What comes next for this: (d) New Director Information. As a condition to the New Directors' appointment to the Board and any subsequent nomination for election as a director at any future Company annual meeting of stockholders, he or she must provide any information required to be disclosed in a proxy statement or other filing under applicable law, stock exchange rules or listing standards. (e) Date of the 2020 Annual Meeting. The Company agrees that it shall hold the 2020 Annual Meeting no later than July 8, 2020 and shall not cause or permit any delay, postponement or adjournment thereof, except for any adjournment solely due to a lack of quorum under the Company's Fourth Amended and Restated By-Laws (the "By-Laws"). (f) Slate of Directors for the 2020 Annual Meeting. (i) The Company agrees that, in connection with the execution and delivery of this Agreement, the Board shall take such actions as are necessary to (i) reduce the size of the Board from ten (10) to seven (7) Directors, effective as of the 2020 Annual Meeting, and (ii) nominate each of the New Directors and Wayne Barr, Jr., Warren H. Gfeller and Philip A. Falcone (collectively, the "2020 Director Slate") for election to the Board at the 2020 Annual Meeting for a term expiring at the Company's 2021 Annual Meeting of Stockholders (the "2021 Annual Meeting"). The Board, based on the information provided to it, has determined that each member of the 2020 Director Slate would (i) qualify as an "independent director" under the applicable rules of the New York Stock Exchange (the "NYSE") and the rules and regulations of the U.S. Securities and Exchange Commission (the "SEC") and (ii) satisfy the guidelines and policies with respect to service on the Board applicable to all non- management directors (other than Mr. Falcone). The Company agrees that, provided that each member of the 2020 Director Slate is able and willing to serve on the Board, (i) the Board will unanimously recommend that the stockholders of the Company vote to elect each member of the 2020 Director Slate as a director of the Company at the 2020 Annual Meeting, (ii) the Company will use its reasonable best efforts (which will include the solicitation of proxies) to obtain the election of the 2020 Director Slate at the 2020 Annual Meeting and (iii) the Company will use its best efforts to resist, discourage and defend against any attempt, solicitation or action by any stockholder of the Company to remove any member of the 2020 Director Slate prior to the 2021 Annual Meeting. For the avoidance of doubt, the Company will be required to use no less than the same level of efforts and to provide no less than the same level of support as was provided for its director nominees at the 2019 Annual Meeting of Stockholders. Any of the Company's current directors that is not standing for election at the 2020 Annual Meeting shall receive the full amount of his or her quarterly compensation for serving as non-management directors during the second quarter of 2020 (including any quarterly fee awarded and vesting of any and all equity awards for serving on, or serving as the Chair of, any committee of the Board). (g) Company Policies and Indemnification. (i) The Parties acknowledge that each of the MG Capital Designees and each other member of the 2020 Director Slate will be governed by the same protections and obligations as other non-employee directors of the Company, including, without limitation, confidentiality, conflicts of interest, related party transactions, fiduciary duties, codes of conduct, trading and disclosure policies, and other governance guidelines and policies of the Company (collectively, "Company Policies"), and shall have the same rights and benefits as other non-employee directors of the Company, including without limitation with respect to insurance, indemnification, compensation and fees. (ii) The Parties acknowledge that to the extent they have not already done so, within three (3) business days of the date hereof, the Company shall enter into an indemnification agreement with each of the New Directors in the form attached as Exhibit 10.20 to the Company's Annual Report on Form 10-K, previously filed with the SEC on March 16, 2020. 2. Additional Agreements. (a) The MG Capital Parties shall comply, and shall cause each of their Affiliates and Associates (as hereinafter defined) to comply with the terms of this Agreement and shall be responsible for any breach of this Agreement by any such Affiliate or Associate. (b) The MG Capital Parties, on behalf of themselves and their Affiliates and Associates, shall irrevocably withdraw their Nomination Notice and any related materials or notices submitted to the Company in connection therewith and shall agree to terminate any solicitation of proxies in connection with the 2020 Annual Meeting.
2
(c) The MG Capital Parties hereby agree to appear in person (including via permitted remote or virtual attendance) or by proxy at any annual or special meeting of the Company's stockholders held during the Standstill Period, and agree that they shall not participate or vote in any solicitation of written consents of the Company's stockholders during the Standstill Period (unless expressly requested to do so by the Board), and that they shall vote all shares of Common Stock beneficially owned by the MG Capital Parties at such meeting or in such consent solicitation, (A) in favor of all directors nominated by the Board for election and against the removal of any member of the Board, (B) in accordance with the Board's recommendation with respect to any "say-on-pay" proposal and (C) in accordance with the Board's recommendation with respect to any other Company proposal or stockholder proposal or nomination presented at such meeting or solicitation of consents; provided, however, that in the event that both Institutional Shareholder Services Inc. ("ISS") and Glass, Lewis & Co., LLC ("Glass Lewis") recommend otherwise with respect to the Company's "say-on-pay" proposal presented at an annual or special meeting held during the Standstill Period, the MG Capital Parties shall be permitted to vote in accordance with the recommendation of ISS and Glass Lewis. (d) The MG Capital Parties agree that the Board or any committee thereof, solely to fulfill the discharge of its fiduciary duties upon the advice of its legal counsel, may recuse either of Messrs. Courtis or Gorzynski by majority vote of the members of the Board (but excluding the applicable director), from the portion of any Board or committee meeting at which the Board or any such committee is evaluating and/or taking action with respect to and after the right of the recused director to be present prior to recusal (A) the exercise of any of the Company's rights or enforcement of any of the obligations under this Agreement, and (B) any transaction proposed by, or with, the MG Capital Parties, their Affiliates or Associates, as long as all other similarly situated directors are similarly recused. The Board or such committee, as applicable, may withhold from either of Messrs. Courtis or Gorznyski any material distributed to the directors to the extent directly relating to the subject of that recusal. 3. Standstill Provisions. (a) The standstill period (the "Standstill Period") begins on the date of this Agreement and shall extend until thirty (30) days prior to the deadline for the submission of stockholder nominations for directors for the 2021 Annual Meeting pursuant to the By-Laws. The MG Capital Parties hereby agree that during the Standstill Period, none of the MG Capital Parties nor any of their Affiliates and Associates will, and they will cause each of their Affiliates and Associates not to, as applicable, directly or indirectly, alone or in concert with others, in any manner, but expressly subject, in each case, to the provisions of Section 3(b) below: (i) fail to comply with all applicable laws and regulatory rules and obtain all applicable regulatory approvals, if and when acquiring, or offering, seeking or agreeing to acquire, by purchase or otherwise, or directing any third party in the acquisition of, any Common Stock or any securities convertible or exchangeable into or exercisable for Common Stock (collectively, "Company Securities"), or rights or options to acquire any Company Securities, or engaging in any swap instrument or derivative hedging transactions or other derivative agreements of any nature with respect to Company Securities; (ii) engage in a "solicitation" of "proxies" (as such terms are defined under the Exchange Act), votes or written consents of stockholders or security holders with respect to, or from the holders of, the Common Stock (including a "withhold" or similar campaign), for any purpose, including, without limitation, the election or appointment of individuals to the Board or to approve or vote in favor or against stockholder proposals, resolutions or motions, or become a "participant" (as such term is defined in Instruction 3 to Item 4 of Schedule 14A promulgated under the Exchange Act) in any contested "solicitation" of proxies, votes or written consents for any purpose, including, without limitation, the election or appointment of directors with respect to the Company (as such terms are defined under the Exchange Act) (other than a "solicitation" or acting as a "participant" in support of the nominees of the Board at any stockholder meeting or providing such encouragement, advice or influence that is consistent with either the Board's or Company management's recommendation in connection with such director nominees or other proposals, resolutions or motions, pursuant to this Agreement or otherwise); (iii) form, join or in any way participate in any "group" (within the meaning of Section 13(d)(3) of the Exchange Act) with respect to the shares of the Common Stock (other than a "group" that includes all or some of the persons or entities identified on Exhibit A attached hereto); provided, however, that nothing herein shall limit the ability of an Affiliate, a family member and an estate planning vehicle formed for any of the foregoing, of the MG Capital Parties to join a "group" with such parties, as applicable, following the execution of this Agreement;
3
(iv) agree, attempt, seek or propose to deposit any shares of Common Stock in any voting trust or similar arrangement or subject any shares of Common Stock to any arrangement or agreement with respect to the voting of any shares of Common Stock, other than any such voting trust, arrangement or agreement solely among the MG Capital Parties, and their Affiliates or Associates and otherwise in accordance with this Agreement; (v) seek or submit, or knowingly encourage any person or entity to seek or submit, nomination(s) in furtherance of a "contested solicitation" for the appointment, election or removal of directors with respect to the Company or seek, or knowingly encourage or take any other action with respect to the appointment, election or removal of any directors, in each case in opposition to the recommendation of the Board; (vi) (A) present or make to the stockholders of the Company, or knowingly encourage any person to present or make to the stockholders of the Company, any proposal or other matter for consideration by stockholders at any annual or special meeting of stockholders of the Company or through action by written consent, (B) make any public offer or proposal to the Company (with or without conditions) with respect to any merger, tender (or exchange) offer, acquisition, recapitalization, restructuring, disposition or other business combination involving the Company or any of its significant subsidiaries, or make any such offer privately to the Company, which private offer would reasonably be expected to require the Company or the Parties to make public disclosure (of any kind), (C) affirmatively solicit a third party to make any public or private offer or proposal (with or without conditions) with respect to any merger, tender (or exchange) offer, acquisition, recapitalization, restructuring, disposition or other business combination involving the Company, or encourage, initiate or support any third party in making such an offer or proposal, (D) publicly comment on any third party proposal regarding any merger, tender (or exchange) offer, acquisition, recapitalization, restructuring, disposition, or other business combination with respect to the Company or any of its significant subsidiaries by such third party prior to such proposal becoming public or (E) make any private proposal to the Company that would reasonably be expected to require the Company or the Parties to make public disclosure (of any kind); (vii) make any public disclosure, communication, announcement or statement regarding any intent, purpose, plan, or proposal with respect to (A) controlling, changing or influencing the Board, including, without limitation, any public disclosure, communication, announcement or statement regarding any intent, purpose, plan, or proposal relating to any change in the number of directors or the filling of any vacancies on the Board, (B) any material change in the capitalization, dividend policy, share repurchase programs and practices or capital allocation programs and practices of the Company, (C) relating to any material change in the Company's management, compensation or corporate structure, (D) relating to any waiver, amendment or modification to the Company's Second Amended and Restated Certificate of Incorporation, as amended (the "Charter"), or to the By-Laws, (E) causing any securities of the Company to be delisted or (F) causing any equity securities of the Company to become eligible for termination of registration; (viii) seek, alone or in concert with others, representation on the Board, except as specifically permitted in Section 1; (ix) subject to Section 3(b) below, advise, knowingly encourage, knowingly support or knowingly influence any person or entity, in the MG Capital Parties' capacity as stockholders of the Company, with respect to the voting or disposition of any securities of the Company at any annual or special meeting of stockholders with respect to the appointment, election or removal of any director(s), except in accordance with Section 1; (x) make any request for stockholder list materials or other books and records of the Company in the MG Capital Parties' capacity as stockholders of the Company; (xi) institute, solicit, assist or join, as a party, any litigation, arbitration or other proceeding against or involving the Company or any of its or their current or former directors or officers (including derivative actions) in order to effect or take any of the actions expressly prohibited by this Section 3; provided, however, that for the avoidance of doubt the foregoing shall not prevent the MG Capital Parties, and their Affiliates or Associates from (A) bringing litigation to enforce the provisions of this Agreement, (B) making counterclaims with respect to any proceeding initiated by, or on behalf of, the Company against the MG Capital Parties, their Affiliates or their Associates, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) complying with a validly issued legal process or (E) exercising statutory appraisal, dissenters or similar rights under applicable law;