential Information in any manner detrimental to the other Party nor shall any of them disclose, publish or make accessible, directly or indirectly, any Confidential Information to any person. In addition, the Parties shall exercise all reasonable efforts to prevent any other person from gaining access to such Confidential Information and take such protective measures as may be or become reasonably necessary to preserve the confidentiality of such Confidential Information.

 

17.3.

Exceptions. Notwithstanding Section 17.1 and Section 17.2, either Party may disclose Confidential Information:

 

(a)

to any Representative of such Party, provided that such Representative has a need to know and has been informed of the confidential nature of the information pursuant to Section 17.4;

 

(b)

to the extent required by (i) any Applicable Law of any Governmental Authority (including any rule or regulation of the Securities and Exchange Commission), (ii) any stock exchange rule or regulation or (iii) any binding judgment, order or requirement of any court or other Governmental Authority of competent jurisdiction; provided, that the Party required to disclose Confidential Information, as the case may be, has delivered written notice to and consulted, to the extent practicable, with the other Party prior to disclosure of such Confidential Information; and

 

(c)

to the extent such Confidential Information becomes available within the public domain (otherwise than as a result of a breach of this Article 17).

 

17.4.

Representatives Bound. Each Party shall inform any representative to whom it provides Confidential Information that such information is confidential and shall instruct them (a) to keep such Confidential Information confidential and (b) not to disclose it to any third party (other than those persons to whom such Confidential Information has already been disclosed in accordance with the terms of this Agreement). The disclosing Party shall be responsible for any breach of this Article 17 by the person to whom the Confidential Information is disclosed.

 

17.5.

Survival. Notwithstanding anything herein to the contrary, the provisions of this Article 17 shall survive the termination of this Agreement for a period of three (3) years and, with respect to each Party, shall survive for a period of three (3) years following the date on which such Party is no longer a Party.

 

 

18.

REPRESENTATIONS AND WARRANTIES.

 

18.1.

Representations of the Parties. As of the Effective Date (or, with respect to each Further Buyer Contracting Party that becomes a Buyer hereunder, as of the time of execution of a joinder hereto), and as of the entry into of each Purchase Order hereunder, each Party represents to the other Party as follows:

 

(a)

Due Formation. Such Party (i) is a duly formed, validly existing and in good standing under the laws of the jurisdiction of its formation, (ii) has the requisite power and authority to own its properties and carry on its business as now being conducted and currently proposed to be conducted and to execute, deliver and perform its obligations under this Agreement, and (iii) is qualified to do business in every jurisdiction in which failure so to qualify could be reasonably be expected to have a material adverse effect on such Party’s ability to perform its obligations hereunder.

 

(b)

Authorization; Enforceability. Such Party has taken all action necessary to authorize it to execute, deliver and perform its obligations under this Agreement. This Agreement constitutes a legal, valid and binding obligation of such Party enforceable in accordance with its terms, subject to bankruptcy, reorganization, moratorium or other similar laws affecting the enforcement of the rights of creditors generally and subject to general principles of equity.

 

(c)

No Conflict. The execution, delivery and performance by such Party of this Agreement does not and will not (i) violate any Applicable Law, (ii) result in any breach of such Party’s constituent documents or (iii) conflict with, violate or result in a breach of or constitute a default under any agreement or instrument to which such Party or any of its properties or assets is bound or result in the imposition or creation of any lien or security interest in or with respect to any of such Party’s property or assets, other than in each case any such violations, conflicts, breaches or impositions which could not be reasonably be expected to have a material adverse effect on such Party’s ability to perform its obligations hereunder.

 

(d)

No Authorization. No authorization or approval or other action by, and no notice to or filing with, any Governmental Authority or any third party (other than those which have been obtained) is required for the due execution, delivery and performance by such Party of this Agreement, other than any such authorizations, approvals or actions the failure of which to obtain could not reasonably be expected to have a material adverse effect on such Party’s ability to perform its obligations hereunder.

 

(e)

Litigation. Such Party is not a party to any legal, administrative, arbitration or other proceeding, and, to such Party’s knowledge, no such proceeding is threatened, before any Governmental Authority that seeks to restrain or prohibit or otherwise challenge the consummation, legality or validity of this Agreement, the subject matter hereof, or that which could be reasonably be expected to have a material adverse effect on such Party’s ability to perform its obligations hereunder.

 

 

18.2.

Additional Representations of Supplier. In addition to representations and warranties set forth elsewhere in this Agreement, Supplier hereby represents and warrants as of the Effective Date and as of the entry into of each Purchase Order hereunder as follows:

 

(a)

None of Supplier, its Affiliates or Representatives is the target of or designated under any sanctions program that is established by statute or regulation of the United States, by Executive Order of the President of the United States, or by designations of any department or agency of the United States government including but not limited to those designations reflected in the “list of Specially Designated Nationals and Blocked Persons” of the Office of Foreign Asset Control, U.S. Department of the Treasury;

 

(b)

Supplier’s Representatives are legally authorized to work in the United States and Supplier shall complete as required by Applicable Law the Department of Labor’s Form I-9 and to retain it for the statutorily designated period and, if requested by Buyer, Supplier shall provide copies of such Forms I-9 to Buyer unless such disclosure shall be prohibited by Applicable Law;

 

(c)

For Services provided at Buyer’s, it’s customer or third party’s premises, Supplier has examined the worksite in order to acquaint itself with the local conditions, including applicable regulations codes, permits, licenses, registrations, environmental standards, and notification requirements concerning site safety and/or security;

 

Supplier has not and will not, absent prior written approval from Buyer, take any actions that: (i) create, or purport to create, any obligation on behalf of Buyer, or (ii) grant, or purport to grant, any rights or immunities to any third party under Buyer’s intellectual property or proprietary rights; and

 

(d)

The bank account named by Supplier to Buyer for all payments to be effected in connection with any Purchase Order hereunder is held in Supplier’s name and solely for its account.

 

19.

ENVIRONMENT, HEALTH AND SAFETY.

 

19.1.

Compliance and Related Matters.

 

(a)

Each of the Parties shall, in addition to other obligations set forth in this Agreement, during the course of performance of their respective obligations under this Agreement or any Purchase Order issued hereunder:

 

(i)

comply with Applicable Laws concerning health, the environment, safety, or pertaining to or regulating pollutants, contaminants, or hazardous, toxic or radioactive substances, materials or wastes, including without limitation the handling, transportation and disposal thereof, or governing or regulating the health and safety of personnel, including but not limited to the Occupational Safety and Health Act of 1970, the Resource Conservation and Recovery Act, and the Toxic Substance Control Act (“TSCA”), as amended (collectively referred to as “EHS Laws”) (pollutants, contaminants, or hazardous, toxic or radioactive substances, materials or wastes as defined under EHS Laws shall be referred to collectively as “Hazardous Materials”);

 

 

(ii)

take reasonable and prudent measures, as appropriate, consistent with applicable industry standards, to mitigate hazards to the environment and to the health and safety of persons;

 

(iii)

select and use only equipment, including but not limited to personal protection equipment, that comports with EHS Laws, implement programs to train its Representatives in the use of such equipment in a safe and lawful manner, and maintain such equipment in good working order at all times; and

 

(iv)

promptly notify the other Party of any incident involving death, injury or damage to any person or property in connection with any Equipment or Purchase Order.

 

(b)

Supplier shall, in addition to other obligations set forth in this Agreement, during the course of performance of its obligations under this Agreement or any Purchase Order issued hereunder:

 

(i)

ensure that Equipment/Services comply with EHS Laws;

 

(ii)

ensure the Equipment, and any and all parts, components, or material thereof, as Delivered by Supplier, bear all markings, labels, warnings, notices or other information required under applicable EHS Laws at the time of such Delivery; and

 

(iii)

comply with any applicable substance declarations and other requirements set forth in Exhibit C.

 

19.2.

On-Site Environmental and Safety Responsibility. Where the Purchase Order includes the presence of Supplier or its Representatives on the premises of Buyer, Buyer’s customer, or any other location other than the premises of Supplier (“Work Site”), Supplier shall: (1) be responsible for the safety, health, medical surveillance, industrial hygiene, training and all other matters required under EHS Laws relating to safety and health of its Representatives at the Work Site, (2) appoint a competent person as its representative for environmental, health and safety who shall take part in safety discussions with Buyer, its Representatives, customer, or the owner of the Work Site, (3)  be responsible for the handling, use, transportation and disposal of any and all substances regulated under the EHS Laws which Supplier or its Representatives bring onto the Work Site or generate in the performance of Supplier’s work pursuant to the applicable Purchase Order, including but not limited to excess, waste or residue, containers or any of such substances not consumed, and for any spills, releases or discharges of such substances to the extent attributable to acts or omissions of Supplier or its Representatives, strictly in accordance with EHS Laws, and (4) ensure Supplier’s Representatives participate in any site-specific safety training and comply with all rules and requirements of Buyer, its customer, or such other owner of the Work Site, in each case, of which Buyer provides Supplier advance written notice.

 

19.3.

Health and Safety Plan. Prior to commencing any Services at a Work Site, Supplier shall, in accordance with EHS Laws provide and comply with a site specific health and safety plan, Work Site requirements, and shall make the same available to Buyer or its Representatives at Buyer’s request. If Supplier fails to comply with this Article 19, Buyer may, at its sole option and without limiting its other rights, order Supplier or its Representatives to cease Services until Supplier complies at Supplier’s sole cost and expense. If Supplier is unable or refuses to take corrective action hereunder Buyer may contract with a third party or otherwise continue such Services at the Work Site and charge Supplier any excess cost reasonably incurred by Buyer. Buyer shall have the right, at its sole discretion, to remove Supplier or its Representatives from a Work Site for violation of this Article 19.

 

 

20.

OPEN SOURCE SOFTWARE.

 

Supplier shall inform Buyer no later than ten (10) Business Days following receipt of any written request from Buyer in connection with a Purchase Order, whether the Equipment/Services contemplated thereby include “Open Source Software.” As used herein “Open Source Software” means any Software that is licensed royalty-free (i.e., fees for exercising the licensed rights are prohibited, whereas fees for reimbursement of costs incurred by licensor can be permitted) under any license terms or other contract terms (“Open License Terms”) which require, as a condition of use, modification and/or distribution of such Software and/or any other Software incorporated into, derived from or distributed with such software (“Derivative Software”), either of the following: (i) that the source code of such Software and/or any Derivative Software be made available to third parties; or (ii) that permission for creating derivative works of such software and/or any Derivative Software be granted to third parties. If Open Source Software is included, Supplier shall deliver to Buyer, not later than the date of order confirmation, (A) a schedule of all Open Source Software files known to be used, indicating the relevant license(s) to the extent known by Supplier; and (B) a written notice that Supplier is not aware of any violation of such license(s) due to such Use of Open Source Software.

 

21.

EXPORT CONTROL AND FOREIGN TRADE REGULATIONS.

 

21.1.

Acknowledgement and Compliance. The Parties acknowledge that all Equipment to be delivered and Services to be provided according to this Agreement are subject to export control and sanctions laws and regulations, including, without limitation, the U.S. Export Administration Regulations (“EAR”) (15 C.F.R. §§ 730-774), the U.S. Foreign Trade Regulations (15 C.F.R. Part 30), and the regulations, rules, and executive orders administered by OFAC (collectively, the “Export Controls and Sanctions Laws”). Each Party agrees to comply with all Export Controls and Sanctions Laws applicable to any such Equipment/Services and shall not take any action that will cause the other Party to violate or be subject to penalty under the Export Controls and Sanctions Laws.

 

21.2.

Export Licenses. Supplier shall obtain all necessary export licenses, unless Buyer or any party other than Supplier is required to apply for the export licenses pursuant to the applicable Export Controls and Sanctions Laws. To the extent Supplier is requested to deliver Equipment/Services regulated under the Arms Export Control Act or the Atomic Energy Act, Supplier shall advise Buyer in advance of order or contract acceptance.

 

21.3.

Provision of Trade Data. At the request of Buyer, Supplier shall provide Buyer for Equipment and Services delivered the following trade data as applicable: (i) “Export Control Classification Number” according to the EAR’s Commerce Control List (ECCN) or the Munitions List Category Designation according to the US International Traffic in Arms Regulations, and all other export control list numbers; (ii) the statistical commodity code according to the current commodity classification for foreign trade statistics and the HS (Harmonized System) coding; (iii) the country of origin (non-preferential origin); and (iv) Supplier’s declaration for preferential origin (in case of European suppliers) or preferential certificates, Supplier’s declaration for preferential origin (in case of European suppliers) or preferential certificates (in case of non-European suppliers) such as NAFTA certificates of origin.

 

 

21.4.

Changes. In the event Supplier has knowledge of any alterations to origin and/or characteristics of the Equipment/Services, it shall notify the Buyer not later than ten (10) Business Days after discovery thereof.

 

21.5.

Additional Buyer’s Obligations. Buyer agrees that it will not, in violation of applicable Export Controls and Sanctions Laws:

 

(a)

directly or indirectly, export, reexport, or transfer Equipment or Services to, or transship Equipment or Services through, a Sanctioned Country;

 

(b)

directly or indirectly, release, sell, provide, export, reexport, transfer, divert, loan, lease, consign, allow access to, or otherwise dispose of Equipment or Services to a Prohibited Person; or

 

(c)

use Equipment or Services to produce products that will be shipped, sold, or supplied, directly or indirectly, to a Sanctioned Country or a Prohibited Person.

 

21.6.

Certain Relief. No Party shall be obligated to fulfill this Agreement if such fulfillment is prevented by any impediments arising out of national or international foreign trade or customs requirements or any embargoes or other sanctions.

 

22.

BUYER CODE OF CONDUCT.

 

Supplier shall comply with the principles and requirements of the "Code of Conduct for AES Suppliers and Third Party Intermediaries" attached hereto as Exhibit D (hereinafter the “Code of Conduct”). If and as requested by Buyer, Supplier shall, not more than once a year (at its option), provide to Buyer either (A) a written self-assessment in substantially the form provided by Buyer or (B) a written report reasonably acceptable to Buyer describing the actions taken or to be taken by Supplier to assure compliance with the Code of Conduct. In addition to any other rights and remedies Buyer may have, in the event of Supplier's material or repeated failure to comply with the Code of Conduct, after providing Supplier reasonable notice and a reasonable opportunity to remedy, Buyer may terminate any outstanding Purchase Orders under this Agreement without any liability whatsoever. Material failures include, but are not limited to, incidents of child labor, corruption and bribery. The notice and remedy provisions herein shall not apply to material failures set forth in the preceding sentence.

 

23.

COMPLIANCE WITH LAWS AND PERMITS.

 

The Parties and their Representatives shall comply with all Applicable Laws in the course of the performance of their respective obligations under this Agreement and any Purchase Orders issued hereunder. In addition, Supplier and Buyer shall each obtain all required licenses, permits, authorizations, registrations or approvals required with respect to the performance of their respective obligations under this Agreement and any Purchase Orders issued hereunder.

 

 

 

24.

DISPUTE RESOLUTION.

 

24.1.

Referral to Senior Management. Except as otherwise provided by this Agreement, any dispute, controversy or claim arising out of or in connection with, or relating to, this Agreement or any breach or alleged breach hereof (which breach or alleged breach by a Party remains uncured within ten (10) Business Days after receipt of written notice thereof from another Party) or the validity or termination hereof or the relationship created between the Parties by and/or through this Agreement (a “Dispute”) shall first be settled as far as possible by good faith negotiations between the parties to the Dispute, in the form of meetings between senior- management level representatives of such Parties, upon the written request by any such Party to the other parties to the Dispute, which writing shall set forth in reasonable detail the nature and extent of the Dispute.

 

24.2.

Referral to Arbitration. If the parties to the Dispute are unable for any reason to resolve a Dispute within thirty (30) days after receipt by any Party of written notice of a Dispute, then any Party may submit the Dispute to arbitration to be finally and exclusively resolved under the Arbitration Rules of the American Arbitration Association (“AAA”) then in effect, except as modified herein, with respect to Equipment and Services to be provided to a Customer with the United States (as applicable, the “Rules”). There shall be three (3) arbitrators. If there are two (2) parties to the Dispute, each of the parties to the Dispute shall nominate one (1) arbitrator in accordance with the Rules. If there are more than two (2) parties to the Dispute, the arbitrators shall be nominated in accordance with the Rules; provided, however, that any Party and its Affiliates shall be entitled to nominate only one (1) such arbitrator. The arbitrators so nominated, once confirmed by the AAA, shall nominate an additional arbitrator to serve as chairman, such nomination to be made within fifteen (15) days of the confirmation by the AAA of the second arbitrator. If the initial arbitrators shall fail to nominate an additional arbitrator within such fifteen (15) day period, such additional arbitrator shall be appointed by the AAA. The arbitrators shall be required to submit a written statement of their findings and conclusions. Except as otherwise agreed by the parties to such Dispute, exclusive venue of arbitration with AAA will be Wilmington, Delaware, and the language of the arbitration shall be English. Each of the Parties will submit to the non-exclusive jurisdiction of the state and federal courts located in Wilmington, Delaware for preliminary relief in aid of arbitration and for the enforcement of any arbitral award from AAA. By agreeing to arbitration, the Parties do not intend to deprive any national court of its jurisdiction to issue any pre-arbitral injunction, pre-arbitral attachment or other order in aid of arbitration proceedings.

 

24.3.

Neutral Arbitrators. None of the Parties or the arbitrators shall select any arbitrator for the arbitral tribunal who has any interest in the Dispute or who has, or within the immediately preceding five (5) years has had, any economic or other relationship with any party to the Dispute.

 

24.4.

Procedures and Costs. The arbitrators shall not have the right to award consequential, incidental, indirect, special, treble, multiple or punitive damages. The arbitral tribunal shall not be empowered to decide any dispute ex aequo et bono or amiable compositeur, and the arbitral tribunal shall decide the Dispute under the substantive laws of the State of Delaware, without regard to applicable choice of law provisions thereof. The arbitration award shall be decided by majority opinion and issued in writing in the English language and shall state the reasons upon which it is based. It may be made public only with the consent of each participating Party or as may be required by law or regulatory authority or as necessary for enforcement of such award. The arbitrators shall allocate the fees and costs of the arbitration. The losing Party(ies) shall pay the prevailing Party(ies)’ attorney’s fees and costs and the costs associated with the arbitration, including the expert fees and costs and the arbitrators’ fees and costs borne by the prevailing Party(ies), all as determined by the arbitrators. Each Party shall bear its own fees and costs until the arbitrators determine which, if any, Party is the prevailing Party(ies) and the amount that is due to such prevailing Party(ies).

 

24.5.

Award. The award rendered by the arbitrators shall be final and binding on the participating Parties and shall be the sole and exclusive remedy between and among the participating Parties regarding any claims, counterclaims, issues or accounting presented to the arbitral tribunal. The award shall be issued no later than one hundred twenty (120) days from the signing or ratification of the Terms of Reference (as defined in the Rules) or as soon thereafter as practicable. The award shall be paid within thirty (30) days after the date it is issued and shall be paid in U.S. Dollars in immediately available funds, free and clear of any Liens, Taxes or other deductions. A judgment confirming or enforcing such award may be rendered by any court of competent jurisdiction.

 

24.6.

Confidentiality. The arbitration shall be confidential. No Party may disclose the fact of the arbitration, any award relating thereto or any settlement relating to any Dispute without the prior consent of the other Party(ies); provided, that such matters may be disclosed without the prior consent of the other Party(ies) to lenders, auditors, tax or other Governmental Authority or as may be required by law or regulatory authorities or as necessary to enforce any award.

 

24.7.

Continued Performance; Provisional Remedies. Notwithstanding the existence of any Dispute, the Parties shall continue to perform their respective obligations under this Agreement unless the Parties otherwise mutually agree in writing. Notwithstanding anything in this Agreement to the contrary, nothing in this Agreement is intended to, nor shall it, prevent the Parties from seeking temporary injunctive relief at any time as may be available under Law or in equity to preserve its rights pending the outcome of any arbitration. Without prejudice to such provisional remedies as may be available under the jurisdiction of a national court, the arbitral tribunal shall have full authority to grant provisional remedies or order the Parties to request that a court modify or vacate any temporary or preliminary relief issued by a court, and to award damages for the failure of any Party to respect the arbitral tribunal’s orders to that effect. The Parties agree that any issue regarding the arbitrability of any claims or disputes arising under, relating to or in connection with this Agreement is an issue solely for the arbitrators, not a court, to decide.

 

24.8.

Waiver of Jury Trial. THE PARTIES HEREBY EXPRESSLY WAIVE ALL RIGHTS TO TRIAL BY JURY OR OTHERWISE ON ANY CLAIM, CAUSE OF ACTION, SUIT OR PROCEEDING PERMITTED UNDER THIS ARTICLE 24. THE PROVISIONS OF THIS AGREEMENT RELATING TO WAIVER OF TRIAL BY JURY SHALL SURVIVE THE TERMINATION OR EXPIRATION OF THIS AGREEMENT.

 

25.

MISCELLANEOUS.

 

25.1.

Governing Law. This Agreement shall be controlled by and construed in accordance with the substantive laws of the State of Delaware without regard to conflict of laws principles. The United Nations Convention on Contracts for the International Sale of Equipment of April 11, 1980 shall be excluded.

 

25.2.

Records. Supplier and its Representatives shall maintain accurate and complete records of all contracts, papers, correspondence, copybooks, applications, accounts, invoices, and/or other information reasonably relating to this Agreement and any Purchase Orders issued hereunder (collectively, “Records”) in accordance with recognized commercial accounting practices, and shall retain such Records for a period of seven (7) years unless a longer period is required under Applicable Law.

 

25.3.

Intentionally Omitted.

 

25.4.

Insurance. Supplier and its Representatives shall comply with the Insurance requirements set forth in Exhibit E attached hereto.

 

25.5.

Assignment; Successors. Neither Party may assign all or any part of this Agreement or any Purchase Order issued hereunder, or any rights or obligations hereunder or thereunder, without the prior written consent of the other Party, which consent shall not be unreasonably withheld. Any purported assignment which fails to comply with the requirements of this Section 25.5 shall be null and void. Notwithstanding the foregoing: (i) either Party may, without the prior written consent of the other Party, assign all or any part of this Agreement or any Purchase Order issued hereunder, or any rights or obligations hereunder or thereunder, to an Affiliate, which will accept such assignment and assume all obligations related to this Agreement and any applicable Purchase Orders (including by executing a joinder to this Agreement in the form of Exhibit B hereto); provided that, notwithstanding any such assignment, the assigning Party shall not be relieved of any of its obligations hereunder by reason of such assignment and shall remain liable hereunder to the same degree that the assigning Party would be responsible had there been no assignment.

 

25.6.

Subcontracting. Supplier shall be solely responsible for the proper selection, supervision, acts and omissions of its subcontractors.

 

25.7.

Other Terms and Amendments. The terms and conditions contained in any sales order, acknowledgment, invoice, website, letter, writing, software or file (such as “clickwrap”, “shrinkwrap”, or website terms of use), or other document or medium shall not be applicable or amend this Agreement or any Purchase Order issued hereunder nor bind the Parties hereto or their Affiliates or Representatives. This Agreement and any Purchase Order issued hereunder may only be amended by a written instrument signed by authorized Representatives of the Parties.

 

25.8.

Government Contracts. When the Equipment/Services are to be used in the performance of a contract or subcontract with a Governmental Authority, applicable government contract requirements attached to this Agreement shall apply and are incorporated herein by reference.

 

25.9.

Relationship of the Parties. Nothing contained in this Agreement shall be construed as creating a partnership, joint venture, agency, employee-employer relationship, trust or other association of any kind between the Parties and each Party shall be individually responsible only for its obligations as set forth in this Agreement. Any Services provided by Supplier, its Affiliates and Representatives pursuant to this Agreement are provided as independent contractors of Buyer and not in the capacity of an employee or agent of Buyer.

 

25.10.

Publicity. No Party hereto shall refer to or use, or permit any persons to refer to or use, any other Party’s name, trademarks, service marks or logos in any advertising, promotional materials, press releases or other publicity without obtaining the prior written consent of the applicable Party.

 

25.11.

Non-Exclusive Remedies and Non-Waivers. No delay or omission by the Parties in exercising any right or remedy provided for herein shall constitute a waiver of such right or remedy nor shall it be construed as a bar to or waiver of any such right or remedy on any future occasion. Any waiver authorized on one occasion must be made in writing and is effective only in that instance and only for the purpose stated, and does not operate as a waiver on any future occasion. The rights and remedies of the Parties herein shall not be exclusive and are in addition to any other rights and remedies provided by Applicable Law or in equity.

 

25.12.

Severability. Any provision of this Agreement or any Purchase Order issued hereunder that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective only to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof (provided the substance of the agreement between the Parties is not thereby materially altered), and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. To the extent permitted by Applicable Laws, the Parties hereto hereby waive any provision of Applicable Law which renders any provision hereof prohibited or unenforceable in any respect.

 

25.13.

Survival. The Title and Risk of Loss, Warranties, Intellectual Property, Defaults and Remedies, Indemnification, Limitations of Liability, Confidentiality, Export Control and Foreign Trade Regulations, Dispute Resolution and Miscellaneous sections of this Agreement, and any provision that contemplates performance or observance subsequent to termination or expiration shall survive termination or expiration of this Agreement.

 

25.14.

Affirmative Action. Supplier shall, to the extent applicable, comply with Buyer’s requirements as promulgated by the U.S. Department of Labor, Office of Federal Contract Compliance Programs set forth in Exhibit F.

 

25.15.

Complete Agreement and Counterparts. This Agreement, together with all Purchase Orders issued hereunder, shall constitute the entire agreement between Buyer and Supplier and shall supersede all previous communications, representations, agreements or understandings, whether oral or written, with respect to the subject matter hereof. The headings used in this Agreement are for reference and shall not limit or affect the meaning or interpretation of any of the terms hereof. Upon the effectiveness of this Agreement, the Prior Agreement shall be deemed amended and restated and superseded and replaced in its entirety by this Agreement, and shall be of no further force or effect.

 

25.16.

Counterparts. This Agreement may be executed in multiple counterparts, each of which when so executed and delivered shall constitute a duplicate original and all counterparts together shall constitute one and the same instrument. Transmission of the executed signature page of a counterpart of this Agreement by electronic mail shall be effective as delivery of an executed counterpart of this Agreement.

 

25.17.

No Pre-Printed Terms. Pre-printed terms or conditions in any invoice, quotation, shipping notice or order acknowledgement issued by Buyer or Supplier shall be of no force or effect, except to the extent included in a Pricing Notice. The terms and conditions applicable to each Purchase Order issued by Buyer shall be those set forth herein and in such Purchase Order and the applicable Pricing Notice therefor.

 

25.18.

Priority. In the event of inconsistency between or among the provisions of this Agreement, a Purchase Order and the applicable Pricing Notice therefor, the following order of precedence, from highest to lowest, shall govern:

 

(a)

mutually agreed Change Orders;

 

(b)

Purchase Order;

 

(c)

this Agreement.

 

25.19.

Notices.

 

(a)

All notices and other communications which either Party is required or may desire to serve upon the other shall be addressed to the Party to be served as follows, unless a different address is designated in writing by the Party to be served:

 

To Buyer:

 

AES Grid Stability, LLC
4300 Wilson Boulevard
Suite 1100
Arlington, VA 22203
Attention: Paul Freedman, General Counsel of The AES Corporation
Email: paul.freedman @aes.com

 

With a copy to:

 

AES Grid Stability, LLC
4300 Wilson Boulevard
Suite 1100
Arlington, VA 22203
Attention: Chris Shelton, Senior Vice President, Chief Product Officer and President, AES Next
Email: chris.shelton@aes.com

 

To Supplier:

 

Fluence Energy, LLC

4602 N. Fairfax Drive
Suite 600
Arlington, VA 22203

Attn: Dennis Fehr, SVP and Chief Financial Officer

Email: dennis.fehr@fluenceenergy.com

 

 

With a copy to:

 

Fluence Energy, LLC

4601 N. Fairfax Drive
Suite 600
Arlington, VA 22203

Attn: Francis A. Fuselier, SVP, General Counsel and Secretary

Email: frank.fuselier@fluenceenergy.com

 

(b)

All notices, requests, consents and other communications under this Agreement must be in writing and shall be deemed to have been duly given and effective (i) immediately (or, if not delivered or sent on a Business Day, the next Business Day) if delivered or sent and received by electronic mail, (ii) on the date of delivery if by hand delivery (or, if not delivered on a Business Day, the next Business Day) or (iii) on the first Business Day following the date of dispatch (or, if not sent on a Business Day, the next Business Day after the date of dispatch) if by a nationally recognized overnight delivery service (all fees prepaid). In the case of notice via email, each Party shall provide confirmation of receipt or non-receipt upon the request of the transmitting Party.

 

(c)

All notices, requests, consents and other communications under this Agreement shall include reference to the applicable Purchase Order number, if any.

 

25.20.

Joint Effort. Preparation of this Agreement has been a joint effort of the Parties and the resulting document shall not be construed more severely against one of the Parties than against the other. Any rule of construction that ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this Agreement, or any amendments or Exhibits hereto.

 

25.21.

Language of the Agreement, Correspondence, Documentation. The language of this Agreement shall be English. Unless to the extent agreed otherwise, correspondence, technical and commercial documents as well as any other information exchanged between the Consortium Members relating to this Agreement shall be in English.

 

[SIGNATURE PAGE FOLLOWS]

 

IN WITNESS WHEREOF, intending to be legally bound, the Parties have caused this Agreement to be executed by their duly authorized representatives as of the date first below above.

 

AES Grid Stability, LLC
By:
Name:
Title:
Fluence Energy, LLC
By:
Name:
Title:
By:
Name:
Title:

 

[Signature Page to AES Amended and Restated Storage Core Frame Purchase Agreement]

 

Schedule 1.1(a)

 

The information contained in columns C and D is provided for informational purposes only. For purposes of this Agreement, the definition of “Applications” shall include Column E.

 

A   No	B   Application	C   Typical Customer	D   Typical system Size in MW	E   Definition
1	Flexible capacity	Power Plant	50 to 100 MW	Flexible capacity is the use of energy storage as a substitute for peak generating capacity or to meet flexible dispatch ability needs in order to secure grid stability.  Such fast acting power sources are an integral part of the grid to provide the required flexible capacity.  The control system is designed such to monitor the grid condition, recognize the need and acts immediately until the grid returns to stable condition, or to be dispatched by the grid operator.  The system is connected to Grids with a Voltage level > 1kV.  The control system makes sure the storage is at the needed stage of charge (subject to setting)
2	Conventional hybrid	Power Plant	up to 10MW	Conventional hybrid is the use of energy storage in conjunction with a conventional generation resource to react on e.g. peak demands.  The system is connected to Grids with a Voltage level > 1kV.  The storage is monitoring and acting based on its own control system
3	Frequency Control	TSO / DSO & PP / Investor	up to 50MW and greater single system size	Frequency regulation is the use of energy storage to regulate electric system frequency as a primary, secondary, or contingency reserve resource.  Energy Storage system is installed usually before the meter and secures the power grid frequency within the frequency band defined by the regulator.  Spinning reserve is a subset of frequency control to deliver the mandatory reserve power out of a storage unit instead of a Power Plant.  The system is connected to Grids with a Voltage level > 1kV.
4	Renewable hybrid	TSO / DSO & PP / Investor	up to 5MW	Renewable hybrid is the use of energy storage in conjunction with a renewable generation resource; (e.g. wind and solar) to control (integral control system) the ramp-up and ramp-down of the power generation or to make the power injection into the power grid stable in relation to the forecast considering parameter such as weather forecast.  The system is connected to Grids with a Voltage level > 1kV.
5	T&D investment/ replacement deferment	TSO / DSO	up to 10MW	Transmission and distribution investment, replacement and deferral is the use of energy storage to replace or defer investment in new conventional electric transmission or distribution infrastructure assets.  The system is connected to Grids with a Voltage level > 1kV.  The storage is monitoring and acting based on its TSO / DSO up to 10MW own control system
6	T&D capacity release	TSO / DSO	up to 10MW	Transmission and distribution capacity release is the use of energy storage to improve the utilization of existing conventional electric transmission or distribution infrastructure assets.  The system is connected to Grids with a Voltage level > 1kV.  The own Storage control system is monitoring the grid conditions and takes corrective action if needed

 

A   No	B   Application	C   Typical Customer	D   Typical system Size in MW	E   Definition
7	Microgrid and Islands*	On shore Microgrid owners and utilities on geographical islands	1-3MW	Energy Storage systems combined with a Microgrid controller providing the micro or island grid master role resulting in a maximized usage of renewable power generation vs. conventional power generation on a geographical or grid island while keeping system voltage and frequency stable monitored and controlled by the storage control systems.  Improving the efficiency of conventional diesel generation where applicable.  The system is connected to Grids with a Voltage level > 1kV.
8	Power Quality (MS UPS)*	Industry / Transportation	1-25MW	Energy Storage system placed behind the meter typically in an industrial environment injecting power in case of grid failure and or voltage dip.  The ability to disconnect ultrafast (<10ms) from the grid to avoid the storage feeding a grid failure.  In addition the system can bridge 15 to 30 minutes power interruption, possibly combined with a diesel power generation.  The system operates on Voltage level > 1kV. The storage control system is monitoring and acting driven by its on control system.
9	Consumer peak shaving (demand charge mgmt.)	Industry / Transportation	1-25MW	Consumer peak shaving, the use of energy storage to reduce an electric consumer’s bill, optimize an electric consumer’s consumption, or to provide other reliability services to the electric consume r.  This energy Storage system is placed behind the meter.  The system operates on Voltage level > 1kV.  The 1 – 25 MW storage control system is monitoring and acting automatically following the given settings.
10	Black start	Gas Turbine power Plants and wind power generation	1-25MW	Black start, the use of energy storage to support generation start-up during recovery from a partial or total shutdown of an electric system as an emergency Gas turbine start up solution.  The Energy Storage system providing power according a defined process until ignition of a gas turbine.  The system operates on Voltage level > 1kV.  The initiation of the Black Start is usually manually, the control system makes sure the black star process as such is following a defined procedure.

 

* Included in the definition of “Application” solely for purposes of Section 4.3.

 

Exhibit A

 

Form of Purchase Order

 

The following sets forth the minimum terms and conditions to be included on a Purchase Order under this Agreement, which terms and conditions may be modified or supplemented by the mutual agreement of the Parties:

 

Equipment:

 

1. Type of Equipment

 

2. Quantity of Equipment

 

3. Unit Price of Equipment

 

4. Total Price of Equipment on this Purchase Order

 

5. Manufacturing Location

 

6. Incoterms and Delivery Location

 

7. Guaranteed Delivery Date

 

8. Insurance

 

9. Equipment Warranty Period

 

10. IP/Software Terms

 

11. Supplier Documents

 

12. Technical Specifications

 

13. Special Packaging Requirements

 

Services:

 

1. Type of Services

 

2. Amount of Services

 

3. Price of Services

 

4. Total Price of Services on this Purchase Order

 

5. Performance Location

 

6. Performance Date(s)

 

7. Insurance

 

8. Services Warranty Period

 

9. IP/Software Terms

 

10. Supplier Documents

 

11. Specifications

 

Other Terms:

 

1. Electronic Banking Method for Payments

 

2. Buyer Furnished Property

 

EXHIBIT B

 

Joinder Agreement Template

 

This Joinder Agreement (the "Joinder Agreement") to the Amended and Restated Storage Core Frame Purchase Agreement, dated __________, 2021 between AES GRID STABILITY, LLC and FLUENCE ENERGY, LLC is made and entered into

 

by and between

 

___

with its registered seat in [Place], [Country]

 

- hereinafter referred to as "Supplier" -

 

and

 

AES (Local Company) ___,

with its registered seat in [Place], [Country]

 

- hereinafter referred to as "Buyer" -

 

- Supplier and Buyer are hereinafter individually
referred to as a "Party" and collectively as the "Parties" -

 

WHEREAS, Supplier and AES GRID STABILITY, LLC (“AES”) entered on XXXXX, 2021 into the Amended and Restated Storage Core Frame Purchase Agreement (the "Agreement") which is attached hereto as Annex 1;

 

WHEREAS, Buyer is an Affiliate of AES and wishes to become a party to the Agreement and to adopt the terms and conditions thereof, and consequently Supplier and Buyer wish to enter into this Joinder Agreement.

 

NOW THEREFORE, in consideration of the mutual covenants and premises contained herein, the Parties agree as follows:

 

Adoption of the AGREEMENT

 

a)

Buyer hereby acknowledges, agrees and confirms that, by its execution of this Joinder Agreement, Buyer shall be deemed a party to the Agreement for all purposes of the Agreement, and shall have all of the obligations of a “Buyer” under the Agreement, as though an original party to the Agreement. Buyer hereby ratifies, as of the date hereof, and agrees to be bound by, and subject to, all of the covenants, terms, provisions and conditions applicable to “Buyer” contained in the Agreement. The terms and conditions as set out in the Agreement are incorporated herein by reference and are made applicable between the Parties.

b)

Without limiting the generality of the foregoing, Buyer hereby represents and warrants that each of the representations and warranties of “Buyer” contained in the Agreement is true and correct as of the date of the execution and delivery of this Joinder Agreement.

c)

This Joinder Agreement shall be controlled by and construed in accordance with the substantive laws of the State of Delaware without regard to conflict of laws principles.

d)

This Joinder Agreement contains the entire agreement between the Parties and supersedes any and all prior negotiations, correspondence, understandings between the Parties concerning the subject matter hereof. It may not be changed orally, but only by an agreement in writing signed by both Parties hereto.

e)

This Joinder Agreement may be executed in multiple counterparts, each of which when so executed and delivered shall constitute a duplicate original and all counterparts together shall constitute one and the same instrument. Transmission of the executed signature page of a counterpart of this Joinder Agreement by electronic mail shall be effective as delivery of an executed counterpart of this Agreement.

 

Specific stipulations under this JOINDER Agreement

 

[ONLY country specific deviations from the Agreement are to be stipulated here.]

 

a)

[Delivery and Payment terms]

 

b)

[Term and Termination]

 

c)

[Country specific regulations (jurisdiction, governing law, tax etc.)]

 

d)

...

 

Order of Precedence between the Agreement and the Adoption Agreement

 

In the event of any conflict or inconsistency between the terms of this Joinder Agreement and the Agreement, the Joinder Agreement shall prevail over the Agreement.

 

Supplier		Buyer
Place, Date:		Place, Date:
Name:		Name:		Name:
(Print)		(Print)		(Print)
Title:		Title:		Title:

 

Annex 1: Amended and Restated Storage Core Frame Purchase Agreement

 

Exhibit C

 

Substance Declaration

 

If Supplier furnishes Equipment that are subject to restrictions, rules or regulations for Hazardous Materials or other substances comprising, part of or contained in such Equipment, including but not limited to statutes, rules, regulations, codes, rules, standards and requirements of (1) EHS Laws, (2) governing, controlling or regulating Hazardous Materials, including but not limited to the Restriction on the Use of Certain Hazardous Substances in Electrical and Electronic Equipment (hereinafter “RoHS”), Directives 2002/96/EC and 2012/19/EU as well as their respective incorporation into EU member states’ legislation including any amendments thereto (hereinafter “WEEE”), (3) the Regulation EC 1907/2006 of the European Parliament and of the Council concerning the Registration, Evaluation, Authorization and Restriction of Chemicals including any amendment thereto (hereinafter “REACH”), (4) EC Directive 2006/66/EC on Batteries and Accumulators and Waste Batteries and Accumulators and/or (5) TSCA, without limiting Supplier’s obligations under this Purchase Order, Supplier shall comply with the requirements of this “Substance Declaration”.

 

Supplier shall submit to Buyer with each Equipment, the chemical substances contained therein or in the Service deliverable, and/or Material Safety Data Sheets, Safety Data Sheets or other such documentation as required by Applicable Laws (including without limitation the OSHA Hazardous Communication Standard 29 CFR 1910.1200 et seq.). If Supplier furnishes Equipment that are subject to substance restrictions, rules or regulations including but not limited to those identified in this Exhibit, Supplier shall declare such substances on the Buyer’s web database BOMcheck (www.BOMcheck.net) or, only if and approved in writing in advance by Buyer, in another reasonable format provided to Buyer no later than first delivery date of the Equipment, and Supplier shall prior to Supplier ’s first delivery of Equipment complete and comply with the Declarable Substances-Form (hereinafter “Substance Declaration”) in the Buyer supplier portal “SCM STAR” or in hard copy forwarded to Buyer. In addition, for Equipment that are subject to substance restrictions, rules or regulations Supplier shall provide ordering entity with a safety data sheet required in Article 31of the Regulation EC 1907/2006 (REACH) and Supplier shall keep this Substance Declaration up to date.

 

Should a delivery hereunder contain “dangerous goods” as so classified pursuant to Applicable Laws, Supplier shall notify Buyer in writing in sufficient detail to identify the Equipment, the hazards, and the laws, rules or regulations applicable thereto no later than three (3) business days after receipt of the Purchase Order.

 

Exhibit D

 

Code of Conduct for AES Suppliers and Third Party Intermediaries

 

This Code of Conduct defines the basic requirements placed on AES’ suppliers and third party intermediaries concerning their responsibilities towards their stakeholders and the environment. AES reserves the right to reasonably change the requirements of this Code of Conduct. In such event AES expects the supplier to accept such reasonable changes.

 

The supplier and/or third party intermediary declares herewith:

 

•      Legal compliance

o

to comply with the laws of the applicable legal Equipment and Services.

•      Prohibition of corruption and bribery

o

to tolerate no form of and not to engage directly or indirectly in any form of corruption or bribery and not to grant, offer or promise anything of value to a government official or to a counterparty in the private sector to influence official action or obtain an improper advantage.

•      Fair competition, anti-trust laws and intellectual property rights

	o	to act in accordance with national and international competition laws and not to participate in price fixing, market or customer allocation, market sharing or bid rigging with competitors;
	o	to respect the intellectual property rights of others.

•      Conflicts of interest

o

to avoid all conflicts of interest that may adversely influence business relationships.

•      Respect for the basic human rights of employees

	o	to promote equal opportunities for and treatment of its employees irrespective of skin color, race, nationality, social background, disabilities, sexual orientation, political or religious conviction, sex or age;
	o	to respect the personal dignity, privacy and rights of each individual;
	o	to refuse to employ or make anyone work against his will;

o

to refuse to tolerate any unacceptable treatment of employees, such as mental cruelty, sexual harassment or discrimination;

	o	to prohibit behavior including gestures, language and physical contact, that is sexual, coercive, threatening, abusive or exploitative;
	o	to provide fair remuneration and to guarantee the applicable national statutory minimum wage;
	o	to comply with the maximum number of working hours laid down in the applicable laws;

o

to recognize, as far as legally possible, the right of free association of employees and to neither favor nor discriminate against members of employee organizations or trade unions.

•      Prohibition of child labor

o

to employ no workers under the age of 15 or, in those countries subject to the developing country exception of the ILO Convention 138, to employ no workers under the age of 14.

 

•      Health and safety of employees

	o	to take responsibility for the health and safety of its employees;
	o	to control hazards and take the best reasonably possible precautionary measures against accidents and occupational diseases;
	o	to provide training and ensure that employees are educated in health and safety issues;
	o	to set up or use a reasonable occupational health & safety management system.

•      Environmental protection

o

to act in accordance with the applicable statutory and international standards regarding environmental protection;

		to minimize environmental pollution and make continuous improvements in environmental protection;
	o	to set up or use a reasonable environmental management system.

•      Supply chain

	o	to use reasonable efforts to promote among its suppliers compliance with this Code of Conduct;
	o	to comply with the principles of nondiscrimination with regard to supplier selection and treatment.

•      Conflict Minerals

o

to take reasonable efforts to avoid in its products the use of raw materials which directly or indirectly finance armed groups who violate human rights.

 

Exhibit E

 

Insurance

 

(A) Supplier shall, at its sole expense, maintain the types of insurance coverage(s) listed below. The coverage limits for each type of insurance listed below shall be the greater of: (i) the coverage limits listed below; or (ii) if the Purchase Order requires Supplier to maintain higher limits, then the coverage limits specified in the Purchase Order. Evidence of insurance required by this Purchase Order is to be furnished before any Goods/Services is commenced. Supplier and its Representatives shall maintain such insurance in full force and effect during the term of this Purchase Order, and, in addition, for as long as Supplier is under any warranty obligations arising out of this Purchase Order. All insurers on required insurance coverage(s) shall have an A.M. Best Rating of A- /VIII or better. Customer and its subsidiaries, Affiliates, and its or their Representatives, and/or any other party designated on the Purchase Order as applicable shall be named as an additional insured, with respect to the Commercial General Liability and Automobile Liability policies/coverage(s). All insurance certificates shall be in a form satisfactory to Customer. Supplier shall deliver the certificates of insurance, naming Customer and, if applicable, Customer’s customer/end user, as the Certificate Holder. All of Supplier’s policies of insurance, except for Workers’ Compensation and Employers Liability, shall be primary insurance and noncontributing with any other insurance maintained by Customer, Customer’s customer/end user and/or other parties. All of Supplier’s policies of insurance, except for Worker’s Compensation and Employer’s Liability, shall contain a cross-liability or severability of interest clause. The limits of insurance set forth below may be satisfied by any combination of excess and primary insurance coverage. Supplier shall require all its insurers to waive all rights of subrogation against Customer, Customer’s customer/end user, and their respective subsidiaries, Affiliates, and Representatives, and any other party designated as an additional insured.

 

(B) Supplier shall maintain the following insurance coverage(s):

 

(i) Worker's Compensation Insurance in accordance with the statutory requirements of the location in which the Purchase Order is performed. If there is an exposure to injury to Supplier’s employee under the U.S. Longshoremen’s and Harbor Worker’s Compensation Act, the Jones Act or under laws, regulations or statutes applicable to maritime employees, coverage required by law shall be provided for same.

 

(ii) Employer's Liability Insurance with the following limits of liability:

 

• $1,000,000 for each occurrence;

• $1,000,000 Disease Policy

• $1,000,000 Each Employee.

 

(iii) Commercial General Liability Insurance, in occurrence coverage form, with minimum limits of $5,000,000 per occurrence, including the following coverages:

 

• Products and Completed Operations

• Contractual Liability insuring the indemnity obligations assumed by Supplier under this Purchase Order

 

• Premises/Operations

• Underground, Undermining, Explosion and Collapse (XCU) Hazard,

• Broad Form Property Damage (including Completed Operations)

 

(iv) Automobile Liability Insurance, including coverage for owned, hired, and non-owned automobiles and trucks used by or on behalf of the Supplier providing insurance for bodily injury, liability and property damage liability with minimum limits for each type of coverage of $5,000,000 per occurrence.

 

(C) The following coverages are specifically required if a Purchase Order involves: (i) [intentionally omitted]; (ii) watercraft owned, operated or chartered by Supplier or its Representatives, liability arising out of such watercraft shall be insured by the General Liability or by Protection and Indemnity Insurance with a CSL of no less than $1,000,000 per each occurrence; (iii) the hauling and/or rigging of property in excess of $100,000, Supplier shall carry “All Risk” Transit Insurance, or “All Risk” Motor Truck Cargo Insurance (Such insurance shall provide a limit of not less than the replacement cost of the highest value single lift or highest value being moved, whichever is greater, and insuring the interest of Supplier, Customer and Customer’s customer/end user, as their respective interests may appear); (iv) aircraft (fixed wing or helicopter) owned, operated or chartered by Supplier or its Representatives, liability arising out of such aircraft shall be insured for not less than $1,000,000 CSL each occurrence; (v) access, storage, transmission or processing of Customer’s, its customer’s /end user’s, its or their Representatives’ confidential information, a Cyber Liability Errors and Omissions Policy shall be procured by Supplier providing coverage, for acts, errors, omissions, and negligence of employees and contractors giving rise to potential liability, financial and other losses relating to data security and privacy, including cost of defense and settlement, in an amount of at least $2,000,000 each claim and in the aggregate; (vi) engineering, design and/or development services, Supplier shall procure Professional Liability and Errors and Omissions Liability Insurance providing coverage for acts, errors, omissions arising out of insured’s negligence in an amount not less than $5,000,000 (USD) per claim and in the aggregate; (viii) Supplier, its Affiliates and/or its and their respective Representative being granted access to Customer or Customer’s Affiliate’s facilities, premises and/or systems, Supplier shall procure Employee Dishonesty and Computer Fraud Insurance covering losses arising out of or in connection with any fraudulent or dishonest acts committed by its personnel, acting alone or with others, in an amount not less than $1,000,000 (USD) per occurrence. Furthermore, on a case by case basis, where a Purchase Order specifies that environmental liability insurance is required for that specific project, then Supplier shall obtain Environmental Impairment Liability Insurance for such project with limits of $5,000,000 per occurrence and in the aggregate.

 

(D) The procurement, maintenance or acceptance of insurance coverage by Customer, if any, shall not: (i) relieve Supplier of liability for loss or damage in excess of the policy coverage limits specified herein; or (ii) limit or release Supplier of its obligations or liabilities under the Purchase Order.

 

(E) No delay or failure in declaring any default or in enforcing any of the requirements of this Exhibit E, and no course of dealing between Customer and Supplier shall constitute a waiver of any of the requirements of this Exhibit E.

 

Exhibit F

 

Affirmative Action

 

Should Buyer become a federal contractor/subcontractor, Buyer will be required to comply with certain federal regulations, including the regulations promulgated by the U.S. Department of Labor, Office of Federal Contract Compliance Programs (“OFCCP”). Should Buyer become a federal contractor, Buyer will also be required to ensure compliance of the OFCCP by its subcontractors, vendors and suppliers covered under the OFCCP (each, a “Covered Party”). Supplier is hereby notified of Buyer’s policy related to affirmative action and its mutual OFCCP obligations to the extent Supplier, its subcontractors, vendors or suppliers is a Covered Party.

 

Buyer is an equal opportunity/affirmative action employer and does not discriminate on the basis of race, color, creed, religion, national origin, ancestry, sex, age, physical or mental disability, marital status, pregnancy, genetic information, sexual orientation, gender identity, protected veteran or military status, or any other consideration not related to the person’s ability to do the job or otherwise made unlawful by federal, state or local law in the following employment practices, including among others: recruiting, hiring, placement, transfer, promotion, demotion, selection for training, layoff, termination, shift assignment, determination of service, rates of pay, benefit plans, and all forms of compensation and other personnel actions.

 

Should Buyer become a federal contractor/subcontractor, Buyer’s Covered Parties (including Supplier and its Covered Parties, if applicable) will also have an obligation to comply with equal opportunity and affirmative action principles. Therefore, Buyer’s Covered Parties (including Supplier and its Covered Parties, if applicable) will take appropriate action in support of these principles. Through our mutual effort and cooperation, we will continue to provide a working environment that appreciates and encourages diversity, promotes equal employment opportunity and is free from any type of discrimination.

 

Supplier and its Covered Parties, if applicable, shall abide by the requirements of the “Equal Opportunity Clause” in Section 202 of Executive Order 11246. See 41 CFR 60-1.4(a).

 

The following shall also apply if the Supplier is a Covered Party:

 

For contracts of $100,000 or more, Supplier shall comply with the following: This Supplier, contractor and subcontractor shall abide by the requirements of 41 CFR 60-300.5(a). This regulation prohibits discrimination against qualified protected veterans, and requires affirmative action by covered prime contractors and subcontractors to employ and advance in employment qualified protected veterans.

 

For contracts of $10,000 or more, Supplier shall comply with the following: This Supplier, contractor and subcontractor shall abide by the requirements of 41 CFR 60-741.5(a). This regulation prohibits discrimination against qualified individuals on the basis of disability, and requires affirmative action by covered prime contractors and subcontractors to employ and advance in employment qualified individuals with disabilities.

 

Exhibit G

 

Key Agreements

 

1.

Third Amended and Restated Limited Liability Company Agreement of Fluence Energy, LLC, dated as of [      ].

2.

Amended and Restated AES License Agreement, dated as of June 9, 2021, between Fluence Energy, LLC and AES Grid Stability LLC.

3.

Amended and Restated AES License Agreement, dated as of June 9, 2021, between Fluence Energy, LLC and The AES Corporation.

4.

Services Agreement, dated as of January 1, 2018, between The AES Corporation, Fluence Energy, LLC and such other companies as set forth therein.

5.

Amended and Restated Storage Core Frame Purchase Agreement, dated as of the date hereof, between AES Grid Stability, LLC and Fluence Energy, LLC

6.

Amended and Restated Company Name Affix and Trademark License Agreement, dated [ ], between The AES Corporation and Fluence Energy, LLC.

7.

Amended and Restated Credit Support and Reimbursement Agreement, dated as of June 9, 2021, by and among Fluence Energy, LLC, The AES Corporation and Siemens Industry, Inc.

 

Attachment A

 

DESCRIPTION OF SUPPLIER’S BATTERY STORAGE EQUIPMENT AND SERVICES

 

 

Exhibit 10.23

 

Amended and Restated

 

Storage Core Frame Purchase Agreement

 

by and between

 

Siemens Industry, Inc.

 

as Buyer

 

and

 

Fluence Energy, LLC

 

as Supplier

 

dated [●], 2021

 

 

	Table of Contents
		Page
1.	DEFINITIONS; INTERPRETATION	1
1.1.	Definitions	1
1.2.	Interpretation	9
2.	TERM AND TERMINATION OF AGREEMENT	10
2.1.	Term	10
2.2.	Early Termination	10
3.	SCOPE OF AGREEMENT	10
3.1.	Scope Generally	10
3.2.	Further Siemens Contracting Parties	10
4.	ORDERS	11
4.1.	Pricing Requests	11
4.2.	Purchase Orders	11
4.3.	Exclusivity and Certain Related Priorities	11
4.4.	Non-Competition	14
4.5.	Payment Terms	16
4.6.	Disputed Payments	17
4.7.	Late Payments	17
4.8.	Taxes; Export and Import Duties	17
5.	DELIVERY	17
5.1.	Delivery Terms; Inspection	17
5.2.	Guaranteed Delivery Date	17
5.3.	Delay Liquidated Damages	18
5.4.	Buyer Caused Delay	18
6.	TITLE, RISK OF LOSS AND CARE, CUSTODY AND CONTROL	18
6.1.	Transfer of Title and Risk of Loss	18
6.2.	Warranty of Title	18
7.	INSPECTION AND QUALITY CONTROL	18
7.1.	Inspection Rights	18
7.2.	Quality Control	19
8.	WARRANTIES	19
8.1.	Equipment Warranty	19
8.2.	Services Warranty	19
8.3.	Notification Requirements	19
8.4.	Corrective Action	19
8.5.	Warranty Exclusions	20
8.6.	NO IMPLIED WARRANTIES	20
8.7.	Reserved Rights	20
8.8.	Access to Buyer Data	20
9.	BUYER FURNISHED PROPERTY	21
10.	PACKAGING	21
11.	FORCE MAJEURE.	21
11.1.	Effect of Force Majeure	21
11.2.	Procedures	21
11.3.	Termination for Extended Force Majeure	22
12.	CHANGE ORDERS	22
12.1.	Change Order	22
12.2.	Change Order Process	22
12.3.	Change Order Restrictions	23
12.4.	No Change	23

 

 

13.	INTELLECTUAL PROPERTY	23
13.1.	Grant of License	23
13.2.	No Copies	23
13.3.	Proprietary Notices	24
13.4.	Security	24
13.5.	No Reverse Engineering	24
13.6.	Open Source Software	24
13.7.	Reporting	24
13.8.	Relief	24
13.9.	Improvements	24
13.10.	Ownership	25
13.11.	Enforcement	26
13.12.	Duration and Transfers	26
13.13.	Government End Users	27
13.14.	Reservation of Rights	27
14.	DEFAULTS AND REMEDIES	27
14.1.	Supplier Defaults	27
14.2.	Buyer Defaults	27
14.3.	Remedies	28
15.	INDEMNIFICATION	28
15.1.	General	28
15.2.	Infringement Indemnification by Supplier	29
15.3.	Infringement Indemnification by Buyer	30
15.4.	Indemnification Procedures	30
15.5.	Limited Waiver of Certain Immunities	31
15.6.	Survival	32
16.	LIMITATIONS OF LIABILITY	32
16.1.	WAIVER OF CERTAIN DAMAGES	32
16.2.	MAXIMUM LIABILITY	32
16.3.	EFFECTIVENESS	32
16.4.	Commencement of Claims	32
17.	CONFIDENTIALITY	32
17.1.	Confidential Information	32
17.2.	Non-Disclosure	33
17.3.	Exceptions	33
17.4.	Representatives Bound	33
17.5.	Survival	33
18.	REPRESENTATIONS AND WARRANTIES	33
18.1.	Representations of the Parties	33
18.2.	Additional Representations of Supplier	34
19.	ENVIRONMENT, HEALTH AND SAFETY	35
19.1.	Compliance and Related Matters	35
19.2.	On-Site Environmental and Safety Responsibility	36
19.3.	Health and Safety Plan	36
20.	OPEN SOURCE SOFTWARE	37
21.	EXPORT CONTROL AND FOREIGN TRADE REGULATIONS	37
21.1.	Acknowledgement and Compliance	37
21.2.	Export Licenses	37
21.3.	Provision of Trade Data	37
21.4.	Changes	37
21.5.	Additional Buyer’s Obligations	38
21.6.	Certain Relief	38

 

 

22.	BUYER CODE OF CONDUCT.	38
23.	COMPLIANCE WITH LAWS AND PERMITS	38
24.	DISPUTE RESOLUTION	38
24.1.	Referral to Senior Management	38
24.2.	Referral to Arbitration	39
24.3.	Neutral Arbitrators	39
24.4.	Procedures and Costs	39
24.5.	Award	39
24.6.	Confidentiality	40
24.7.	Continued Performance; Provisional Remedies	40
24.8.	Waiver of Jury Trial	40
25.	MISCELLANEOUS	40
25.1.	Governing Law	40
25.2.	Records	40
25.3.	Intentionally Omitted	40
25.4.	Insurance	40
25.5.	Assignment; Successors	41
25.6.	Subcontracting	41
25.7.	Other Terms and Amendments	41
25.8.	Government Contracts	41
25.9.	Relationship of the Parties	41
25.10.	Publicity	41
25.11.	Non-Exclusive Remedies and Non-Waivers	41
25.12.	Severability	42
25.13.	Survival	42
25.14.	Affirmative Action	42
25.15.	Complete Agreement and Counterparts	42
25.16.	Counterparts	42
25.17.	No Pre-Printed Terms	42
25.18.	Priority	42
25.19.	Notices	43
25.20.	Joint Effort	44
25.21.	Language of the Agreement, Correspondence, Documentation	44

 

Schedule 1.1(a) Applications

 

Exhibits
Exhibit A	Form of Purchase Order
Exhibit B	Form of Joinder Agreement
Exhibit C	Substance Declaration
Exhibit D	Code of Conduct
Exhibit E	Insurance
Exhibit F	Affirmative Action Requirements
Exhibit G	Key Agreements

 

Attachment A Description of Supplier’s Battery Storage Equipment and Services

 

 

THIS AMENDED AND RESTATED STORAGE CORE FRAME PURCHASE AGREEMENT (this “Agreement”) is made and entered into on [·], 2021 between Siemens Industry, Inc. hereinafter referred to as “Buyer” and Fluence Energy, LLC, whose principal place of business is 4601 N. Fairfax Drive, Suite 600, Arlington, Virginia 22203 hereinafter referred to as “Supplier”. This Agreement shall become effective upon the Effective Date defined in Section 2.1 below. Each of Buyer and Supplier are referred to herein as a “Party” and collectively are referred to herein as the “Parties.”

 

WHEREAS, Buyer is a company providing products, services and solutions to the buildings and energy markets;

 

WHEREAS, Buyer may want to purchase energy storage equipment and related services to incorporate within its electrical transmission and distribution projects;

 

WHEREAS, Supplier sells energy storage equipment and related services; WHEREAS, Supplier wishes to cooperate with Buyer in order to fulfill Buyer’s requirements and provide preferred purchasing conditions to Buyer for those energy storage equipment and related services;

 

WHEREAS, Supplier and Buyer are parties to that certain Storage Core Frame Purchase Agreement, dated as of January 1, 2018, by and between Supplier and Buyer (the “Prior Agreement”); and

 

WHEREAS, Buyer is party to the Second Amended and Restated Limited Liability Company Agreement of Supplier, dated as of June 9, 2021(the “LLC Agreement”);

 

WHEREAS, Supplier, Buyer and certain other parties are entering into a series of transactions in connection with the formation of Fluence Energy, Inc., a Delaware corporation (“Issuer”) to serve as the vehicle through which the public will own indirect interests in Supplier through an initial public offering;

 

WHEREAS, in connection with the closing of initial public offering, the LLC Agreement is being amended and restated in its entirety by the Third Amended and Restated Limited Liability Company Agreement, dated on or about the date hereof (the “Restated LLC Agreement”), to, among other things, reflect Issuer’s ownership of Supplier and the restructuring of Supplier and its Affiliates; and

 

NOW, THEREFORE, the Parties agree that on the Effective Date, the Prior Agreement is hereby amended and restated in its entirety by this Agreement, and further agree as follows:

 

1.

DEFINITIONS; INTERPRETATION.

 

1.1.

Definitions. Initially-capitalized terms used in this Agreement (including the preamble and Recitals hereto) and not otherwise defined herein shall have the meanings specified below.

 

“AES Grid Stability” means AES Grid Stability, LLC.

 

“AES Storage Core Frame Purchase Agreement” means that certain Amended and Restated Storage Core Frame Purchase Agreement, dated of even date herewith, between AES Grid Stability and Supplier.

 

 

“Affiliate” means, at any time, and with respect to any Person or group of Persons, a Person that at such time directly or indirectly through one or more intermediaries, Controls, is Controlled by, or is under common Control with such Person or group of Persons. No Person shall be considered an Affiliate of another Person or under the Control of such other Person so long as (i) it is owned less than 50% by such other Person, (ii) such other Person has no capacity to elect or appoint the majority of the board of directors or similar governing body of the subject Person, (iii) such other Person does not consolidate the subject Person in its financial reporting and (iv) there is no other management or services agreement pursuant to which such other Person exerts control over the subject Person. With respect to Buyer, none of Gamesa Corporación Technológica S.A., Siemens Healthineers AG nor any of their respective Subsidiaries shall be considered an Affiliate of Buyer.

 

“Agreement” has the meaning set forth in the Preamble hereto.

 

“Applicable Law” means any applicable constitutional provision, statute, act, code, law, regulation, rule, ordinance, order, decree, ruling, proclamation, resolution, judgment, decision or declaration of a Governmental Authority having valid jurisdiction.

 

“Application” means one of the stationary, battery based energy storage solutions and services for the grid connected storage market (including systems both in front of and behind the meter) set forth on Schedule 1.1(a).

 

“Battery” means a battery included within the Equipment supplied pursuant to this Agreement.

 

“Business Day” means any day except a Saturday, Sunday or other day on which commercial banks in New York, New York are authorized or required by law to close.

 

“Buyer” has the meaning set forth in the Preamble hereto.

 

“Buyer Data” has the meaning set forth in Section 13.10(b).

 

“Buyer Event of Default” has the meaning set forth in Section 14.2.

 

“Buyer Furnished Property” has the meaning set forth in Article 9.

 

“Change Order” has the meaning set forth in Section 12.1.

 

“Change Order Information” has the meaning set forth in Section 12.2.

 

“Claims” has the meaning set forth in Section 15.1.

 

“Confidential Information” has the meaning set forth in Section 17.1.

 

“Control” means, with respect to the relationship between two or more Persons, the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through ownership of voting securities, as trustee or executor, by contract or otherwise. The terms “Controlled” or “under common Control with” have correlative meanings.

 

 

“Defect” means any material defect in design, manufacturing, materials or workmanship in or to the Equipment, or any failure of the Equipment to materially comply with the Technical Specifications, excluding in all cases any of the foregoing attributable to or caused by ordinary wear and tear of the Warranted Equipment.

 

“Deliver”, “Delivered” or “Delivery” means that Supplier has caused the delivery of the applicable Equipment to the Delivery Point in accordance with the terms of this Agreement.

 

“Delivery Point” means the delivery location set forth in a Pricing Notice, provided that, if no such location is specified in the applicable Pricing Notice, the Delivery Point for Equipment comprised of batteries shall be at the facility of the supplier thereof and the Delivery Point for all other Equipment shall the location of Supplier’s facility.

 

“Derivative Software” has the meaning set forth in Article 20.

 

“EAR” has the meaning set forth in Section 21.1.

 

“eBoP” shall have the meaning assigned to such term in Section 4.3(d).

 

“Effective Date” shall have the meaning assigned to such term in Section 2.1.

 

“EHS Laws” has the meaning set forth in Section 19.1.

 

“Enforcement Action” has the meaning set forth in Section 13.11.

 

“Equipment” means any energy storage equipment offered for sale by Supplier pursuant to this Agreement, as set forth in Attachment A.

 

“Equipment Warranty” has the meaning set forth in Section 8.1.

 

“Equipment Warranty Period” has the meaning set forth in Section 8.1.

 

“Exclusive Activities” means the development, marketing and sale of an Integrated Solution for one or more Applications, where the size of such Integrated Solution is equal to or greater than 500 kilowatts, including those Integrated Solutions marketed, sold and delivered through a Buyer sales channel or another Supplier sales channel as contemplated in Supplier’s then current business plan.

 

“Export Controls and Sanctions Laws” has the meaning set forth in Section 21.1.

 

“Force Majeure” means any event which is not within the reasonable control of the Party affected and with the exercise of due diligence could not reasonably be prevented, avoided or removed by such Party, which causes the affected Party to be delayed, in whole or in part, or unable, using commercially reasonable efforts, to partially or wholly perform its obligations under this Agreement (other than an obligation for the payment of money) and is not caused by or resulting from the negligence or breach or failure of such Party to perform its obligations under this Agreement, which, subject to the foregoing, may include: acts of God or the public enemy, natural disasters, war, terrorism, insurrection, sabotage, unavoidable accidents, orders, decrees, rulings and policies of any Governmental Authority, fires, floods, earthquakes, volcanic activity, severe weather conditions not reasonably foreseeable taking into account the location of performance and the climate patterns applicable thereto, explosions, riots, general strikes and area lockouts. Force Majeure shall not include a Party’s financial inability to perform under this Agreement or any Purchase Order.

 

 

“Further Siemens Contracting Parties” has the meaning set forth in Section 3.2.

 

“Governmental Authority” means a federal, state, local or foreign governmental authority (including any regulatory authority); a state, province, commonwealth, territory or district thereof; a county; a city, town, township, or other municipality; a district, ward or other subdivision of any of the foregoing; any executive, legislative or other governing body of any of the foregoing; any agency, authority, board, department, system, service, office, commission, committee, council or other administrative body of any of the foregoing; any court or other judicial body; and any officer, official or other representative of any of the foregoing.

 

“Guaranteed Delivery Date” has the meaning set forth in Section 5.2.

 

“Hazardous Materials” has the meaning set forth in Section 19.1.

 

“Indemnified Party” has the meaning set forth in Section 15.1.

 

“Indemnifying Party” has the meaning set forth in Section 15.1.

 

“Infringement Claim Costs” means any and all judgments, damages, fines, awards, penalties, and interest associated with any of the foregoing, that, in each case, are finally awarded in a claim for which an Indemnifying Party is obligated to indemnify an Indemnified Party under Section 15.2 or 15.3, as applicable, and costs and expenses, including reasonable attorneys’ fees, court costs and other reasonable costs of suit, arbitration, dispute resolution or other similar proceedings, associated with such claim.

 

“Integrated Solution” means an integrated, stationary, battery based energy storage solution, comprised of inverters, a control system including software, and electrical battery. Notwithstanding the foregoing, the following will not be considered Integrated Solutions: (i) uninterruptable power supply (UPS) systems (other than for use in Applications), (ii) a virtual energy storage network built out of individual, connected, geographically distributed product units of less than 150 kilowatts per unit (a “swarm”), (iii) static synchronous compensators (Statcom), (iv) supercapacitors, (v) the technology for the storage medium (e.g. batteries), (vi) energy storage inverters, (vii) stationary storage systems sold as part of an integrated product in conjunction with the sale of energy storage systems on board of vessels, vehicles or locomotives, where the main purpose of the stationary storage system is to charge or to be charged by such on board energy storage system or the vehicle brake energy and (viii) stationary storage systems providing power directly and primarily to electric vehicle charging stations.

 

“Intellectual Property” means United States and foreign: (a) Patents; (b) Trademarks; (c) copyrights, whether registered or unregistered, and all applications and registrations therefor, web sites, proprietary domain names, mask works, and all applications and registrations therefor; (d) Know-How; (e) Software; and (f) similar or other intellectual property rights, subject matter of any of the foregoing, tangible embodiments of any of the foregoing, licenses in, to and under any of the foregoing.

 

 

“Key Agreements” means the various contracts between Supplier and certain of its members or their Affiliates listed on Exhibit G, as the same may be amended and/or restated from time to time.

 

“Know-How” means all proprietary and confidential information and data (irrespective as to whether such information or data is available by way of documentation, orally or in electronic format, or protected by copyrights), including business and trade secrets, technical and business information and data, know-how and similar proprietary rights in confidential information and processes, discoveries, analytic models, improvements, techniques, devices, methods, patterns, formulations and specifications, all to the extent that such information and data are proprietary and confidential and neither Software nor a Patent.

 

“License” has the meaning set forth in Section 13.1.

 

“Licensed Technology” means, collectively, all of the following to the extent owned by, or licensed (with the right to grant sublicenses) to, Supplier, relating to the Equipment or the uses and purposes contemplated in connection with this Agreement or any Purchase Order issued hereunder for such Equipment: (a) Software embedded in or integrated with the Equipment, (b) any other trade secrets, proprietary information, know-how or other Intellectual Property incorporated into or embedded within the Equipment or necessary for the installation, operation, maintenance, and ownership of the Equipment, (c) any improvements of or updates to any of the foregoing provided to Buyer pursuant to this Agreement, if any, and (d) all Intellectual Property rights of Supplier in the Licensed Technology listed in any of clauses (a) through (d) above, in each case, for use solely in connection with the installation, commissioning, operation and maintenance of the Equipment at the Project Site or such other site as Buyer shall elect.

 

“LLC Agreement” has the meaning set forth in the Recitals hereto.

 

“Lockup Period” shall have the meaning assigned to such term in Section 4.3(a).

 

“OFAC” means the Office of Foreign Assets Control of the U.S. Department of the Treasury.

 

“Open License Terms” has the meaning set forth in Article 20.

 

“Open Source Software” has the meaning set forth in Article 20.

 

“Party” has the meaning set forth in the Preamble hereto.

 

“Parties” has the meaning set forth in the Preamble hereto.

 

“Patents” means all patents, utility models, patent and utility model applications, and all priorities and rights related thereto, including all reissues, reexaminations, divisions, continuations, continuations-in-part, provisionals, continued prosecution applications, substitutions, extensions, additions or renewals of any of the foregoing.

 

“Person” means any natural person, corporation, partnership, joint venture, trust, estate, unincorporated association, limited liability company or any other entity (whether or not having separate legal personality), and shall include any successor (by merger or otherwise) of such entity.

 

 

“Potential Project” shall have the meaning assigned to such term in Section 4.3(b)(ii).

 

“Pricing Notice” has the meaning set forth in Section 4.1.

 

“Pricing Request” has the meaning set forth in Section 4.1.

 

“Prohibited Person” means (i) any individual or entity that has been determined by competent authority to be the subject of a prohibition in any law, regulation, rule, or executive order administered by OFAC or the U.S. Department of State; (ii) the government, including any political subdivision, agency or instrumentality thereof, of a Sanctioned Country; (iii) any individual or entity that acts on behalf of or is owned or controlled by the government of a Sanctioned Country; (iv) any individual or entity that has been identified on the OFAC Specially Designated Nationals and Blocked Persons List (Appendix A to 31 C.F.R. Ch. V) or any other similar list published by OFAC, including, but not limited to, the Foreign Sanctions Evaders List, the Part 561 List, and the Non SDN Iranian Sanctions List; (v) any individual or entity that has been designated on any similar list or order published by the United States government, including, without limitation, the Denied Persons List, Entity List, or Unverified List of the U.S. Department of Commerce, or the Debarred List or Nonproliferation Sanctions List of the U.S. Department of State; or (vi) any entity beneficially owned or controlled, directly or indirectly, by, any of the individuals or entities listed in subparagraphs (i)-(v) above.

 

“Project Bid” shall have the meaning assigned to such term in Section 4.3(b)(iv).

 

“Prudent Industry Practices” means those practices, methods, specifications and standards of safety, performance, dependability, efficiency and economy generally recognized by electrical utility industry members, including Supplier, in the U.S. as good and proper, and such other practices, methods or acts which, in the exercise of reasonable judgment by those reasonably experienced in the industry in light of the facts known at the time a decision is made, would be expected to accomplish the result intended at a reasonable cost and consistent with Applicable Laws, reliability, safety and expedition. Prudent Industry Practices are not intended to be limited to the optimum practices, methods or acts to the exclusion of all others, but rather to be a spectrum of good and proper practices, methods and acts.

 

“Purchase Order” means a purchase order in the form attached hereto as Exhibit A issued for the purchase of Equipment and Services pursuant to and in accordance with the terms and conditions of this Agreement.

 

“Representatives” means, with respect to any Person, such Person’s shareholders, members, officers, directors, employees, accountants, consultants, legal counsel, financial advisors and other representatives and agents.

 

“Revised Project Bid” shall have the meaning assigned to such term in Section 4.3(b)(v).

 

“Sanctioned Country” means any country or territory against which the United States maintains comprehensive economic sanctions or embargoes, including, without limitation, Crimea, Cuba, Iran, North Korea, Sudan and Syria.

 

 

“Services” means any Equipment related services offered for sale by Supplier pursuant to this Agreement, as set forth in Attachment A.

 

“Services Warranty” has the meaning set forth in Section 8.2.

 

“Services Warranty Period” has the meaning set forth in Section 8.2.

 

“Shares” means (i) the Class A Common Stock of the Issuer, calculated on a fully diluted basis and assuming that all options, warrants and any other rights to purchase shares of Class A Common Stock of the Issuer have been exercised in full, including, for sake of clarity, the Underlying Class A Shares plus (ii) any other equity securities now or hereafter issued by the Issuer, together with any options thereon and any other shares of stock or other equity securities issued or issuable with respect thereto (whether by way of a stock dividend, stock split or in exchange for or in replacement or upon conversion of such shares or otherwise in connection with a combination of shares, recapitalization, merger, consolidation or other corporate reorganization); provided, however, that in no event shall the Shares include the Class B Common Stock of the Issuer.

 

“Siemens AG” means Siemens Aktiengesellschaft, a German corporation headquartered in Munich and Berlin.

 

“Siemens BUs” means, separately and collectively in the aggregate, Siemens DG, Siemens DS and Siemens EP. In the event the lines of business conducted by Siemens DG, Siemens DS or Siemens EP as of the date hereof are transferred to other business units within the Siemens organizational structure, such lines of business shall continue to be subject to the terms and conditions of this Agreement to the same extent as if they remained part of the applicable Siemens BUs.

 

“Siemens DG” means the business unit of Siemens AG that serves as a global supplier of hardware and software products, systems, solutions, micro-grid solutions, information technology integration, engineering, consulting and services for protections and control, automation and control, power quality and substation automation of infrastructure grids for utilities (power transmission, distribution, generation, multi-utilities), municipalities, industry, critical infrastructure (e.g. but not limited to dams/water reservoirs, bridges, telecommunication towers/stations) and other related infrastructure or such business as conducted by any successor thereto.

 

“Siemens DS” means the business units of Siemens AG that serves as a global supplier of products, systems, solutions and services for the distribution of electrical power to its customers (primarily utility companies and industrial customers), whose portfolio currently includes utility scale and large commercial scale battery based electrical energy storage systems and solutions, low-voltage power distribution products and solutions, medium-voltage switchgear and devices, eBoP, emobility or such business as conducted by any successor thereto.

 

“Siemens EP” means the business unit of Siemens AG that serves as a global supplier of low and medium voltage distribution products, control components and systems for industrial applications, infrastructure, buildings and low voltage power grids (M4 market excluded) or such business as conducted by any successor thereto.

 

 

“Software” means all computer programs, operating systems, applications, systems, firmware, and software of any nature, whether operational, active, under development, or design, non-operational or inactive, including all object code, source code, comment code, algorithms, processes, formulae, interfaces, navigational devices, menu structures or arrangements, icons, operational instructions, scripts, commands, syntax, screen designs, reports, designs, concepts, visual expressions, technical manuals, test scripts, user manuals, and other documentation therefore, whether in machine-readable form, programming language, or any other language or symbols, and whether stored, encoded, recorded, or written on disk, tape, film, memory device, paper, or other media of any nature and all databases necessary or appropriate to operate any such computer program, operating system, applications system, firmware, or software.

 

“Subsidiary” means, with respect to any Person, any corporation, limited liability company, partnership, association or business entity of which (a) if a corporation, a majority of the total voting power of shares of stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person or a combination thereof, or (b) if a limited liability company, partnership, association or other business entity (other than a corporation), a majority of partnership or other similar ownership interest thereof is at the time owned or controlled, directly or indirectly, by any Person or one or more Subsidiaries of that Person or a combination thereof. For purposes hereof, a Person or Persons shall be deemed to have a majority ownership interest in a limited liability company, partnership, association or other business entity (other than a corporation) if such Person or Persons shall be allocated a majority of limited liability company, partnership, association or other business entity gains or losses or shall be or control any managing member, general partner or analogous controlling Person of such limited liability company, partnership, association or other business entity. For purposes hereof, references to a “Subsidiary” of any Person shall be given effect only at such times that such Person has one or more Subsidiaries.

 

“Sunset Date” means the earlier to occur of (i) the seventh (7^th) anniversary of the Effective Date and (ii) that date on which Buyer and Affiliates collectively hold Shares representing less than twenty percent (20%) of the then outstanding Voting Power.

 

“Supplier” has the meaning set forth in the Preamble hereto.

 

“Supplier Documents” means the documents and deliverables to be provided by Supplier to Buyer to the extent reasonably required for the installation, commissioning, operation and maintenance of the Equipment, as more fully set forth in the applicable Purchase Order.

 

“Supplier Event of Default” has the meaning set forth in Section 14.1.

 

“Taxes” means any and all forms of taxation, charges, duties, imposts, levies and rates whenever imposed by any Governmental Authority, including income tax, withholding tax, corporation tax, capital gains tax, capital transfer tax, sales tax, business and occupation tax, inheritance tax, water rates, value added tax, customs duties, capital duty, excise duties, betterment levy, stamp duty, stamp duty reserve tax, national insurance, social security or other similar contributions, and generally any tax, duty, impost, levy, rate or other amount and any interest, penalty or fine in connection therewith.

 

 

“Technical Specifications” means the technical specifications for the Equipment as set forth in the applicable Purchase Order.

 

“Term” has the meaning set forth in Section 2.1.

 

“Terminating Event” shall have the meaning assigned to such term in Section 4.3(a)(i).

 

“Territory” means (i) for purposes of the sales and marketing by Buyer of the Equipment, worldwide and (ii) for all other use of the Equipment, the country in which the Equipment is installed for use.

 

“Third Party” means any Person, other than a member of Supplier or such member’s Affiliates.

 

“Trademarks” means all trademarks, trademark applications, service marks, service mark applications, trade dress, trade names, identifying symbols, words, colors, designs, product names, company names, slogans, logos or insignia, whether registered or unregistered, and all applications and registrations therefor, and all goodwill associated therewith.

 

“TSCA” has the meaning set forth in Section 19.1.

 

“Underlying Class A Shares” means all shares of Class A Common Stock of the Issuer issuable upon redemption of Common Units of the Supplier, assuming all such Common Units are redeemed for Class A Common Stock of the Issuer on a one for one basis.

 

“Voting Power” means the total voting power of all Shares entitled to vote generally in the election of directors (for clarity, on a basis that assumes that all Common Units of Supplier have been redeemed for shares of Class A Common Stock of the Issuer on a one for one basis and that there are no shares of Class B Common Stock of the Issuer outstanding).

 

“Work Site” has the meaning set forth in Section 19.2.

 

1.2.

Interpretation.

 

(a)

References to Recitals, Articles, Sections, Exhibits, Annexes and Attachments are, unless otherwise indicated, to Recitals, Articles, Sections, Exhibits, Annexes and Attachments to this Agreement. All Exhibits, Annexes and Attachments to this Agreement are incorporated herein by this reference and made a part hereof for all purposes.

 

(b)

As used in this Agreement, the masculine gender shall include the feminine and neuter and the singular number shall include the plural, and vice versa.

 

(c)

Unless expressly stated otherwise, references to a Person include its successors and permitted assigns and, in the case of a Governmental Authority, any Person succeeding to its functions and capacities.

 

(d)

As used in this Agreement, references to “days” shall mean calendar days, unless the term “Business Days” is used. If the term “Business Days” is used and the time for performing an obligation under this Agreement expires on a day that is not a Business Day, the time shall be extended until that time on the next Business Day.

 

 

(e)

As used in this Agreement, where a word or phrase is specifically defined, other grammatical forms of such word or phrase have corresponding meanings; the words “herein,” “hereunder” and “hereof” refer to this Agreement, taken as a whole, and not to any particular provision of this Agreement; “including” means “including, for example and without limitation,” and other forms of the verb “to include” are to be interpreted similarly.

 

(f)

As used in this Agreement, all references to a given agreement, instrument or other document shall be a reference to that agreement, instrument or other document as modified, amended, supplemented and restated through the date as of which such reference is made. Any term defined or provision incorporated in this Agreement by reference to another document, instrument or agreement shall continue to have the meaning or effect ascribed thereto whether or not such other document, instrument or agreement is in effect.

 

2.

TERM AND TERMINATION OF AGREEMENT.

 

2.1.

Term. This Agreement shall become effective and the term shall commence on the day on which the Class A Common Stock of the Issuer is issued to the underwriters in its initial public offering (the “Effective Date”); provided, that if the Effective Date does not occur on or prior to December 31, 2021, this Agreement shall be deemed terminated as of such date and of no force or effect without further notice or action by the Parties, and the Prior Agreement shall remain in full force and effect without any amendment thereto. The term of this Agreement shall continue from the Effective Date until the date that the obligations contained in Section 4.4(a) (Non-Competition) cease to apply to Buyer (the “Term”). The expiration or early termination of the Term of this Agreement shall not affect any Purchase Orders executed between the Parties prior to the date of termination or expiration, and in such event the Parties shall attempt, in fair dealing and good faith, to agree on reasonable post-termination or post-expiration procedures in compliance with Applicable Law and antitrust requirements.

 

3.

SCOPE OF AGREEMENT.

 

3.1.

Scope Generally. This Agreement shall apply to all purchases by Buyer from Supplier of Equipment and Services during the Term. Notwithstanding the foregoing, nothing herein shall be construed to mean that either Buyer or Supplier is committing to any specific level of business or quantity of Equipment and Services to be purchased or supplied other than that specified in Purchase Orders issued to Supplier during the Term of this Agreement by Buyer. Attachment A hereto sets forth the various standard Equipment and Services offerings of Supplier, it being understood that any project-specific requirements associated with any particular order hereunder shall be as set forth in the applicable Purchase Order therefor. Supplier may from time to time update the Equipment and Services offered for sale hereunder by furnishing to Buyer an update to Attachment A hereto, it being agreed that no such update shall affect any previously issued Purchase Order unless and to the extent set forth in a Change Order thereto.

 

3.2.

Further Siemens Contracting Parties. Siemens AG and its Subsidiary companies (hereinafter referred to as “Further Siemens Contracting Parties”) shall be entitled to conclude individual Purchase Orders under the terms of this Agreement provided that such Further Siemens Contracting Parties either: (a) execute a joinder agreement acceptable to Supplier and otherwise in the form of Exhibit B hereto or (b) agree that the terms of this Agreement will govern the subject transaction by including a conspicuous cross-reference in the applicable Purchase Order which confirms that the terms of this Agreement will apply to the Purchase Order.

 

 

4.

ORDERS.

 

4.1.

Pricing Requests. If Buyer desires to purchase Equipment and Services from Supplier during the Term, Buyer shall furnish Supplier with written request (a “Pricing Request”) detailing the Equipment and Services it wishes to purchase and requesting pricing therefor from Supplier, including in such Pricing Request such information as may be reasonably necessary for Supplier to determine pricing therefor and any other project-specific requirements, including Buyer’s requested delivery schedule. Supplier shall endeavor to provide an initial response to any Pricing Request within five (5) Business Days, indicating (i) whether or not Supplier intends to furnish an offer to Buyer for the requested Equipment and Services on the timeline requested by Buyer and (ii) indicating what, if any, additional information Supplier may need in order to furnish such offer. Within fourteen (14) days after a final written scope of work is agreed with Buyer, or one of its Affiliates, Supplier shall provide Buyer with a written notice (a “Pricing Notice”) detailing Supplier’s pricing and delivery schedule for the Equipment and Services that Buyer wishes to purchase (including therein any terms, conditions and specifications required by Supplier in connection with the particular project and/or purchase contemplated by Buyer, which terms and conditions may be different than, and shall supersede, those set forth in this Agreement), which Pricing Notice Supplier shall endeavor to provide within ten (10) Business Days of receipt of Buyer’s Pricing Request. If Buyer does not issue a Purchase Order to Supplier pursuant to Section 4.2 in response to the Pricing Notice within ten (10) Business Days of issuance thereof, the Pricing Notice shall be deemed rejected.

 

4.2.

Purchase Orders. If Buyer desires to purchase the Equipment and Services on the terms specified in a Pricing Request, it shall issue a Purchase Order to Supplier in the form attached hereto as Exhibit A, which Purchase Order shall include: (i) the pricing and any other terms, conditions and specifications set forth in Supplier’s Pricing Notice; and (ii) a detailed description of the Equipment and Services to be purchased, consistent with those set forth in the Pricing Request and to the extent modified thereby, the Pricing Notice. Purchase Orders shall only be binding when issued in compliance with the requirements of this Agreement and sent by e-mail, by fax or by electronic data interchange to Supplier. Supplier shall accept or reject a Purchase Order within ten (10) Business Days after receipt. Acceptance or rejection shall be declared in the form of the Purchase Order. If a Purchase Order is neither accepted nor rejected within ten (10) Business Days after receipt, it shall be deemed rejected.

 

4.3.

Exclusivity and Certain Related Priorities.

 

(a)

Subject to Applicable Law, during the period from the Effective Date until the Sunset Date, Buyer shall cause the Siemens BUs to:

 

(i)            purchase exclusively from Supplier any battery-based energy storage technology systems/solutions that are (A) within the Exclusive Activities (provided that for the purposes of this paragraph only, the term “Application” within Exclusive Activities shall also include power quality and microgrid/island applications (in each case as described on Schedule 1.1(a))) and (B) offered for sale by Supplier; provided, however, it is hereby agreed that the exclusive purchase obligations contained in this Section 4.3(a)(i) shall immediately cease to apply with respect to the particular purchase opportunity in the event that (1) either (x) Supplier fails to provide an initial response within five (5) Business Days following receipt of a Pricing Request from Buyer, or one of its Affiliates, or (y) Supplier fails to submit a bona fide Pricing Notice within fourteen (14) days after a final written scope of work is agreed with Buyer, or one of its Affiliates, provided that if a shorter response time is required for a final bid by the customer or project related thereto, the parties will discuss and mutually agree on such shorter time period, or (2) the prerequisite of a public tender specifies using a particular vendor, other than Supplier, to provide such battery-based energy storage technology systems/solutions (the matters set forth in the immediately preceding clause (1) and clause (2), may each individually be referred to herein as a “Terminating Event”); and

 

 

(ii)            prioritize the purchase of any other battery-based energy storage technology systems/solutions that are offered for sale by Supplier and request that each of the Siemens BUs notify Supplier if it intends to purchase such systems/solutions, such that Supplier shall have an opportunity to sell such systems/solutions thereto. It is hereby agreed that any opportunity described above is subject to other factors, including that such systems/solutions offered by Supplier are competitive in the discretion of the Siemens BUs, taking into account economic, financial and technological aspects as well as the ability to perform and deliver in terms of timeframes and logistics, that such systems/solutions comply with specific customer requirements, country-specific requirements or mandatory external regulation and in all cases subject to Applicable Laws.

 

In each case of clause (i) and (ii) above, the above provisions shall apply to the extent that such systems/solutions are needed as components of, or parts for, its other products/services or for its own needs or for reselling; excluding, however, inverters, which may be sourced independently.

 

(b)

With respect to Section 4.3(a)(ii), it is hereby agreed that the following shall apply with respect to any requirement to prioritize the purchase of any battery-based energy storage technology systems/solutions that are offered for sale by Supplier:

 

(i)

(A) any such opportunity described therein is subject to other factors, including that such systems/solutions offered by Supplier are competitive in the discretion of the applicable Siemens BU, taking into account economic, financial and technological aspects as well as the ability to perform and deliver in terms of timeframes and logistics, that such systems/solutions comply with specific customer requirements, country-specific requirements or mandatory external regulation and in all cases subject to Applicable Laws and (B) the purchase priority obligations contained in Section 4.3(a)(ii) shall immediately cease to apply with respect to the particular purchase opportunity upon the occurrence of a Terminating Event;

 

 

(ii)

Buyer shall cause the Siemens’ BUs to consult regarding Supplier’s products, solutions and technology and keep regular contact with the Siemens’ BUs concerning projects and opportunities for which Supplier’s products, solutions and technology may be suitable (each, a “Potential Project”);

 

(iii)

Buyer shall cause the Siemens BUs to notify Supplier of each such Potential Project and support Supplier’s preparing bids or proposals therefor, subject to Applicable Law and Third Party contractual restrictions;

 

(iv)

In the event that Supplier makes a formal bid or proposal with respect to a Potential Project (each, a “Project Bid”) and such Project Bid is not accepted by the applicable Siemens BU, subject to Applicable Law and Third Party contractual restrictions, Buyer shall cause the applicable Siemens BU to inform Supplier of the main considerations of such Siemens BU which led to Supplier’s Project Bid not being accepted with respect to such Potential Project;

 

(v)

If Supplier is able to submit a revised Project Bid to the applicable Siemens BU (the “Revised Project Bid”), and such Revised Project Bid is not accepted, subject to Applicable Law and Third Party contractual restrictions, Buyer shall cause the applicable Siemens BU to inform Supplier of the main considerations of such Siemens BU which led to Supplier’s Revised Project Bid not being accepted with respect to such Potential Project. If Supplier is able to submit a Project Bid and, if applicable, a Revised Project Bid to the applicable Siemens BU for the Potential Project and such Revised Project Bid is satisfactory to such Siemens BU in all respects and is deemed by such Siemens BU in its judgment to be the best bid for the Potential Project, then such Siemens BU shall proceed with Supplier’s Revised Project Bid. In the event that Supplier is ultimately not chosen by such Siemens BU for such Potential Project based on its initial Project Bid or subsequent Revised Project Bid, Buyer shall cause such Siemens BU to discuss with Supplier how Supplier can improve the competitiveness of its products, solutions and technology for future offerings.

 

(c)

Subject to Applicable Law, during the period from the Effective Date until the Sunset Date, Supplier will offer its Equipment and Services to Buyer and the Siemens BUs at Most Favored Nation Pricing in the Pricing Notice.  “Most Favored Nation Pricing” shall be reasonably determined by the Supplier by reference to recent (last six (6) months) sales arrangements with customers, resellers or project developers, as applicable, taking into account purchase volumes, regional market conditions, the geographic location of the projects, and the relative size and technology to be used.  Supplier shall not be obligated to provide such pricing if it no longer offers the relevant products or services for sale and Supplier shall have no obligations to offer or continue to offer any such products or services for sale. If requested by Buyer, Supplier shall furnish to Buyer a certificate executed by an executive officer of Supplier and attesting to the methodology used by Supplier in determining the Most Favored Nation Pricing set forth in the applicable Pricing Notice. Supplier shall provide Buyer with supporting information concerning the comparable purchase volumes, regional market conditions, the geographic location of the projects, relative size and technology to be used, and any other variables that Supplier considered when determining the Most Favored Nation Pricing; provided that Suppler may always anonymize information about other customers’ projects, in Supplier’s sole discretion. In the event that Buyer believes the price indicated in the Pricing Notice does not accurately reflect Most Favored Nation Pricing, then the parties shall retain a mutually-agreeable auditing firm to independently and confidentially review Supplier’s methodology and pricing inputs and to render a decision regarding whether Supplier must offer a lower price in order to satisfy its Most Favored Nation Pricing obligation as set forth above. The decision of the independent auditor shall be final and binding on both Parties. The costs of the independent auditor shall be shared equally between Supplier and Buyer.

 

 

(d)

Subject to Applicable Law, during the period from the Effective Date until the Sunset Date, if Supplier seeks certain non-exclusive supply agreements to make use of Buyer electrical balance of plant (“eBoP”) components (e.g. inverters, switch gear or other electrical components etc.) and/or services, in each case, as used in the Core Offering (as defined in Supplier’s then current business plan) where applicable, Buyer shall provide “most favored nation pricing” to Supplier for such eBoP components and/or services, it being understood that Buyer shall not be obligated to provide such pricing if it no longer offers the relevant products or services for sale and Buyer shall have no obligation to offer or continue to offer any such products or services for sale.

 

4.4.

Non-Competition.

 

(a)

Subject to compliance with Applicable Law or regulatory requirements, Buyer agrees that until the earlier to occur of (i) the seventh (7th) anniversary of the Effective Date and (ii) that date on which Buyer and Affiliates collectively hold Shares representing less than ten percent (10%) of the then outstanding Voting Power, neither it nor its Affiliates will directly or indirectly engage in any Exclusive Activities; provided, however, that beginning on October 1, 2023, if Supplier has not achieved at least $25,000,000 in average annual gross revenues over a rolling period of three fiscal years (such rolling period commencing on October 1, 2020) for Application No. 9 (as set forth on Schedule 1.1(a)), then Buyer, at its sole discretion, may, upon written notice to the other members of Supplier, remove Application No. 9 as an Exclusive Activity for all purposes hereunder). If Buyer removes Application No. 9 as an Exclusive Activity pursuant to this Section 4.4(a), then Application No. 9 shall simultaneously and automatically also be removed as an “Exclusive Activity” under the AES Storage Core Frame Purchase Agreement. In addition, if AES Grid Stability removes Application No. 4 as an “Exclusive Activity” pursuant to the AES Storage Core Frame Purchase Agreement, then Application No. 4 shall simultaneously and automatically also be removed as an Exclusive Activity under this Agreement.

 

(b)

Notwithstanding the foregoing, the restrictions set forth in this Section 4.4 shall not affect or prohibit Buyer or its Affiliates from:

 

(i)

(A) engaging in activities expressly permitted or contemplated herein or in the Key Agreements, or as otherwise approved by Issuer as Supplier’s managing member, (B) selling Supplier’s Equipment and Services to Buyer’s customers with Supplier acting as a sub-supplier to Buyer, or (C) engaging in the development and sale of larger solutions incorporating an Integrated Solution from a Third Party, which is subject to the provisions of Section 4.3 hereof;

 

 

(ii)

acquiring and owning, through its venture capital or growth capital activities, a non-controlling interest of up to thirty-five percent (35%) of the equity or debt securities of any legal entity that is engaged in whole or in part in any Exclusive Activity, provided, that the products and/or services of such legal entity that are included within the scope of Exclusive Activities are not sold or marketed by Buyer or its Affiliates; or

 

(iii)

acquiring or owning any debt or equity securities of any legal entity engaged in whole or in part in any Exclusive Activities through any employee benefit or pension plan maintained by Buyer or its Affiliates or solely for purposes of asset or treasury management; or

 

(iv)

acquiring control of a business or legal entity (an “Acquired Business”) engaged in whole or in part in any Exclusive Activities (a “Competing Business”) where the annual revenues attributable to the Competing Business of the Acquired Business over its previous fiscal year were less than both (A) twenty-five percent (25%) of the total annual revenues of the Acquired Business for such fiscal year, and (B) twenty-five percent (25%) of the total annual revenues of the Issuer and its Subsidiaries for such fiscal year(collectively, the “Non-Triggering Acquisition Thresholds”); provided, that the Non-Triggering Acquisition Threshold set forth in clause (B) above shall only apply in the case where the annual revenues attributable to the Competing Business of the Acquired Business over its previous fiscal year were more than $25.0 million; and provided, further, that in each case where revenue is only available for a part of a fiscal year, references to annual revenues in this Section 4.4(b)(iv) and in Section 4.4(b)(v) shall mean the annualized revenues reasonably determined by extrapolation from such partial fiscal year revenues;

 

(v)

either (i) acquiring control of an Acquired Business where at the time of such acquisition the annual revenues attributable to the Competing Business of the Acquired Business over its most recent fiscal year (x) equal or exceed either of the Non-Triggering Acquisition Thresholds and (y) are less than forty percent (40%) of the total annual revenues of the Acquired Business for its most recently completed fiscal year,(ii) acquiring control of an Acquired Business where at the time of such acquisition the annual revenues attributable to the Competing Business of the Acquired Business over its most recent fiscal year (x) equal or exceed forty percent (40%) of the total annual revenues of the Acquired Business for its most recently completed fiscal year and (y) are equal to or less than twenty-five million dollars ($25,000,000) for its most recently completed fiscal year, or (iii) continuing to own and control a Competing Business of an Acquired Business at any time after such acquisition when the non-compete restrictions herein apply, once the annual revenues attributable to the Competing Business of the Acquired Business over its most recent fiscal year equal or exceed both twenty-five percent (25%) of the total annual revenues of the Issuer and its Subsidiaries for such fiscal year and twenty-five million dollars ($25,000,000) (either such circumstance as described in clauses (i), (ii) or (iii) above, a “Triggering Event”); provided, that, within thirty (30) days following the occurrence of such Triggering Event, Buyer shall, or shall cause its Affiliate to, (A) offer to sell the equity interests or assets comprising the Competing Business to Issuer for a price not greater than the Fair Market Value thereof (appropriately taking into account the assumption of liabilities and Indebtedness of (to the extent not included in determining or calculating the purchase price or valuation for)), the Competing Business (which, in the case of a Triggering Event existing as of the closing of an acquisition of an Acquired Business, shall not exceed that portion of the price paid by Buyer or its Affiliate that was allocable in good faith to the Competing Business) (each, a “Competing Business Offer”) and (B) provide Issuer with such material information regarding the applicable Competing Business, subject to any restrictions of confidentiality or Applicable Law, that Buyer or its Affiliate determines in good faith will permit Issuer to make an informed decision as to whether to accept or reject such Competing Business Offer.

 

 

(c)

Buyer or its Affiliate shall provide such additional information regarding the applicable Competing Business, subject to any restrictions of confidentiality or Applicable Law, as may be reasonably requested by Issuer following Issuer’s receipt of the Competing Business Offer that it determines is reasonably necessary to permit Issuer to make an informed decision as to such Competing Business Offer.

 

(d)

In the event that the Issuer accepts a Competing Business Offer, Buyer and Supplier shall (and shall cause their respective Affiliates to) act in good faith to consummate the acquisition of such Competing Business which is the subject of the Competing Business Offer, including with respect to securing financing, either through equity or debt financing, as necessary;

 

(e)

Issuer shall have eighteen (18) months from receipt of such Competing Business Offer to enter into a legally binding commitment with Buyer or its Affiliate to acquire the Competing Business which is the subject of the Competing Business Offer. In addition, Issuer shall have up to six (6) months after entering into such legally binding commitment to consummate such acquisition, or such longer period as may be reasonably required to obtain any required regulatory approvals. Failure to meet either of the timelines set forth above notwithstanding the good faith efforts of Buyer, Supplier, and their respective Affiliates to consummate the transaction will be deemed to be a rejection of the Competing Business Offer.

 

(f)

In case of rejection of a Competing Business Offer, Buyer or its Affiliate shall be free to continue to own and control the Competing Business.

 

4.5.

Payment Terms. Unless otherwise provided in a Pricing Notice, all payments for Equipment are due and payable net thirty (30) days following invoice. Payment terms will be mutually agreed in the Purchase Order and may be milestone based such that payments match cost outflow timing and conditions similar to 20%, 30%, 40%, 10% for Order, Delivery, Project Substantial Completion, Project Final Completion. Unless otherwise provided in a Purchase Order, all payments for Services are due and payable net thirty (30) days following invoice based on progress of the Services being performed.  Payment(s) shall be by electronic banking method identified on the Purchase Order.  Buyer will not make payments to Supplier in cash or bearer instruments, nor to an account other than that specified in the Purchase Order.  Buyer will make no unlawful payments, nor make payments through any trust, intermediate entity or other party.  Buyer will not make payment(s) to an individual, employee, or other designee of Supplier.

 

 

 

4.6.

Disputed Payments. If a dispute arises regarding the payments to be made hereunder, Buyer or Supplier, as applicable, shall pay all undisputed amounts, and the Parties shall attempt in good faith to resolve the dispute as promptly as practicable.

 

4.7.

Late Payments. Any amount owed by a Party hereunder beyond the date that such amount first becomes due and payable under this Agreement shall accrue interest from the date that it first became due and payable until the date that it is paid at the lesser of (a) LIBOR plus four percent (4%) per annum or (b) the maximum rate permitted by Applicable Law.

 

4.8.

Taxes; Export and Import Duties. Notwithstanding anything herein to the contrary, (i) Supplier shall collect and withhold any and all sales taxes arising in connection with or relating to the supply, sale or Delivery of the Equipment and imposed by any Governmental Authority having jurisdiction over Supplier at the Delivery Point and (ii) Buyer shall be responsible for any and all other Taxes arising in connection with or relating to the supply, sale or Delivery of the Equipment, any and all export duties from the jurisdiction or jurisdictions in which the Equipment is manufactured or from which the Equipment may be shipped and any and all import duties, in each case, arising in connection with or relating to the supply, sale or Delivery of the Equipment. Buyer shall also be responsible for and pay all Taxes in relation to the operation of its business, including in connection with the use of the Equipment. Buyer and Seller shall cooperate to obtain exemption from, or to minimize, any Taxes.

 

5.

DELIVERY.

 

5.1.

Delivery Terms; Inspection. Unless otherwise provided in a Pricing Notice, delivery of Equipment comprised of Batteries shall be made FCA (Incoterms 2010) at facility of the supplier thereof and delivery of all other Equipment shall be FCA (Incoterms 2010) Supplier location. Prior to Delivery a representative of Supplier and a representative of Buyer may inspect the Equipment for damage and record such damage, if any.

 

5.2.

Guaranteed Delivery Date. Supplier shall use commercially reasonable efforts to Deliver Equipment to the applicable Delivery Point by the applicable guaranteed Delivery date therefore, if any, as set forth in the applicable Purchase Order, subject to extension as provided under this Agreement (as may be extended hereunder, the “Guaranteed Delivery Date”). Any other dates in a Purchase Order for performance by Supplier of any work and any other obligations of Supplier pursuant to such Purchase Order are estimated, and not guaranteed, dates. The failure of Supplier to timely achieve such other Supplier milestones or obligations by the applicable dates set forth in the Purchase Order shall not be a breach under this Agreement. Neither the Purchase Order nor any milestone date contained therein, including the Guaranteed Delivery Date for the Equipment, may be changed unless the same has been modified by a duly executed Change Order. If an unexcused delay originates with Supplier or its Representatives, Supplier shall be solely responsible for expedited delivery and other charges to meet Delivery dates.

 

 

5.3.

Delay Liquidated Damages. Except as may be otherwise agreed in a Purchase Order, if Delivery of the Equipment has not occurred by the Guaranteed Delivery Date for reasons that are not excused hereunder, and Buyer can prove that as a direct result thereof it must pay delay liquidated damages to its Customer, Supplier shall reimburse Buyer for such delay liquidated damages (such reimbursement not to exceed an amount equal to 0.5% of the price set forth in the Purchase Order allocable to the delayed Equipment for every completed week of delay) for each completed week after the Guaranteed Delivery Date that Buyer pays such liquidated damages to its Customer as a result of Supplier’s delay, provided, however, that the amount of delay liquidated damages payable by Supplier shall be reduced by any amounts received by Buyer under any delay in startup insurance policies providing coverage for any such losses or damages. Payment of the delay liquidated damages shall be the sole and exclusive remedy of Buyer for delay and under no circumstances shall the total aggregate liability of Supplier exceed five percent (5%) of the price set forth in the applicable Purchase Order.

 

5.4.

Buyer Caused Delay. If Buyer fails to perform any obligations under a Purchase Order or otherwise causes a delay in the performance by Supplier of its obligations under a Purchase Order, and such failure or delay results in an increase in Supplier’s costs and/or impacts Supplier’s ability to meet any Supplier milestone in accordance with the schedule contemplated by the applicable Purchase Order, Supplier shall be entitled to a Change Order increasing the price payable under the applicable Purchase Order and extending the date for completion of any Supplier milestones commensurate with such delay and added cost, including overtime charges for labor and equipment.

 

6.

TITLE, RISK OF LOSS AND CARE, CUSTODY AND CONTROL.

 

6.1.

Transfer of Title and Risk of Loss. Title, care, custody, control and risk of loss of any portion of the Equipment shall pass to Buyer upon Delivery of the Equipment to the Delivery Point. Notwithstanding the foregoing, in no event will title to the Licensed Technology or any other Intellectual Property used in the Equipment or otherwise provided to Buyer, including any Software, transfer to Buyer.

 

6.2.

Warranty of Title. Supplier warrants to Buyer that, when title to the Equipment or any portion thereof is transferred to Buyer in accordance herewith, Buyer shall have good title to the Equipment or such portion thereof free and clear of all Liens, other than any such Liens which may arise in connection with Buyer’s failure to make payments as they become due under this Agreement. In the event of any nonconformity with the foregoing, Supplier, at its own expense, upon written notice of such failure, shall indemnify Buyer from the consequences of such nonconformity and defend the title to such Equipment, and Supplier shall either promptly replace such Equipment or any affected portion thereof or remedy the title defect.

 

7.

INSPECTION AND QUALITY CONTROL.

 

7.1.

Inspection Rights. Supplier shall permit Buyer, its Representatives and/or customer(s), at Buyer’s expense, to inspect Equipment/Services during manufacture at Supplier’s facilities or during performance and shall use commercially reasonable efforts to facilitate similar inspections at the manufacturing facilities of third party suppliers. Buyer shall provide Supplier with written notice of its intent to make any such inspection not less than ten (10) Business Days prior to the proposed inspection date. Buyer’s inspections/tests will not unduly interfere with Supplier’s business or the business of its third party suppliers.

 

 

7.2.

Quality Control. Supplier shall maintain quality control with respect to the Equipment and Services as mutually agreed upon by the Parties and provide Buyer with quality assurance documentation, manuals or certifications.

 

8.

WARRANTIES.

 

8.1.

Equipment Warranty. Supplier warrants to Buyer that (i) the Equipment as Delivered shall be new at the time of Delivery and shall have been manufactured using new components and (ii) during the Equipment Warranty Period the Equipment shall be free of any Defects (the “Equipment Warranty”). As used herein, the “Equipment Warranty Period” means the period of time commencing on the earlier to occur of (i) the date that the Equipment is placed into service as evidenced by the operation thereof for commercial purposes and (ii) the day that is sixty (60) days after the date of Delivery of the Equipment and continuing to and ending on the first (1st) anniversary of such date. Notwithstanding the foregoing, (i) the Parties may agree in any particular Purchase Order to address defect warranties with respect to Batteries separately and (ii) any performance guarantees with respect to Batteries shall be solely as set forth in the applicable Purchase Order.

 

8.2.

Services Warranty. Supplier warrants to Buyer that any Services shall at the time of performance thereof and during the Services Warranty Period be (i) performed in a good and workmanlike manner and free of any fault, defect or deficiency that would preclude or impair the ability of such Services to fulfill the purposes set forth in the applicable Purchase Order therefor in all material respects, (ii) consistent with a level of care, skill and judgment which conforms with Prudent Industry Practices, and (iii) in compliance with the requirements of this Agreement and the applicable Purchase Order (the “Services Warranty”). As used herein, the “Services Warranty Period” means the period of time commencing on the date of performance of the applicable Service and continuing to and ending on the first (1st) anniversary of such date.

 

8.3.

Notification Requirements. Buyer shall promptly (but in any event within ten (10) Business Days after obtaining notice or knowledge thereof) notify Supplier of any failure of the Equipment to satisfy the Equipment Warranty or any failure of the Services to satisfy the Services Warranty, in each case by delivering written notice to Supplier of a warranty claim. The written notice of warranty claim shall, to the extent reasonably practicable, identify the applicable failure and the circumstances or conditions observed by Buyer that indicates the presence of such failure.

 

8.4.

Corrective Action. If, at any time prior to the expiration of the Equipment Warranty Period, either Party discovers any Defect, Supplier agrees that it shall Deliver a replacement for the applicable Defective part, without cost or expense to Buyer. When a Defective part has been Delivered to Buyer, such replaced part shall be covered by the Equipment Warranty until the later of (a) twelve (12) months from the time such replacement part was Delivered to Buyer, and (b) the end of the Equipment Warranty Period. All replacement parts shall be of good and workmanlike quality and shall be new or newly refurbished. If, at any time prior to the expiration of the Services Warranty Period, either Party discovers any failure of the Services to satisfy the Services Warranty, Supplier agrees that it shall, in its sole discretion, either correctly re-perform or otherwise correct the defective Services, without cost or expense to Buyer. When a defective Service has been remedied, such remedied Service shall be covered by the Services Warranty until the later of (a) twelve (12) months from the time such remedy was completed, and (b) the end of the Services Warranty Period.

 

 

8.5.

Warranty Exclusions. The Equipment Warranty and the Services Warranty shall not apply if (a) the applicable Defect or failure is attributable to Buyer’s failure to operate, repair or maintain the Equipment in material compliance with the procedures set forth in any Supplier Documents furnished to Buyer, which procedures are identified therein as necessary to maintain the effectiveness of the warranties or (b) the applicable Defect or failure is attributable to Buyer’s or Buyer’s contractor’s misuse or abuse of the Equipment (c) if the Equipment has been used in a manner contrary to Supplier's instructions set forth in the Supplier Documents that are identified therein as necessary to maintain the effectiveness of the warranties; (d) the applicable Defect or failure is attributable to any materials or equipment provided by Buyer; or (e) if the Equipment has failed as a result of ordinary wear and tear.

 

8.6.

NO IMPLIED WARRANTIES. THE WARRANTIES OF SUPPLIER SET FORTH IN THIS AGREEMENT ARE SUPPLIER'S SOLE AND EXCLUSIVE WARRANTIES AND ARE MADE IN LIEU OF ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, STATUTORY OR OTHERWISE. THE REMEDIES SET FORTH HEREIN WITH RESPECT TO SUCH WARRANTIES ARE BUYER'S SOLE AND EXCLUSIVE REMEDIES, AND SUPPLIER'S SOLE AND EXCLUSIVE LIABILITY, FOR ANY BREACH OF SUCH WARRANTIES. OTHER THAN THE WARRANTIES OF SUPPLIER SET FORTH IN THIS AGREEMENT, SUPPLIER HEREBY DISCLAIMS, AND BUYER HEREBY WAIVES, ALL OTHER EXPRESS WARRANTIES AND ALL OTHER WARRANTIES, CONDITIONS, DUTIES AND OBLIGATIONS, STATUTORY OR OTHERWISE, IMPLIED IN LAW, INCLUDING THOSE OF PERFORMANCE, MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT, CUSTOM, USAGE, OR OTHERWISE. THERE ARE NO OTHER WARRANTIES, CONDITIONS, AGREEMENTS, ORAL OR WRITTEN, STATUTORY OR OTHERWISE, OR UNDERSTANDINGS, WHETHER OR NOT IN A CONTEMPORANEOUSLY EXECUTED OR DATED AGREEMENT OR SPECIFICATION, THAT EXTEND BEYOND THOSE SET FORTH HEREIN AND NO OTHER WARRANTIES, CONDITIONS, AGREEMENTS, ORAL OR WRITTEN, STATUTORY OR OTHERWISE, WHICH MIGHT HAVE BEEN GIVEN BY AN EMPLOYEE, AGENT OR REPRESENTATIVE OF SUPPLIER OR ITS AFFILIATES ARE AUTHORIZED BY SUPPLIER.

 

8.7.

Reserved Rights. Without limiting Supplier’s obligations hereunder to remedy Defects, Supplier reserves the right (i) to make changes and improvements in its equipment and products without incurring any obligation to make such changes and improvements to any Equipment previously sold under a Purchase Order pursuant to this Agreement; and (ii) to change the terms of the warranty it provides to other Persons in the future without incurring any right or obligation to make the revised terms applicable to any Equipment previously sold under a Purchase Order pursuant to this Agreement. The provisions of this Section 8.7 shall survive the termination or expiration of this Agreement.

 

8.8.

Access to Buyer Data. Real time access on a 24/7 basis to all Buyer Data shall be determined on a case by case basis and set forth in the applicable Purchase Order.

 

 

9.

BUYER FURNISHED PROPERTY.

 

The term “Buyer Furnished Property” shall mean all tools, patterns, equipment, materials or other property which is either supplied by, or purchased by or on behalf of, Buyer or its Representatives to Supplier to perform the Services or furnish the Equipment. Title to Buyer Furnished Property shall remain with Buyer and risk of loss shall be with the Party who has possession. For Buyer Furnished Property in Supplier’s possession, custody or control, Supplier shall insure against loss and damage in an amount equal to full replacement cost. Buyer Furnished Property shall carry no guarantee or warranty, express or implied. Supplier shall not use Buyer Furnished Property on any work other than the Equipment/Services. Supplier shall clearly mark Buyer Furnished Property to show Buyer's ownership and prevent a lien, encumbrance or challenge to Buyer's title thereto. Supplier shall, at its own expense, maintain and repair Buyer Furnished Property returning it to Buyer in the condition in which received, reasonable wear and tear excepted. Upon expiration or termination of the Purchase Order, Supplier shall dispose of Buyer Furnished Property as Buyer directs in writing. Buyer reserves the right to abandon Buyer Furnished Property at no additional cost to Buyer. The applicable Purchase Order pursuant to which Buyer Furnished Property was furnished to Seller shall remain in effect so long as Supplier possesses Buyer Furnished Property.

 

10.

PACKAGING.

 

Except where the Purchase Order includes alternative requirements, Supplier shall be responsible for packaging Equipment, and the clear and conspicuous marking of Equipment and packaging, in accordance with Applicable Law, industry standards and in a manner sufficient to permit efficient handling, to provide adequate protection and comply with requirements of carrier and Applicable Law. Packing slips identifying the Purchase Order number, and part number must accompany each shipment. The exterior of each shipping container or package will be clearly marked with Buyer’s Purchase Order number and country of origin, which shall also be marked on Equipment, in a clear, conspicuous and permanent manner. Supplier shall provide all necessary shipping documents, including, but not limited to, customs invoices and packing lists in accordance with Buyer’s requirements and Applicable Law. Damages and costs incurred by Buyer, its Representative or customer resulting from Supplier or its Representative’s failure to comply with this Article 10 shall be paid by Supplier. If Supplier imports wood packaging materials, in accordance with 7 CFR 319.40, Supplier warrants that such wood packaging material is treated and marked under an official program developed and overseen by the National Plant Protection Organization in the country of export.

 

11.

FORCE MAJEURE.

 

11.1.

Effect of Force Majeure. A Party shall not be considered to be in breach or default of this Agreement or any Purchase Order hereunder if and to the extent that its failure or delay in performance or its efforts to cure are prevented by Force Majeure.

 

11.2.

Procedures. If either Party, as a result of the occurrence of a Force Majeure, is rendered wholly or partially unable to perform its obligations under this Agreement or any Purchase Order, such Party shall comply with the following:

 

(a)

the affected Party shall promptly notify the other Party hereto in writing, and in any event within five (5) Business Days after the affected Party becomes aware of the occurrence of such Force Majeure event, describing in such notice the particulars of the occurrence;

 

 

(b)

the affected Party shall give the other Party written notice estimating the event’s expected duration and probable impact on the performance of such Party’s obligations under this Agreement, and such affected Party shall continue to furnish timely regular reports with respect thereto during the continuation of the event;

 

(c)

the suspension of performance shall be of no greater scope and of no longer duration than is reasonably required by the event;

 

(d)

no liability of either Party which arose before the occurrence of the event causing the suspension of performance shall be excused as a result of the occurrence;

 

(e)

the affected Party shall exercise all reasonable efforts to mitigate or limit damages to the other Party, promptly taking appropriate and sufficient corrective action, including the expenditure of all reasonable sums of money;

 

(f)

the affected Party shall use all reasonable efforts to continue to perform its obligations under this Agreement and to correct or cure the event excusing performance; and

 

(g)

when the affected Party is able to resume performance of the affected obligations under this Agreement, the affected Party shall promptly resume performance and give the other Party written notice to that effect.

 

11.3.

Termination for Extended Force Majeure. If Supplier experiences a Force Majeure Event completely preventing Supplier’s performance for more than forty-five (45) consecutive days, Buyer shall have the right to terminate the applicable Purchase Order and shall be entitled to a refund of all monies advanced to Supplier.

 

12.

CHANGE ORDERS.

 

12.1.

Change Order. A “Change Order” is a written instrument signed by the Parties and stating their mutual agreement upon a change in the obligations of the Parties under this Agreement or any Purchase Order, including if applicable the amount of the adjustment in the purchase price and the extent of any adjustment to the Delivery schedule, including the Guaranteed Delivery Date.

 

12.2.

Change Order Process. In addition to circumstances set forth herein where the Parties are entitled to a Change Order, either Party may request changes in the obligations of the Parties under this Agreement within the scope of this Agreement consisting of additions, deletions, or other revisions to such obligations. If either Buyer or Supplier wishes to change such obligations, it shall submit a change request to the other Party in writing. If the requested change relates to a change to the Equipment supply obligations or results from a condition in which Supplier is entitled to a Change Order under this Agreement, then, within fifteen (15) Business Days following receipt or delivery, as applicable, of the requested change, Supplier shall submit a proposal to Buyer stating (i) the increase or decrease, if any, in the purchase price and changes to the Delivery schedule and/or the Guaranteed Delivery Date, if any, that would result from such change (collectively, the “Change Order Information”). If the proposed change relates to any other matter, the requesting Party, at the time the request for the change is made, shall provide the proposed Change Order Information. Within five (5) Business Days following receipt of the Change Order Information, the Parties shall meet and, acting reasonably, negotiate in good faith a mutually acceptable Change Order in accordance with the principles set forth herein. Following agreement on the terms and conditions of the Change Order, the Parties shall execute the same. If the Parties do not agree upon the terms and conditions of the Change Order, and the proposed change relates to circumstances in which a Party is entitled to a Change Order under this Agreement, then either Party may submit the matter to dispute resolution pursuant to Article 24.

 

 

12.3.

Change Order Restrictions. Notwithstanding anything herein to the contrary, Buyer shall not be entitled reduce the scope of the Equipment supply obligations under any Purchase Order.

 

12.4.

No Change. Supplier shall not be obligated to proceed with any change in the Equipment supply obligations requested by Buyer unless and until a Change Order is executed by the Parties in relation to such change. Further, Supplier shall not be required to implement a requested change in the Equipment supply obligations by Buyer if Supplier reasonably believes the implementation of such change would impair Supplier’s ability to comply with any of the warranties or the covenants set forth in this Agreement or the applicable Purchase Order.

 

13.

INTELLECTUAL PROPERTY.

 

13.1.

Grant of License. Upon transfer of title with respect to any Equipment purchased hereunder and upon providing parts under the Equipment Warranty hereunder, Supplier hereby grants to Buyer a non-exclusive, transferable, fully paid-up with no further royalty obligation, worldwide, license in and to, all Intellectual Property owned or licensed by Supplier which are necessary for the use and enjoyment by Buyer of Equipment hereunder (the “License”) to import into the Territory and use the Licensed Technology (including any Intellectual Property in the Licensed Technology) within the Territory, and solely in accordance with the terms of this Agreement. Such license includes a perpetual license to use software provided for the operation of the Equipment, including but not limited to all modifications or additions to software upon payment of commercially reasonable service charges to be negotiated, as well as all related documentation and technical information. With respect to any Confidential Information contained within the Licensed Technology, Buyer may disclose such Confidential Information to third party contractors who have a need to know such parts of the Licensed Technology solely for Buyer’s use and operation of the Equipment and in accordance with the terms of this Agreement; provided that such third parties shall first execute a confidentiality agreement consistent with this Agreement containing restrictions on disclosure and use at least as restrictive as those in Article 17 (and such third party contractors shall not be permitted to disclose the Licensed Technology to any other third party). The Licensed Technology is Confidential Information of Supplier as defined in Section 17.1 even if not marked as “confidential,” “proprietary” or with other such similar language, except where an exception in Section 17.3 applies.

 

13.2.

No Copies. Except as otherwise permitted by this Agreement, Buyer shall not make any copies of the Licensed Technology without first obtaining express written permission from Supplier. Notwithstanding the foregoing, Buyer may make such number of copies of (i) the documentation and manuals for the Equipment or other Intellectual Property licensed hereunder that is not embedded in the Equipment as are required for Buyer’s normal use and operation hereunder (including such copies as may be included in or attached to electronic mail messages by Buyer for delivery to Persons who are otherwise permitted recipients of Supplier’s Confidential Information hereunder) and (ii) the Licensed Technology as are reasonably required for back-up, disaster recovery and archival purposes.

 

 

13.3.

Proprietary Notices. Buyer shall not remove or alter, or permit to be removed or altered, any proprietary notices that appear on or with the Licensed Technology. Buyer shall include on and with the Licensed Technology a written notice stating: “Confidential and Proprietary Information of Supplier. Access and Use Restricted by License.” or such other or additional notice as Supplier reasonably may prescribe.

 

13.4.

Security. Buyer shall take all reasonable steps to ensure that no unauthorized persons have access to the Licensed Technology, and to ensure that no persons authorized to have such access shall take any action which would be in violation of this Agreement. Such steps shall include, but shall not be limited to, imposing password restrictions on use of the Licensed Technology securing Buyer’s network on which such Licensed Technology resides from outside intrusion, preventing the making of unauthorized copies of the Licensed Technology and administering and monitoring use of the Licensed Technology.

 

13.5.

No Reverse Engineering. The Licensed Technology includes trade secrets of Supplier or its Affiliates. In order to protect the Licensed Technology, Buyer shall not modify, translate, decompile, reverse engineer, decrypt, extract or disassemble the Licensed Technology or otherwise reduce or attempt to reduce any Software in the Licensed Technology to source code form. Buyer shall ensure, both during and (if Buyer still has possession of the Licensed Technology) after the performance of this Agreement, that (a) Persons who are not bound by a confidentiality agreement consistent with this Agreement shall not have access to the Licensed Technology and (b) Persons who are so bound are put on written notice that the Licensed Technology contains trade secrets, owned by and proprietary to Supplier or its Affiliates.

 

13.6.

Open Source Software. Buyer shall not sell, sublicense, or otherwise make available the Licensed Technology or any part thereof as Open Source Software, nor combine the Licensed Technology with any Open Source Software in a manner that could require the release, disclosure or distribution of the Licensed Technology, or otherwise infect the Licensed Technology so as to impose any obligation on Supplier or diminish any rights Supplier may have therein.

 

13.7.

Reporting. Buyer shall promptly report to Supplier any actual or suspected violation of this Article 13, and shall take such further steps as may reasonably be requested by Supplier to prevent or remedy any such violation.

 

13.8.

Relief. Because unauthorized use or transfer of the Licensed Technology is likely to diminish substantially the value of such Licensed Technology and irreparably harm Supplier and will not be susceptible of cure by the payment of monetary damages, if Buyer breaches the provisions of this Article 13, Supplier shall be entitled to injunctive and/or other equitable relief, in addition to other remedies afforded by law, to prevent or restrain such breach.

 

13.9.

Improvements.

 

(a)

By Supplier. Any improvement hereafter made by or for Supplier or any of its Affiliates in the Licensed Technology that is approved and adopted by Supplier for use by Buyer under this Agreement shall be included in the Licensed Technology for purposes of the License. The Parties agree that Supplier may decide in its sole discretion which improvements it shall approve and adopt for purposes of Buyer’s use under the License; provided, however, that if Supplier makes improvements available to buyers similarly situated to Buyer in terms of project scope and fees paid, Supplier also shall make such improvements available to Buyer on terms at least as favorable to Buyer as the terms generally provided to such similarly situated buyers.

 

 

(b)

By Buyer. Buyer may not modify the Licensed Technology except as expressly permitted in this Section 13.9(b). Buyer may suggest modifications in the Licensed Technology to Supplier. Any modification in the Licensed Technology suggested by Buyer must first be approved by Supplier in its sole discretion in writing before it is used by Buyer hereunder. If Buyer develops any material modification or improvement in the Licensed Technology (whether permitted or not), it shall promptly disclose it to Supplier in writing. If and only if, and to the extent, Applicable Law mandates that Buyer own any modifications to or improvements in the Licensed Technology, in whole or in part, and notwithstanding the terms of this Agreement, Buyer hereby grants to Supplier and its Affiliates a non-exclusive, perpetual, worldwide, royalty-free license to make, have made, import, offer for sale, sell, copy, make derivative works, use and sublicense others to use these modifications or improvements.

 

13.10.

Ownership.

 

(a)

Supplier. As between the Parties, Supplier or its Affiliates shall own the Licensed Technology, including any modifications, discoveries, derivative works and improvements derived from or based on it, whether developed by Supplier, by Buyer, or by the Parties jointly, all Intellectual Property therein and any Intellectual Property developed during, or arising out of, the performance of Supplier’s obligations under this Agreement, to the extent permitted by Applicable Law. Buyer acquires only certain rights to use the Licensed Technology under the License, strictly in compliance with the terms of this Agreement, and does not acquire any ownership rights or title to it.

 

(b)

Buyer. As between the Parties, Buyer or its Affiliates shall own (1) any Intellectual Property developed or acquired by Buyer prior to or independently of this Agreement, (2) all data generated or collected by the Equipment or Buyer or its customer during the commercial use of the Equipment (the “Buyer Data”), and (3) all Intellectual Property therein, excluding in each case any of the Licensed Technology incorporated therein or any Intellectual Property in any combination of the Licensed Technology and Buyer Data.

 

(c)

Cooperation. Buyer shall reasonably cooperate with Supplier to assist in perfecting Supplier’s ownership in any Intellectual Property in modifications, discoveries, derivative works and improvements to Licensed Technology developed by Supplier or by the Parties jointly, including by executing declarations, oaths, assignments or other formalities documents as needed.

 

 

13.11.

Enforcement. Each Party shall notify the other promptly in writing of any suspected infringement by a third party of the Licensed Technology or any of the Intellectual Property therein. Supplier shall have the exclusive right to enforce and defend the rights appurtenant to the Licensed Technology or the Intellectual Property therein in Supplier’s sole discretion and shall have the sole right of control of any such enforcement action or proceeding it elects to initiate (an “Enforcement Action”), at Supplier’s sole cost and expense. Supplier shall keep Buyer timely and reasonably informed as to significant events during the course of all such Enforcement Actions as would reasonably be expected to affect Buyer’s use of the Licensed Technology whether conducted for Supplier’s or Buyer’s account. Buyer shall provide on Supplier’s written request reasonable assistance in preparing and advancing Supplier’s case, in consideration of which Supplier shall reimburse Buyer’s reasonable out-of-pocket costs incurred in doing so (including reasonable attorneys’ fees). Supplier may retain any monetary damages or other compensation or recovery awarded to it in any Enforcement Action under this Section 13.11. Notwithstanding the foregoing, Buyer may participate and be represented in any Enforcement Action by its own counsel at its own expense, to the extent such participation and representation does not materially interfere with Supplier’s right to control such Enforcement Action. Supplier shall not settle any such Enforcement Action in a manner materially and adversely affecting Buyer’s rights in this Agreement, or in a manner including an admission of wrongdoing by Buyer, without obtaining the prior written consent of Buyer, which consent shall not be unreasonably withheld, conditioned or delayed. Buyer has no right to enforce Supplier’s Intellectual Property in the Licensed Technology against any third parties.

 

13.12.

Duration and Transfers. Subject to termination in accordance with this Agreement, the License (i) shall continue for so long as Buyer or any successor retains ownership of the Equipment and continues operating the same (ii) shall terminate automatically if and when the Equipment is permanently removed from service (subject to earlier termination in accordance herewith) and (iii) shall transfer as part of an assignment that is permitted under Section 25.5. If Buyer sells or transfers the Equipment, or any portion thereof, apart from an Assignment of this Agreement, the License will terminate as to Buyer with respect to the Equipment, or any portion thereof sold or transferred and Buyer must, as a condition thereof, notify Supplier in writing and assign to the transferee thereof the License with respect to the Equipment, or any portion thereof sold or transferred, and procure from the transferee an assumption of such License, on substantially the same terms as set forth in this Article 13 and in form subject to Supplier’s prior reasonable approval, to the extent the License is applicable to the assets being sold or transferred. The License may not be assigned, transferred or sublicensed except as expressly permitted in this Section 13.12. Buyer shall be responsible for, and indemnify, defend and hold harmless Supplier, Supplier’s Parent, Supplier’s Affiliates, and their respective officers, directors, members, agents and employees from and against any damage, injury or loss resulting from the failure of Buyer to comply with the terms of this Article 13. Supplier may terminate the License, except with respect to any Licensed Technology that is integrated in any Equipment as to which title has transferred to Buyer hereunder, on written notice to Buyer if Buyer (a) fails to cure any material breach of an obligation in this Article 13 which is capable of being cured within thirty (30) days after Supplier’s written notice specifying the breach, or (b) on more than two (2) occasions in any five (5) year period, Buyer is found, through resolution of a Dispute, whether by settlement or otherwise, to have materially breached the terms and conditions of this Article 13 in substantially the same manner.

 

 

13.13.

Government End Users. The Software portion of the Licensed Technology is a “commercial item” as that term is defined at 48 CFR 2.101, and includes “commercial computer software” and “commercial computer software documentation” as such terms are used in 48 CFR 12.212 and in the event the Licensed Technology is provided to the US Government, such Licensed Technology shall be provided to the US Government only as a commercial end item. Consistent with 48 CFR 12.212, civilian US Government end users acquire the Software and documentation with only those license rights set forth herein as restricted by 48 CFR 12.212(a)(1) and (a)(2); Department of Defense end users acquire the Software and documentation with only those license rights set forth herein as restricted by 48 CFR 227.7202-1 through 227.7202-4.

 

13.14.

Reservation of Rights. Supplier reserves all rights in the Licensed Technology not expressly granted to Buyer in this Agreement. No right or license is granted (expressly or by implication or estoppel) by Supplier to Buyer or its Affiliates under any tangible, Intellectual Property, or other proprietary right.

 

14.

DEFAULTS AND REMEDIES.

 

14.1.

Supplier Defaults. The occurrence of any one or more of the following events shall constitute an event of default by Supplier hereunder (a “Supplier Event of Default”):

 

(a)

Supplier fails to pay to Buyer any payment required under this Agreement (which is not subject to a good faith dispute) when due, and such failure continues for ten (10) Business Days after receipt of written notice of such failure;

 

(b)

Supplier voluntarily commences bankruptcy, insolvency, reorganization, stay, moratorium or similar debtor-relief proceedings, or shall have become insolvent or generally does not pay its debts as they become due, or admits in writing its inability to pay its debts, or makes an assignment for the benefit of creditors;

 

(c)

Insolvency, receivership, reorganization, bankruptcy, or similar proceedings shall have been commenced against Supplier and such proceedings remain undismissed or unstayed for a period of ninety (90) days;

 

(d)

Supplier fails to deliver Equipment by the date upon which Supplier exhausts its liability for liquidated damages for delayed deliveries under Section 5.3; or

 

(e)

Except as otherwise expressly provided for in this Section 14.1, Supplier is in material breach of its obligations under this Agreement and such material breach continues uncured for sixty (60) days after receipt of written notice from Buyer.

 

14.2.

Buyer Defaults. The occurrence of any one or more of the following events shall constitute an event of default by Buyer hereunder (a “Buyer Event of Default”):

 

(a)

Buyer fails to pay to Supplier any payment required under this Agreement (which is not subject to a good faith dispute) when due, and such failure continues for ten (10) Business Days after receipt of written notice of such failure;

 

(b)

Buyer voluntarily commences bankruptcy, insolvency, reorganization, stay, moratorium or similar debtor-relief proceedings, or shall have become insolvent or generally does not pay its debts as they become due, or admits in writing its inability to pay its debts, or makes an assignment for the benefit of creditors;

 

 

(c)

Insolvency, receivership, reorganization, bankruptcy, or a similar proceeding shall have been commenced against Buyer and such proceeding remains undismissed or unstayed for a period of ninety (90) days;

 

(d)

Any Assignment by Buyer not in conformity with Section 25.5; or

 

(e)

Except as otherwise expressly provided for in this Section 14.2, Buyer is in material breach of its obligations under this Agreement and such material breach continues uncured for sixty (60) days after receipt of written notice from Supplier.

 

14.3.

Remedies. Upon the occurrence of a Supplier Event of Default, Buyer may, by written notice to Supplier, terminate the outstanding Purchase Order(s) under which the Supplier Event of Default has arisen and/or shall be entitled to such rights and remedies as may be available at law or in equity. Upon the occurrence of a Buyer Event of Default, Supplier may, by written notice to Buyer, terminate the outstanding Purchase Order(s) under which the Buyer Event of Default has arisen and/or shall be entitled to such rights and remedies as may be available at law or in equity. Any rights and remedies available under Applicable Law upon termination of this Agreement pursuant to this Section 14.3 shall be limited in all respects by the limitations of liability set forth in Article 16. For sake of clarity, in the event that there are more than one Buyer under this Agreement, (i) a Buyer Event of Default by one such Buyer shall not constitute a Buyer Event of Default by any other Buyer and any remedies available to Supplier shall be exercisable only as against the defaulting Buyer and as regards the non-defaulting Buyer(s) this Agreement and any related Purchase Orders shall continue in full force and effect, and (ii) a Supplier Event of Default with respect to any particular Purchase Order shall only count as a Supplier Event of Default for the applicable Purchase Order and as regards any other Purchase Orders and any other Buyer(s), this Agreement and any related Purchase Orders shall continue in full force and effect.

 

15.

INDEMNIFICATION.

 

15.1.

General. Each Party (the “Indemnifying Party”) shall indemnify, defend and hold harmless the other Party, its Affiliates, and their Representatives and assigns (the “Indemnified Party”) from and against all claims, suits, causes of action, losses, liabilities, liens, damages, assessments, costs, expenses, demands, complaints or actions including but not limited to reasonable attorneys’ fees and court costs (collectively, “Claims”) of third parties concerning: (i) death, personal injury, or property damage of third parties, (ii) nonpayment of wages, benefits, fees, amounts owed, and/or any taxes (including penalties and interest) associated therewith arising from the Indemnifying Party’s Representatives, suppliers, contractors, and/or materialmen which may include liens or encumbrances on the Equipment/Services or the premises on which located and (iii) violations by the Indemnifying Party or any Person for whom the Indemnifying Party is responsible of Applicable Law; in each case to the extent arising or resulting from the Indemnifying Party’s or its Representative’s negligence, willful misconduct, or breach of this Agreement. For sake of clarity, if both Parties are negligent or otherwise at fault or strictly liable without fault, then the obligations of indemnification under this Section 15.1 shall continue, but the Indemnifying Party shall indemnify the Indemnified Party only for the percentage of responsibility for the damage or injuries attributable to the Indemnifying Party.

 

 

15.2.

Infringement Indemnification by Supplier.

 

(a)

Indemnity. If an action is brought or threatened against Buyer claiming that Buyer’s use, as permitted herein, of the Licensed Technology within the Territory infringes any Intellectual Property arising or existing under Applicable Law, Supplier shall defend, indemnify and hold harmless Buyer, its Affiliates, and their Representatives and assigns at Supplier’s expense from and against any and all Infringement Claim Costs of Buyer to the extent arising from such action or claim.

 

(b)

Corrective Actions. If Buyer’s permitted use of the Licensed Technology within the Territory is materially impaired or if Supplier’s performance of the Equipment supply obligations under this Agreement or any other obligation is materially impaired by reason of such third party claim, Supplier shall use commercially reasonable efforts, at its expense, to continue its performance of the Equipment supply obligations under this Agreement or the other affected obligations, including at its own election and expense (i) to substitute an equivalent non-infringing item or process for the allegedly infringing item or process, (ii) to modify the allegedly infringing item or process so that it no longer infringes but remains functionally equivalent or better or (iii) to obtain for Buyer the right to continue using such item or process. Supplier shall, prior to proceeding with any of the foregoing actions, consult with Buyer as to the proposed action and consider in good faith any reasonable request of Buyer in respect thereof. Nothing herein constitutes a guarantee by Supplier that such efforts will succeed in avoiding the infringement claim or that Supplier will be able to replace the infringing item or process with an item or process of comparable functionality or effectiveness. If Supplier reasonably believes that an injunction against use of the Licensed Technology in the Territory may be granted against Buyer, either imminently or with the passage of time, Supplier may at its expense, and upon reasonable prior written notice to Buyer, take any of the foregoing actions in order to minimize its liability.

 

(c)

Exclusions. This Section 15.2 does not apply to, and Supplier assumes no liability with respect to, claims for patent infringement or copyright infringement or improper use of other proprietary rights (including any license or Intellectual Property, whether by way of copyright or otherwise) to the extent that such claims relate, in whole or in part, to (i) Buyer’s modification or alteration of the Licensed Technology (except to the extent permitted by this Agreement) or the Equipment, in either case made without Supplier’s written consent or contrary to Supplier’s instructions, (ii) the combination of the Licensed Technology with other Software, products, materials, equipment, parts or apparatus and not approved in writing by Supplier or (iii) a failure to promptly install an update required by Supplier.

 

(d)

Entire Liability. THE FOREGOING PROVISIONS OF THIS SECTION 15.2 STATE THE ENTIRE LIABILITY AND OBLIGATION OF SUPPLIER AND ITS AFFILIATES AND THE EXCLUSIVE REMEDY OF BUYER, WITH RESPECT TO ANY ACTUAL OR ALLEGED INFRINGEMENT OF PATENTS, COPYRIGHTS, TRADEMARKS OR OTHER INTELLECTUAL PROPERTY BY THE EQUIPMENT OR THE LICENSED TECHNOLOGY OR ANY PART THEREOF, EXCEPT TO THE EXTENT THAT SUCH LIABILITY CANNOT BE EXCLUDED IN ACCORDANCE WITH MANDATORY LEGAL REQUIREMENTS.

 

 

(e)

Notifications. Buyer shall promptly notify Supplier in writing following receipt of written notice of any claims alleging infringement of patents or other proprietary rights (including Intellectual Property) in connection with Buyer’s permitted use of the Licensed Technology or Supplier’s performance of the Equipment supply obligations under this Agreement or Equipment Warranty obligations, and shall provide Supplier with all information in its possession relevant to such claim. In turn, Supplier shall notify Buyer as soon as practical in writing of any claims which Supplier may receive alleging infringement of patents or other proprietary rights which may affect Supplier’s performance of the Equipment supply obligations under this Agreement or Equipment Warranty obligations under this Agreement or Buyer’s right to own, operate and maintain the Equipment.

 

15.3.

Infringement Indemnification by Buyer.

 

(a)

Indemnity. If an action is brought or threatened against Supplier claiming that any condition or event described in Section 15.2(c) results in an infringement upon any Intellectual Property within the Territory arising or existing under Applicable Law, Buyer shall defend, indemnify and hold harmless the Supplier Indemnified Parties at Buyer’s expense from and against any and all Infringement Claim Costs of Supplier to the extent arising from such action or claim.

 

(b)

Corrective Actions. If performance of Supplier’s obligations hereunder is enjoined by reason of a claim subject to Section 15.3(a), Buyer shall use commercially reasonable efforts, at its option and expense, at its own election (i) to substitute an equivalent non-infringing item or process for the allegedly infringing item or process, (ii) to modify the allegedly infringing item or process so that it no longer infringes but remains functionally equivalent, or (iii) to obtain for Supplier the right to continue using such item or process. Nothing herein constitutes a guarantee by Buyer that such efforts will succeed in avoiding the infringement claim or that Buyer will be able to replace the infringing item or process with an item or process of comparable functionality or effectiveness.

 

(c)

Exclusions. This Section 15.3 does not apply to, and Buyer assumes no liability with respect to, claims for patent infringement or copyright infringement or improper use of other proprietary rights (including any license or Intellectual Property, whether by way of copyright or otherwise), to the extent that such claims relate, in whole or in part, to (i) a modification to the Licensed Technology or the Equipment requested by Buyer but executed by Supplier or with Supplier’s supervision and control or (ii) the combination of the Licensed Technology with other products, materials, equipment, parts or apparatus approved in writing by Supplier.

 

15.4.

Indemnification Procedures.

 

(a)

If an Indemnified Party receives written notice of a Claim, the Indemnified Party shall give prompt written notice to the Indemnifying Party, including a reasonably detailed description of the facts and circumstances relating to such Claim, a complete copy of all notices, pleadings and other papers related thereto, and a description in reasonable detail of the basis for the potential claim for indemnification with respect thereto. The Indemnified Party’s delay or deficiency in notifying Supplier shall not relieve Supplier of liability or obligation except to the extent (and only to the extent) such delay materially impacts the defense of the Claim.

 

 

(b)

The Indemnifying Party shall be entitled to assume the defense and to represent the interests of the Indemnified Party, which shall include the right to select and direct legal counsel and other consultants (all of whom shall be reasonably acceptable to the Indemnified Party), appear in proceedings on behalf of the Indemnified Party and to propose, accept or reject offers of settlement, subject to Section 15.4(c) below, all at its sole cost. Nothing herein shall prevent an Indemnified Party from retaining its own legal counsel and other consultants or participating in its own defense at its own cost and expense. Notwithstanding the foregoing, if (i) the claim is primarily for non-monetary damages against the Indemnified Party, or primarily for an injunction or other equitable relief that, if granted, would reasonably be expected to be material to the Indemnified Party, (ii) there is a material actual or potential conflict of interest that makes representation of the Indemnifying Party and the Indemnified Party by the same counsel or the counsel selected by the Indemnifying Party inappropriate, or (iii) the claim is a criminal proceeding, then in each case the Indemnified Party may, upon notice to the Indemnifying Party, assume the exclusive right to defend (and in the case of clause (iii) above, compromise and settle), such claim and the reasonable fees and expenses of the Indemnified Party’s separate counsel shall be borne by the Indemnifying Party; however the settlement of any claim pursuant to clauses (i) and (ii) above shall be governed by Section 15.4(c) below. Notwithstanding anything to the contrary herein, for sake of clarity, the Parties agree that the foregoing provisions shall not be construed so as to permit the Indemnified Party to control or assume the defense of any action, lawsuit, proceeding, investigation, demand or other claim brought against the Indemnifying Party concurrently with or in a joint proceeding in respect of any claim that is the subject of an indemnification claim hereunder by the Indemnified Party.

 

(c)

Notwithstanding anything to the contrary herein, the Indemnifying Party shall not compromise or settle, or admit any liability with respect to any third party Claim without the prior written consent of the Indemnified Party (which consent shall not be unreasonably withheld or delayed), unless the relief consists solely of (i) money damages (all of which the Indemnifying Party shall pay), and (ii) includes a provision whereby the plaintiff or claimant in the matter releases the Indemnified Party from all liability with respect thereto. If the Indemnified Party assumes the defense of or represents their own interests, no settlement shall be made without the prior written consent of the Indemnifying Party (which consent shall not be unreasonably withheld or delayed).

 

15.5.

Limited Waiver of Certain Immunities. Each of the Parties hereby specifically and expressly agrees that with respect to any and all claims against an Indemnified Party by any representative of an Indemnifying Party, any indemnification available hereunder shall not be limited by reason of any immunity to which such Indemnifying Party may be entitled under any workers compensation and/or industrial insurance acts, disability benefit acts, or other employee benefits acts and any limitation on the amount or type of damages, compensation, or benefits payable by or for the Indemnifying Party to such representative with respect to any such claim. For the sake of clarity, the Indemnifying Party’s waiver of immunity by the provisions of this section extends only to indemnification claims against the Indemnifying Party by or on behalf of the Indemnified Party under or pursuant to this Agreement, and does not apply to any claims made by the Indemnifying Party’s representatives directly against the Indemnifying Party.

 

 

15.6.

Survival. The indemnities set forth in this Article 15 shall survive the termination or expiration of this Agreement.

 

16.

LIMITATIONS OF LIABILITY.

 

16.1.

WAIVER OF CERTAIN DAMAGES. NOTWITHSTANDING ANYTHING IN THIS AGREEMENT OR ANY PURCHASE ORDER EXECUTED HEREUNDER TO THE CONTRARY, NEITHER PARTY SHALL BE LIABLE, WHETHER BASED IN CONTRACT, GUARANTY, WARRANTY, TORT (INCLUDING NEGLIGENCE), PRODUCT LIABILITY, STRICT LIABILITY, INDEMNITY OR ANY OTHER LEGAL OR EQUITABLE THEORY, FOR: LOSS OF USE, REVENUE, SAVINGS, PROFIT, INTEREST, GOODWILL OR OPPORTUNITY, COSTS OF CAPITAL, COSTS OF REPLACEMENT OR SUBSTITUTE USE OR PERFORMANCE, LOSS OF INFORMATION AND DATA, LOSS OF POWER, VOLTAGE IRREGULARITIES OR FREQUENCY FLUCTUATION, CLAIMS ARISING FROM BUYER’S THIRD PARTY CONTRACTS, OR FOR ANY TYPE OF INDIRECT, SPECIAL, PUNITIVE, EXEMPLARY, COLLATERAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES, OR FOR ANY OTHER LOSS OR COST OF A SIMILAR TYPE.

 

16.2.

MAXIMUM LIABILITY. SUPPLIER’S MAXIMUM LIABILITY UNDER THIS AGREEMENT SHALL NOT EXCEED THE PURCHASE PRICE SET FORTH IN THE APPLICABLE PURCHASE ORDER PURSUANT TO WHICH THE APPLICABLE CLAIM AROSE.

 

16.3.

EFFECTIVENESS. THE PARTIES AGREE THAT THE EXCLUSIONS AND LIMITATIONS IN THIS ARTICLE 16 WILL PREVAIL OVER ANY CONFLICTING TERMS AND CONDITIONS IN THIS AGREEMENT OR ANY PURCHASE ORDER EXECUTED HEREUNDER AND MUST BE GIVEN FULL FORCE AND EFFECT, WHETHER OR NOT ANY OR ALL SUCH REMEDIES ARE DETERMINED TO HAVE FAILED OF THEIR ESSENTIAL PURPOSE. THESE LIMITATIONS OF LIABILITY ARE EFFECTIVE EVEN IF SUPPLIER HAS BEEN ADVISED BY BUYER OF THE POSSIBILITY OF SUCH DAMAGES. THE WAIVERS AND DISCLAIMERS OF LIABILITY, RELEASES FROM LIABILITY AND LIMITATIONS ON LIABILITY EXPRESSED IN THIS ARTICLE 16 EXTEND TO THE PARTIES’ RESPECTIVE AFFILIATES, PARTNERS, PRINCIPALS, MEMBERS SHAREHOLDERS, DIRECTORS, OFFICERS, EMPLOYEES, SUPPLIERS, AGENTS, AND SUCCESSORS AND ASSIGNS.

 

16.4.

Commencement of Claims. Except with respect to claims arising under Article 13, Article 15 or Article 17, any legal action of either Party arising under this Agreement or any Purchase Order issued hereunder must be commenced within two (2) years after the Delivery of the applicable Equipment or performance of the applicable Service. To the maximum extent permitted by Applicable Law, each Party hereby waives any right to commence any claim or action after such two (2) year period.

 

17.

CONFIDENTIALITY.

 

17.1.

Confidential Information. Each Party shall, and shall cause its respective Affiliates and Representatives to, keep confidential any information which it may have or acquire before or after the date of this Agreement, concerning the other Party and its assets, business, operations, affairs, financial condition or such information, “Confidential Information”).

 

 

17.2.

Non-Disclosure. Neither Party shall use any Confidential Information in any manner detrimental to the other Party nor shall any of them disclose, publish or make accessible, directly or indirectly, any Confidential Information to any person. In addition, the Parties shall exercise all reasonable efforts to prevent any other person from gaining access to such Confidential Information and take such protective measures as may be or become reasonably necessary to preserve the confidentiality of such Confidential Information.

 

17.3.

Exceptions. Notwithstanding Section 17.1 and Section 17.2, either Party may disclose Confidential Information:

 

(a)

to any Representative of such Party, provided that such Representative has a need to know and has been informed of the confidential nature of the information pursuant to Section 17.4;

 

(b)

to the extent required by (i) any Applicable Law of any Governmental Authority (including any rule or regulation of the Securities and Exchange Commission), (ii) any stock exchange rule or regulation or (iii) any binding judgment, order or requirement of any court or other Governmental Authority of competent jurisdiction; provided, that the Party required to disclose Confidential Information, as the case may be, has delivered written notice to and consulted, to the extent practicable, with the other Party prior to disclosure of such Confidential Information; and

 

(c)

to the extent such Confidential Information becomes available within the public domain (otherwise than as a result of a breach of this Article 17).

 

17.4.

Representatives Bound. Each Party shall inform any representative to whom it provides Confidential Information that such information is confidential and shall instruct them (a) to keep such Confidential Information confidential and (b) not to disclose it to any third party (other than those persons to whom such Confidential Information has already been disclosed in accordance with the terms of this Agreement). The disclosing Party shall be responsible for any breach of this Article 17 by the person to whom the Confidential Information is disclosed.

 

17.5.

Survival. Notwithstanding anything herein to the contrary, the provisions of this Article 17 shall survive the termination of this Agreement for a period of three (3) years and, with respect to each Party, shall survive for a period of three (3) years following the date on which such Party is no longer a Party.

 

18.

REPRESENTATIONS AND WARRANTIES.

 

18.1.

Representations of the Parties. As of the Effective Date (or, with respect to each Further Siemens Contracting Party that becomes a Buyer hereunder, as of the time of execution of a joinder hereto), and as of the entry into of each Purchase Order hereunder, each Party represents to the other Party as follows:

 

(a)

Due Formation. Such Party (i) is a duly formed, validly existing and in good standing under the laws of the jurisdiction of its formation, (ii) has the requisite power and authority to own its properties and carry on its business as now being conducted and currently proposed to be conducted and to execute, deliver and perform its obligations under this Agreement, and (iii) is qualified to do business in every jurisdiction in which failure so to qualify could be reasonably be expected to have a material adverse effect on such Party’s ability to perform its obligations hereunder.

 

 

(b)

Authorization; Enforceability. Such Party has taken all action necessary to authorize it to execute, deliver and perform its obligations under this Agreement. This Agreement constitutes a legal, valid and binding obligation of such Party enforceable in accordance with its terms, subject to bankruptcy, reorganization, moratorium or other similar laws affecting the enforcement of the rights of creditors generally and subject to general principles of equity.

 

(c)

No Conflict. The execution, delivery and performance by such Party of this Agreement does not and will not (i) violate any Applicable Law, (ii) result in any breach of such Party’s constituent documents or (iii) conflict with, violate or result in a breach of or constitute a default under any agreement or instrument to which such Party or any of its properties or assets is bound or result in the imposition or creation of any lien or security interest in or with respect to any of such Party’s property or assets, other than in each case any such violations, conflicts, breaches or impositions which could not be reasonably be expected to have a material adverse effect on such Party’s ability to perform its obligations hereunder.

 

(d)

No Authorization. No authorization or approval or other action by, and no notice to or filing with, any Governmental Authority or any third party (other than those which have been obtained) is required for the due execution, delivery and performance by such Party of this Agreement, other than any such authorizations, approvals or actions the failure of which to obtain could not reasonably be expected to have a material adverse effect on such Party’s ability to perform its obligations hereunder.

 

(e)

Litigation. Such Party is not a party to any legal, administrative, arbitration or other proceeding, and, to such Party’s knowledge, no such proceeding is threatened, before any Governmental Authority that seeks to restrain or prohibit or otherwise challenge the consummation, legality or validity of this Agreement, the subject matter hereof, or that which could be reasonably be expected to have a material adverse effect on such Party’s ability to perform its obligations hereunder.

 

18.2.

Additional Representations of Supplier. In addition to representations and warranties set forth elsewhere in this Agreement, Supplier hereby represents and warrants as of the Effective Date and as of the entry into of each Purchase Order hereunder as follows:

 

(a)

None of Supplier, its Affiliates or Representatives is the target of or designated under any sanctions program that is established by statute or regulation of the United States, by Executive Order of the President of the United States, or by designations of any department or agency of the United States government including but not limited to those designations reflected in the “list of Specially Designated Nationals and Blocked Persons” of the Office of Foreign Asset Control, U.S. Department of the Treasury;

 

(b)

Supplier’s Representatives are legally authorized to work in the United States and Supplier shall complete as required by Applicable Law the Department of Labor’s Form I-9 and to retain it for the statutorily designated period and, if requested by Buyer, Supplier shall provide copies of such Forms I-9 to Buyer unless such disclosure shall be prohibited by Applicable Law;

 

 

(c)

For Services provided at Buyer’s, it’s customer or third party’s premises, Supplier has examined the worksite in order to acquaint itself with the local conditions, including applicable regulations codes, permits, licenses, registrations, environmental standards, and notification requirements concerning site safety and/or security;

 

Supplier has not and will not, absent prior written approval from Buyer, take any actions that: (i) create, or purport to create, any obligation on behalf of Buyer, or (ii) grant, or purport to grant, any rights or immunities to any third party under Buyer’s intellectual property or proprietary rights; and

 

(d)

The bank account named by Supplier to Buyer for all payments to be effected in connection with any Purchase Order hereunder is held in Supplier’s name and solely for its account.

 

19.

ENVIRONMENT, HEALTH AND SAFETY.

 

19.1.

Compliance and Related Matters.

 

(a)

Each of the Parties shall, in addition to other obligations set forth in this Agreement, during the course of performance of their respective obligations under this Agreement or any Purchase Order issued hereunder:

 

(i)

comply with Applicable Laws concerning health, the environment, safety, or pertaining to or regulating pollutants, contaminants, or hazardous, toxic or radioactive substances, materials or wastes, including without limitation the handling, transportation and disposal thereof, or governing or regulating the health and safety of personnel, including but not limited to the Occupational Safety and Health Act of 1970, the Resource Conservation and Recovery Act, and the Toxic Substance Control Act (“TSCA”), as amended (collectively referred to as “EHS Laws”) (pollutants, contaminants, or hazardous, toxic or radioactive substances, materials or wastes as defined under EHS Laws shall be referred to collectively as “Hazardous Materials”);

 

(ii)

take reasonable and prudent measures, as appropriate, consistent with applicable industry standards, to mitigate hazards to the environment and to the health and safety of persons;

 

(iii)

select and use only equipment, including but not limited to personal protection equipment, that comports with EHS Laws, implement programs to train its Representatives in the use of such equipment in a safe and lawful manner, and maintain such equipment in good working order at all times; and

 

(iv)

promptly notify the other Party of any incident involving death, injury or damage to any person or property in connection with any Equipment or Purchase Order.

 

 

(b)

Supplier shall, in addition to other obligations set forth in this Agreement, during the course of performance of its obligations under this Agreement or any Purchase Order issued hereunder:

 

(i)

ensure that Equipment/Services comply with EHS Laws;

 

(ii)

ensure the Equipment, and any and all parts, components, or material thereof, as Delivered by Supplier, bear all markings, labels, warnings, notices or other information required under applicable EHS Laws at the time of such Delivery; and

 

(iii)

comply with any applicable substance declarations and other requirements set forth in Exhibit C.

 

19.2.

On-Site Environmental and Safety Responsibility. Where the Purchase Order includes the presence of Supplier or its Representatives on the premises of Buyer, Buyer’s customer, or any other location other than the premises of Supplier (“Work Site”), Supplier shall: (1) be responsible for the safety, health, medical surveillance, industrial hygiene, training and all other matters required under EHS Laws relating to safety and health of its Representatives at the Work Site, (2) appoint a competent person as its representative for environmental, health and safety who shall take part in safety discussions with Buyer, its Representatives, customer, or the owner of the Work Site, (3)  be responsible for the handling, use, transportation and disposal of any and all substances regulated under the EHS Laws which Supplier or its Representatives bring onto the Work Site or generate in the performance of Supplier’s work pursuant to the applicable Purchase Order, including but not limited to excess, waste or residue, containers or any of such substances not consumed, and for any spills, releases or discharges of such substances to the extent attributable to acts or omissions of Supplier or its Representatives, strictly in accordance with EHS Laws, and (4) ensure Supplier’s Representatives participate in any site-specific safety training and comply with all rules and requirements of Buyer, its customer, or such other owner of the Work Site, in each case, of which Buyer provides Supplier advance written notice.

 

19.3.

Health and Safety Plan. Prior to commencing any Services at a Work Site, Supplier shall, in accordance with EHS Laws provide and comply with a site specific health and safety plan, Work Site requirements, and shall make the same available to Buyer or its Representatives at Buyer’s request. If Supplier fails to comply with this Article 19, Buyer may, at its sole option and without limiting its other rights, order Supplier or its Representatives to cease Services until Supplier complies at Supplier’s sole cost and expense. If Supplier is unable or refuses to take corrective action hereunder Buyer may contract with a third party or otherwise continue such Services at the Work Site and charge Supplier any excess cost reasonably incurred by Buyer. Buyer shall have the right, at its sole discretion, to remove Supplier or its Representatives from a Work Site for violation of this Article 19.

 

 

 

20.

OPEN SOURCE SOFTWARE.

 

Supplier shall inform Buyer no later than ten (10) Business Days following receipt of any written request from Buyer in connection with a Purchase Order, whether the Equipment/Services contemplated thereby include “Open Source Software.” As used herein “Open Source Software” means any Software that is licensed royalty-free (i.e., fees for exercising the licensed rights are prohibited, whereas fees for reimbursement of costs incurred by licensor can be permitted) under any license terms or other contract terms (“Open License Terms”) which require, as a condition of use, modification and/or distribution of such Software and/or any other Software incorporated into, derived from or distributed with such software (“Derivative Software”), either of the following: (i) that the source code of such Software and/or any Derivative Software be made available to third parties; or (ii) that permission for creating derivative works of such software and/or any Derivative Software be granted to third parties. If Open Source Software is included, Supplier shall deliver to Buyer, not later than the date of order confirmation, (A) a schedule of all Open Source Software files known to be used, indicating the relevant license(s) to the extent known by Supplier; and (B) a written notice that Supplier is not aware of any violation of such license(s) due to such Use of Open Source Software.

 

21.

EXPORT CONTROL AND FOREIGN TRADE REGULATIONS.

 

21.1.

Acknowledgement and Compliance. The Parties acknowledge that all Equipment to be delivered and Services to be provided according to this Agreement are subject to export control and sanctions laws and regulations, including, without limitation, the U.S. Export Administration Regulations (“EAR”) (15 C.F.R. §§ 730-774), the U.S. Foreign Trade Regulations (15 C.F.R. Part 30), and the regulations, rules, and executive orders administered by OFAC (collectively, the “Export Controls and Sanctions Laws”). Each Party agrees to comply with all Export Controls and Sanctions Laws applicable to any such Equipment/Services and shall not take any action that will cause the other Party to violate or be subject to penalty under the Export Controls and Sanctions Laws.

 

21.2.

Export Licenses. Supplier shall obtain all necessary export licenses, unless Buyer or any party other than Supplier is required to apply for the export licenses pursuant to the applicable Export Controls and Sanctions Laws. To the extent Supplier is requested to deliver Equipment/Services regulated under the Arms Export Control Act or the Atomic Energy Act, Supplier shall advise Buyer in advance of order or contract acceptance.

 

21.3.

Provision of Trade Data. At the request of Buyer, Supplier shall provide Buyer for Equipment and Services delivered the following trade data as applicable: (i) “Export Control Classification Number” according to the EAR’s Commerce Control List (ECCN) or the Munitions List Category Designation according to the US International Traffic in Arms Regulations, and all other export control list numbers; (ii) the statistical commodity code according to the current commodity classification for foreign trade statistics and the HS (Harmonized System) coding; (iii) the country of origin (non-preferential origin); and (iv) Supplier’s declaration for preferential origin (in case of European suppliers) or preferential certificates, Supplier’s declaration for preferential origin (in case of European suppliers) or preferential certificates (in case of non-European suppliers) such as NAFTA certificates of origin.

 

21.4.

Changes. In the event Supplier has knowledge of any alterations to origin and/or characteristics of the Equipment/Services, it shall notify the Buyer not later than ten (10) Business Days after discovery thereof.

 

 

21.5.

Additional Buyer’s Obligations. Buyer agrees that it will not, in violation of applicable Export Controls and Sanctions Laws:

 

(a)

directly or indirectly, export, reexport, or transfer Equipment or Services to, or transship Equipment or Services through, a Sanctioned Country;

 

(b)

directly or indirectly, release, sell, provide, export, reexport, transfer, divert, loan, lease, consign, allow access to, or otherwise dispose of Equipment or Services to a Prohibited Person; or

 

(c)

use Equipment or Services to produce products that will be shipped, sold, or supplied, directly or indirectly, to a Sanctioned Country or a Prohibited Person.

 

21.6.

Certain Relief. No Party shall be obligated to fulfill this Agreement if such fulfillment is prevented by any impediments arising out of national or international foreign trade or customs requirements or any embargoes or other sanctions.

 

22.

BUYER CODE OF CONDUCT.

 

Supplier shall comply with the principles and requirements of the "Code of Conduct for Siemens Suppliers and Third Party Intermediaries" attached hereto as Exhibit D (hereinafter the “Code of Conduct”). If and as requested by Buyer, Supplier shall, not more than once a year (at its option), provide to Buyer either (A) a written self-assessment in substantially the form provided by Buyer or (B) a written report reasonably acceptable to Buyer describing the actions taken or to be taken by Supplier to assure compliance with the Code of Conduct. In addition to any other rights and remedies Buyer may have, in the event of Supplier's material or repeated failure to comply with the Code of Conduct, after providing Supplier reasonable notice and a reasonable opportunity to remedy, Buyer may terminate any outstanding Purchase Orders under this Agreement without any liability whatsoever. Material failures include, but are not limited to, incidents of child labor, corruption and bribery. The notice and remedy provisions herein shall not apply to material failures set forth in the preceding sentence.

 

23.

COMPLIANCE WITH LAWS AND PERMITS.

 

The Parties and their Representatives shall comply with all Applicable Laws in the course of the performance of their respective obligations under this Agreement and any Purchase Orders issued hereunder. In addition, Supplier and Buyer shall each obtain all required licenses, permits, authorizations, registrations or approvals required with respect to the performance of their respective obligations under this Agreement and any Purchase Orders issued hereunder.

 

24.

DISPUTE RESOLUTION.

 

24.1.

Referral to Senior Management. Except as otherwise provided by this Agreement, any dispute, controversy or claim arising out of or in connection with, or relating to, this Agreement or any breach or alleged breach hereof (which breach or alleged breach by a Party remains uncured within ten (10) Business Days after receipt of written notice thereof from another Party) or the validity or termination hereof or the relationship created between the Parties by and/or through this Agreement (a “Dispute”) shall first be settled as far as possible by good faith negotiations between the parties to the Dispute, in the form of meetings between senior- management level representatives of such Parties, upon the written request by any such Party to the other parties to the Dispute, which writing shall set forth in reasonable detail the nature and extent of the Dispute.

 

 

24.2.

Referral to Arbitration. If the parties to the Dispute are unable for any reason to resolve a Dispute within thirty (30) days after receipt by any Party of written notice of a Dispute, then any Party may submit the Dispute to arbitration to be finally and exclusively resolved under the Arbitration Rules of the American Arbitration Association (“AAA”) then in effect, except as modified herein, with respect to Equipment and Services to be provided to a Customer with the United States (as applicable, the “Rules”). There shall be three (3) arbitrators. If there are two (2) parties to the Dispute, each of the parties to the Dispute shall nominate one (1) arbitrator in accordance with the Rules. If there are more than two (2) parties to the Dispute, the arbitrators shall be nominated in accordance with the Rules; provided, however, that any Party and its Affiliates shall be entitled to nominate only one (1) such arbitrator. The arbitrators so nominated, once confirmed by the AAA, shall nominate an additional arbitrator to serve as chairman, such nomination to be made within fifteen (15) days of the confirmation by the AAA of the second arbitrator. If the initial arbitrators shall fail to nominate an additional arbitrator within such fifteen (15) day period, such additional arbitrator shall be appointed by the AAA. The arbitrators shall be required to submit a written statement of their findings and conclusions. Except as otherwise agreed by the parties to such Dispute, exclusive venue of arbitration with AAA will be Wilmington, Delaware, and the language of the arbitration shall be English. Each of the Parties will submit to the non-exclusive jurisdiction of the state and federal courts located in Wilmington, Delaware for preliminary relief in aid of arbitration and for the enforcement of any arbitral award from AAA. By agreeing to arbitration, the Parties do not intend to deprive any national court of its jurisdiction to issue any pre-arbitral injunction, pre-arbitral attachment or other order in aid of arbitration proceedings.

 

24.3.

Neutral Arbitrators. None of the Parties or the arbitrators shall select any arbitrator for the arbitral tribunal who has any interest in the Dispute or who has, or within the immediately preceding five (5) years has had, any economic or other relationship with any party to the Dispute.

 

24.4.

Procedures and Costs. The arbitrators shall not have the right to award consequential, incidental, indirect, special, treble, multiple or punitive damages. The arbitral tribunal shall not be empowered to decide any dispute ex aequo et bono or amiable compositeur, and the arbitral tribunal shall decide the Dispute under the substantive laws of the State of Delaware, without regard to applicable choice of law provisions thereof. The arbitration award shall be decided by majority opinion and issued in writing in the English language and shall state the reasons upon which it is based. It may be made public only with the consent of each participating Party or as may be required by law or regulatory authority or as necessary for enforcement of such award. The arbitrators shall allocate the fees and costs of the arbitration. The losing Party(ies) shall pay the prevailing Party(ies)’ attorney’s fees and costs and the costs associated with the arbitration, including the expert fees and costs and the arbitrators’ fees and costs borne by the prevailing Party(ies), all as determined by the arbitrators. Each Party shall bear its own fees and costs until the arbitrators determine which, if any, Party is the prevailing Party(ies) and the amount that is due to such prevailing Party(ies).

 

24.5.

Award. The award rendered by the arbitrators shall be final and binding on the participating Parties and shall be the sole and exclusive remedy between and among the participating Parties regarding any claims, counterclaims, issues or accounting presented to the arbitral tribunal. The award shall be issued no later than one hundred twenty (120) days from the signing or ratification of the Terms of Reference (as defined in the Rules) or as soon thereafter as practicable. The award shall be paid within thirty (30) days after the date it is issued and shall be paid in U.S. Dollars in immediately available funds, free and clear of any Liens, Taxes or other deductions. A judgment confirming or enforcing such award may be rendered by any court of competent jurisdiction.

 

 

24.6.

Confidentiality. The arbitration shall be confidential. No Party may disclose the fact of the arbitration, any award relating thereto or any settlement relating to any Dispute without the prior consent of the other Party(ies); provided, that such matters may be disclosed without the prior consent of the other Party(ies) to lenders, auditors, tax or other Governmental Authority or as may be required by law or regulatory authorities or as necessary to enforce any award.

 

24.7.

Continued Performance; Provisional Remedies. Notwithstanding the existence of any Dispute, the Parties shall continue to perform their respective obligations under this Agreement unless the Parties otherwise mutually agree in writing. Notwithstanding anything in this Agreement to the contrary, nothing in this Agreement is intended to, nor shall it, prevent the Parties from seeking temporary injunctive relief at any time as may be available under Law or in equity to preserve its rights pending the outcome of any arbitration. Without prejudice to such provisional remedies as may be available under the jurisdiction of a national court, the arbitral tribunal shall have full authority to grant provisional remedies or order the Parties to request that a court modify or vacate any temporary or preliminary relief issued by a court, and to award damages for the failure of any Party to respect the arbitral tribunal’s orders to that effect. The Parties agree that any issue regarding the arbitrability of any claims or disputes arising under, relating to or in connection with this Agreement is an issue solely for the arbitrators, not a court, to decide.

 

24.8.

Waiver of Jury Trial. THE PARTIES HEREBY EXPRESSLY WAIVE ALL RIGHTS TO TRIAL BY JURY OR OTHERWISE ON ANY CLAIM, CAUSE OF ACTION, SUIT OR PROCEEDING PERMITTED UNDER THIS ARTICLE 24. THE PROVISIONS OF THIS AGREEMENT RELATING TO WAIVER OF TRIAL BY JURY SHALL SURVIVE THE TERMINATION OR EXPIRATION OF THIS AGREEMENT.

 

25.

MISCELLANEOUS.

 

25.1.

Governing Law. This Agreement shall be controlled by and construed in accordance with the substantive laws of the State of Delaware without regard to conflict of laws principles. The United Nations Convention on Contracts for the International Sale of Equipment of April 11, 1980 shall be excluded.

 

25.2.

Records. Supplier and its Representatives shall maintain accurate and complete records of all contracts, papers, correspondence, copybooks, applications, accounts, invoices, and/or other information reasonably relating to this Agreement and any Purchase Orders issued hereunder (collectively, “Records”) in accordance with recognized commercial accounting practices, and shall retain such Records for a period of seven (7) years unless a longer period is required under Applicable Law.

 

25.3.

Intentionally Omitted.

 

25.4.

Insurance. Supplier and its Representatives shall comply with the Insurance requirements set forth in Exhibit E attached hereto.

 

 

25.5.

Assignment; Successors. Neither Party may assign all or any part of this Agreement or any Purchase Order issued hereunder, or any rights or obligations hereunder or thereunder, without the prior written consent of the other Party, which consent shall not be unreasonably withheld. Any purported assignment which fails to comply with the requirements of this Section 25.5 shall be null and void. Notwithstanding the foregoing: (i) either Party may, without the prior written consent of the other Party, assign all or any part of this Agreement or any Purchase Order issued hereunder, or any rights or obligations hereunder or thereunder, to an Affiliate, which will accept such assignment and assume all obligations related to this Agreement and any applicable Purchase Orders (including by executing a joinder to this Agreement in the form of Exhibit B hereto); provided that, notwithstanding any such assignment, the assigning Party shall not be relieved of any of its obligations hereunder by reason of such assignment and shall remain liable hereunder to the same degree that the assigning Party would be responsible had there been no assignment.

 

25.6.

Subcontracting. Supplier shall be solely responsible for the proper selection, supervision, acts and omissions of its subcontractors.

 

25.7.

Other Terms and Amendments. The terms and conditions contained in any sales order, acknowledgment, invoice, website, letter, writing, software or file (such as “clickwrap”, “shrinkwrap”, or website terms of use), or other document or medium shall not be applicable or amend this Agreement or any Purchase Order issued hereunder nor bind the Parties hereto or their Affiliates or Representatives. This Agreement and any Purchase Order issued hereunder may only be amended by a written instrument signed by authorized Representatives of the Parties.

 

25.8.

Government Contracts. When the Equipment/Services are to be used in the performance of a contract or subcontract with a Governmental Authority, applicable government contract requirements attached to this Agreement shall apply and are incorporated herein by reference.

 

25.9.

Relationship of the Parties. Nothing contained in this Agreement shall be construed as creating a partnership, joint venture, agency, employee-employer relationship, trust or other association of any kind between the Parties and each Party shall be individually responsible only for its obligations as set forth in this Agreement. Any Services provided by Supplier, its Affiliates and Representatives pursuant to this Agreement are provided as independent contractors of Buyer and not in the capacity of an employee or agent of Buyer.

 

25.10.

Publicity. No Party hereto shall refer to or use, or permit any persons to refer to or use, any other Party’s name, trademarks, service marks or logos in any advertising, promotional materials, press releases or other publicity without obtaining the prior written consent of the applicable Party.

 

25.11.

Non-Exclusive Remedies and Non-Waivers. No delay or omission by the Parties in exercising any right or remedy provided for herein shall constitute a waiver of such right or remedy nor shall it be construed as a bar to or waiver of any such right or remedy on any future occasion. Any waiver authorized on one occasion must be made in writing and is effective only in that instance and only for the purpose stated, and does not operate as a waiver on any future occasion. The rights and remedies of the Parties herein shall not be exclusive and are in addition to any other rights and remedies provided by Applicable Law or in equity.

 

 

25.12.

Severability. Any provision of this Agreement or any Purchase Order issued hereunder that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective only to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof (provided the substance of the agreement between the Parties is not thereby materially altered), and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. To the extent permitted by Applicable Laws, the Parties hereto hereby waive any provision of Applicable Law which renders any provision hereof prohibited or unenforceable in any respect.

 

25.13.

Survival. The Title and Risk of Loss, Warranties, Intellectual Property, Defaults and Remedies, Indemnification, Limitations of Liability, Confidentiality, Export Control and Foreign Trade Regulations, Dispute Resolution and Miscellaneous sections of this Agreement, and any provision that contemplates performance or observance subsequent to termination or expiration shall survive termination or expiration of this Agreement.

 

25.14.

Affirmative Action. Supplier shall, to the extent applicable, comply with Buyer’s requirements as promulgated by the U.S. Department of Labor, Office of Federal Contract Compliance Programs set forth in Exhibit F.

 

25.15.

Complete Agreement and Counterparts. This Agreement, together with all Purchase Orders issued hereunder, shall constitute the entire agreement between Buyer and Supplier and shall supersede all previous communications, representations, agreements or understandings, whether oral or written, with respect to the subject matter hereof. The headings used in this Agreement are for reference and shall not limit or affect the meaning or interpretation of any of the terms hereof. Upon the effectiveness of this Agreement, the Prior Agreement shall be deemed amended and restated and superseded and replaced in its entirety by this Agreement, and shall be of no further force or effect.

 

25.16.

Counterparts. This Agreement may be executed in multiple counterparts, each of which when so executed and delivered shall constitute a duplicate original and all counterparts together shall constitute one and the same instrument. Transmission of the executed signature page of a counterpart of this Agreement by electronic mail shall be effective as delivery of an executed counterpart of this Agreement.

 

25.17.

No Pre-Printed Terms. Pre-printed terms or conditions in any invoice, quotation, shipping notice or order acknowledgement issued by Buyer or Supplier shall be of no force or effect, except to the extent included in a Pricing Notice. The terms and conditions applicable to each Purchase Order issued by Buyer shall be those set forth herein and in such Purchase Order and the applicable Pricing Notice therefor.

 

25.18.

Priority. In the event of inconsistency between or among the provisions of this Agreement, a Purchase Order and the applicable Pricing Notice therefor, the following order of precedence, from highest to lowest, shall govern:

 

(a)

mutually agreed Change Orders;

 

(b)

Purchase Order;

 

(c)

this Agreement.

 

 

25.19.

Notices.

 

(a)

All notices and other communications which either Party is required or may desire to serve upon the other shall be addressed to the Party to be served as follows, unless a different address is designated in writing by the Party to be served:

 

To Buyer:

 

Siemens Industry, Inc.
4800 North Point Parkway
Alpharetta, GA 30005
Attn: Craig Langley, Associate General Counsel
Email: langley.craig@siemens.com

 

To Supplier:

 

Fluence Energy, LLC
4601 N. Fairfax Drive, Suite 600
Arlington, VA 22203
Attn: Marek Wolek, SVP – Strategy & Partnerships
Email: marek.wolek@fluenceenergy.com

 

With a copy to:

 

Fluence Energy, LLC
4601 N. Fairfax Drive, Suite 600
Arlington, VA 22203
Attn: Frank Fuselier, General Counsel

Email: frank.fuselier@fluenceenergy.com

 

(b)

All notices, requests, consents and other communications under this Agreement must be in writing and shall be deemed to have been duly given and effective (i) immediately (or, if not delivered or sent on a Business Day, the next Business Day) if delivered or sent and received by electronic mail, (ii) on the date of delivery if by hand delivery (or, if not delivered on a Business Day, the next Business Day) or (iii) on the first Business Day following the date of dispatch (or, if not sent on a Business Day, the next Business Day after the date of dispatch) if by a nationally recognized overnight delivery service (all fees prepaid). In the case of notice via email, each Party shall provide confirmation of receipt or non-receipt upon the request of the transmitting Party.

 

 

(c)

All notices, requests, consents and other communications under this Agreement shall include reference to the applicable Purchase Order number, if any.

 

25.20.

Joint Effort. Preparation of this Agreement has been a joint effort of the Parties and the resulting document shall not be construed more severely against one of the Parties than against the other. Any rule of construction that ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this Agreement, or any amendments or Exhibits hereto.

 

25.21.

Language of the Agreement, Correspondence, Documentation. The language of this Agreement shall be English. Unless to the extent agreed otherwise, correspondence, technical and commercial documents as well as any other information exchanged between the Consortium Members relating to this Agreement shall be in English.

 

[SIGNATURE PAGE FOLLOWS]

 

 

IN WITNESS WHEREOF, intending to be legally bound, the Parties have caused this Agreement to be executed by their duly authorized representatives as of the date first below above.

 

Siemens Industry, Inc.
By:
Name:
Title:
By:
Name:
Title:
Fluence Energy, LLC
By:
Name:
Title:
By:
Name:
Title:

 

[Signature Page to Amended and Restated Storage Core Frame Purchase Agreement]

 

 

Schedule 1.1(a)

 

The information contained in columns C and D is provided for informational purposes only. For purposes of this Agreement, the definition of “Applications” shall include Column E.

 

A   No	B   Application	C   Typical Customer	D   Typical system Size in MW	E   Definition
1	Flexible capacity	Power Plant	50 to 100 MW	Flexible capacity is the use of energy storage as a substitute for peak generating capacity or to meet flexible dispatch ability needs in order to secure grid stability.  Such fast acting power sources are an integral part of the grid to provide the required flexible capacity.  The control system is designed such to monitor the grid condition, recognize the need and acts immediately until the grid returns to stable condition, or to be dispatched by the grid operator.  The system is connected to Grids with a Voltage level > 1kV.  The control system makes sure the storage is at the needed stage of charge (subject to setting)
2	Conventional hybrid	Power Plant	up to 10MW	Conventional hybrid is the use of energy storage in conjunction with a conventional generation resource to react on e.g. peak demands.  The system is connected to Grids with a Voltage level > 1kV.  The storage is monitoring and acting based on its own control system
3	Frequency Control	TSO / DSO & PP / Investor	up to 50MW and greater single system size	Frequency regulation is the use of energy storage to regulate electric system frequency as a primary, secondary, or contingency reserve resource.  Energy Storage system is installed usually before the meter and secures the power grid frequency within the frequency band defined by the regulator.  Spinning reserve is a subset of frequency control to deliver the mandatory reserve power out of a storage unit instead of a Power Plant.  The system is connected to Grids with a Voltage level > 1kV.
4	Renewable hybrid	TSO / DSO & PP / Investor	up to 5MW	Renewable hybrid is the use of energy storage in conjunction with a renewable generation resource; (e.g. wind and solar) to control (integral control system) the ramp-up and ramp-down of the power generation or to make the power injection into the power grid stable in relation to the forecast considering parameter such as weather forecast.  The system is connected to Grids with a Voltage level > 1kV.
5	T&D investment/ replacement deferment	TSO / DSO	up to 10MW	Transmission and distribution investment, replacement and deferral is the use of energy storage to replace or defer investment in new conventional electric transmission or distribution infrastructure assets.  The system is connected to Grids with a Voltage level > 1kV.  The storage is monitoring and acting based on its TSO / DSO up to 10MW own control system
6	T&D capacity release	TSO / DSO	up to 10MW	Transmission and distribution capacity release is the use of energy storage to improve the utilization of existing conventional electric transmission or distribution infrastructure assets.  The system is connected to Grids with a Voltage level > 1kV.  The own Storage control system is monitoring the grid conditions and takes corrective action if needed

 

 

A   No	B   Application	C   Typical Customer	D   Typical system Size in MW	E   Definition
7	Microgrid and Islands*	On shore Microgrid owners and utilities on geographical islands	1-3MW	Energy Storage systems combined with a Microgrid controller providing the micro or island grid master role resulting in a maximized usage of renewable power generation vs. conventional power generation on a geographical or grid island while keeping system voltage and frequency stable monitored and controlled by the storage control systems.  Improving the efficiency of conventional diesel generation where applicable.  The system is connected to Grids with a Voltage level > 1kV.
8	Power Quality (MS UPS)*	Industry / Transportation	1-25MW	Energy Storage system placed behind the meter typically in an industrial environment injecting power in case of grid failure and or voltage dip.  The ability to disconnect ultrafast (<10ms) from the grid to avoid the storage feeding a grid failure.  In addition the system can bridge 15 to 30 minutes power interruption, possibly combined with a diesel power generation.  The system operates on Voltage level > 1kV. The storage control system is monitoring and acting driven by its on control system.
9	Consumer peak shaving (demand charge mgmt.)	Industry / Transportation	1-25MW	Consumer peak shaving, the use of energy storage to reduce an electric consumer’s bill, optimize an electric consumer’s consumption, or to provide other reliability services to the electric consume r.  This energy Storage system is placed behind the meter.  The system operates on Voltage level > 1kV.  The 1 – 25 MW storage control system is monitoring and acting automatically following the given settings.
10	Black start	Gas Turbine power Plants and wind power generation	1-25MW	Black start, the use of energy storage to support generation start-up during recovery from a partial or total shutdown of an electric system as an emergency Gas turbine start up solution.  The Energy Storage system providing power according a defined process until ignition of a gas turbine.  The system operates on Voltage level > 1kV.  The initiation of the Black Start is usually manually, the control system makes sure the black star process as such is following a defined procedure.

 

* Included in the definition of “Application” solely for purposes of Section 4.3.

 

 

Exhibit A

 

Form of Purchase Order

 

The following sets forth the minimum terms and conditions to be included on a Purchase Order under this Agreement, which terms and conditions may be modified or supplemented by the mutual agreement of the Parties:

 

Equipment:

 

1. Type of Equipment

 

2. Quantity of Equipment

 

3. Unit Price of Equipment

 

4. Total Price of Equipment on this Purchase Order

 

5. Manufacturing Location

 

6. Incoterms and Delivery Location

 

7. Guaranteed Delivery Date

 

8. Insurance

 

9. Equipment Warranty Period

 

10. IP/Software Terms

 

11. Supplier Documents

 

12. Technical Specifications

 

13. Special Packaging Requirements

 

Services:

 

1. Type of Services

 

2. Amount of Services

 

3. Price of Services

 

4. Total Price of Services on this Purchase Order

 

5. Performance Location

 

6. Performance Date(s)

 

7. Insurance

 

8. Services Warranty Period

 

9. IP/Software Terms

 

10. Supplier Documents

 

11. Specifications

 

Other Terms:

 

1. Electronic Banking Method for Payments

 

2. Buyer Furnished Property

 

 

EXHIBIT B

 

Joinder Agreement Template

 

This Joinder Agreement (the "Joinder Agreement") to the Amended and Restated
Storage Core Frame Purchase Agreement, dated [●], 2021 between SIEMENS
INDUSTRY, INC. and FLUENCE ENERGY, LLC is made and entered into

 

by and between

 

___

 

with its registered seat in [Place], [Country]

 

- hereinafter referred to as "Supplier" -

 

and

 

Siemens (Local Company) ___,

with its registered seat in [Place], [Country]

 

- hereinafter referred to as "Buyer" -

 

- Supplier and Buyer are hereinafter individually
referred to as a "Party" and collectively as the "Parties" -

 

 

WHEREAS, Supplier and SIEMENS INDUSTRY, INC. (“Siemens”) entered on January 1, 2018 into the Amended and Restated Storage Core Frame Purchase Agreement (the "Agreement") which is attached hereto as Annex 1;

 

WHEREAS, Buyer is an Affiliate of Siemens and wishes to become a party to the Agreement and to adopt the terms and conditions thereof, and consequently Supplier and Buyer wish to enter into this Joinder Agreement.

 

NOW THEREFORE, in consideration of the mutual covenants and premises contained herein, the Parties agree as follows:

 

Adoption of the AGREEMENT

 

a)

Buyer hereby acknowledges, agrees and confirms that, by its execution of this Joinder Agreement, Buyer shall be deemed a party to the Agreement for all purposes of the Agreement, and shall have all of the obligations of a “Buyer” under the Agreement, as though an original party to the Agreement. Buyer hereby ratifies, as of the date hereof, and agrees to be bound by, and subject to, all of the covenants, terms, provisions and conditions applicable to “Buyer” contained in the Agreement. The terms and conditions as set out in the Agreement are incorporated herein by reference and are made applicable between the Parties.

 

b)

Without limiting the generality of the foregoing, Buyer hereby represents and warrants that each of the representations and warranties of “Buyer” contained in the Agreement is true and correct as of the date of the execution and delivery of this Joinder Agreement.

 

c)

This Joinder Agreement shall be controlled by and construed in accordance with the substantive laws of the State of Delaware without regard to conflict of laws principles.

 

d)

This Joinder Agreement contains the entire agreement between the Parties and supersedes any and all prior negotiations, correspondence, understandings between the Parties concerning the subject matter hereof. It may not be changed orally, but only by an agreement in writing signed by both Parties hereto.

 

e)

This Joinder Agreement may be executed in multiple counterparts, each of which when so executed and delivered shall constitute a duplicate original and all counterparts together shall constitute one and the same instrument. Transmission of the executed signature page of a counterpart of this Joinder Agreement by electronic mail shall be effective as delivery of an executed counterpart of this Agreement.

 

 

Specific stipulations under this JOINDER Agreement

 

[ONLY country specific deviations from the Agreement are to be stipulated here.]

 

a)

[Delivery and Payment terms]

 

b)

[Term and Termination]

 

c)

[Country specific regulations (jurisdiction, governing law, tax etc.)]

 

d)

...

 

 

Order of Precedence between the Agreement and the Adoption Agreement

 

In the event of any conflict or inconsistency between the terms of this Joinder Agreement and the Agreement, the Joinder Agreement shall prevail over the Agreement.

 

Supplier		Buyer
Place, Date:		Place, Date:
Name:		Name:		Name:
(Print)		(Print)		(Print)
Title:		Title:		Title:

 

 

Annex 1: Amended and Restated Storage Core Frame Purchase Agreement

 

 

Exhibit C

 

Substance Declaration

 

If Supplier furnishes Equipment that are subject to restrictions, rules or regulations for Hazardous Materials or other substances comprising, part of or contained in such Equipment, including but not limited to statutes, rules, regulations, codes, rules, standards and requirements of (1) EHS Laws, (2) governing, controlling or regulating Hazardous Materials, including but not limited to the Restriction on the Use of Certain Hazardous Substances in Electrical and Electronic Equipment (hereinafter “RoHS”), Directives 2002/96/EC and 2012/19/EU as well as their respective incorporation into EU member states’ legislation including any amendments thereto (hereinafter “WEEE”), (3) the Regulation EC 1907/2006 of the European Parliament and of the Council concerning the Registration, Evaluation, Authorization and Restriction of Chemicals including any amendment thereto (hereinafter “REACH”), (4) EC Directive 2006/66/EC on Batteries and Accumulators and Waste Batteries and Accumulators and/or (5) TSCA, without limiting Supplier’s obligations under this Purchase Order, Supplier shall comply with the requirements of this “Substance Declaration”.

 

Supplier shall submit to Buyer with each Equipment, the chemical substances contained therein or in the Service deliverable, and/or Material Safety Data Sheets, Safety Data Sheets or other such documentation as required by Applicable Laws (including without limitation the OSHA Hazardous Communication Standard 29 CFR 1910.1200 et seq.). If Supplier furnishes Equipment that are subject to substance restrictions, rules or regulations including but not limited to those identified in this Exhibit, Supplier shall declare such substances on the Buyer’s web database BOMcheck (www.BOMcheck.net) or, only if and approved in writing in advance by Buyer, in another reasonable format provided to Buyer no later than first delivery date of the Equipment, and Supplier shall prior to Supplier ’s first delivery of Equipment complete and comply with the Declarable Substances-Form (hereinafter “Substance Declaration”) in the Buyer supplier portal “SCM STAR” or in hard copy forwarded to Buyer. In addition, for Equipment that are subject to substance restrictions, rules or regulations Supplier shall provide ordering entity with a safety data sheet required in Article 31of the Regulation EC 1907/2006 (REACH) and Supplier shall keep this Substance Declaration up to date.

 

Should a delivery hereunder contain “dangerous goods” as so classified pursuant to Applicable Laws, Supplier shall notify Buyer in writing in sufficient detail to identify the Equipment, the hazards, and the laws, rules or regulations applicable thereto no later than three (3) business days after receipt of the Purchase Order.

 

Exhibit D

 

Code of Conduct for Siemens Suppliers and Third Party Intermediaries

 

Siemens Group Code of Conduct

for Suppliers and Third Party Intermediaries

 

This Code of Conduct defines the basic requirements placed on the suppliers and third party intermediaries of the Siemens Group concerning their responsibilities towards their stakeholders and the environment. The supplier and/or third party intermediary declares herewith to:

 

Legal Compliance

 

·

Comply with the laws and regulations of the applicable legal systems.

 

Human Rights and Labor Practices

 

To ensure respect of all internationally proclaimed human rights by avoiding causation of and complicity in any human rights violations, heightened attention shall be paid to ensuring respect of human rights of specifically vulnerable rights holders or groups of rights holders such as women, children or migrant workers, or of (indigenous) communities.

 

Ø	Prohibition of Forced Labor

·

Neither use nor contribute to slavery, servitude, forced or compulsory labor and human trafficking.

 

Ø	Prohibition of Child Labor

·

Employ no workers under the age of 15 or, in those countries subject to the developing country exception of the ILO Convention 138, employ no workers under the age of 14.

·

Employ no workers under the age of 18 for hazardous work according to ILO Convention 182.

 

Ø	Non-Discrimination and Respect for Employees

·

Promote equal opportunities and treatment of employees, irrespective of skin color, race, nationality, ethnicity, political affiliation, social background, disabilities, gender, sexual identity and orientation, marital status, religious conviction, or age.

·

Refuse to tolerate any unacceptable treatment of individuals such as mental cruelty, sexual harassment or discrimination including gestures, language and physical contact, that is sexual, coercive, threatening, abusive or exploitative.

 

Ø	Working Hours, Wages & Benefits for Employees

·

Recognize the legal rights of workers to form or join existing trade unions and to engage in collective bargaining; neither disadvantage nor prefer members of employee organizations or trade unions.

·

Adhere to all applicable working-hours regulations globally.

·

Pay fair wages for labor and adhere to all applicable wage and compensation laws globally.

·

In the event of cross-border personnel deployment adhere to all applicable legal requirements, especially with regard to minimum wages.

 

Ø	Health & Safety of Employees

·

Act in accordance with the applicable statutory and international standards regarding occupational health and safety and provide safe working conditions.

·

Provide training to ensure employees are educated in health & safety issues.

·

Establish a reasonable occupational health & safety management system¹.

 

Ø	Grievance Mechanism

·

Provide access to a protected mechanism for their employees to report possible violations of the principles of this Code of Conduct.

 

Code of Conduct Version 4.0, October 2019

Page 1 of 2

 

 

 

Environmental Protection

 

·

Act in accordance with the applicable statutory and international standards regarding the environment. Minimize environmental pollution and make continuous improvements in environmental protection.

·

Establish a reasonable environmental management system¹.

 

Fair Operating Practices

 

Ø	Anti-Corruption and Bribery

·

Tolerate no form of and do not engage directly or indirectly in any form of corruption or bribery and do not grant, offer or promise anything of value to a government official or to a counterparty in the private sector to influence official action or obtain an improper advantage. This includes to renounce from giving or accepting improper facilitation payments.

 

Ø	Fair Competition, Anti-Trust Laws and Intellectual Property Rights

·

Act in accordance with national and international competition laws and do not participate in price fixing, market or customer allocation, market sharing or bid rigging with competitors.

·

Respect the intellectual property rights of others.

 

Ø	Conflicts of Interest

·

Avoid and/or disclose internally and to Siemens all conflicts of interest that may influence business relationships, and to avoid already the appearance thereof.

 

Ø	Anti-Money Laundering, Terrorism Financing

·

Not directly or indirectly facilitate money laundering or terrorism financing.

 

Ø	Data Privacy

·

Process personal data confidentially and responsibly, respect everyone’s privacy and ensure that personal data is effectively protected and used only for legitimate purposes.

 

Ø	Export Control and Customs

·

Comply with the applicable export control and customs regulations.

 

Responsible Minerals Sourcing

 

·

Take reasonable efforts to avoid in its products the use of raw materials which originate from Conflict-Affected and High-Risk Areas and contribute to human rights abuses, corruption, the financing of armed groups or similar negative effects.

 

Supply Chain

 

·

Use reasonable efforts to make its suppliers comply with the principles of this Code of Conduct.

·

Comply with the principles of non-discrimination with regard to supplier selection and treatment.

 

¹ www.siemens.com/code-of-conduct/managementsystems

 

Code of Conduct Version 4.0, October 2019

 

 

Exhibit E

 

Insurance

 

(A) Supplier shall, at its sole expense, maintain the types of insurance coverage(s) listed below. The coverage limits for each type of insurance listed below shall be the greater of: (i) the coverage limits listed below; or (ii) if the Purchase Order requires Supplier to maintain higher limits, then the coverage limits specified in the Purchase Order. Evidence of insurance required by this Purchase Order is to be furnished before any Goods/Services is commenced. Supplier and its Representatives shall maintain such insurance in full force and effect during the term of this Purchase Order, and, in addition, for as long as Supplier is under any warranty obligations arising out of this Purchase Order. All insurers on required insurance coverage(s) shall have an A.M. Best Rating of A- /VIII or better. Customer and its subsidiaries, Affiliates, and its or their Representatives, and/or any other party designated on the Purchase Order as applicable shall be named as an additional insured, with respect to the Commercial General Liability and Automobile Liability policies/coverage(s). All insurance certificates shall be in a form satisfactory to Customer. Supplier shall deliver the certificates of insurance, naming Customer and, if applicable, Customer’s customer/end user, as the Certificate Holder. All of Supplier’s policies of insurance, except for Workers’ Compensation and Employers Liability, shall be primary insurance and noncontributing with any other insurance maintained by Customer, Customer’s customer/end user and/or other parties. All of Supplier’s policies of insurance, except for Worker’s Compensation and Employer’s Liability, shall contain a cross-liability or severability of interest clause. The limits of insurance set forth below may be satisfied by any combination of excess and primary insurance coverage. Supplier shall require all its insurers to waive all rights of subrogation against Customer, Customer’s customer/end user, and their respective subsidiaries, Affiliates, and Representatives, and any other party designated as an additional insured.

 

(B) Supplier shall maintain the following insurance coverage(s):

 

(i) Worker's Compensation Insurance in accordance with the statutory requirements of the location in which the Purchase Order is performed. If there is an exposure to injury to Supplier’s employee under the U.S. Longshoremen’s and Harbor Worker’s Compensation Act, the Jones Act or under laws, regulations or statutes applicable to maritime employees, coverage required by law shall be provided for same.

 

(ii) Employer's Liability Insurance with the following limits of liability:

 

• $1,000,000 for each occurrence;

• $1,000,000 Disease Policy

• $1,000,000 Each Employee.

 

 

(iii) Commercial General Liability Insurance, in occurrence coverage form, with minimum limits of $5,000,000 per occurrence, including the following coverages:

 

• Products and Completed Operations

• Contractual Liability insuring the indemnity obligations assumed by Supplier under this Purchase Order

• Premises/Operations

• Underground, Undermining, Explosion and Collapse (XCU) Hazard,

• Broad Form Property Damage (including Completed Operations)

 

(iv) Automobile Liability Insurance, including coverage for owned, hired, and non-owned automobiles and trucks used by or on behalf of the Supplier providing insurance for bodily injury, liability and property damage liability with minimum limits for each type of coverage of $5,000,000 per occurrence.

 

(C) The following coverages are specifically required if a Purchase Order involves: (i) [intentionally omitted]; (ii) watercraft owned, operated or chartered by Supplier or its Representatives, liability arising out of such watercraft shall be insured by the General Liability or by Protection and Indemnity Insurance with a CSL of no less than $1,000,000 per each occurrence; (iii) the hauling and/or rigging of property in excess of $100,000, Supplier shall carry “All Risk” Transit Insurance, or “All Risk” Motor Truck Cargo Insurance (Such insurance shall provide a limit of not less than the replacement cost of the highest value single lift or highest value being moved, whichever is greater, and insuring the interest of Supplier, Customer and Customer’s customer/end user, as their respective interests may appear); (iv) aircraft (fixed wing or helicopter) owned, operated or chartered by Supplier or its Representatives, liability arising out of such aircraft shall be insured for not less than $1,000,000 CSL each occurrence; (v) access, storage, transmission or processing of Customer’s, its customer’s /end user’s, its or their Representatives’ confidential information, a Cyber Liability Errors and Omissions Policy shall be procured by Supplier providing coverage, for acts, errors, omissions, and negligence of employees and contractors giving rise to potential liability, financial and other losses relating to data security and privacy, including cost of defense and settlement, in an amount of at least $2,000,000 each claim and in the aggregate; (vi) engineering, design and/or development services, Supplier shall procure Professional Liability and Errors and Omissions Liability Insurance providing coverage for acts, errors, omissions arising out of insured’s negligence in an amount not less than $5,000,000 (USD) per claim and in the aggregate; (vii) [intentionally omitted]; (viii) Supplier, its Affiliates and/or its and their respective Representative being granted access to Customer or Customer’s Affiliate’s facilities, premises and/or systems, Supplier shall procure Employee Dishonesty and Computer Fraud Insurance covering losses arising out of or in connection with any fraudulent or dishonest acts committed by its personnel, acting alone or with others, in an amount not less than $1,000,000 (USD) per occurrence. Furthermore, on a case by case basis, where a Purchase Order specifies that environmental liability insurance is required for that specific project, then Supplier shall obtain Environmental Impairment Liability Insurance for such project with limits of $5,000,000 per occurrence and in the aggregate.

 

(D) The procurement, maintenance or acceptance of insurance coverage by Customer, if any, shall not: (i) relieve Supplier of liability for loss or damage in excess of the policy coverage limits specified herein; or (ii) limit or release Supplier of its obligations or liabilities under the Purchase Order.

 

(E) No delay or failure in declaring any default or in enforcing any of the requirements of this Exhibit E, and no course of dealing between Customer and Supplier shall constitute a waiver of any of the requirements of this Exhibit E.

 

Exhibit F

 

Affirmative Action

 

As a federal contractor/subcontractor, Siemens is required to comply with certain federal regulations, including the regulations promulgated by the U.S. Department of Labor, Office of Federal Contract Compliance Programs (“OFCCP”). As a federal contractor, Siemens is also required to ensure compliance of the OFCCP by its subcontractors, vendors and suppliers covered under the OFCCP (each, a “Covered Party”). Supplier is hereby notified of Siemens’ policy related to affirmative action and our mutual OFCCP obligations to the extent Supplier, its subcontractors, vendors or suppliers is a Covered Party.

 

Siemens is an equal opportunity/affirmative action employer and does not discriminate on the basis of race, color, creed, religion, national origin, ancestry, sex, age, physical or mental disability, marital status, pregnancy, genetic information, sexual orientation, gender identity, protected veteran or military status, or any other consideration not related to the person’s ability to do the job or otherwise made unlawful by federal, state or local law in the following employment practices, including among others: recruiting, hiring, placement, transfer, promotion, demotion, selection for training, layoff, termination, shift assignment, determination of service, rates of pay, benefit plans, and all forms of compensation and other personnel actions.

 

As a federal contractor/subcontractor, Siemens’ Covered Parties (including Supplier and its Covered Parties, if applicable) also have an obligation to comply with equal opportunity and affirmative action principles. Therefore, Siemens’ Covered Parties (including Supplier and its Covered Parties, if applicable) will take appropriate action in support of these principles. Through our mutual effort and cooperation, we will continue to provide a working environment that appreciates and encourages diversity, promotes equal employment opportunity and is free from any type of discrimination.

 

Supplier and its Covered Parties, if applicable, shall abide by the requirements of the “Equal Opportunity Clause” in Section 202 of Executive Order 11246. See 41 CFR 60-1.4(a).

 

The following shall also apply if the Supplier is a Covered Party:

 

For contracts of $100,000 or more, Supplier shall comply with the following: This Supplier, contractor and subcontractor shall abide by the requirements of 41 CFR 60-300.5(a). This regulation prohibits discrimination against qualified protected veterans, and requires affirmative action by covered prime contractors and subcontractors to employ and advance in employment qualified protected veterans.

 

For contracts of $10,000 or more, Supplier shall comply with the following: This Supplier, contractor and subcontractor shall abide by the requirements of 41 CFR 60-741.5(a). This regulation prohibits discrimination against qualified individuals on the basis of disability, and requires affirmative action by covered prime contractors and subcontractors to employ and advance in employment qualified individuals with disabilities.

 

 

Exhibit G

 

Key Agreements

 

1.

Third Amended and Restated Limited Liability Company Agreement of Fluence Energy, LLC, dated as of [      ].

 

2.

Amended and Restated Credit Support and Reimbursement Agreement dated as of June 9, 2021, among The AES Corporation, Siemens Industry, Inc. and Fluence Energy, LLC.

 

3.

Amended and Restated Siemens License Agreement, dated as of June 9, 2021, between Fluence Energy, LLC and Siemens Aktiengesellschaft.

 

4.

Amended and Restated Siemens License Agreement, dated as of June 9, 2021, between Fluence Energy, LLC and Siemens Industry, Inc.

 

5.

Siemens Master Sales Cooperation Agreement, dated as of [ ], by and between Fluence Energy, LLC and Siemens Industry, Inc.

 

6.

Services Agreement, dated as of January 1, 2018, between Siemens Aktiengesellschaft, Fluence Energy, LLC and such other companies as set forth therein.

 

7.

Amended and Restated Company Name Affix and Trademark License Agreement, dated [ ], between Siemens Aktiengesellschaft and Fluence Energy, LLC.

 

8.

Amended and Restated Equipment Services and Purchase Agreement, dated [ ], between Siemens Industry, Inc. and Fluence Energy, LLC.

 

 

Attachment A

 

DESCRIPTION OF SUPPLIER’S BATTERY STORAGE EQUIPMENT AND SERVICES

 

 

Exhibit 10.24

 

SECOND AMENDMENT TO Company Name Affix and Trademark License Agreement

 

This SECOND AMENDMENT TO COMPANY NAME AFFIX AND TRADEMARK LICENSE AGREEMENT (this “Second Amendment”), is dated as of [●], 2021, by and between The AES Corporation, a corporation incorporated and validly existing under the laws of the State of Delaware (“AES”) and Fluence Energy, LLC, a limited liability company duly organized and validly existing under the laws of the State of Delaware (“Licensee”). AES and the Licensee may herein collectively be referred to as the “Parties”

 

WHEREAS, AES and Licensee are parties to that certain Company Name Affix and Trademark License Agreement, dated on or about July 9, 2017, which was amended by that certain Amendment to Company Name Affix and Trademark License Agreement, dated on or about June 9^th, 2021 (collectively, the “Trademark License Agreement”);

 

WHEREAS, certain other parties are entering into a series of transactions in connection with the formation of Fluence Energy, Inc., a Delaware corporation (“Issuer”) to serve as the vehicle through which the public will own indirect interests in Licensee through an initial public offering (the “IPO”);

 

WHEREAS, in connection with the IPO, the Parties desire to further amend the Trademark License Agreement as set forth in this Second Amendment, with such Second Amendment to take effect as of the Effective Date (as defined in Section 3 hereof), without any further action necessary on the part of the Parties; and

 

WHEREAS, this Second Amendment is duly made by the Parties pursuant to Section 17.2 of the Trademark License Agreement.

 

NOW, THEREFORE, in consideration of the foregoing and of the covenants and agreements set forth in this Second Amendment, and subject to the terms and conditions set forth in this Second Amendment, the Parties agree as follows:

 

1.             Capitalized Terms. Capitalized terms used and not otherwise defined in this Second Amendment shall have the respective meanings ascribed to them in the Trademark License Agreement.

 

2.              Amendments. The Parties agree to amend the Trademark License Agreement as follows:

 

(a)               Definitions. Article 1 of the Trademark Agreement is hereby amended to add the following definitions:

 

“AES Grid Stability” shall mean AES Grid Stability, LLC, a Delaware limited liability company.

 

 

“Affiliate” shall mean, at any time, and with respect to any Person or group of Persons, a Person that at such time directly or indirectly through one or more intermediaries, Controls, is Controlled by, or is under common Control with such Person or group of Persons. No Person shall be considered an Affiliate of another Person or under the Control of such other Person so long as (i) it is owned less than 50% by such other Person, (ii) such other Person has no capacity to elect or appoint the majority of the board of directors or similar governing body of the subject Person, (iii) such other Person does not consolidate the subject Person in its financial reporting and (iv) there is no other management or services agreement pursuant to which such other Person exerts control over the subject Person. With respect to Siemens, none of Gamesa Corporación Technológica S.A., Siemens Healthineers AG nor any of their respective Subsidiaries shall be considered an Affiliate of Siemens.

 

“Control” shall mean, with respect to the relationship between two or more Persons, the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through ownership of voting securities, as trustee or executor, by contract or otherwise. The terms “Controlled” or “under common Control with” have correlative meanings

 

“Person” shall mean any natural person, corporation, partnership, joint venture, trust, estate, unincorporated association, limited liability company or any other entity (whether or not having separate legal personality), and shall include any successor (by merger or otherwise) of such entity

 

“Shares” shall mean (i) the Class A Common Stock of the Issuer, calculated on a fully diluted basis and assuming that all options, warrants and any other rights to purchase shares of Class A Common Stock of the Issuer have been exercised in full, including, for sake of clarity, the Underlying Class A Shares plus (ii) any other equity securities now or hereafter issued by the Issuer, together with any options thereon and any other shares of stock or other equity securities issued or issuable with respect thereto (whether by way of a stock dividend, stock split or in exchange for or in replacement or upon conversion of such shares or otherwise in connection with a combination of shares, recapitalization, merger, consolidation or other corporate reorganization); provided, however, that in no event shall the Shares include the Class B Common Stock of the Issuer.

 

“SII” shall mean Siemens Industry, Inc., a Delaware corporation.

 

“Third Party” shall mean any Person other than SII and its Affiliates or AES Grid Stability and its Affiliates.

 

“Underlying Class A Shares” shall mean all shares of Class A Common Stock of the Issuer issuable upon redemption of Common Units of the Licensee, assuming all such Common Units are redeemed for Class A Common Stock of the Issuer on a one for one basis

 

 

“Voting Power” shall mean the total voting power of all Shares entitled to vote generally in the election of directors (for clarity, on a basis that assumes that all Common Units of Licensee have been redeemed for shares of Class A Common Stock of the Issuer on a one for one basis and that there are no shares of Class B Common Stock of the Issuer outstanding).

 

(b)               Termination. Section 12.2 of the Trademark License Agreement is hereby amended and restated in its entirety as follows:

 

“12.2 During the period commencing on the Effective Date and ending on January 1, 2024 (the “Lock-up Period”), Siemens may terminate this Agreement only in the event of one of the following (each, a “Termination Event”), in each case with immediate effect by giving written notice thereof to Licensee: (i) for cause as set forth in 12.3 below, (ii) if at any time, the then outstanding Voting Power represented by the Shares held collectively by SII and its Affiliates is ten (10) percentage points or more than the then outstanding Voting Power represented by the Shares held collectively by AES Grid Stability and its Affiliates at such time (measured by the total Voting Power of all outstanding shares), (iii) if at any time, SII and AES Grid Stability, together with their respectively Affiliates, collectively no longer hold Shares representing more than fifty percent (50%) of the then outstanding Voting Power, (iv) if at any time, any Third Party together with its Affiliates, collectively holds Shares representing a higher percentage of the then outstanding Voting Power as compared to the then outstanding Voting Power represented by the Shares held by either (A) SII and its Affiliates, or (B) AES Grid Stability and its Affiliates, at such time. After the conclusion of the Lock-up Period, provided this Agreement is not earlier terminated pursuant to a Termination Event, Siemens is entitled to terminate the rights and licenses granted under this Agreement upon 90 day written notice to Licensee without having to present to Licensee the reasons for such termination.”

 

3.             Effectiveness of this Second Amendment. Each of the Parties, by its signature below, does hereby give its written consent to the amendment of the Trademark License Agreement in accordance with this Second Amendment. This Second Amendment will become effective as of the day on which the Class A Common Stock of the Issuer is issued to the underwriters in the Issuer’s IPO (the “Effective Date”); provided, that if the Effective Date does not occur on or prior to December 31, 2021, this Second Amendment shall be deemed terminated as of such date and of no force or effect without further notice or action by the Parties, and the Trademark License Agreement shall remain in full force and effect without any amendment thereto.

 

4.                  No Other Amendments. Except as expressly modified by this Second Amendment, the Trademark License Agreement (as heretofore modified) shall remain unmodified and in full force and effect.

 

 

5.             Counterparts. This Second Amendment may be executed in two or more counterparts, each of which shall be deemed an original but all of which shall constitute one (1) and the same Second Amendment. A signed copy of this Second Amendment delivered by facsimile or email will be deemed to have the same legal effect as delivery of an original signed copy of such Second Amendment.

 

6.             Execution and Delivery. A .pdf, or other reproduction of this Second Amendment may be executed by one or more parties hereto and delivered by such Party by email or any similar electronic transmission device pursuant to which the signature of or on behalf of such Party can be seen. Such execution and delivery shall be considered valid, binding and effective for all purposes. At the request of any Party hereto, all parties hereto agree to execute and deliver an original of this Second Amendment as well as any .pdf or other reproduction hereof.

 

7.             Governing Law. This Second Amendment is exclusively governed by, and shall be exclusively construed in accordance with the laws of the United States and the laws of the State of Delaware, without regard to any conflict of law rules that require the application of the laws of any other jurisdiction.

 

[Signature page follows]

 

 

IN WITNESS WHEREOF, the Parties have executed this Second Amendment as of the day and year first above written.

 

	The AES Corporation
	By:
	Name: [Chris Shelton]
	Title:   [Vice President and Chief Product Officer]
	By:
	Name:
	Title:
	Fluence Energy, LLC
	By:
	Name:
	Title:

 

Signature Page – Second Amendment to Trademark License Agreement

 

 

 

Exhibit 10.25

 

SECOND AMENDMENT TO Company Name Affix and Trademark License Agreement

 

This SECOND AMENDMENT TO COMPANY NAME AFFIX AND TRADEMARK LICENSE AGREEMENT (this “Second Amendment”), is dated as of [●], 2021, by and between Siemens Aktiengesellschaft, with registered seats in Berlin and Munich, Federal Republic of Germany (“Siemens”) and Fluence Energy, LLC, a limited liability company duly organized and validly existing under the laws of the State of Delaware (“Licensee”). Siemens and the Licensee may herein collectively be referred to as the “Parties”

 

WHEREAS, Siemens and Licensee are parties to that certain Company Name Affix and Trademark License Agreement, dated on or about July 9, 2017, which was amended by that certain Amendment to Company Name Affix and Trademark License Agreement, dated on or about June 9^th, 2021 (collectively, the “Trademark License Agreement”);

 

WHEREAS, Siemens Industry, Inc., a Delaware corporation and affiliate of Siemens (“SII”), Licensee, and certain other parties are entering into a series of transaction in connection with the formation of Fluence Energy, Inc., a Delaware corporation (“Issuer”) to serve as the vehicle through which the public will own indirect interests in Licensee through an initial public offering (the “IPO”);

 

WHEREAS, in connection with the IPO, the Parties desire to further amend the Trademark License Agreement as set forth in this Second Amendment, with such Second Amendment to take effect as of the Effective Date (as defined in Section 3 hereof), without any further action necessary on the part of the Parties; and

 

WHEREAS, this Second Amendment is duly made by the Parties pursuant to Section 17.2 of the Trademark License Agreement.

 

NOW, THEREFORE, in consideration of the foregoing and of the covenants and agreements set forth in this Second Amendment, and subject to the terms and conditions set forth in this Second Amendment, the Parties agree as follows:

 

1.             Capitalized Terms. Capitalized terms used and not otherwise defined in this Second Amendment shall have the respective meanings ascribed to them in the Trademark License Agreement.

 

2.             Amendments. The Parties agree to amend the Trademark License Agreement as follows:

 

(a)               Definitions. Article 1 of the Trademark Agreement is hereby amended to add the following definitions:

 

“AES” shall mean AES Grid Stability, LLC, a Delaware limited liability company.

 

 

“Affiliate” shall mean, at any time, and with respect to any Person or group of Persons, a Person that at such time directly or indirectly through one or more intermediaries, Controls, is Controlled by, or is under common Control with such Person or group of Persons. No Person shall be considered an Affiliate of another Person or under the Control of such other Person so long as (i) it is owned less than 50% by such other Person, (ii) such other Person has no capacity to elect or appoint the majority of the board of directors or similar governing body of the subject Person, (iii) such other Person does not consolidate the subject Person in its financial reporting and (iv) there is no other management or services agreement pursuant to which such other Person exerts control over the subject Person. With respect to Siemens, none of Gamesa Corporación Technológica S.A., Siemens Healthineers AG nor any of their respective Subsidiaries shall be considered an Affiliate of Siemens.

 

“Control” shall mean, with respect to the relationship between two or more Persons, the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through ownership of voting securities, as trustee or executor, by contract or otherwise. The terms “Controlled” or “under common Control with” have correlative meanings

 

“Person” shall mean any natural person, corporation, partnership, joint venture, trust, estate, unincorporated association, limited liability company or any other entity (whether or not having separate legal personality), and shall include any successor (by merger or otherwise) of such entity

 

“Shares” shall mean (i) the Class A Common Stock of the Issuer, calculated on a fully diluted basis and assuming that all options, warrants and any other rights to purchase shares of Class A Common Stock of the Issuer have been exercised in full, including, for sake of clarity, the Underlying Class A Shares plus (ii) any other equity securities now or hereafter issued by the Issuer, together with any options thereon and any other shares of stock or other equity securities issued or issuable with respect thereto (whether by way of a stock dividend, stock split or in exchange for or in replacement or upon conversion of such shares or otherwise in connection with a combination of shares, recapitalization, merger, consolidation or other corporate reorganization); provided, however, that in no event shall the Shares include the Class B Common Stock of the Issuer.

 

“Third Party” shall mean any Person other than SII and its Affiliates or AES and its Affiliates.

 

“Underlying Class A Shares” shall mean all shares of Class A Common Stock of the Issuer issuable upon redemption of Common Units of the Licensee, assuming all such Common Units are redeemed for Class A Common Stock of the Issuer on a one for one basis

 

 

“Voting Power” shall mean the total voting power of all Shares entitled to vote generally in the election of directors (for clarity, on a basis that assumes that all Common Units of Licensee have been redeemed for shares of Class A Common Stock of the Issuer on a one for one basis and that there are no shares of Class B Common Stock of the Issuer outstanding).

 

(b)              Termination. Section 12.2 of the Trademark License Agreement is hereby amended and restated in its entirety as follows:

 

“12.2          During the period commencing on the Effective Date and ending on January 1, 2024 (the “Lock-up Period”), Siemens may terminate this Agreement only in the event of one of the following (each, a “Termination Event”), in each case with immediate effect by giving written notice thereof to Licensee: (i) for cause as set forth in 12.3 below, (ii) if at any time, the then outstanding Voting Power represented by the Shares held collectively by AES and its Affiliates is ten (10) percentage points or more than the then outstanding Voting Power represented by the Shares held collectively by SII and its Affiliates at such time (for example, AES holding Voting Power equal to 30% (or more than 30%) and Siemens holding Voting Power equal to 20%), (iii) if at any time, SII and AES, together with their respectively Affiliates, collectively no longer hold Shares representing more than fifty percent (50%) of the then outstanding Voting Power, (iv) if at any time, any Third Party together with its Affiliates, collectively holds Shares representing a higher percentage of the then outstanding Voting Power as compared to the then outstanding Voting Power represented by the Shares held by either (A) SII and its Affiliates, or (B) AES and its Affiliates, at such time. After the conclusion of the Lock-up Period, provided this Agreement is not earlier terminated pursuant to a Termination Event, Siemens is entitled to terminate the rights and licenses granted under this Agreement upon 90 day written notice to Licensee without having to present to Licensee the reasons for such termination.”

 

3.             Effectiveness of this Second Amendment. Each of the Parties, by its signature below, does hereby give its written consent to the amendment of the Trademark License Agreement in accordance with this Second Amendment. This Second Amendment will become effective as of the day on which the Class A Common Stock of the Issuer is issued to the underwriters in the Issuer’s IPO (the “Effective Date”); provided, that if the Effective Date does not occur on or prior to December 31, 2021, this Second Amendment shall be deemed terminated as of such date and of no force or effect without further notice or action by the Parties, and the Trademark License Agreement shall remain in full force and effect without any amendment thereto.

 

4.             No Other Amendments. Except as expressly modified by this Second Amendment, the Trademark License Agreement (as heretofore modified) shall remain unmodified and in full force and effect.

 

 

5.             Counterparts. This Second Amendment may be executed in two or more counterparts, each of which shall be deemed an original but all of which shall constitute one (1) and the same Second Amendment. A signed copy of this Second Amendment delivered by facsimile or email will be deemed to have the same legal effect as delivery of an original signed copy of such Second Amendment.

 

6.             Execution and Delivery. A .pdf, or other reproduction of this Second Amendment may be executed by one or more parties hereto and delivered by such Party by email or any similar electronic transmission device pursuant to which the signature of or on behalf of such Party can be seen. Such execution and delivery shall be considered valid, binding and effective for all purposes. At the request of any Party hereto, all parties hereto agree to execute and deliver an original of this Second Amendment as well as any .pdf or other reproduction hereof.

 

7.             Governing Law. This Second Amendment is exclusively governed by, and shall be exclusively construed in accordance with, the substantive laws of Germany with the exclusion of the Vienna Convention on the International Sale of Goods and without regard to any conflict of law rules that require the application of the laws of any other jurisdiction. This includes, without limitation, the legal concepts and terms contained in this Second Amendment, the English translation of which may not be identical with the original German terms in their respective legal understanding. Any possible current of future obligations between Parties which fall under the EC Regulations No. 864/2007 on the Law Applicable to Non-Contractual Obligation (“Rome II”) are governed by German Law, the United Nations Convention on Contracts for the International Sale of Goods and any conflict of law rules that require the application of the laws of any other jurisdiction being excluded.

 

[Signature page follows]

 

 

IN WITNESS WHEREOF, the Parties have executed this Second Amendment as of the day and year first above written.

 

	Siemens Aktiengesellschaft
	By:
	Name:
	Title:
	By:
	Name:
	Title:
	Fluence Energy, LLC
	By:
	Name:
	Title:

 

Signature Page – Second Amendment to Trademark License Agreement

 

 

 

Exhibit 10.26

 

Master Sales Cooperation Agreement (2021)

  

between

 

Siemens Industry, Inc. – Smart Infrastructure

 

with its principal place of business at 100 Technology Drive, Alpharetta GA 30005

 

- hereinafter referred to as “Siemens” -

 

and

 

Fluence Energy, LLC

 

with its principal place of business at 4300 Wilson Blvd., #1100, Arlington VA 22203

 

- hereinafter referred to as “Fluence” -

  

- Siemens and Fluence hereinafter referred to individually
as “Party” or collectively as “Parties”

 

 

Article 1 - Purpose

 

1.1

Fluence is a company providing battery energy storage solutions (“BESS”) and related services for the installation, commissioning, operation and maintenance of BESS products in an industrial environment.

 

1.2

Siemens is a company providing products, services and solutions to the buildings and energy markets and also intending to provide its customer base with BESS as part of larger solutions.

 

1.3

Siemens, as a major shareholder of Fluence, has an interest that Fluence further succeeds in addressing its markets.

 

1.4

The Parties previously entered into a January 1, 2018 Master Sales Cooperation Agreement (“Initial MSCA”) for the intent of cooperating to ensure meeting customer demands, timely delivery of high-quality BESS and related service and effective order planning and processing. In order to accelerate the adoption of energy storage in the market and to leverage Siemens’ extensive sales reach, Fluence is using Siemens sales organizations and customer relationships in some countries to bring Fluence’s BESS to Siemens customers as well as working together to assist Siemens in offering BESS as part of a larger solution. Fluence benefits from the extensive global sales reach of Siemens and its established customer relationships.

 

1.5

The Parties agree that the Initial MSCA is terminated effective as of the date of the signing of this Master Sales Cooperation Agreement (“MSCA 2021”) and that this MSCA 2021 replaces the Initial MSCA in its entirety.

 

1.6

Each Party shall endeavor to provide the other Party with information reasonably required for the purpose of the MSCA 2021.

 

Article 2 - Scope

 

2.1

The Parties intend to cooperate and to deliver value to each of the Parties’ customers ("Cooperation"). It is the objective of the Parties to benefit from this Cooperation by expanding their individual capabilities, making use of their combined capabilities, and achieving synergies where possible.

 

(1) The Parties intend to continue and further grow their mutual supplier relationship in accordance with the Storage Core Frame Purchase Agreement and the Equipment and Services Purchase Agreement (both dated January 1, 2018), as the same may be amended from time to time.

 

(2) Siemens intends to support Fluence in a potential usage of the Siemens sales organization worldwide. The specific support any Siemens affiliate can provide, and related terms of support (including potential commission), will be defined by a country specific agreement and/or project related agreements. Those agreements are expected to include arrangements covering among others: Dedicated Siemens resources, services (e.g. grid studies) and equipment deliveries, Siemens commission rates and expectations for Fluence.

 

 

2.2

Special Cooperation sales models between the Parties (e.g. consortium approach) shall be defined on a project specific basis.

 

2.3

The decision to pursue any specific project or transactions under any of the agreements shall be made independently and at the sole discretion of the Parties.

 

2.4

Any Cooperation activities are non-exclusive and are always subject to all applicable antitrust laws. The Parties will continuously review with their antitrust experts whether the intended sharing of project leads is admissible under the applicable antitrust laws before discussing any opportunities with each other.

 

Article 3 - Legally binding provisions

 

3.1

The Parties shall not be legally committed to provide any Cooperation activities as described in Article 2 above. The Parties will in their sole discretion decide whether to provide the Cooperation activities and in their sole discretion decide upon the length of time that it will offer the Cooperation activities. Neither Party will be liable for deciding not to provide Cooperation activities nor for deciding to cease providing Cooperation activities.

 

3.2

Each Party shall bear its own internal and external costs related to drafting and execution of this MSCA 2021.

 

3.3

Neither Party shall have grounds for any claim under any theory of law (including, without limitation, claims for damages and cost reimbursement) against the other Party as it relates to this MSCA 2021.

 

3.4

Each Party shall treat the negotiations and the contents of this MSCA 2021 as confidential unless the other Party gives its prior written consent to the disclosure of such information to a third-party. This confidentiality obligation shall not apply to information which is generally known, which can be shown to have been independently developed by the recipient, or which has been acquired from a third party without nondisclosure obligation to the disclosing Party. This obligation shall likewise not apply to the extent a Party is required by statutory regulations, governmental orders, legal process or stock exchange requirements to reveal this MSCA 2021 or any of the information such Party has obtained. This obligation shall survive the term of this MSCA 2021 for a period of three (3) years.

 

3.5

The substantive law governing this MSCA 2021 shall be that of the State of Delaware.

 

 

3.6

Modifications to this MSCA 2021 shall only be valid if made in writing. The requirement of the written form can itself only be waived in writing.

 

3.7

This MSCA 2021 shall become effective upon signature by all Parties and will continue in effect until December 31, 2022 (“Initial Term”). The MSCA 2021 shall automatically extend by consecutive one (1) year terms (“Renewal Term”) unless terminated by a Party upon three (3) months prior written notice to the other Party with effect from the end of the Initial Term or the respective Renewal Term. Clauses 1.5, 3.1, 3.2, 3.3, 3.4 and 3.5 shall survive termination.

  

Siemens Industry, Inc. –

Fluence Energy, LLC

Smart Infrastructure

  

By:			By:
Name:			Name:
Title:			Title:
Date:			Date:
By:			By:
Name:			Name:
Title:			Title:
Date:			Date:

 

  

 

Exhibit 10.27 

 

Amended and Restated Cooperation Agreement

 

between

 

Fluence Energy, LLC

 

and

 

The AES Corporation

 

Dated as of [____], 2021

 

 

THIS AMENDED AND RESTATED COOPERATION AGREEMENT (this “Agreement”) is made and entered into on [_____], 2021 (the “Effective Date”), between The AES Corporation, whose principal place of business is at 4300 Wilson Boulevard, Arlington, VA 22203 hereinafter referred to as “AES” and Fluence Energy, LLC, whose principal place of business is 4601 N. Fairfax Drive, Suite 600, Arlington, VA 22203 hereinafter referred to as “Fluence”. Each of AES and Fluence are referred to herein as a “Party” and collectively are referred to herein as the “Parties.”

 

WHEREAS, AES is a company headquartered in Arlington, Virginia with electrical transmission, distribution and power generation subsidiaries located globally, supplying power services to utilities, power systems, and end customers;

 

WHEREAS, Fluence is a company headquartered in Arlington, Virginia with a battery storage system business, and seeks to sell Battery Energy Storage Systems and Solutions to owners of power projects and assets;

 

WHEREAS, Fluence and AES are parties to that certain Cooperation Agreement, dated as of January 1, 2018, by and between Fluence and AES (the “Prior Agreement”); and

 

WHEREAS, AES Grid Stability LLC (“AES LLC”), a Delaware limited liability company and wholly-owned subsidiary of AES, owns a 43.18% membership interest in Fluence as of the Effective Date, but prior to the initial public offering described in the recitals below;

 

WHEREAS, AES LLC is party to the Second Amended and Restated Limited Liability Company Agreement of Fluence, dated as of June 9, 2021(the “Second A&R LLC Agreement”);

 

WHEREAS, Fluence, AES LLC and certain other parties are entering into a series of transactions in connection with the formation of Fluence Energy, Inc., a Delaware corporation (“Issuer”) to serve as the vehicle through which the public will own indirect interests in Fluence through an initial public offering;

 

WHEREAS, in connection with the initial public offering, the Second A&R LLC Agreement is being amended and restated in its entirety by the Third Amended and Restated Limited Liability Company Agreement, dated on or about the date hereof (the “Third A&R LLC Agreement”), to, among other things, reflect Issuer’s ownership of Fluence and the restructuring of Fluence and its Affiliates; and

 

NOW, THEREFORE, the Parties agree that the Prior Agreement is hereby amended and restated in its entirety by this Agreement, and further agree as follows:

 

Article 1.           Definitions

 

1.1         Definitions. The terms used in this Agreement, with their initial letters capitalized, shall, unless the context thereof otherwise requires, have the meanings specified in this Section 1.1.

 

“AAA” shall have the meaning assigned to such term in Section 13.2.

 

“AES” has the meaning set forth in the Preamble hereto.

 

"AES Entity" shall mean either AES or an Affiliate of AES, as the case may be.

 

 

“AES LLC” has the meaning set forth in the Recitals hereto.

 

“AES Representative” shall have the meaning assigned to such term in Section 6.1.

 

“AES Strategic Business Unit” shall mean one of the primary regional business groupings managed by a SBU President in AES.

 

“Affiliate” means, at any time, and with respect to any Person or group of Persons, a Person that at such time directly or indirectly through one or more intermediaries, Controls, is Controlled by, or is under common Control with such Person or group of Persons..

 

“Agreement” has the meaning set forth in the Preamble hereto.

 

“Application” has the meaning set forth in the LLC Agreement.

 

“Battery Energy Storage Systems and Solutions” means any battery based energy storage system and related services offered for sale from time to time by Fluence, including such as may be purchased pursuant to the Storage Core Frame Purchase Agreement.

 

“Branding Agreement” means that certain Branding Agreement entered into as of the Effective Date between AES and Fluence.

 

“Claim” shall have the meaning assigned to such term in Section 9.1.

 

“Compliance Breach” shall have the meaning assigned to such term in Section 8.2.

 

“Confidential Information” shall have the meaning assigned to such term in Section 12.1.

 

“Control” means, with respect to the relationship between two or more Persons, the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through ownership of voting securities, as trustee or executor, by contract or otherwise. The terms “Controlled” or “under common Control with” have correlative meanings.

 

“Customer” is the end-use customer for any Battery Energy Storage Solutions proposed as part of a project owned by AES Entity.

 

“Dispute” shall have the meaning assigned to such term in Section 13.1.

 

“Effective Date” has the meaning set forth in the Preamble hereto.

 

“Fluence” has the meaning set forth in the Preamble hereto.

 

"Fluence Entity" shall mean either Fluence or an Affiliate of Fluence, as the case may be.

 

“Fluence Representative” shall have the meaning assigned to such term in Section 6.1.

 

“Government Official” shall mean any officer or employee or family member of an officer or employee of a government, department (whether executive, legislative, judicial or administrative), agency or instrumentality of such government, or any person acting in an official capacity for or on behalf of such government or any candidate for public office or representative of a political party.

 

 

“Governmental Authority” means a federal, state, local or foreign governmental authority (including any regulatory authority); a state, province, commonwealth, territory or district thereof; a county; a city, town, township, or other municipality; a district, ward or other subdivision of any of the foregoing; any executive, legislative or other governing body of any of the foregoing; any agency, authority, board, department, system, service, office, commission, committee, council or other administrative body of any of the foregoing; any court or other judicial body; and any officer, official or other representative of any of the foregoing.

 

“Indemnified Party” shall have the meaning assigned to such term in Section 9.1.

 

“Indemnifying Party” shall have the meaning assigned to such term in Section 9.1.

 

“Initial Term” shall have the meaning assigned to such term in Section 10.1.

 

“Integrated Solution” has the meaning set forth in the LLC Agreement.

 

“Issuer” has the meaning set forth in the Recitals hereto.

 

“LLC Agreement” means the Second A&R LLC Agreement prior to the effectiveness of the Third A&R LLC Agreement, and thereafter means the Third A&R LLC Agreement.

 

“Parties” has the meaning set forth in the Preamble hereto.

 

“Party” has the meaning set forth in the Preamble hereto.

 

“Person” means any natural person, corporation, partnership, joint venture, trust, estate, unincorporated association, limited liability company or any other entity (whether or not having separate legal personality), and shall include any successor (by merger or otherwise) of such entity.

 

“Prohibited Payment” means any offer, gift, payment, promise to pay, or authorization of the payment of any money or anything of value, directly or indirectly, to a Government Official for the purpose of either (i) influencing any act or decision of the Government Official in his or her official capacity, (ii) inducing the Government Official to do or omit to do any act in violation of his or her lawful duty, (iii) securing any improper advantage or (iv) inducing the Government Official to use his influence with a government or instrumentality thereof to affect or influence any act or decision of such government or instrumentality, in order to assist in obtaining or retaining business or in directing business to any party.

 

“Prohibited Transaction” means any of the following: (i) receiving, transferring, transporting, retaining, using, structuring, diverting or hiding the proceeds of any criminal activity whatsoever, including drug trafficking, fraud or bribery of a Government Official; (ii) engaging or becoming involved in, financing, or supporting financially or otherwise, sponsoring, facilitating, or giving aid to any terrorist person, activity or organization; or (iii) participating in any transaction or otherwise conducting business with any Person that appears on any list issued by a United States or European Union Governmental Authority, the World Bank or the United Nations with respect to money laundering, terrorism financing, drug trafficking or economic or arms embargoes.

 

 

“Representatives” means, with respect to any person, such person’s shareholders, officers, directors, employees, accountants, consultants, legal counsel, financial advisors and other representatives and agents.

 

“Rules” shall have the meaning assigned to such term in Section 13.2.

 

“Second A&R LLC Agreement” has the meaning set forth in the Recitals hereto.

 

“SLA” shall have the meaning assigned to such term in Section 5.2.

 

“Storage Core Frame Purchase Agreement” means that certain Amended and Restated Storage Core Frame Purchase Agreement entered into as of the Effective Date between AES LLC and Fluence pursuant to which AES Entities may from time to time purchase Battery Energy Storage Solutions from Fluence.

 

“Third A&R LLC Agreement” has the meaning set forth in the Recitals hereto.

 

1.2         Interpretation.

 

1.2.1     When a reference is made in this Agreement to an Article, Section clause, Exhibit or Schedule, such reference shall be to an Article, Section or clause of, Exhibit or Schedule to, this Agreement unless otherwise indicated, and the words “Agreement,” “hereby,” “herein,” “hereof,” “hereunder” and words of similar import refer to this Agreement as a whole (including any Exhibits) and not merely to the specific section, paragraph or clause in which such word appears. The table of contents and the Article and Section headings contained in this Agreement are solely for the purpose of reference, are not part of the agreement of the Parties and do not in any way affect the meaning or interpretation of this Agreement. The phrases “the date of this Agreement,” “the date hereof” and terms of similar import, shall be deemed to refer to the Effective Date. References to any statute are to that statute, as amended from time to time, and to the rules and regulations promulgated thereunder. Unless otherwise expressly provided herein, references to any agreement or document shall be a reference to such agreement or document as amended, modified or supplemented and in effect from time to time and shall include reference to all exhibits, schedules and other documents or agreements attached thereto or incorporated therein, including waivers or consents. Unless otherwise expressly provided herein, references to any Person include the successors and permitted assigns of that Person. Whenever the content of this Agreement permits, the masculine gender shall include the feminine and neuter genders, and a reference to singular or plural shall be interchangeable with the other. References from or through any date mean, unless otherwise specified, from and including or through and including, respectively. As used in this Agreement: (i) the term “including” and words of similar import mean “including, without limitation” unless otherwise specified, (ii) “$” and “dollars” refer to the currency of the United States of America, and (iii) “any” shall mean “one or more”. Unless the defined term “Business Days” is used, references to “days” in this Agreement refer to calendar days.

 

1.2.2     The Parties have participated jointly in negotiating and drafting this Agreement. In the event that an ambiguity or a question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the Parties, and no presumption or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of any provision of this Agreement.

 

1.2.3     No summary of this Agreement prepared by or on behalf of any Party shall affect the meaning or interpretation of this Agreement.

 

Article 2.           Scope

 

2.1         Scope. The Parties shall use commercially reasonable efforts to maximize opportunities to use Battery Energy Storage Solutions on a global basis across the AES fleet. AES shall cause the AES Entities to apply this Agreement on a global basis, with the same understanding as to applicable laws concerning transfer pricing.

 

2.2         AES Entities. In the case of non-controlled AES Entities, AES agrees to promote and educate those entities about the benefits of energy storage and Fluence. AES agrees to use commercially reasonable efforts to enable interactions between Fluence and non-controlled entities for the purpose of exploring energy storage project investments, enabling the participation of Fluence in any energy storage procurements, and creating a preferred vendor role for Fluence where permitted and applicable.

 

2.3         Key Interfaces. During the term of this Agreement, each Party shall provide the other Party with contact persons to serve as liaisons for effective cooperation and communication between AES and Fluence regarding the implementation of the terms of this Agreement. These contact persons shall schedule regular meetings. These contact persons include, but are not limited to, the following:

 

2.3.1     Management: The Fluence Representative and the AES Representative will be the respective interfaces at the management level for this Agreement. The Fluence Representative will manage the business plan and competitiveness of the Battery Energy Storage Solutions, and the AES Representative will manage interaction across AES Strategic Business Units with respect to energy storage project development. The Fluence Representative and the AES Representative shall both manage his or her respective teams independently and will be his or her respective Party’s representative with respect to escalated matters to be resolved, including but not limited to target sharing, availability of agreed technical sales support, capacity planning, and project delivery matters which cannot be resolved by Fluence sales people and the AES Strategic Business Units or individual AES project leads.

 

 

Article 3.           Offer Management Process – Supporting BD at AES

 

3.1         BD Process. It is recognized that AES projects will move through several life cycle stages from original conception to investment implementation. Fluence will provide support to AES as a preferred vendor of Battery Energy Storage Solutions throughout this process. AES will manage its project development process at its own discretion and will make information, pricing, support, or other needs known to Fluence for use in AES internal investment reviews, external bid processes, or other activities aimed at expanding the market for energy storage. AES will have the sole discretion to pursue project development investments. AES and Fluence agree that each will bear their own cost of these activities.

 

3.2         Bid Support. From time to time, AES may participate in bid or RFP processes to win contracted projects from Customers. Fluence will support AES as a key vendor in these processes with information, diagrams, processes, and personal representation as suitable and agreed upon request. AES will have the sole discretion to bid or not bid in any process. AES and Fluence agree that each will bear their own cost of these activities.

 

3.3         Advanced Projects. As AES projects advance in maturity, AES will have the sole discretion for whether to continue to fund and develop its own projects for investment. Fluence will support this effort in a manner consistent with a key project vendor. Any financial support, credit support, warranty support, or other commitment by Fluence will be subject to a specific Purchase Order under the Storage Core Purchase Agreement.

 

Article 4.           Marketing Cooperation and Related Matters

 

4.1         Business Planning. As needed, but at least on an annual basis, the Parties shall jointly review the Fluence business plan and the AES outlook for project investments that could include energy storage, including discussion of any new technical requirements or needs from Fluence to assist AES in realizing project opportunities.

 

4.2         Joint Marketing. Joint marketing activities and trade events, including, but not limited to, marketing and trade fairs within a broader AES context, shall be agreed and planned in the business planning discussed in Section 4.1 between AES and Fluence. The Parties will mutually discuss in good faith proposals for joint marketing and fair participations. For agreed joint marketing or trade fair events in which AES enables Fluence to participate, Fluence will be responsible to pay any added fees or costs for materials related to its participation. AES shall be permitted to utilize images, product names, and materials from Fluence at events and in promotional efforts related to the sale of Battery Energy Storage Solutions, subject to compliance by AES with Fluence’s usage and brand guidelines and the Branding Agreement.

 

Article 5.           AES Business Development

 

5.1         Staffing. The staffing and hiring of personnel of AES and AES Entities shall be under the sole discretion of the AES Entity. Fluence shall have no right under this Agreement to make any decisions with respect to AES Business Development.

 

5.2         Funding. Funding of AES Business Development shall be the exclusive responsibility of the AES Entity’s own budget at its own expense and as needed to achieve project development objectives. In a rare case and for a limited purpose, Fluence may conclude a separate service level agreement (“SLA”) with the AES Entity to provide a fixed payment for a certain period of time to fund additional storage development resources. Any such SLA shall be negotiated in good faith between the parties and shall include development personnel as mutually agreed upon by the AES Entity and Fluence as well as customary reporting/feedback on performance.

 

5.3         Compensation. No AES Entity shall be entitled to any compensation payment from Fluence or any Fluence Entity in connection with any sales of Battery Energy Storage Solutions facilitated pursuant to this Agreement, except and then only to the extent that a specific SLA for sales resources as contemplated by Section 5.2 above applies.

 

5.4         Training. The Parties shall work together to develop a training program to facilitate the development of projects that utilize Battery Energy Storage Solutions by the AES Strategic Business Units. AES will name specific management and business development personnel to participate. The travel costs and expenses of the participants shall be borne by AES, and the costs and expenses for trainer and training facilities shall be borne by Fluence. Fluence shall provide initial training to the nominated personnel at regional training sessions within 180 days of the Effective Date. The Parties agree that such training program will continue on an ongoing basis throughout the Term and that they will work together in good faith to ensure that the AES business development team is properly trained at all times.

 

 

Article 6.           Contact Persons

 

6.1         Nomination. The Parties shall nominate permanent contact persons on both sides to act as liaison for communications between the AES Entity and Fluence (the “AES Representative” and the “Fluence Representative” respectively). These contact persons shall schedule regular meetings in order to exchange relevant information regarding (i) current project development activities, (ii) trade fairs, (iii) roadmaps for budgeting tools, and (iv) marketing activities.

 

6.2         Initial Contact Persons. The nominated contact person from AES (subject to replacement by AES on prior written notice to Fluence) is:

 

The AES Corporation
4300 Wilson Boulevard
Suite 1100
Arlington, VA 22203
Attention: [_________]
Email: [_________]

 

The nominated contact person from Fluence (subject to replacement by Fluence on prior written notice to AES) is:

 

Fluence Energy, LLC
4601 N. Fairfax Drive
Suite 600
Arlington, Virginia 22203 USA
Attention: President, Americas

Email: john.zahurancik@fluenceenergy.com

 

Article 7.           No Restrictions

 

7.1         No Fluence Restrictions. AES acknowledges and agrees that notwithstanding anything to the contrary in this Agreement or the LLC Agreement, AES does not have any exclusive rights to market and sell the Battery Energy Storage Systems and Solutions, and that the relationship contemplated by this Agreement shall not restrict Fluence in any way from utilizing the services of other Persons for the marketing and sale of Battery Energy Storage Solutions or from itself marketing and selling such Battery Energy Storage Solutions directly.

 

Article 8.           Compliance

 

8.1         Compliance Representations and Obligations.

 

8.1.1     Both Parties shall ensure that they and their respective Affiliates and Representatives comply fully with all applicable anti-bribery, anti-corruption, anti-terrorism, economic sanctions and anti-money laundering Applicable Laws and regulations, including, without limitation, international anti-corruption conventions such as the United Nations Convention Against Bribery, and the United States Foreign Corrupt Practices Act, and in each case, any applicable implementing legislation, with respect to their respective obligations under this Agreement.

 

8.1.2     Both Parties represent and warrant that neither they nor any of their respective Affiliates or Representatives, have, either directly or indirectly, made a Prohibited Payment or engaged in a Prohibited Transaction with respect to their respective obligations under this Agreement.

 

8.1.3     Both Parties shall ensure that neither they nor any of their respective Affiliates or Representatives, will, either directly or indirectly, make, promise or authorize the making of a Prohibited Payment or engage in a Prohibited Transaction with respect to their respective obligations under this Agreement.

 

8.1.4     Both Parties agree to notify the other Party immediately upon gaining knowledge that a Prohibited Transaction or Prohibited Payment related to the obligations set forth in this Agreement and/or the sales and marketing efforts with respect to the Battery Energy Storage Solutions may have occurred and to cooperate in good faith with each other to determine whether a Prohibited Transaction or Prohibited Payment has occurred.

 

 

 

8.1.5     Both Parties agree that, if the other Party has any reasonable grounds to believe that a Prohibited Transaction has taken place or a Prohibited Payment has been made, it shall cooperate in good faith with the other Party in determining whether such a violation occurred by taking necessary measures, which could include engaging an independent third party to investigate the matter and to provide a written report of its findings to the Parties.

 

8.1.6     Both Parties acknowledge receipt of a copy of the other Party’s Code of Conduct and understands the standards to which the other Party expects all its contractors to comply with when performing services for or on behalf of the other Party.

 

8.1.7     In order to mitigate potential exposure to risk, the Parties shall perform due diligence on any subcontractors, consultants or agents prior to their engagement pursuant to the standards set forth in the other Party’s compliance program. The Parties shall execute a written agreement with each subcontractor, consultant, agent or representative which shall include the provisions at least as restrictive as those contained in this Article 8.

 

8.1.8     For the purpose of detecting potential violations of Applicable Law, the Parties shall perform periodic internal or independent audits of its financial books, accounts and records.

 

8.1.9     The Parties agree to provide an effective education and training program about the requirements and prohibitions of applicable anti-corruption laws for its subcontractors, consultants, agents and representatives who perform services under this Agreement.

 

8.2         Compliance Breaches. The Parties agree that a material breach of one or more of the covenants or representations (“Compliance Breach”) in this Article 8 shall be sufficient cause for the other Party to terminate this Agreement, , in each case in whole or in part, and to declare all or any of them null and void, in which case the breaching Party agrees that it shall forfeit any claim to any additional payments due to it under any of such terminated agreements, other than payments for services previously rendered under such terminated agreements, in addition to being liable for any damages or remedies available to the other Party under Applicable Law. the breaching Party shall indemnify and hold harmless the other Party from any claims, costs, liabilities, obligations, and damages the other Party incurs (including, without limitation, for the fees of any legal counsel Company may retain or engage) as a result of such Compliance Breach.

 

8.3         Survival. All the provisions in this Article 8 are material and shall survive the termination of the Agreement between AES and Fluence.

 

Article 9.           Indemnification

 

9.1         General. Each Party (the “Indemnifying Party”) shall indemnify, defend and hold harmless the other Party, its Affiliates, and their Representatives and assigns (the “Indemnified Party”) from and against all claims, suits, causes of action, losses, liabilities, liens, damages, assessments, costs, expenses, demands, complaints or actions including but not limited to reasonable attorneys’ fees and court costs (collectively, “Claims”) of third parties concerning: (i) death, personal injury, or property damage of third parties, (ii) nonpayment of wages, benefits, fees, amounts owed, and/or any taxes (including penalties and interest) associated therewith arising from the Indemnifying Party’s Representatives, suppliers, contractors, and/or materialmen and (iii) violations by the Indemnifying Party or any Person for whom the Indemnifying Party is responsible of Applicable Law; in each case to the extent arising or resulting from the Indemnifying Party’s or its Representative’s negligence, willful misconduct, or breach of this Agreement. For sake of clarity, if both Parties are negligent or otherwise at fault or strictly liable without fault, then the obligations of indemnification under this Section ‎9.1 shall continue, but the Indemnifying Party shall indemnify the Indemnified Party only for the percentage of responsibility for the damage or injuries attributable to the Indemnifying Party.

 

9.2         Indemnification Procedures.

 

9.2.1     If an Indemnified Party receives written notice of a Claim, the Indemnified Party shall give prompt written notice to the Indemnifying Party, including a reasonably detailed description of the facts and circumstances relating to such Claim, a complete copy of all notices, pleadings and other papers related thereto, and a description in reasonable detail of the basis for the potential claim for indemnification with respect thereto. The Indemnified Party’s delay or deficiency in notifying the Indemnifying Party shall not relieve the Indemnifying Party of liability or obligation except to the extent (and only to the extent) such delay materially impacts the defense of the Claim.

 

9.2.2     The Indemnifying Party shall be entitled to assume the defense and to represent the interests of the Indemnified Party, which shall include the right to select and direct legal counsel and other consultants (all of whom shall be reasonably acceptable to the Indemnified Party), appear in proceedings on behalf of the Indemnified Party and to propose, accept or reject offers of settlement, subject to Section ‎9.2.3 below, all at its sole cost. Nothing herein shall prevent an Indemnified Party from retaining its own legal counsel and other consultants or participating in its own defense at its own cost and expense. Notwithstanding the foregoing, if (i) the claim is primarily for non-monetary damages against the Indemnified Party, or primarily for an injunction or other equitable relief that, if granted, would reasonably be expected to be material to the Indemnified Party, (ii) there is a material actual or potential conflict of interest that makes representation of the Indemnifying Party and the Indemnified Party by the same counsel or the counsel selected by the Indemnifying Party inappropriate, or (iii) the claim is a criminal proceeding, then in each case the Indemnified Party may, upon notice to the Indemnifying Party, assume the exclusive right to defend (and in the case of clause (iii) above, compromise and settle), such claim and the reasonable fees and expenses of the Indemnified Party’s separate counsel shall be borne by the Indemnifying Party; however the settlement of any claim pursuant to clauses (i) and (ii) above shall be governed by Section ‎9.2.3 below. Notwithstanding anything to the contrary herein, for sake of clarity, the Parties agree that the foregoing provisions shall not be construed so as to permit the Indemnified Party to control or assume the defense of any action, lawsuit, proceeding, investigation, demand or other claim brought against the Indemnifying Party concurrently with or in a joint proceeding in respect of any claim that is the subject of an indemnification claim hereunder by the Indemnified Party.

 

 

 

9.2.3       Notwithstanding anything to the contrary herein, the Indemnifying Party shall not compromise or settle, or admit any liability with respect to any third party Claim without the prior written consent of the Indemnified Party (which consent shall not be unreasonably withheld or delayed), unless the relief consists solely of (i) money damages (all of which the Indemnifying Party shall pay), and (ii) includes a provision whereby the plaintiff or claimant in the matter releases the Indemnified Party from all liability with respect thereto. If the Indemnified Party assume the defense of or represents their own interests, no settlement shall be made without the prior written consent of the Indemnifying Party (which consent shall not be unreasonably withheld or delayed).

 

9.3           Limited Waiver of Certain Immunities. Each of the Parties hereby specifically and expressly agrees that with respect to any and all claims against an Indemnified Party by any representative of an Indemnifying Party, any indemnification available hereunder shall not be limited by reason of any immunity to which such Indemnifying Party may be entitled under any workers compensation and/or industrial insurance acts, disability benefit acts, or other employee benefits acts and any limitation on the amount or type of damages, compensation, or benefits payable by or for the Indemnifying Party to such representative with respect to any such claim. For the sake of clarity, the Indemnifying Party’s waiver of immunity by the provisions of this section extends only to indemnification claims against the Indemnifying Party by or on behalf of the Indemnified Party under or pursuant to this agreement, and does not apply to any claims made by the Indemnifying Party’s representatives directly against the Indemnifying Party.

 

9.4           Survival. The indemnities set forth in this Article 9 shall survive the termination or expiration of this Agreement.

 

Article 10.             Term and Termination

 

10.1         Term. The term of this Agreement shall commence as of the Effective Date and shall continue until the fourth (4^th) anniversary thereof (the “Initial Term”) and thereafter shall be automatically extended in successive one (1) year increments (the Initial Term together with any such extensions, the “Term”).

 

10.2         Early Termination. Either Party may terminate this Agreement effective upon the expiration of the Initial Term or the expiration of any extension thereof upon not less than six (6) months prior written notice of termination furnished to the other Party. No termination of this Agreement pursuant to this Section 10.2 shall affect any Purchase Orders executed between the Parties prior to the date of termination or any Consortium Agreement then in effect.

 

10.3         Transition. If this Agreement is terminated pursuant to this Section 10.2, the Parties shall cooperate to manage any projects or opportunities in progress so as to ensure minimal disruption to the end customer, subject to compliance with Applicable Law (including antitrust requirements). Each Party shall submit a list of opportunities in progress for which the Parties agree to continue working together and where existing sales arrangements will be honored through completion.

 

10.4         Termination for Cause and other Remedies. A Party may terminate this Agreement for cause and/or pursue such other rights and remedies as may be available to it at law or in equity, upon thirty (30) days prior written notice in the event the other Party hereto materially breaches this Agreement and fails to cure the breach within thirty (30) days after receipt of written demand therefor.

 

 

Article 11.            Limitations of Liability

 

11.1         WAIVER OF CERTAIN DAMAGES. NOTWITHSTANDING ANYTHING IN THIS AGREEMENT TO THE CONTRARY, NEITHER PARTY SHALL BE LIABLE, WHETHER BASED IN CONTRACT, GUARANTY, WARRANTY, TORT (INCLUDING NEGLIGENCE), PRODUCT LIABILITY, STRICT LIABILITY, INDEMNITY OR ANY OTHER LEGAL OR EQUITABLE THEORY, FOR: LOSS OF USE, REVENUE, SAVINGS, PROFIT, INTEREST, GOODWILL OR OPPORTUNITY, COSTS OF CAPITAL, COSTS OF REPLACEMENT OR SUBSTITUTE USE OR PERFORMANCE, LOSS OF INFORMATION AND DATA, LOSS OF POWER, VOLTAGE IRREGULARITIES OR FREQUENCY FLUCTUATION, CLAIMS ARISING FROM THE OTHER PARTY’S THIRD PARTY CONTRACTS, OR FOR ANY TYPE OF INDIRECT, SPECIAL, LIQUIDATED, PUNITIVE, EXEMPLARY, COLLATERAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES, OR FOR ANY OTHER LOSS OR COST OF A SIMILAR TYPE.

 

11.2         EFFECTIVENESS. THE PARTIES AGREE THAT THE EXCLUSIONS AND LIMITATIONS IN THIS ARTICLE 12 WILL PREVAIL OVER ANY CONFLICTING TERMS AND CONDITIONS IN THIS AGREEMENT AND MUST BE GIVEN FULL FORCE AND EFFECT, WHETHER OR NOT ANY OR ALL SUCH REMEDIES ARE DETERMINED TO HAVE FAILED OF THEIR ESSENTIAL PURPOSE. THESE LIMITATIONS OF LIABILITY ARE EFFECTIVE EVEN IF A PARTY HAS BEEN ADVISED BY THE OTHER PARTY OF THE POSSIBILITY OF SUCH DAMAGES. THE WAIVERS AND DISCLAIMERS OF LIABILITY, RELEASES FROM LIABILITY AND LIMITATIONS ON LIABILITY EXPRESSED IN THIS ARTICLE 12 EXTEND TO THE PARTIES’ RESPECTIVE AFFILIATES, PARTNERS, PRINCIPALS, MEMBERS SHAREHOLDERS, DIRECTORS, OFFICERS, EMPLOYEES, SUPPLIERS, AGENTS, AND SUCCESSORS AND ASSIGNS.

 

11.3         Commencement of Claims. Except with respect to claims arising under Article ‎10 or Article ‎13, any legal action of either Party arising under this Agreement must be commenced within two (2) years after the earlier to occur of (i) such Party having obtained knowledge of such claim or (ii) the expiration or termination of this Agreement. To the maximum extent permitted by Applicable Law, each Party hereby waives any right to commence any claim or action after such two (2) year period.

 

Article 12.            Confidentiality

 

12.1         Confidential Information. Each Party shall, and shall cause its respective Affiliates and Representatives to, keep confidential any information which it may have or acquire before or after the date of this Agreement, concerning the other Party and its assets, business, operations, affairs, financial condition or such information, “Confidential Information”).

 

12.2         Non-Disclosure. Neither Party shall use any Confidential Information in any manner detrimental to the other Party nor shall any of them disclose, publish or make accessible, directly or indirectly, any Confidential Information to any person. In addition, the Parties shall exercise all reasonable efforts to prevent any other person from gaining access to such Confidential Information and take such protective measures as may be or become reasonably necessary to preserve the confidentiality of such Confidential Information.

 

 

12.3         Exceptions. Notwithstanding Section 12.1 and Section 12.2, either Party may disclose Confidential Information:

 

12.3.1  to any Representative of such Party, provided that such Representative has a need to know and has been informed of the confidential nature of the information pursuant to Section 12.4;

 

12.3.2  to the extent required by (i) any applicable law of any Governmental Authority (including any rule or regulation of the Securities and Exchange Commission), (ii) any stock exchange rule or regulation or (iii) any binding judgment, order or requirement of any court or other Governmental Authority of competent jurisdiction; provided, that the Party required to disclose Confidential Information, as the case may be, has delivered written notice to and consulted, to the extent practicable, with the other Party prior to disclosure of such Confidential Information; and

 

12.3.3  to the extent such Confidential Information becomes available within the public domain (otherwise than as a result of a breach of this Article 12).

 

12.4         Representatives Bound. Each Party shall inform any representative to whom it provides Confidential Information that such information is confidential and shall instruct them (a) to keep such Confidential Information confidential and (b) not to disclose it to any third party (other than those persons to whom such Confidential Information has already been disclosed in accordance with the terms of this Agreement). The disclosing Party shall be responsible for any breach of this Article 12 by the person to whom the Confidential Information is disclosed.

 

12.5         Survival. Notwithstanding anything herein to the contrary, the provisions of this Article 12 shall survive the termination of this Agreement for a period of three (3) years.

 

Article 13.             Dispute Resolution and Choice of Law

 

13.1         Referral to Senior Management. Except as otherwise provided by this Agreement, any dispute, controversy or claim arising out of or in connection with, or relating to, this Agreement or any breach or alleged breach hereof (which breach or alleged breach by a Party remains uncured within ten (10) Business Days after receipt of written notice thereof from another Party) or the validity or termination hereof or the relationship created between the Parties by and/or through this Agreement (a “Dispute”) shall first be settled as far as possible by good faith negotiations between the parties to the Dispute, in the form of meetings between senior-management level representatives of such Parties, upon the written request by any such Party to the other parties to the Dispute, which writing shall set forth in reasonable detail the nature and extent of the Dispute. For this purpose a senior-management level representative of AES shall be named and the senior-management level representative of Fluence shall be its Chief Executive Officer.

 

13.2         Referral to Arbitration. If the parties to the Dispute are unable for any reason to resolve a Dispute within thirty (30) days after receipt by any Party of written notice of a Dispute, then any Party may submit the Dispute to arbitration to be finally and exclusively resolved under the Commercial Arbitration Rules of the American Arbitration Association (“AAA”) then in effect (the “Rules”), except as modified herein. There shall be three (3) arbitrators. If there are two (2) parties to the Dispute, each of the parties to the Dispute shall nominate one (1) independent arbitrator in accordance with the Rules. If there are more than two (2) parties to the Dispute, the independent arbitrators shall be nominated in accordance with the Rules; provided, however, that any Party and its Affiliates shall be entitled to nominate only one (1) such independent arbitrator. The arbitrators so nominated, once confirmed by the AAA, shall nominate an additional arbitrator to serve as chairman, such nomination to be made within fifteen (15) days of the confirmation by the AAA of the second arbitrator. If the initial arbitrators shall fail to nominate an additional arbitrator within such fifteen (15) day period, such additional arbitrator shall be appointed by the AAA. The arbitrators shall be required to submit a written statement of their findings and conclusions. Except as otherwise agreed by the parties to such Dispute, exclusive venue of arbitration shall be New York, New York, and the language of the arbitration shall be English and each of the Parties hereby submits to the non-exclusive jurisdiction of the state and federal courts located in New York, New York for preliminary relief in aid of arbitration and for the enforcement of any arbitral award. By agreeing to arbitration, the Parties do not intend to deprive any national court of its jurisdiction to issue any pre-arbitral injunction, pre-arbitral attachment or other order in aid of arbitration proceedings.

 

 

13.3         Neutral Arbitrators. None of the Parties or the arbitrators shall select any arbitrator for the arbitral tribunal who has any interest in the Dispute or who has, or within the immediately preceding five (5) years has had, any economic or other relationship with any party to the Dispute.

 

13.4         Procedures and Costs. The arbitrators shall not have the right to award consequential, incidental, indirect, special, treble, multiple or punitive damages. The arbitral tribunal shall not be empowered to decide any dispute ex aequo et bono or amiable compositeur, and the arbitral tribunal shall decide the Dispute under the substantive laws of the State of Delaware pursuant to the Rules of AAA, without regard to applicable choice of law provisions thereof. The arbitration award shall be decided by majority opinion and issued in writing in the English language and shall state the reasons upon which it is based. It may be made public only with the consent of each participating Party or as may be required by law or regulatory authority or as necessary for enforcement of such award. The arbitrators shall allocate the fees and costs of the arbitration. The losing Party(ies) shall pay the prevailing Party(ies)’ attorney’s fees and costs and the costs associated with the arbitration, including the expert fees and costs and the arbitrators’ fees and costs borne by the prevailing Party(ies), all as determined by the arbitrators. Each Party shall bear its own fees and costs until the arbitrators determine which, if any, Party is the prevailing Party(ies) and the amount that is due to such prevailing Party(ies).

 

13.5         Award. The award rendered by the arbitrators shall be final and binding on the participating Parties and shall be the sole and exclusive remedy between and among the participating Parties regarding any claims, counterclaims, issues or accounting presented to the arbitral tribunal. The award shall be issued no later than one hundred twenty (120) days from the last hearing held by the arbitrators or as soon thereafter as practicable. The award shall be paid within thirty (30) days after the date it is issued and shall be paid in U.S. Dollars in immediately available funds, free and clear of any Liens, Taxes or other deductions. A judgment confirming or enforcing such award may be rendered by any court of competent jurisdiction.

 

13.6         Confidentiality. The arbitration shall be confidential. No Party may disclose the fact of the arbitration, any award relating thereto or any settlement relating to any Dispute without the prior consent of the other Party(ies); provided, that such matters may be disclosed without the prior consent of the other Party(ies) to lenders, auditors, tax or other Governmental Authority or as may be required by law or regulatory authorities or as necessary to enforce any award.

 

13.7         Continued Performance; Provisional Remedies. Notwithstanding the existence of any Dispute, the Parties shall continue to perform their respective obligations under this Agreement unless the Parties otherwise mutually agree in writing. Notwithstanding anything in this Agreement to the contrary, nothing in this Agreement is intended to, nor shall it, prevent the Parties from seeking temporary injunctive relief at any time as may be available under Law or in equity to preserve its rights pending the outcome of any arbitration. Without prejudice to such provisional remedies as may be available under the jurisdiction of a national court, the arbitral tribunal shall have full authority to grant provisional remedies or order the Parties to request that a court modify or vacate any temporary or preliminary relief issued by a court, and to award damages for the failure of any Party to respect the arbitral tribunal’s orders to that effect. The Parties agree that any issue regarding the arbitrability of any claims or disputes arising under, relating to or in connection with this Agreement is an issue solely for the arbitrators, not a court, to decide.

 

 

13.8         Waiver of Jury Trial. THE PARTIES HEREBY EXPRESSLY WAIVE ALL RIGHTS TO TRIAL BY JURY OR OTHERWISE ON ANY CLAIM, CAUSE OF ACTION, SUIT OR PROCEEDING PERMITTED UNDER THIS ARTICLE 13. THE PROVISIONS OF THIS AGREEMENT RELATING TO WAIVER OF TRIAL BY JURY SHALL SURVIVE THE TERMINATION OR EXPIRATION OF THIS AGREEMENT. EACH PARTY HERETO (A) CERTIFIES THAT IT IS RELYING ON THE WAIVER CONTAINED HEREIN AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATES IN THIS SECTION 13.8.

 

Article 14.             Miscellaneous

 

14.1         Governing Law. This Agreement (including any Dispute) shall be deemed made and prepared and shall be governed, construed and interpreted in accordance with the internal laws of the State of Delaware, without regard to principles of conflict of laws thereof which may require the application of the law of another jurisdiction.

 

14.2         Assignment; Successors. Neither Party may assign all or any part of this Agreement, or any rights or obligations hereunder, without the prior written consent of the other Party, which consent shall not be unreasonably withheld. Any purported assignment which fails to comply with the requirements of this Section 14.2 shall be null and void. Notwithstanding the foregoing: (i) either Party may, without the prior written consent of the other Party, assign all or any part of this Agreement or any Purchase Order issued hereunder, or any rights or obligations hereunder or thereunder, to an Affiliate, which will accept such assignment and assume all obligations related to this Agreement; provided that, notwithstanding any such assignment, the assigning Party shall not be relieved of any of its obligations hereunder by reason of such assignment and shall remain liable hereunder to the same degree that the assigning Party would be responsible had there been no assignment. It shall be reasonable for a Party to withhold consent to a proposed assignment where the proposed assignee is identified on Exhibit D to the LLC Agreement.

 

14.3         Compliance with Applicable Law. The Parties agree to comply with all applicable laws and regulations. The Parties’ obligations to fulfill this Agreement are subject to the condition that the fulfillment is not prohibited by any national and/or international foreign trade and customs regulations or any embargos or other applicable sanctions.

 

14.4         Amendments. Any modification or amendment to this Agreement must be made in writing and signed by authorized representatives of the Parties to be effective.

 

14.5         Relationship of the Parties. Nothing contained in this Agreement shall be construed as creating a partnership, joint venture, agency, employee-employer relationship, trust or other association of any kind between the Parties and each Party shall be individually responsible only for its obligations as set forth in this Agreement. In each case where a AES Entity referred to in this Agreement is an Affiliate of AES, such reference shall be deemed to mean that AES shall cause such AES Affiliate to comply with the applicable obligation, and in each case where a Fluence Entity referred to in this Agreement is an Affiliate of Fluence, such reference shall be deemed to mean that Fluence shall cause such Fluence Affiliate to comply with the applicable obligation.

 

 

14.6         Publicity. No Party hereto shall refer to or use, or permit any persons to refer to or use, any other Party’s name, trademarks, service marks or logos in any advertising, promotional materials, press releases or other publicity without obtaining the prior written consent of the applicable Party, except when, and to the extent that, such communication is required by applicable laws, regulations or stock exchange rules.

 

14.7         Non-Exclusive Remedies and Non-Waivers. No delay or omission by the Parties in exercising any right or remedy provided for herein shall constitute a waiver of such right or remedy nor shall it be construed as a bar to or waiver of any such right or remedy on any future occasion. Any waiver authorized on one occasion must be made in writing and is effective only in that instance and only for the purpose stated, and does not operate as a waiver on any future occasion. The rights and remedies of the Parties herein shall not be exclusive and are in addition to any other rights and remedies provided by Applicable Law or in equity.

 

14.8         Severability. Any provision of this Agreement issued hereunder that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective only to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof (provided the substance of the agreement between the Parties is not thereby materially altered), and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. To the extent permitted by Applicable Laws, the Parties hereto hereby waive any provision of Applicable Law which renders any provision hereof prohibited or unenforceable in any respect.

 

14.9         Survival. The Indemnification, Limitations of Liability, Confidentiality, Dispute Resolution and Miscellaneous sections of this Agreement, and any provision that contemplates performance or observance subsequent to termination or expiration shall survive termination or expiration of this Agreement.

 

14.10       Complete Agreement and Counterparts. This Agreement shall constitute the entire agreement between the Parties and shall supersede all previous communications, representations, agreements or understandings, whether oral or written, with respect to the subject matter hereof. The headings used in this Agreement are for reference and shall not limit or affect the meaning or interpretation of any of the terms hereof.

 

14.11       Counterparts. This Agreement may be executed in multiple counterparts, each of which when so executed and delivered shall constitute a duplicate original and all counterparts together shall constitute one and the same instrument. Transmission of the executed signature page of a counterpart of this Agreement by electronic mail shall be effective as delivery of an executed counterpart of this Agreement.

 

14.12       Notices.

 

14.12.1               All notices and other communications which either Party is required or may desire to serve upon the other shall be addressed to the Party to be served as follows, unless a different address is designated in writing by the Party to be served:

 

To AES:

 

The AES Corporation

4300 Wilson Boulevard
Suite 1100
Arlington, VA 22203
Attention: [_________]
Email: [_________]

 

 

With a copy to:

 

AES Grid Stability, LLC
4300 Wilson Boulevard
Suite 1100
Arlington, VA 22203
Attention: [_________]
Email: [_________]

 

To Fluence:

 

To the contact person designated pursuant to Article 6 above

 

With a copy to:

 

Fluence Energy, LLC

Attn: General Counsel

Email: frank.fuselier@fluenceenergy.com

 

14.12.2               All notices, requests, consents and other communications under this Agreement must be in writing and shall be deemed to have been duly given and effective (i) immediately (or, if not delivered or sent on a Business Day, the next Business Day) if delivered or sent and received by electronic mail , (ii) on the date of delivery if by hand delivery (or, if not delivered on a Business Day, the next Business Day) or (iii) on the first Business Day following the date of dispatch (or, if not sent on a Business Day, the next Business Day after the date of dispatch) if by a nationally recognized overnight delivery service (all fees prepaid). In the case of notice via email, each Party shall upon request of the other Party expressly acknowledge or deny receipt of such notice.

 

14.13    Joint Effort. Preparation of this Agreement has been a joint effort of the Parties and the resulting document shall not be construed more severely against one of the Parties than against the other. Any rule of construction that ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this Agreement, or any amendments or Exhibits hereto.

 

14.14    Language of the Agreement, Correspondence, Documentation. The language of this Agreement shall be English. Unless to the extent agreed otherwise, correspondence, technical and commercial documents as well as any other information exchanged between the Consortium Members relating to this Agreement shall be in English.

 

[Signature page follows]

 

 

IN WITNESS WHEREOF, Fluence and AES have caused their duly appointed representatives to execute this Agreement.

 

The AES Corporation

 

By:
Name:	[_________]
Title:	[_________]
Fluence Energy, LLC
By:
Name:	[_________]
Title:	[_________]

 

[Signature Page to AES Cooperation Agreement]

 

 

 

Exhibit 23.1 

 

Consent of Independent Registered Public Accounting Firm

 

We consent to the reference to our firm under the caption "Experts" and to the use of our report dated June 24, 2021, with respect to the consolidated financial statements of Fluence Energy, LLC included in the Registration Statement (Form S-1) and related Prospectus of Fluence Energy, Inc. dated October 18, 2021.

 

/s/ Ernst & Young LLP

Tysons, Virginia

October 18, 2021

  

 

 

Exhibit 99.1

 

Consent to be Named as a Director Nominee

 

In connection with the filing by Fluence Energy, Inc. of the Registration Statement on Form S-1 (the “Registration Statement”), and in all subsequent amendments and post-effective amendments or supplements thereto, with the Securities and Exchange Commission under the Securities Act of 1933, as amended (the “Securities Act”), I hereby consent, pursuant to Rule 438 of the Securities Act, to being named as a nominee to the board of directors of Fluence Energy, Inc. in the Registration Statement and any and all amendments and supplements thereto. I also consent to the filing of this consent as an exhibit to such Registration Statement and any amendments thereto.

 

Date: October 14, 2021	/s/ Cynthia Arnold
	Name: Cynthia Arnold

 

 

 

 

Exhibit 99.2

 

Consent to be Named as a Director Nominee

 

In connection with the filing by Fluence Energy, Inc. of the Registration Statement on Form S-1 (the “Registration Statement”), and in all subsequent amendments and post-effective amendments or supplements thereto, with the Securities and Exchange Commission under the Securities Act of 1933, as amended (the “Securities Act”), I hereby consent, pursuant to Rule 438 of the Securities Act, to being named as a nominee to the board of directors of Fluence Energy, Inc. in the Registration Statement and any and all amendments and supplements thereto. I also consent to the filing of this consent as an exhibit to such Registration Statement and any amendments thereto.

 

Date: October 14, 2021	/s/ Herman Bulls
	Name: Herman Bulls

  

 

 

 

Exhibit 99.3

 

Consent to be Named as a Director Nominee

 

In connection with the filing by Fluence Energy, Inc. of the Registration Statement on Form S-1 (the “Registration Statement”), and in all subsequent amendments and post-effective amendments or supplements thereto, with the Securities and Exchange Commission under the Securities Act of 1933, as amended (the “Securities Act”), I hereby consent, pursuant to Rule 438 of the Securities Act, to being named as a nominee to the board of directors of Fluence Energy, Inc. in the Registration Statement and any and all amendments and supplements thereto. I also consent to the filing of this consent as an exhibit to such Registration Statement and any amendments thereto.

 

Date: October 14, 2021	/s/ Harald von Heynitz
	Name: Harald von Heynitz

  

 

 

 

 

Exhibit 99.4

 

Consent to be Named as a Director Nominee

 

In connection with the filing by Fluence Energy, Inc. of the Registration Statement on Form S-1 (the “Registration Statement”), and in all subsequent amendments and post-effective amendments or supplements thereto, with the Securities and Exchange Commission under the Securities Act of 1933, as amended (the “Securities Act”), I hereby consent, pursuant to Rule 438 of the Securities Act, to being named as a nominee to the board of directors of Fluence Energy, Inc. in the Registration Statement and any and all amendments and supplements thereto. I also consent to the filing of this consent as an exhibit to such Registration Statement and any amendments thereto.

   

Date: October 14, 2021	/s/ Elizabeth Fessenden
	Name: Elizabeth Fessenden