Powerus Corp 8-K, filed Oct 1, 2026
Powerus Corp (PUSA)
About this 8-K
Powerus Corp filed this 8-K on October 1, 2026.
Items reported
- Item 2.01: Completed an acquisition or sale of assets
- Item 3.03: Change to shareholders' rights
- Item 4.01: Change of auditor
- Item 5.01: Change in control
- Item 5.02: Director or officer change, or executive pay
- Item 5.03: Charter or bylaw amendment, or fiscal year change
- Item 5.05: Code of ethics change or waiver
- Item 7.01: Regulation FD disclosure
- Item 9.01: Financial statements and exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date
of Report (Date of earliest event reported):
Powerus Corporation
(Exact name of registrant as specified in its charter)
(State or other jurisdiction of incorporation) |
(Commission File Number) |
(I.R.S. Employer Identification No.) |
| (Address of principal executive offices) | (Zip Code) |
Registrant’s
telephone number, including area code:
Aureus Greenway Holdings,
Inc. 2995 Remington Boulevard
Kissimmee, Florida 34744
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging
growth company
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Introductory Note
As previously disclosed, on March 8, 2026, Powerus Corporation (formerly known as Aureus Greenway Holdings, Inc.) (prior to the Closing Date, unless the context otherwise requires, “AGH” and, after the Closing Date, the “Company”) entered into an Agreement and Plan of Merger (as amended on July 17, 2026, the “Merger Agreement”), by and among AGH, Aureus Merger Sub Inc., a Delaware corporation and direct wholly owned subsidiary of the Company (“Merger Sub”), Autonomous Power Corporation, a Delaware corporation (“Legacy Powerus”) and Andrew Fox, solely in his capacity as the representative, agent and attorney-in-fact of the stockholders of Legacy Powerus, providing for the combination of AGH and Legacy Powerus. Under the Merger Agreement, Merger Sub would merge with and into Legacy Powerus, and Legacy Powerus would continue as the surviving corporation and a direct subsidiary of the Company (such transaction, the “Merger”).
On October 1, 2026, the parties consummated the Merger (the “Closing”). Following the Effective Time (as defined in the Merger Agreement), each issued and outstanding share of Legacy Powerus was converted automatically into 599.18229 (the “Exchange Ratio”) validly issued, fully paid and non-assessable shares of Company common stock, par value $0.001 per share (“Common Stock”), and all such converted shares ceased to exist and are no longer outstanding. In connection with the Closing, the Company changed its name to Powerus Corporation.
The material provisions of the Merger Agreement are described in AGH’s definitive information statement/prospectus filed on Form S-4 with the U.S. Securities and Exchange Commission (the “SEC”), most recently amended on August 10, 2026 and declared effective on August 12, 2026 (as amended, the “Information Statement/Prospectus”), in the section entitled “The Merger Agreement” beginning on page 121, and are incorporated herein by reference.
The foregoing description of the Merger Agreement is not complete and is subject to and qualified in its entirety by reference to the complete text of the Merger Agreement, a copy of which is attached hereto as Exhibit 2.1 and 2.2 and incorporated herein by reference.
| Item 2.01 | Completion of Acquisition or Disposition of Assets. |
The disclosure set forth in the “Introductory Note” above, including with respect to the Merger, is incorporated into this Item 2.01 by reference. Pursuant to the Closing of the Merger, the Company acquired the businesses of Legacy Powerus.
At the Effective Time, the Company issued approximately 134.6 million shares of Common Stock (the “Merger Consideration”) in addition to approximately 21.8 million Replacement Options and 28.6 million Replacement Warrants (as such terms are defined in the Merger Agreement). Immediately following the Effective Time, the Legacy Powerus stockholders owned approximately 83% of the Company’s issued and outstanding Common Stock. After giving effect to the purchase of the Company’s Series A Preferred Stock pursuant to an exchange agreement by and among Andrew Fox, Roman Vintfeld and Michael Sinensky, on one hand, and The Steven Scopellite 2021 Irrevocable Trust, on the other, the Legacy Powerus stockholders hold approximately 93% of the voting power of the Company as of the Closing Date.
| Item 3.03 | Material Modification to Rights of Security Holders. |
The information set forth in Items 2.01, 5.01 and 5.03 of this Current Report on Form 8-K is incorporated herein by reference.
| Item 4.01 | Changes in Registrant’s Certifying Accountant. |
(a) Dismissal of WWC, P.C.
WWC, P.C. (“WWC”) served as the independent registered public accounting firm of AGH prior to the consummation of the Merger. On October 1, 2026, WWC was dismissed as the independent registered public accounting firm of the Company to be effective upon completion by WWC of its review of the financial statements of AGH for the quarter ended September 30, 2026, and the filing of the related Form 10-Q. The decision to dismiss WWC was approved by the Audit Committee of the Board (the “Audit Committee”).
The reports of WWC on the consolidated financial statements of the Company for the fiscal years ended December 31, 2025 and 2024 did not contain an adverse opinion or disclaimer of opinion and were not qualified or modified as to uncertainty, audit scope or accounting principles.
During the Company’s two most recent fiscal years and the subsequent period from January 1, 2026 to October 1, 2026, there were (i) no disagreements (as defined in Item 304(a)(1)(iv) of Regulation S-K and the related instructions thereto) with WWC on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreement, if not resolved to the satisfaction of WWC, would have caused it to make reference to the subject matter of the disagreement in connection with its report and (ii) no reportable events (as described in Item 304(a)(1)(v) of Regulation S-K) except for the material weaknesses in internal control over financial reporting as of June 30, 2026, related to (i) inadequate segregation of duties for certain key functions due to limited staff and resources, and (ii) a lack of sufficient financial reporting and accounting personnel with appropriate knowledge of U.S. GAAP and SEC reporting requirements to formalize key controls over financial reporting, as reported in Part I, Item 4 of AGH’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2026. The Audit Committee discussed the material weaknesses in AGH’s internal control over financial reporting with WWC, and AGH has authorized WWC to respond fully to inquiries of BDO concerning such material weaknesses.
The Company provided WWC with a copy of the disclosures made in this Item 4.01 and requested WWC to furnish the Company with a letter addressed to the SEC stating whether it agrees with the statements made by the Company and, if not, stating the respects in which it does not agree. A copy of WWC’s letter to the SEC dated October 1, 2026 regarding these statements is filed as Exhibit 16.1 to this Current Report on Form 8-K.
(b) Appointment of New Independent Registered Public Accounting Firm
BDO USA, P.C. (“BDO”) served as the independent registered public accounting firm of Legacy Powerus prior to the consummation of the Merger. On October 1, 2026, the Audit Committee appointed BDO as the independent registered public accounting firm of the Company to be effective following the Company’s filing of its Form 10-Q for the quarter ended September 30, 2026.
During the Company’s two most recent fiscal years and the subsequent period from January 1, 2026 to October 1, 2026, neither the Company nor anyone on its behalf consulted BDO regarding: (i) the application of accounting principles to a specified transaction, either completed or proposed, or the type of audit opinion that might be rendered on the Company’s financial statements, and neither a written report nor oral advice was provided to the Company that BDO concluded was an important factor considered by the Company in reaching a decision as to any accounting, auditing or financial reporting issue; or (ii) any matter that was the subject of a disagreement (as defined in Item 304(a)(1)(iv) of Regulation S-K and the related instructions thereto) or a reportable event (as described in Item 304(a)(1)(v) of Regulation S-K).
| Item 5.01 | Changes in Control of Registrant. |
The information set forth in Items 2.01 and 5.02 of this Current Report on Form 8-K is incorporated by reference into this Item 5.01.
| Item 5.02 | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
Resignation of Directors
In accordance with the Merger Agreement, upon consummation of the Merger, Matthew Saker, Xinyue Jasmine Geffner and Christopher Schraft (the directors then serving on the Board) resigned from the Board and committees of the Board on which they respectively served. Such resignations were not the result of any disagreements with the Company relating to its operations, policies or practices.
Appointment of Directors
Effective upon the Closing, Andrew Fox, Brett Velicovich, Jason Finger, Matthew Britton and Richard Allorto were appointed to the Board along with Vuk Jeremic, who remained on the Board. Mr. Fox was appointed as Chairperson. Messrs. Allorto and Jeremic were appointed as Class I directors, with their terms expiring at the Company’s 2027 annual meeting, Messrs. Velicovich and Britton were appointed as Class II directors, with their terms expiring at the Company’s 2028 annual meeting, and Messrs. Fox and Finger were appointed as Class III directors, with their terms expiring at the Company’s 2029 annual meeting.
The Board has determined that each of Messrs. Finger, Britton, Allorto and Jeremic qualify as “independent” under applicable Nasdaq listing rules. There are no arrangements or understandings between any director named above and any other person pursuant to which such director was appointed as a director of the Company. There are no transactions between any director named above and the Company that would require disclosure pursuant to Item 404(a) of Regulation S-K.
Biographical information of each director can be found in Exhibit 99.2, which is “furnished” hereto and shall not be deemed to be “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Exchange Act or the Securities Act regardless of any general incorporation language in such filing.
Board Committees
As of the Closing, the Board reconstituted its existing committees as follows:
Audit Committee: Messrs. Allorto, Finger and Jeremic were appointed to the Audit Committee of the Board, each of whom were determined by the Board to satisfy the requirements for audit committee membership under the Nasdaq Listing Rules and Rule 10A-3 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Mr. Allorto was appointed chair of the Audit Committee and was designated as an “audit committee financial expert.”
Compensation Committee: Messrs. Finger, Britton and Allorto were appointed to the Compensation Committee of the Board. Mr. Finger was appointed chair of the Compensation Committee.
Nominating and Corporate Governance Committee: Messrs. Finger, Jeremic and Britton were appointed to the Nominating and Corporate Governance Committee of the Board. Mr. Finger was appointed chair of the Nominating and Corporate Governance Committee.
Departure of Executive Officers
In accordance with the Merger Agreement, effective as of the Closing, Matthew Saker resigned as Interim Chief Executive Officer and director of the Company, and Sam Wai Sing Lui resigned as Chief Financial Officer of the Company.
Appointment of Executive Officers
Effective upon the Closing, the Board appointed Andrew Fox as Chief Executive Officer (principal executive officer), Edward Jordan as Chief Financial Officer (principal financial officer and principal accounting officer), and Brett Velicovich as President. Biographical information for Messrs. Fox, Jordan and Velicovich can be found in the Information Statement/Prospectus in the section “Management And Directors Of Newco After The Merger” beginning on page 183 and are incorporated herein by reference.
There are no family relationships among any of our executive officers or directors. Other than as set forth in this Current Report on Form 8-K, none of the newly appointed directors are party to any transaction with the Company that would require disclosure under Item 404(a) of Regulation S-K or any arrangement or understanding with any other person pursuant to which he was selected as a director.
Non-Employee Director Compensation Program
On October 1, 2026, the Board approved a new non-employee director compensation program, which includes the following annual cash retainers, payable in quarterly installments:
| Board Retainers | ||||
| Member | $ | 40,000 | ||
| Audit Committee Retainers | ||||
| Chair | $ | 20,000 | ||
| Non-Chair Member | $ | 10,000 | ||
| Compensation Committee Retainers | ||||
| Chair | $ | 15,000 | ||
| Non-Chair Member | $ | 10,000 | ||
| Nom Gov Committee Retainers | ||||
| Chair | $ | 10,000 | ||
| Non-Chair Member | $ | 5,000 |
In connection with the Closing, each non-employee member of the Board is receiving a one-time grant of stock options to purchase 50,000 shares of Common Stock, which will vest in four quarterly installments through the earlier of the next annual shareholder meeting or the first anniversary of the date of grant. Future annual awards will be determined by the Board at a later time.
All members of the Board are also reimbursed for reasonable and documented out-of-pocket travel and lodging expenses incurred in connection with attending meetings and activities of the Board and its committees.
Executive Employment Agreements
In connection with their appointments, the Company entered into new employment agreements with each of Andrew Fox and Brett Velicovich (the “Employment Agreements”).
The Employment Agreements for Messrs. Fox and Velicovich each have an initial term of three years from the Effective Date, after which employment continues on an at-will basis for no set period of time. Mr. Fox will be paid an initial base salary of $350,000 and Mr. Velicovich will be paid an initial base salary of $350,000 under their respective Employment Agreements. Messrs. Fox and Velicovich will each be entitled to a target annual incentive award opportunity of no less than 100% of his then-current annual base salary (the “Target Annual Incentive Award”), with the actual amount determined pursuant to the Company’s bonus program or cash incentive plan but subject to a floor of $150,000. Each executive will participate in employee benefit plans in effect from time to time.
If the executive’s employment is terminated by the Company without cause or by the executive for good reason, other than in connection with a change in control, he will be entitled to a prorated annual incentive award for the year of termination, cash severance equal to the greater of 18 months of base salary or the remainder of the initial term, immediate vesting of time-based equity awards, continued vesting of performance-based equity awards per the applicable award agreement (or at 100% if not specified), a two-year post-termination stock option exercise period, and COBRA premium reimbursement for up to 18 months.
If such termination occurs within three months prior to, upon, or within 12 months following a change in control, the executive would be entitled to the same equity acceleration and COBRA benefits described above, except that cash severance would equal two times the greater of his annual base salary immediately prior to termination or immediately prior to the change in control, plus two times the greater of his Target Annual Incentive Award for the year of termination or the year immediately preceding the change in control. The Employment Agreements also contain 12-month post-termination non-competition and non-solicitation covenants.
The foregoing description of the Employment Agreements does not purport to be complete and is subject to and qualified in its entirety by reference to the full text of the Employment Agreements, copies of which are attached hereto as Exhibits 10.1 and 10.2 and incorporated herein by reference.
The Company also has agreed to amend its Consulting Agreement with Griseo Consulting LLC, the limited liability company owned by Edward Jordan, to reflect a new annual compensation of $350,000 as well as a one-time bonus payment of $250,000. Mr. Jordan will also receive a grant of 500,000 restricted stock units as well as a grant of options to purchase 250,000 shares of Common Stock that will vest over a year beginning on January 1, 2027. Upon a termination of full-time services without cause, Mr. Jordan would be entitled to a payment of $150,000 and would provide consulting services for a period of up to one year thereafter for a monthly fee of $10,000.
Stock Incentive Plan
On March 8, 2026 and March 9, 2026, the Company’s board of directors and shareholders approved the Powerus 2026 Equity Incentive Plan (the “2026 Incentive Plan”), subject to the consummation of the Merger. The purpose of the 2026 Incentive Plan is to promote and closely align the interests of employees, officers, non-employee directors and other individual service providers of the Company and its stockholders by providing stock-based compensation and other performance-based compensation. The initial share pool under the 2026 Incentive Plan is 50,000,000. The shares that may be issued under the 2026 Incentive Plan will be automatically increased on January 1 of each year beginning in 2027 and continuing through 2036, in an amount equal to the lesser of (i) 5% of the diluted stock (including Company common stock, preferred stock and unexercised pre-funded warrants) on the preceding December 31, or (ii) such lower (or no) increase as determined by the Board or relevant committee thereof.
The foregoing description of the 2026 Incentive Plan is not complete and is subject to and qualified in its entirety by reference to the complete text of the 2026 Incentive Plan, a copy of which is attached hereto as Exhibit 10.4 and incorporated herein by reference.
Indemnification Agreements
On October 1, 2026, in connection with the Closing, the Company entered into indemnification agreements (each, an “Indemnification Agreement”) with each of its directors and executive officers that provide for indemnification of certain expenses (including attorneys’ fees), judgments, penalties, fines, and amounts paid in settlement actually and reasonably incurred in any action or proceeding arising by reason of the indemnitee’s service as a director or officer, as applicable, to the maximum extent permitted by applicable law. The foregoing description of the Indemnification Agreements does not purport to be complete and is qualified in its entirety by the full text of the form of Indemnification Agreement, a copy of which is attached hereto as Exhibit 10.7 and is incorporated herein by reference.
| Item 5.03 | Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year. |
On October 1, 2026, the Company amended and restated its Articles of Incorporation through a filing with the Secretary of State of the State of Nevada (the “A&R Charter”). The purpose of the A&R Charter was to, among other things, change the Company’s name to “Powerus Corporation” and increase the number of authorized shares of common stock to 800,000,000.
Also on October 1, 2026, the Company’s Board adopted amended and restated bylaws (the “A&R Bylaws”). The A&R Bylaws reflect the Company’s name change and contain a number of material changes from the prior bylaws, including, among other things: the establishment of a classified board of directors divided into three classes serving staggered three-year terms; changing the quorum requirement to a majority of the outstanding voting power; the addition of detailed advance notice and procedural requirements for stockholder nominations and proposals at annual and special meetings, including specific timing windows, information disclosure obligations, and compliance with Rule 14a-19 under the Securities Exchange Act of 1934, as amended; a provision that directors may be removed only in the manner set forth in the articles of incorporation; and the addition of an exclusive forum provision designating the Eighth Judicial District Court of Clark County, Nevada as the sole and exclusive forum for certain internal corporate claims and the federal district courts of the United States as the exclusive forum for claims arising under the Securities Act of 1933, as amended.
Certain other rights of the Company’s stockholders were changed as a result of the A&R Charter and A&R Bylaws. A more detailed description of the A&R Charter and A&R Bylaws, and the effects thereof, is set forth under the headers “Approval of Newco Amended and Restated Articles of Incorporation” and “Comparison of Stockholder Rights” beginning on pages 177 and 195, respectively, in the Information Statement/Prospectus filed on August 10, 2026. Such descriptions contained therein are incorporated herein by reference.
The foregoing description of the A&R Charter and the A&R Bylaws is qualified by reference to the A&R Charter and A&R Bylaws, copies of which are filed hereto as Exhibit 3.1 and 3.2, respectively, and are incorporated herein by reference.
| Item 5.05 | Amendments to the Registrant’s Code of Ethics, or Waiver of a Provision of the Code of Ethics. |
On October 1, 2026, in connection with the Closing, the Board adopted a new Code of Business Conduct and Ethics of the Company (the “Code of Conduct”), effective as of such date. The Code of Conduct supersedes the existing Code of Business Conduct and Ethics, as previously adopted by AGH’s board of directors (the “Existing Code of Conduct”). The Code of Conduct applies to all directors, officers and employees of the Company and is intended to enhance understanding of the Company’s standards of ethical business practices and promote awareness of ethical issues that may be encountered in carrying out a director’s, officer’s or employee’s responsibilities.
The adoption of the Code of Conduct did not result in any explicit or implicit waiver of any provision of the Existing Code of Conduct. A copy of the Code of Conduct is available under the Investor Relations-Governance section of the Company’s website at www.power.us. The information on the Company’s website does not constitute part of this Current Report on Form 8-K and is not incorporated by reference herein.
| Item 7.01 | Regulation FD Disclosure. |
On October 1, 2026, the Company issued a press release announcing the consummation of the Merger, which is included in this Current Report on Form 8-K as Exhibit 99.1.
The exhibits furnished under Item 7.01 of this Current Report on Form 8-K shall not be deemed to be “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Exchange Act or the Securities Act regardless of any general incorporation language in such filing.
| Item 9.01 | Financial Statements and Exhibits. |
(a) Financial statements of businesses or funds acquired
The financial statements required by this Item 9.01(a) will be filed by amendment to this Current Report on Form 8-K within 71 calendar days after the date on which this Current Report is required to be filed.
(b) Pro forma financial information
The pro forma financial information required by this Item 9.01(b) will be filed by amendment to this Current Report on Form 8-K within 71 calendar days after the date on which this Current Report is required to be filed.
(d) Exhibits.
The following exhibits are being filed herewith:
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Date: October 1, 2026
| Powerus Corporation | ||
| By: | /s/ Jim Biehl | |
| Name: | Jim Biehl | |
| Title: | Chief Legal Officer | |
Exhibit 3.1
AMENDED AND RESTATED
ARTICLES OF INCORPORATION
OF
POWERUS CORPORATION
Article 1
Name
The name of the corporation is Powerus Corporation (the “Corporation”).
Article 2
Registered Office and Agent
The registered office of the Corporation shall be the street address of its registered agent in the State of Nevada. The Corporation may, from time to time, in the manner provided by applicable law, change the registered agent and registered office within the State of Nevada. The Corporation may also maintain an office or offices for the conduct of its business, either within or without the State of Nevada.
Article 3
Purpose
The purpose of the Corporation is to engage in any lawful act or activity for which corporations may be organized under the Nevada Revised Statutes (as amended from time to time and including any successor statutes, the “NRS”).
Article 4
Capital Stock
Section 1. Capitalization. The Corporation is authorized to issue two classes of stock to be designated, respectively, Common Stock and Preferred Stock. The total number of shares of Common Stock that the Corporation shall have authority to issue is 800,000,000 shares, par value $0.001 per share. The total number of shares of Preferred Stock authorized to be issued is 50,000,000 shares, par value $0.001 per share, 20,000,000 of which are hereby designated as Series A Preferred Stock, having the rights described herein.
Section 2. Number of Shares. Subject to the rights of the holders of any one or more series of Preferred Stock then outstanding, the number of authorized shares of any class of the Common Stock or the Preferred Stock may be increased or decreased, in each case by the affirmative vote of the stockholders of the Corporation entitled to vote thereon, voting together as a single class, and no vote of the holders of any class of the Common Stock or the Preferred Stock voting separately as a class will be required therefor, unless a vote of any holders of one or more series of Preferred Stock is required pursuant to the terms of these articles of incorporation (as amended from time to time, the “Articles of Incorporation”), including any certificate of designation relating to any series of Preferred Stock (and any separate class or series vote in this regard pursuant to NRS 78.2055(3), NRS 78.207(3) and NRS 78.390(2) is hereby specifically denied).
Section 3. Rights of Common Stock.
(a) Voting Rights. Each holder of Common Stock will be entitled to one vote for each share of Common Stock held of record by such holder on all matters on which stockholders generally are entitled to vote.
(b) Dividend and Distribution Rights. Notwithstanding anything to the contrary in the Articles of Incorporation or the Bylaws, the Corporation is hereby specifically allowed to make any dividend or other distribution that otherwise would be prohibited by NRS 78.288(2)(b).
Section 4. Preferred Stock. Shares of Preferred Stock may be issued from time to time in one or more series. The Board of Directors is hereby empowered to authorize by resolution(s) from time to time the issuance of one or more series of Preferred Stock and, by filing a certificate of designation pursuant to NRS 78.1955, to establish from time to time the number of shares to be included in each such series, and to fix the designations, powers, preferences and relative, participating, optional or other rights, if any, and the qualifications, limitations or restrictions thereof, if any, with respect to each such series of Preferred Stock and the number of shares constituting each such series, and to increase or decrease the number of shares of any such series to the extent permitted by the NRS and these Articles of Incorporation.
Section 5. Series A Preferred Stock.
(a) Designation and Amount. The designation of this class of preferred stock shall be “Series A Preferred Stock,” par value $0.001 per share (the “Series A Preferred Stock”). The number of authorized shares of Series A Preferred Stock is 20,000,000.
(b) Dividends. The holders of the Series A Preferred Stock shall not be entitled to receive dividends of any kind.
(c) Conversion Rights. The Series A Preferred Stock shall not be subject to conversion into Common Stock or other equity authorized to be issued by the Corporation.
(d) Voting Rights. The holders of the Series A Preferred Stock are entitled to vote on all matters on which the holders of shares of Common Stock are entitled to vote and, except as otherwise provided herein or by law, the holders of the Series A Preferred Stock shall vote together with the holders of shares of Common Stock as a single class. As of any record date or other determination date, each holder of the Series A Preferred Stock shall be entitled to twenty (20) votes per Series A Preferred Share.
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(e) Recapitalization or Reclassification. If the Corporation shall at any time effect a recapitalization, reclassification or other similar transaction of such character that the shares of Common Stock shall be changed into or become exchangeable for a larger or smaller number of shares, then upon the effective date thereof, the number of Series A Preferred Stock, as set forth in Paragraph 3 above, shall be increased or decreased, as applicable, in the same proportion to the increase or decrease in the number of shares of Common Stock by reason of such recapitalization, reclassification or similar transaction.
(f) Exclusion of Other Rights. Except as may otherwise be required by law, the Series A Preferred Stock shall not have any preferences or relative, participating, optional or special rights, other than those specifically set forth in this resolution (as such resolution may be amended from time to time) and in the Articles.
(g) Headings. The heading of the various subdivisions hereof is for convenience of reference only and shall not affect the interpretation of any of the provisions hereof.
(h) Severability of Provisions. If any right, preference or limitation of the Series A Preferred Stock set forth in this resolution (as such resolution may be amended from time to time) is invalid, unlawful or incapable of being enforced by reason of any rule of law or public policy, all other rights, preferences and limitations set forth in this resolution (as so amended) which can be given effect without the invalid, unlawful or unenforceable right, preference or limitation shall nevertheless remain in full force and effect, and no right, preference or limitation herein set forth shall be deemed dependent upon any other such right, preference or limitation unless so expressed herein.
(i) Status of Cancelled Shares. Series A Preferred Stock which have been issued and cancelled in any manner shall (upon compliance with any applicable provisions of the laws of the State of Nevada) have the status of authorized and unissued Series A Preferred Stock issuable in series undesignated and may be redesignated and reissued.
Section 6. Subject to Terms of Preferred Stock. Notwithstanding anything to the contrary in these Articles of Incorporation, the shares of Common Stock shall be subject to the express terms of the shares of Preferred Stock and any series thereof.
Section 7. Stockholders Appearing on Stock Ledger. The Corporation shall be entitled to treat the person in whose name any share of its stock is registered as the owner thereof for all purposes and shall not be bound to recognize any equitable or other claim to, or interest in, such share on the part of any other person, whether or not the Corporation shall have notice thereof, except as expressly provided by applicable law. In connection with any action of stockholders taken at a meeting, the stock ledger of the Corporation shall be presumptive evidence as to who are the stockholders entitled to vote in person or by proxy at any meeting of stockholders and the class or classes or series of shares held by each such stockholder and the number of shares of each class or classes or series held by such stockholder.
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Article 5
Board of Directors
Section 1. Management by Board. The business and affairs of the Corporation shall be managed by or under the direction of the board of directors of the Corporation (the “Board of Directors”).
Section 2. Size of Board; Committees. Subject to the terms of any series of Preferred Stock entitled to separately elect directors, the Board of Directors shall initially consist of six directors and thereafter the number of directors on the Board of Directors shall be determined from time to time solely by resolution adopted by the affirmative vote of a majority of the Board of Directors.
Section 3. Classified Board; Term.
(a) Except as otherwise provided in the terms of any series of Preferred Stock entitled to separately elect directors, the directors shall be divided into three classes, designated Class I, Class II and Class III. Each class shall consist, as nearly as may be possible, of one-third of the total number of directors constituting the entire Board of Directors. Each director shall serve for a term ending on the date of the third annual meeting of stockholders next following the annual meeting at which such director was elected. In the event of any change in the number of directors, the Board of Directors shall apportion any newly created directorships among, or reduce the number of directorships in, such class or classes as shall equalize, as nearly as possible, the number of directors in each class. In no event will a decrease in the number of directors shorten the term of any incumbent director.
(b) Subject to these Articles of Incorporation, each director shall hold office until such director’s successor shall have been duly elected and qualified or until such director’s earlier death, resignation or removal and for a term that shall coincide with the term of the class to which such director shall have been elected.
Section 4. Vacancies. Vacancies on the Board of Directors resulting from death, resignation, removal or otherwise and newly created directorships resulting from any increase in the number of directors shall, except as otherwise required by applicable law, be filled solely by a majority of the directors then in office (although less than a quorum) or by the sole remaining director, and each director so elected shall hold office for a term that shall coincide with the term of the class to which such director shall have been elected.
Section 5. Removal. No director may be removed from office by the stockholders except with the affirmative vote of the holders of at least the minimum percentage of the voting power of all outstanding shares of stock of the Corporation entitled to vote generally in the election of directors, voting together as a single class, then permitted under the NRS for such vote (which at the effective time of these Articles of Incorporation is two-thirds of the voting power and in any event shall not be less than a simple majority thereof).
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Article 6
Stockholders
Section 1. Action by Stockholders. Subject to the rights of the holders of any series of Preferred Stock, for so long as the corporation remains a “controlled company” under applicable Nasdaq or NYSE exchange listing rules, any action required or permitted to be taken by the stockholders of the Corporation may be taken without a meeting, without prior notice and without a vote, if a consent or consents, setting forth the action so taken, are (1) signed by the holders of outstanding shares of stock of the Corporation 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 of the Corporation then issued and outstanding entitled to vote thereon were present and voted, and (2) delivered to the Corporation in accordance with applicable law. Subject to the rights of the holders of any series of Preferred Stock, from and after the date on which the Corporation ceases to meet the definition of a “controlled company” under applicable Nasdaq or NYSE exchange listing rules, any action required or permitted to be taken by the stockholders of the Corporation must be effected at an annual or special meeting of the stockholders of the Corporation, and shall not be taken by consent in lieu of a meeting.
Section 2. Special Meetings of Stockholders. Special meetings of stockholders may be called only by the affirmative vote of a majority of the entire Board of Directors.
Article 7
Limitations on Liability and Indemnification
Section 1. Limitation of Liability.
(a) The liability of directors and officers of the Corporation is hereby eliminated or limited to the fullest extent permitted by the NRS.
(b) Neither the amendment or repeal of this Article 7, nor the adoption of any provision of these Articles of Incorporation or the Bylaws, nor, to the fullest extent permitted by the NRS, any modification of law, shall adversely affect any right or protection of a director or officer of the Corporation hereunder in respect of any act or omission occurring prior to the time of such amendment, repeal, adoption or modification. If the NRS is amended after the date of filing these Articles of Incorporation further eliminating or limiting the liability of directors or officers, then the liability of a director or officer of the Corporation shall be eliminated or limited to the fullest extent permitted by the NRS, as so amended.
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Section 2. Right to Indemnification. The Corporation shall indemnify and hold harmless, to the fullest extent permitted by applicable law (including, without limitation, NRS 78.7502 and NRS 78.751) as it presently exists or may hereafter be amended, any Person (a “Covered Person”) who was or is a party or is threatened to be made a party to or otherwise involved in any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (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, officer or employee of the Corporation or, while a director, officer or employee of the Corporation, is or was serving at the request of the Corporation as a director, officer, manager or managing member, employee, agent or trustee of another entity or enterprise, including service with respect to employee benefit plans, against all liability and loss suffered and expenses (including, without limitation, attorneys’ fees and expenses, judgments, fines, excise taxes or penalties under the Employee Retirement Income Security Act of 1974, as amended, and amounts paid or to be paid in settlement) reasonably incurred by such Covered Person. Notwithstanding the foregoing, except as otherwise provided in Section 4 of this Article 7 with respect to Proceedings to enforce rights to indemnification or advancement of expenses or with respect to any compulsory counterclaim brought by such indemnitee, 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 by the Board of Directors.
Section 3. Advancement of Expenses. In addition to the right to indemnification conferred herein, an indemnitee shall also have the right, to the fullest extent not prohibited by applicable law, to be paid by the Corporation expenses (including attorneys’ fees) incurred by a Covered Person in appearing at, participating in or defending any Proceeding in advance of its final disposition or in connection with a Proceeding brought to establish or enforce a right to indemnification or advancement of expenses under this Article 7 (which shall be governed by Section 4 of this Article 7); provided that if and to the extent required by applicable law or in the case of advance made in a Proceeding brought to establish or enforce a right to indemnification or advancement, such payment of expenses in advance of the final disposition of the Proceeding shall be made solely 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 or entitled to advancement of expenses under this Article 7 or otherwise.
Section 4. Claims. If a claim for indemnification or advancement of expenses under this Article 7 is not paid in full within 30 days after a written claim therefor by the Covered Person has been received by the Corporation, the Covered Person may file suit to recover the unpaid amount of such claim or to obtain an advancement of expenses, as applicable. To the fullest extent permitted by applicable law, if successful in whole or in part in any such suit, or in a suit brought by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking, the Covered Person shall be entitled to be paid the expense of prosecuting or defending such claim. 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. In (i) any suit brought by a Covered Person to enforce a right to indemnification hereunder (but not in a suit brought by a Covered Person to enforce a right to an advancement of expenses) it shall be a defense that, and (ii) any suit brought by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking, the Corporation shall be entitled to recover such expenses upon a final adjudication that, such Person has not met any applicable standard for indemnification imposed by the NRS under such circumstances. Neither the failure of the Corporation (including by its directors who are not parties to such action, a committee of such directors, independent legal counsel or its stockholders) to have made a determination prior to the commencement of such suit that indemnification of the Covered Person is proper in the circumstances because the Covered Person has met any applicable standard of conduct imposed by the NRS under such circumstances, nor an actual determination by the Corporation (including by its directors who are not parties to such action, a committee of such directors, independent legal counsel or its stockholders) that the Covered Person has not met any such applicable standard of conduct, shall create a presumption that such Person has not met such standard of conduct or, in the case of such a suit brought by the Covered Person, be a defense to such suit.
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Section 5. Nonexclusivity of Rights. The rights conferred on any Covered Person by this Article 7 shall not be exclusive of any other rights that such Covered Person may have or hereafter acquire under any statute, provision of these Articles of Incorporation, the Bylaws, agreement, vote of stockholders or Disinterested Directors or otherwise.
Section 6. Other Sources. Subject to Section 7 of this Article 7, 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 entity or enterprise shall be reduced by any amount such Covered Person has actually collected as indemnification or advancement of expenses from such other entity or enterprise.
Section 7. Indemnitor of First Resort. Given that certain jointly indemnifiable claims (as defined below) may arise due to the service of a Covered Person as a director, officer and/or employee of the Corporation at the request of the indemnitee-related entities (as defined below), the Corporation shall be fully and primarily responsible for the payment to the Covered Person in respect of indemnification or advancement of all expenses, judgments, penalties, fines and amounts paid in settlement to the extent legally permitted and as required by the terms of these Articles of Incorporation or the Bylaws (or any other agreement between the Corporation and such persons) in connection with any such jointly indemnifiable claims, pursuant to and in accordance with the terms of this Article 7, irrespective of any right of recovery the Covered Person may have from the indemnitee-related entities. Any obligation on the part of any indemnitee-related entities to indemnify or advance expenses to any Covered Person shall be secondary to the Corporation’s obligation and shall be reduced by any amount that the Covered Person has actually collected as indemnification or advancement from the Corporation. The Corporation irrevocably waives, relinquishes and releases the indemnitee-related entities from any and all claims it may have against the indemnitee-related entities for contribution, subrogation or any other recovery of any kind in respect thereof. Under no circumstance shall the Corporation be entitled to any right of subrogation or contribution by the indemnitee-related entities and no right of advancement or recovery a 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 Corporation hereunder. If any of the indemnitee-related entities shall make any payment to a Covered Person in respect of indemnification or advancement of expenses with respect to any jointly indemnifiable claim, the indemnitee-related entity making such payment shall be subrogated to the extent of such payment to all of the rights of recovery of the Covered Person against the Corporation, and the Covered Person shall execute all instruments or other documents reasonably required and shall do all things that may be reasonably necessary to secure such rights, including the execution of such instruments or other documents as may be necessary to enable the indemnitee-related entities effectively to bring suit to enforce such rights. Each of the indemnitee-related entities shall be third-party beneficiaries with respect to, and be entitled to enforce, this Section 7. For purposes of this Section 7, the following terms shall have the following meanings:
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(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 Corporation or any other corporation, limited liability company, partnership, joint venture, trust, employee benefit plan or other enterprise for which a Covered Person has agreed, on behalf of the Corporation or at the Corporation’s request, to serve as a director, officer, manager or managing member, employee or agent and which service is covered by the indemnity described herein) from whom a Covered Person may be entitled to indemnification or advancement of expenses with respect to which, in whole or in part, the Corporation may also have an indemnification or advancement obligation.
(b) The term “jointly indemnifiable claims” shall be broadly construed and shall include, without limitation, any action, suit or proceeding for which a Covered Person shall be entitled to indemnification or advancement of expenses from both the indemnitee-related entities and the Corporation pursuant to the NRS, any agreement or articles of incorporation, bylaws, partnership agreement, operating agreement, certificate of formation, certificate of limited partnership or comparable organizational documents of the Corporation or the indemnitee-related entities, as applicable.
Section 8. Amendment or Repeal. Neither the amendment or repeal of the foregoing provisions of this Article 7, nor the adoption of any provision of these Articles of Incorporation, shall adversely affect any right or protection hereunder of any Covered Person in respect of any act or omission occurring prior to the time of such amendment, repeal or adoption.
Section 9. Other Indemnification and Advancement of Expenses. This Article 7 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.
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Section 10. Reliance. Covered Persons who after the date of the adoption of this provision become or remain a Covered Person described in Article 7 will be conclusively presumed to have relied on the rights to indemnity, advance of expenses and other rights contained in this Article 7 in entering into or continuing the service. The rights to indemnification and to the advance of expenses conferred in this Article 7 will apply to claims made against any Covered Person described in this Article 7 arising out of acts or omissions in respect of the Corporation or one of its subsidiaries that occurred or occur both prior and subsequent to the adoption hereof. The rights conferred upon Covered Persons in this Article 7 shall be contract rights and such rights shall continue as to a Covered Person who has ceased to be a director, officer or employee and shall inure to the benefit of the Covered Person’s heirs, executors and administrators. Any amendment, alteration or repeal of this Article 7 that adversely affects any right of a Covered Person or its successors shall be prospective only and shall not limit, eliminate or impair any such right with respect to any proceeding involving any occurrence or alleged occurrence of any action or omission to act that took place prior to such amendment or repeal.
Section 11. Insurance. The Corporation may purchase and maintain insurance, at its expense, to protect itself and any director, officer, employee or agent of the Corporation or another corporation, partnership, joint venture, trust or other enterprise against any expense, liability or loss, whether or not the Corporation would have the power to indemnify such person against such expense, liability or loss under the NRS.
Article 8
Corporate Opportunities
Section 1. Acknowledgement. In recognition and anticipation that members of the Board of Directors who are not employees of the Corporation (“Non-Employee Directors”) or its Affiliates may now engage and may continue to engage in the same or similar activities or related lines of business as those in which the Corporation, directly or indirectly, may engage and/or other business activities that overlap with or compete with those in which the Corporation, directly or indirectly, may engage, the provisions of this Article 8 are set forth to regulate and define the conduct of certain affairs of the Corporation with respect to certain classes or categories of business opportunities as they may involve any of the Non-Employee Directors or their respective Affiliates and the powers, rights, duties and liabilities of the Corporation and its directors, officers and stockholders in connection therewith.
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Section 2. Competition and Corporate Opportunities; Renouncement. No Non- Employee Director (including any Non-Employee Director who serves as an officer of the Corporation in both his or her director and officer capacities) or his or her Affiliates (collectively, “Identified Persons” and, individually, as an “Identified Person”) shall, to the fullest extent permitted by applicable law, have any duty to refrain from directly or indirectly (1) engaging in the same or similar business activities or lines of business in which the Corporation or any of its Affiliates now engages or proposes to engage or (2) otherwise competing with the Corporation or any of its Affiliates, and, to the fullest extent permitted by applicable law, no Identified Person shall be liable to the Corporation or its stockholders or to any Affiliate of the Corporation for breach of any fiduciary duty solely by reason of the fact that such Identified Person engages in any such activities or did not offer such activities to the Corporation. To the fullest extent permitted by applicable law, the Corporation hereby renounces any interest or expectancy in, or right to be offered an opportunity to participate in, any business opportunity which may be a corporate opportunity for an Identified Person and the Corporation or any of its Affiliates, except as provided in Section 3 of this Article 8. Subject to Section 3 of this Article 8, if any Identified Person acquires knowledge of a potential transaction or other business opportunity which may be a corporate opportunity for itself, herself or himself and the Corporation or any of its Affiliates, such Identified Person shall, to the fullest extent permitted by applicable law, have no duty to communicate or offer such transaction or other business opportunity to the Corporation or any of its Affiliates and, to the fullest extent permitted by applicable law, shall not be liable to the Corporation or its stockholders or to any Affiliate of the Corporation for breach of any fiduciary duty as a stockholder, director or officer of the Corporation solely by reason of the fact that such Identified Person pursues or acquires such corporate opportunity for itself, herself or himself, or offers or directs such corporate opportunity to another Person.
Section 3. Allocation of Corporate Opportunities. The Corporation does not renounce its interest in any corporate opportunity offered to any Non-Employee Director if such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of the Corporation, and the provisions of Section 2 of this Article 8 hereof shall not apply to any such corporate opportunity.
Section 4. Certain Matters Deemed Not Corporate Opportunities. In addition to and notwithstanding the foregoing provisions of this Article 8, a corporate opportunity shall not be deemed to be a potential corporate opportunity for the Corporation if it is a business opportunity that (i) the Corporation is neither financially or legally able, nor contractually permitted to undertake, (ii) from its nature, is not in the line of the Corporation’s business or is of no practical advantage to the Corporation or (iii) is one in which the Corporation has no interest or reasonable expectancy.
Article 9
Inapplicability of Combinations with Interested Stockholders Statutes
The Corporation hereby expressly elects not to be governed by the provisions of NRS 78.411 through 78.444, inclusive.
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Article 10
Limited Waiver of Jury Trials
To the fullest extent not inconsistent with any applicable U.S. federal laws, any and all “internal actions” (as defined in NRS 78.046) must be tried in a court of competent jurisdiction before the presiding judge as the trier of fact and not before a jury. This Article 10 shall conclusively operate as a waiver of the right to trial by jury by each party to any such internal action.
Article 11
Miscellaneous
The following provisions are inserted for the management of the business and conduct of the affairs of the Corporation and for the further definition of the powers of the Corporation and its directors:
(a) Bylaws. The Board of Directors shall have the non-exclusive power, and is expressly authorized, to adopt, amend or repeal, in whole or in part, the Bylaws. In addition, the Bylaws may be amended or repealed in any respect, and new bylaws may be adopted, in each case by the affirmative vote of the holders of at least a majority of the outstanding voting power of the Corporation, voting together as a single class.
(b) Written Ballots. Elections of directors need not be by written ballot unless the Bylaws so provide.
(c) Severability. If any provision or provisions of these Articles of Incorporation shall be held to be invalid, illegal or unenforceable as applied to any circumstance for any reason whatsoever: (i) the validity, legality and enforceability of such provisions in any other circumstance and of the remaining provisions of these Articles of Incorporation (including, without limitation, each portion of any paragraph of these Articles of Incorporation containing any such provision held to be invalid, illegal or unenforceable that is not itself held to be invalid, illegal or unenforceable) shall not, to the fullest extent permitted by applicable law, in any way be affected or impaired thereby and (ii) the provisions of these Articles of Incorporation (including, without limitation, each such portion of any paragraph of these Articles of Incorporation containing any such provision held to be invalid, illegal or unenforceable) shall be construed so as to permit the Corporation to protect its directors, officers, employees and agents from individual liability to the fullest extent under these Articles of Incorporation.
(d) Deemed Notice and Consent. To the fullest extent permitted by applicable law, each and every natural person, corporation, general or limited partnership, limited liability company, joint venture, trust, association or any other entity purchasing or otherwise acquiring any interest (of any nature whatsoever) in any shares of the capital stock of the Corporation shall be deemed, by reason of and from and after the time of such purchase or other acquisition, to have notice of and to have consented to all of the provisions of (i) these Articles of Incorporation, (ii) the Bylaws and (iii) any amendment to these Articles of Incorporation or the Bylaws enacted or adopted in accordance with these Articles of Incorporation, the Bylaws and applicable law.
(e) Definitions. As used herein, the following terms have the following meanings:
“Affiliate” means, with respect to any Person, any other Person directly or indirectly controlling, controlled by or under common control with such Person; provided that (i) neither the Corporation nor any of its subsidiaries will be deemed an Affiliate of any stockholder of the Corporation or any of such stockholders’ Affiliates, and (ii) no stockholder of the Corporation will be deemed an Affiliate of any other stockholder of the Corporation, in each case, solely by reason of any investment in the Corporation.
“Disinterested Director” means a director who satisfies the definition of “disinterested director” as set forth in Section 7.8240(6)(e) of the Nevada Revised Statutes, as amended from time to time.
“Person” means any individual, partnership, firm, corporation, limited liability company, association, trust, unincorporated organization or other entity.
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Exhibit 3.2
AMENDED AND RESTATED BYLAWS
OF
POWERUS CORPORATION
Article 1
Offices
Section 1.01. Registered Office. The registered office of Powerus Corporation (the “Corporation”) shall be the street address of the corporation’s registered agent in the State of Nevada, as determined by the Corporation’s board of directors (the “board of directors”) from time to time in accordance with the Corporation’s articles of incorporation (as amended from time to time, including by any certificate of designation establishing any class or series of preferred stock, the “articles of incorporation”), these bylaws (as amended from time to time, these “bylaws”), and the Nevada Revised Statutes (as amended from time to time, the “NRS” or “Nevada Law”).
Section 1.02. Other Offices. The Corporation may also have offices at other places both within and without the State of Nevada.
Section 1.03. Books. The books of the Corporation may be kept within or without the State of Nevada.
Article 2
Meetings of Stockholders
Section 2.01. Time and Place of Meetings. All meetings of stockholders shall be held at such physical location, if any, either within or without the State of Nevada, on such date and at such time as may be determined from time to time by the board of directors. The board of directors may, in its sole discretion, determine that any meeting of the stockholders shall be held exclusively, or simultaneously with the conduct of the meeting at a physical location, by means of remote communication (as described in NRS 78.320(4)) or other available technology permitted under the NRS.
Section 2.02. Annual Meetings. An annual meeting of stockholders shall be held for the election of directors and to transact such other business as may properly be brought before the meeting pursuant to these bylaws.
Section 2.03. Special Meetings.
(a) Special meetings of stockholders may be called at any time in accordance with the procedures set forth in the articles of incorporation and these bylaws. Such request shall state the purpose or purposes of the proposed meeting. Stockholders shall have no right to request or call a special meeting.
(b) A special meeting shall be held at such date, time and physical location, if any, and/or by such method of remote communication, if any, as may be fixed by the board of directors in accordance with these bylaws.
(c) Business conducted at a special meeting shall be limited to the matters described in the applicable notice for such special meeting.
Section 2.04. Notice of Meetings and Adjourned Meetings; Waivers of Notice.
(a) Whenever stockholders are required or permitted to take any action at a meeting, a written notice of the meeting shall be given which shall state the physical location, if any, date and hour of the meeting, the means of remote communications, if any, by which stockholders and proxies shall be deemed to be present in person and vote at such meeting, the record date for determining stockholders entitled to notice of, and to vote, at such meeting, and, in the case of a special meeting, the purpose or purposes for which the meeting is called. The notice shall be delivered in accordance with, and shall contain or be accompanied by such additional information as may be required by Nevada Law, including, without limitation, NRS 78.379, 92A.120 or 92A.410. Any notice of a meeting of stockholders delivered pursuant to and in accordance with NRS 78.370(9) shall be deemed to have satisfied any and all requirements applicable to such notice under these bylaws.
(b) In the case of an annual meeting, any proper business may be presented for action, except that (i) if a proposed plan of merger, conversion or exchange is submitted to a vote, the notice of the meeting must state that the purpose, or one of the purposes, of the meeting is to consider the plan of merger, conversion or exchange and must contain or be accompanied by a copy or summary of the plan; and (ii) if a proposed action creating dissenter’s rights is to be submitted to a vote, the notice of the meeting must state that the stockholders are, are not or may be entitled to assert dissenter’s rights under NRS 92A.300 to 92A.500, inclusive, and be accompanied by a copy of those statutes.
(c) A copy of the notice shall be personally delivered or mailed postage prepaid to each stockholder of record at the address appearing on the records of the Corporation. Upon mailing, service of the notice is complete, and the time of the notice begins to run from the date upon which the notice is deposited in the mail. If the address of any stockholder does not appear upon the records of the Corporation or is incomplete, it will be sufficient to address any notice to such stockholder at the registered office of the Corporation. Notwithstanding the foregoing and in addition thereto, any notice to stockholders given by the Corporation pursuant to NRS Title 7 (including, without limitation, NRS Chapters 75, 78 and 92A), the articles of incorporation or these bylaws may be given pursuant to any form of electronic transmission permitted under the NRS. Notice shall be deemed given (i) by facsimile when directed to a number consented to by the stockholder to receive notice, (ii) by e-mail when directed to an e-mail address designated or used by the stockholder to receive notice, (iii) by posting on an electronic network together with a separate notice to the stockholder of the specific posting on the later of the specific posting or the giving of the separate notice or (iv) by any other electronic transmission as consented to by and when directed to the stockholder. The stockholder consent necessary to permit electronic transmission to such stockholder shall be deemed revoked and of no force and effect if (A) the Corporation is unable to deliver by electronic transmission two consecutive notices given by the Corporation in accordance with the stockholder’s consent and (B) the inability to deliver by electronic transmission becomes known to the secretary, assistant secretary, transfer agent or other agent of the Corporation responsible for the giving of notice.
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(d) Unless otherwise provided by Nevada Law, such notice shall be given not less than 10 nor more than 60 days before the date of the meeting to each stockholder of record entitled to notice of such meeting. Unless these bylaws otherwise require, when a meeting is adjourned to another time or place (whether or not a quorum is present), notice need not be given of the adjourned meeting if the time, physical location, if any, and the means of remote communications, if any, by which stockholders and proxies shall 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, the Corporation may transact any business which might have been transacted at the original meeting. If the adjournment is for more than 60 days, or if after the adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each stockholder of record entitled to notice of such adjourned meeting.
(e) Whenever notice is required to be given under any provision of Nevada Law or the articles of incorporation or these bylaws, a written waiver signed by the person entitled thereto, or a waiver by electronic transmission by the person entitled to notice, whether before or after the time stated therein, shall be deemed equivalent to notice. Neither the business to be transacted at, nor the purpose of, any regular or special meetings of stockholders need be specified in any written waiver of notice or any waiver by electronic transmission unless so required by the articles of incorporation or these bylaws. Attendance of a person at a meeting shall constitute a waiver of notice of such meeting, except when the person attends the 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. Business transacted at any special meeting of stockholders shall be limited to the purposes stated in the notice.
Section 2.05. Notice of Nominations and Stockholder Business.
(a) Annual Meetings of Stockholders.
(i) Except as otherwise provided in the articles of incorporation, nominations of persons for election to the board of directors or the proposal of other business to be transacted by the stockholders may be made at an annual meeting of stockholders only (A) pursuant to the Corporation’s notice of meeting (or any supplement thereto), (B) by or at the direction of the board of directors, (C) as may be provided in the certificate of designation establishing any class or series of preferred stock or (D) by any stockholder of the Corporation who is a stockholder of record at the time of giving of notice provided for in this Section 2.05(a), who shall be entitled to vote at the meeting, who is a stockholder of record at the time of the annual meeting and who complies with the notice procedures set forth in this Section 2.05(a).
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(ii) Unless the board of directors determines otherwise, for nominations or other business to be properly brought before an annual meeting of stockholders by a stockholder pursuant to clause (D) of paragraph (a)(i) of this Section 2.05, the stockholder must have given timely notice thereof in writing to the secretary of the Corporation and any such proposed business (other than the nominations of persons for election to the board of directors) must constitute a proper matter for stockholder action. To be timely, a stockholder’s notice must be received by the secretary of the Corporation at the principal executive offices of the Corporation not later than 5:00 p.m., Eastern time, on the 90th day nor earlier than 8:00 a.m., Eastern time, on the 120th day prior to the first anniversary of the preceding year’s annual meeting of stockholders as first specified in the Corporation’s notice of such annual meeting (without regard to any adjournment, rescheduling, postponement or other delay of such annual meeting occurring after such notice was first sent); provided, however, that in the event that no annual meeting of stockholders was held in the preceding year or the date of the annual meeting is advanced more than 60 days prior to such anniversary date or delayed more than 30 days after such anniversary date then to be timely such notice must be received by the secretary of the Corporation at the principal executive offices of the Corporation no earlier than 8:00 a.m., Eastern time, on the 120th day prior to the day of such annual meeting and no later than the later of 5:00 p.m., Eastern time, on the 90th day prior to the date of the meeting or, if the first Public Announcement of the date of such annual meeting is less than 100 days prior to the date of such annual meeting, the 10th day following the day on which Public Announcement of the date of the meeting was first made by the Corporation. If the number of directors to be elected to the board of directors at the annual meeting is increased and there is no Public Announcement naming all of the nominees for director or specifying the size of the increased board of directors at least 10 days before the last day that a stockholder may deliver a notice of nomination pursuant to the foregoing provisions, then a stockholder’s notice required by this Section 2.05(a)(ii) will also be considered timely, but only with respect to any nominees for any new positions created by such increase, if it is received by the secretary of the Corporation at the principal executive offices of the Corporation no later than 5:00 p.m., Eastern time, the 10th day following the day on which such Public Announcement is first made. In no event shall the adjournment, rescheduling, postponement or other delay of an annual meeting, or any announcement thereof, commence a new time period (or extend any time period) for the giving of a stockholder’s notice as described above. In no event may a stockholder provide notice with respect to a greater number of director candidates than there are director seats subject to election by stockholders at the annual meeting. For purposes of Sections 2.05(a)(ii) and 2.05(b) of these bylaws, “Public Announcement” shall mean disclosure (x) in a press release reported by the Dow Jones News Service, the Associated Press, Business Wire, PR Newswire or any comparable national news service or (y) in a document publicly filed by the Corporation with the Securities and Exchange Commission pursuant to Section 13, 14 or 15(d) of the Securities Exchange Act of 1934, as amended (including the rules and regulations promulgated thereunder, the “Exchange Act”).
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(iii) A stockholder’s notice to the secretary of the Corporation shall set forth (A) as to each person whom the stockholder proposes to nominate for election or reelection as a director all information relating to such person that is required to be disclosed in solicitations of proxies for election of directors, or is otherwise required, in each case pursuant to Regulation 14A under the Exchange Act (including such person’s written consent to being named as a nominee of such stockholder, to being named in the Corporation’s proxy statement as a nominee and form of proxy pursuant to Rule 14a-19 under the Exchange Act (“Rule 14a-19”) and to serving as a director if elected), (B) as to any other business that the stockholder proposes to bring before the meeting, a brief description of the business desired to be brought before the meeting, the text of the proposal or business (including the text of any resolutions proposed for consideration and in the event that such business includes a proposal to amend these bylaws, the text of the proposed amendment), the reasons for conducting such business at the meeting and any material interest in such business of such stockholder and the beneficial owner, if any, on whose behalf the proposal is made and (C) as to the stockholder giving the notice and the beneficial owner, if any, on whose behalf the nomination or proposal is made:
(1) the name and address of such stockholder (as they appear on the Corporation’s stock ledger) and of such beneficial owner and (i) any affiliate or associate (as such terms are defined for purposes of the Exchange Act) of the stockholder or beneficial owner and any other person acting in concert with any of the foregoing and (ii) any person controlling, controlled by or under common control with such stockholder or beneficial owner or their respective affiliates (collectively, “Stockholder Associated Persons”);
(2) the class or series and number of shares of capital stock of the Corporation which are held of record or are beneficially owned by such stockholder, the beneficial owner and by any Stockholder Associated Persons and a description of all purchases and sales of, or other transactions involving in any way, shares of capital stock of the Corporation by or on behalf of the stockholder and by or on behalf of any Stockholder Associated Person during the 24-month period prior to the date of the notice, including the date of the transactions, the class and number of shares and the consideration exchanged in each such transaction (without regard to whether such shares were or were not owned by the stockholder or any such person);
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(3) a description of any agreement, arrangement or understanding between or among such stockholder, such beneficial owner and any Stockholder Associated Persons, and any other person or persons (including their names) in connection with the proposal of such nomination or other business;
(4) a description of any agreement, arrangement or understanding (including, regardless of the form of settlement, any derivative, long or short positions, profit interests, forwards, futures, swaps, options, warrants, convertible securities, stock appreciation or similar rights, hedging transactions and borrowed or loaned shares) that has been entered into by or on behalf of, or any other agreement, arrangement or understanding that has been made, the effect or intent of which is to create or mitigate loss to, manage risk or benefit of share price changes for, or increase or decrease the voting power of, such stockholder, such beneficial owner or any such Stockholder Associated Person or any proposed nominee identified in such stockholder’s notice with respect to the Corporation’s securities (a “Derivative Instrument”);
(5) to the extent not disclosed pursuant to clause (4) above, the principal amount of any indebtedness of the Corporation or any of its subsidiaries beneficially owned by such stockholder, such beneficial owner or by any Stockholder Associated Person, together with the title of the instrument under which such indebtedness was issued and a description of any Derivative Instrument entered into by or on behalf of such stockholder, such beneficial owner or such Stockholder Associated Person relating to the value or payment of any indebtedness of the Corporation or any such subsidiary;
(6) a representation that the stockholder is a holder of record of stock of the Corporation as of the date of submission of such stockholder’s notice, is entitled to vote at such meeting and intends to appear in person or by proxy at the meeting to bring such nomination or other business before the meeting; and
(7) a representation as to whether such stockholder, such beneficial owner or any such Stockholder Associated Person intends or is part of a group that intends to (i) deliver a proxy statement and/or form of proxy to holders of at least the percentage of the voting power of the Corporation’s outstanding capital stock required to approve or adopt the proposal (or, to extent relating to the nomination of a director, holders of at least 67% of the voting power of the Corporation’s outstanding capital stock), (ii) otherwise comply with Rule 14a-19, and/or (iii) otherwise to solicit proxies from stockholders in support of such proposal or nomination.
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For a stockholder’s notice to be considered timely, the information required under clauses (C)(2), (3), (4) and (5) of the preceding sentence of this Section 2.05 shall be updated and supplemented by such stockholder and any such beneficial owner if necessary, so that the information provided or required to be provided in such notice is true and correct as of the record date for determining the stockholders entitled to notice of, and to vote at, the meeting and as of the date that is 10 business days prior to the meeting or any adjournment, rescheduling, postponement or other delay thereof. For purposes of these bylaws, the term “business day” shall mean any day other than a Saturday, Sunday or a legal holiday on which commercial banking institutions in Nevada are authorized to close for business. Any such update and supplement or additional information must be received by the secretary of the Corporation at the principal executive offices of the Corporation not later than five business days after the record date for the meeting (in the case of any update and supplement required to be made as of the record date), and not later than eight business days prior to the date for the meeting or any adjournment, rescheduling, postponement or other delay thereof (in the case of any update or supplement required to be made as of 10 business days prior to the meeting or any adjournment, rescheduling, postponement or other delay thereof). The failure to timely provide such update, supplement, evidence or additional information shall result in the nomination or proposal no longer being eligible for consideration at the meeting.
No later than five business days prior to the meeting or any adjournment, rescheduling, postponement or other delay thereof, a stockholder nominating individuals for election as a director will provide the Corporation with reasonable evidence that such stockholder has met the requirements of Rule 14a-19. If the nominating stockholder fails to comply with the requirements of Rule 14a-19 (including because the nominating stockholder fails to provide the Corporation with all information or notices required by Rule 14a-19), then the director nominees proposed by such stockholder shall be ineligible for election at the meeting and any votes or proxies in respect of such nomination shall be disregarded, notwithstanding that proxies may have been received by the Corporation and counted for the purposes of determining quorum.
For the avoidance of doubt, the obligation to update and supplement, or provide additional information or evidence, as set forth in these bylaws shall not limit the Corporation’s rights with respect to any deficiencies in any notice provided by a stockholder, extend any applicable deadlines pursuant to these bylaws or enable or be deemed to permit a stockholder who has previously submitted notice pursuant to these bylaws to amend or update any nomination or to submit any new nomination. No disclosure pursuant to these bylaws will be required with respect to the ordinary course business activities of any broker, dealer, commercial bank, trust company or other nominee who is the stockholder submitting a notice pursuant to this Section 2.05 solely because such broker, dealer, commercial bank, trust company or other nominee has been directed to prepare and submit the notice required by these bylaws on behalf of a beneficial owner.
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In addition to the information required pursuant to Section 2.05(a)(iii)(A), to the extent that a stockholder proposes to nominate a person for election or reelection as a director, the stockholder’s notice shall also include (A) a completed questionnaire (in the form provided by the secretary of the Corporation upon request by the stockholder, which form will be provided by the secretary of the Corporation within 5 business days of receiving such request) signed by such nominee with respect to information of the type required by the Corporation’s questionnaires for directors and officers of the Corporation and which shall also include a representation and agreement that such nominee (1) is not and will not become a party to (x) any agreement, arrangement or understanding with, and has not given any commitment or assurance to, any person or entity as to how such nominee, if elected as a director of the Corporation, will act or vote on any issue or question (a “Voting Commitment”) that has not been, or will not be within three business days thereafter, disclosed to the Corporation or (y) any Voting Commitment that could limit or interfere with the nominee’s ability to comply, if elected as a director of the Corporation, with such nominee’s fiduciary duties under Nevada Law, (2) 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, reimbursement or indemnification in connection with service or action as a director of the Corporation that has not been, or will not be within three business days thereafter, disclosed to the Corporation and (3) in such nominee’s individual capacity and on behalf of any person or entity on whose behalf the nomination is being made, would be in compliance, if elected as a director of the Corporation, and will comply, with Nevada Law and all applicable corporate governance, code of conduct and ethics, conflict of interest, corporate opportunities, confidentiality and stock ownership and trading policies and guidelines of the Corporation, (B) the classes or series of shares of stock of the Corporation that are owned (beneficially and of record) by or on behalf of such nominee as of the date of such notice, (C) a description of such nominee’s qualifications to be a director, (D) a statement as to whether such nominee would be an independent director, and the basis therefor, under the rules and listing standards of the securities exchange(s) upon which the stock of the Corporation is listed or traded, any applicable rules of the SEC or any publicly disclosed standards used by the board of directors (such as corporate governance guidelines), (E) a description of all direct and indirect compensation and other material monetary agreements, arrangements and understandings during the past three years, and any other material relationships, between or among the nominating stockholder and any Stockholder Associated Persons, on the one hand, and each nominee and any (i) any affiliate or associate (as such terms are defined for purposes of the Exchange Act) of the nominee and any other person acting in concert with any of the foregoing, (ii) any beneficial owner of shares of stock of the Corporation owned of record or beneficially by such nominee and (iii) any person controlling, controlled by or under common control with such person, on the other hand, including, without limitation, all information that would be required to be disclosed pursuant to Item 404 promulgated under Regulation S-K if the stockholder, any beneficial owner on whose behalf such nomination was made or any Stockholder Associated Person, were the “registrant” for purposes of such rule and the nominee were a director or executive officer of such registrant and (F) otherwise comply with Rule 14a-19.
Notwithstanding anything to the contrary, the notice requirements set forth herein with respect to the proposal of any business pursuant to this Section 2.05 other than a nomination shall be deemed satisfied by a stockholder if such stockholder has submitted a proposal to the Corporation in compliance with Rule 14a-8 promulgated under the Exchange Act and such stockholder’s proposal has been included in a proxy statement that has been prepared by the Corporation to solicit proxies for the meeting of stockholders.
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(b) Special Meetings of Stockholders. Only such business shall be conducted at a special meeting of stockholders as shall have been brought before the meeting pursuant to the Corporation’s notice of meeting pursuant to Section 2.04. Nominations of persons for election to the board of directors of the Corporation at a special meeting of stockholders may be made by stockholders only if the election of directors is included as business to be brought before a special meeting in the Corporation’s notice of meeting and then only by any stockholder of the Corporation who is a stockholder of record at the time of giving of notice provided for in this Section 2.05(b) who shall be entitled to vote at the meeting and who complies with the notice procedures set forth in this Section 2.05(b). For nominations to be properly brought before a special meeting of stockholders by a stockholder pursuant to this Section 2.05(b), the stockholder must have given timely notice thereof in writing to the secretary of the Corporation. To be timely, a stockholder’s notice shall be delivered to or mailed and received by the secretary of the Corporation at the principal executive offices of the Corporation (A) not earlier than 8:00 a.m., Eastern time, on the 120th day prior to the date of the special meeting nor (B) later than the later of 5:00 p.m., Eastern time, on the 90th day prior to the date of the special meeting or, if the first Public Announcement of the date of such special meeting is less than 100 days prior to the date of such special meeting, the 10th day following the day on which Public Announcement of the date of the special meeting was first made. A stockholder’s notice to the secretary shall be properly brought only if it complies with the notice requirements of Section 2.05(a)(iii).
(c) General.
(i) At the request of the board of directors, any person nominated by the board of directors for election as a director shall furnish to the secretary of the Corporation the information that is required to be set forth in a stockholder’s notice of nomination that pertains to the nominee. No person shall be eligible to be nominated by a stockholder to serve as a director of the Corporation unless nominated in accordance with the procedures set forth in this Section 2.05. No business shall be conducted at a stockholder meeting except in accordance with the procedures set forth in Section 2.03 and this Section 2.05. The chair of the meeting shall, if the facts warrant, determine and declare to the meeting that a nomination was not made in accordance with the procedures prescribed by these bylaws or that business was not properly brought before the meeting, and if he or she should so determine and declare, the defective nomination shall be disregarded or such business shall not be transacted, as the case may be. Notwithstanding the foregoing provisions of this Section 2.05, unless otherwise required by law, if the stockholder (or a qualified representative of the stockholder) does not appear at the annual or special meeting of stockholders of the Corporation to present a nomination or other proposed business, such nomination shall be disregarded or such proposed business shall not be transacted, as the case may be, notwithstanding that proxies in respect of such vote may have been received by the Corporation and counted for purposes of determining a quorum. For purposes of this Section 2.05, to be considered a qualified representative of the stockholder, a person must be a duly authorized officer, manager or partner of such stockholder or must be authorized by a writing executed by such stockholder or an electronic transmission delivered by such stockholder to act for such stockholder as proxy at the meeting of stockholders and such person must produce such writing or electronic transmission, or a reliable reproduction of the writing or electronic transmission, at the meeting of stockholders.
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(ii) Without limiting the foregoing provisions of this Section 2.05, a stockholder shall also comply with all applicable requirements of the Exchange Act with respect to the matters set forth in this Section 2.05; provided, however, that any references in these bylaws to the Exchange Act are not intended to and shall not limit any requirements applicable to nominations or proposals as to any other business to be considered pursuant to this Section 2.05, and compliance with Section 2.05(a) or (b) shall be the exclusive means for a stockholder to make nominations or submit other business (other than as provided in the last paragraph of Section 2.05(a)).
Section 2.06. Quorum. Unless otherwise provided in Nevada Law, the articles of incorporation, these bylaws or the rules of any applicable stock exchange on which the Corporation’s securities are listed, the presence, in person or by proxy (regardless of whether the proxy has authority to vote on any matter), of the holders of a majority of the voting power of all outstanding capital stock of the Corporation entitled to vote at a meeting of stockholders shall constitute a quorum for the transaction of business. If, however, such quorum shall not be present at any meeting of the stockholders, either the chair of the meeting or holders of a majority in voting power of the shares of capital stock of the Corporation present in person or represented by proxy may adjourn the meeting, without notice other than announcement at the meeting, until a quorum shall be present. At such adjourned meeting at which a quorum shall be present any business may be transacted which might have been transacted at the meeting as originally notified.
Section 2.07. Voting. (a) Any share of capital stock of the Corporation held by the Corporation shall have no voting rights. If a quorum is present, unless the articles of incorporation, these bylaws, the rules of any applicable stock exchange on which the Corporation’s securities are listed, Nevada Law or other applicable law provide for a different proportion, action by the stockholders entitled to vote on a matter other than the election of directors, is approved by and is the act of the stockholders if the number of votes cast in favor of the action exceeds the votes cast in opposition to the action, unless voting by classes or series is required for any action of the stockholders by Nevada Law, the articles of incorporation, these bylaws or the rules of any applicable stock exchange on which the Corporation’s securities are listed, in which case the number of votes cast in favor of the action by the voting power of each such class or series must exceed the number of votes cast in opposition to the action by the voting power of each such class or series. If a quorum is present, and subject to the rights of the holders of any series of preferred stock to elect additional directors under specific circumstances, directors shall be elected by a plurality of the voting power of shares of capital stock of the Corporation present in person or represented by proxy at the meeting and entitled to vote on the election of directors.
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(b) Each stockholder entitled to vote at a meeting of stockholders may authorize another person or persons to act for such stockholder by proxy, appointed by an instrument in writing, subscribed by such stockholder or by his attorney thereunto authorized, or by proxy sent by cable, telegram or by any means of electronic communication permitted by law, which results in a writing from such stockholder or by his attorney, and delivered to the secretary of the meeting. If a stockholder designates two or more persons to act as proxies, then a majority of those persons present at a meeting has and may exercise all of the powers conferred by the stockholder or, if only one is present, then that one has and may exercise all of the powers conferred by the stockholder, unless the stockholder’s designation of proxy provides otherwise. No proxy shall be voted after six months from its date, unless said proxy provides for a longer period (which may not exceed seven years from the date of its creation, unless the proxy is deemed irrevocable in accordance with Nevada Law), subject to and in accordance with Nevada Law.
(c) Votes may be cast by any stockholder entitled to vote in person or by his or her proxy. In determining the number of votes cast for or against a proposal or nominee, shares abstaining from voting on a matter (including elections) and broker non-votes will not be treated as votes cast.
Section 2.08. Organization. At each meeting of stockholders, the director or officer designated by the board of directors prior to such meeting or, if one shall not have been designated, the chair of the board of directors, shall act as chair of the meeting. The secretary (or in the secretary’s absence or inability to act, the person whom the chair of the meeting shall appoint secretary of the meeting) shall act as secretary of the meeting and keep the minutes thereof.
Section 2.09. Order of Business. Except as otherwise provided pursuant to Section 2.10, the order of business at all meetings of stockholders shall be as determined by the chair of the meeting.
Section 2.10. Conduct of Meetings. The board of directors may adopt such rules and procedures for the conduct of stockholder meetings as it deems appropriate. At each meeting of stockholder, the chair of the meeting shall preside over the meeting. Except to the extent inconsistent with the rules and procedures as adopted by the board of directors, the person presiding over the meeting of stockholders shall have the right and authority to convene, adjourn and reconvene the meeting from time to time, to prescribe such additional rules and procedures and to do all such acts as, in the judgment of such person, are appropriate for the proper conduct of the meeting. Such rules and procedures, whether adopted by the board of directors or prescribed by the person presiding over the meeting, may include (a) the establishment of an agenda or order of business for the meeting, (b) rules and procedures for maintaining order at the meeting and the safety of those present, (c) limitations on attendance at or participation in the meeting to stockholders of record of the Corporation, their duly authorized and constituted proxies or such other persons as the person presiding over the meeting shall determine, (d) restrictions on entry to the meeting after the time fixed for the commencement thereof and (e) limitations on the time allotted to questions or comments by participants. The person presiding over any meeting of stockholders, in addition to making any other determinations that may be appropriate to the conduct of the meeting, may determine and declare to the meeting that a matter or business was not properly brought before the meeting and if such presiding person should so determine, he or she shall so declare to the meeting and any such matter or business not properly brought before the meeting shall not be transacted or considered.
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Article 3
Board of Directors
Section 3.01. General Powers. Except as otherwise provided in Nevada Law or the articles of incorporation, the business and affairs of the Corporation shall be managed by or under the direction of the board of directors.
Section 3.02. Number, Election, Classes, Term of Office. (a) Subject to the terms of any series of Preferred Stock entitled to separately elect directors, the board of directors shall initially consist of six directors and thereafter shall be determined from time to time solely by resolution adopted by the board of directors.
(b) Except as otherwise provided in the articles of incorporation or in the terms of any series of Preferred Stock entitled to separately elect directors, the directors shall be divided into three classes, designated Class I, Class II and Class III. Each class shall consist, as nearly as may be possible, of one-third of the total number of directors constituting the entire board of directors. Except as otherwise provided in the articles of incorporation, each director shall serve for a term ending on the date of the third annual meeting of stockholders next following the annual meeting at which such director was elected.
(c) Except as otherwise provided in the articles of incorporation, each director shall hold office until such director’s successor shall have been duly elected and qualified or until such director’s earlier death, resignation or removal and for a term that shall coincide with the term of the class to which such director shall have been elected. Directors need not be stockholders.
Section 3.03. Quorum and Manner of Acting. Unless the articles of incorporation or these bylaws require a greater number, a majority of the total number of directors shall constitute a quorum for the transaction of business, and the affirmative vote of a majority of the directors present at a meeting at which a quorum is present shall be the act of the board of directors. When a meeting is adjourned to another time or place (whether or not a quorum is present), notice need not be given of the adjourned meeting if the time and physical location hereof, if any, and the means of remote communications, if any, are announced at the meeting at which the adjournment is taken. At the adjourned meeting, the board of directors may transact any business which might have been transacted at the original meeting. If a quorum shall not be present at any meeting of the board of directors, the directors present thereat may adjourn the meeting, from time to time, without notice other than announcement at the meeting, until a quorum shall be present.
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Section 3.04. Time and Place of Meetings. The board of directors shall hold its meetings at such physical location, if any, either within or without the State of Nevada, or by means of remote communication, and at such time as may be determined from time to time by the board of directors (or the chair in the absence of a determination by the board of directors).
Section 3.05. Annual Meeting. The board of directors shall meet for the purpose of organization, the election of officers and the transaction of other business, as soon as practicable after each annual meeting of stockholders. Notice of such meeting need not be given. In the event such annual meeting is not held on the same day and at the same physical location, if any, as the annual meeting of stockholders, the annual meeting of the board of directors may be held at such physical location, if any, either within or without the State of Nevada, on such date and at such time as shall be specified in a notice thereof given as hereinafter provided in Section 3.07 or in a waiver of notice thereof signed by any director who chooses to waive the requirement of notice.
Section 3.06. Regular Meetings. After the physical location, if any, and time of regular meetings of the board of directors shall have been determined and notice thereof shall have been once given to each member of the board of directors, regular meetings may be held without further notice being given.
Section 3.07. Special Meetings. Special meetings of the board of directors may be called by the chair of the board of directors or the chief executive officer and shall be called by the secretary on the written request of at least two directors. Notice of special meetings of the board of directors shall be given to each director at least 24 hours before the time of the holding of the meeting. Such notice shall be deemed given (i) by facsimile when directed to a number consented to by the director to receive notice, (ii) by e-mail when directed to an e-mail address designated or used by the director to receive notice, (iii) by posting on an electronic network together with a separate notice to the director of the specific posting on the later of the specific posting or the giving of the separate notice or (iv) by any other electronic transmission as consented to by and when directed to the director. The notice need not state the physical location, if any, of the special meeting (if the meeting is to be held at the Corporation’s principal executive offices) nor the purpose of the meeting, unless required by law.
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Section 3.08. Committees. (a) The board of directors may designate one or more committees, each committee to consist of one or more of the directors of the Corporation. The board of directors will have at least three standing committees, including an audit committee, a compensation committee and a nominating and governance committee. 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 the committee. In the absence or disqualification of a member of a committee, the member or members present at any meeting and not disqualified from voting, whether or not such member or members constitute a quorum, may unanimously appoint another member of the board of directors to act at the meeting in the place of any such absent or disqualified member. Any committee of the board of directors, to the extent provided in the resolution of the board of directors, shall have and may exercise all 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 to be affixed to all papers which may require it. Each committee shall keep regular minutes of its meetings and report the same to the board of directors when required.
(b) Unless otherwise provided in the articles of incorporation, these bylaws or the resolution of the board of directors designating the committee, a committee may create one or more subcommittees consisting of one or more members of such committee and delegate to such subcommittee any or all of the powers and authority of the committee.
(c) 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 committee shall conduct its business in the same manner as the board of directors conducts its business pursuant to this Article 3.
Section 3.09. Action by Consent. Unless otherwise restricted by the articles 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, if all members of the board of directors or committee, as the case may be (other than any director(s) abstaining in writing pursuant to and in accordance with NRS 78.315(2)), consent thereto in writing or by electronic transmission, and the writing or writings or electronic transmission or transmissions, are filed with the minutes of proceedings of the board of directors or committee. Such filing shall be in paper form if the minutes are maintained in paper form and shall be in electronic form if the minutes are maintained in electronic form.
Section 3.10. Telephonic and Electronic Meetings. Unless otherwise restricted by the articles of incorporation or these bylaws, members of the board of directors, or any committee designated by the board of directors, may participate in a meeting of the board of directors, or such committee, as the case may be, by means of conference telephone or other communications equipment (including any means of remote communications permitted under Nevada Law) by means of which all persons participating in the meeting can hear each other, and such participation in a meeting shall constitute presence in person at the meeting.
Section 3.11. Resignation. Any director may resign at any time by giving notice in writing or by electronic transmission to the board of directors or to the secretary of the Corporation. The resignation of any director shall take effect upon receipt of notice thereof or at such later time as shall be specified in such notice; and unless otherwise specified therein, the acceptance of such resignation shall not be necessary to make it effective.
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Section 3.12. Vacancies. Vacancies on the board of directors resulting from death, resignation, removal or otherwise and newly created directorships resulting from any increase in the number of directors shall, except as otherwise required by law or as set forth in the articles of incorporation, be filled solely by a majority of the directors then in office (although less than a quorum) or by the sole remaining director, and each director so elected shall hold office for a term that shall coincide with the term of the class to which such director shall have been elected. If there are no directors in office, then an election of directors may be held in accordance with Nevada Law.
Section 3.13. Removal. Directors may only be removed from office in the manner set forth in the articles of incorporation. Any vacancies created by any such removal may be filled in accordance with Section 3.12 herein.
Section 3.14. Compensation. Unless otherwise restricted by the articles of incorporation or these bylaws, the board of directors shall have authority to fix the compensation of directors, including fees and reimbursement of expenses.
Section 3.15. Organization. Meetings of the board of directors shall be presided over by the chair of the board of directors, or in the absence of the chair of the board of directors by the vice chair, or in his or her absence by a chair chosen at the meeting. The secretary, or in the absence of the secretary an assistant secretary, shall act as secretary of the meeting, but in the absence of the secretary and any assistant secretary, the chair of the meeting may appoint any person to act as secretary of the meeting. The order of business at each such meeting shall be as determined by the chair of the meeting.
Article 4
Officers
Section 4.01. Principal Officers. The principal officers of the Corporation shall be a chief executive officer, a chief financial officer, one or more executive vice presidents, a secretary who shall have the duty, among other things, to record the proceedings of the meetings of stockholders and directors in a book kept for that purpose and any other officers as may be required under Nevada Law. Subject to Section 3.01, the chief executive officer shall conduct and direct generally all the day-to-day business and affairs of the Corporation. The Corporation may also have such other principal officers as the board of directors may in its discretion appoint. One person may hold the offices and perform the duties of any two or more of said offices, except that no one person shall hold the offices and perform the duties of chief executive officer and secretary.
Section 4.02. Election, Term of Office and Remuneration. The principal officers of the Corporation shall be elected annually by the board of directors at the annual meeting thereof. Each such officer shall hold office until his or her successor is elected and qualified, or until his or her earlier death, resignation or removal. The remuneration of all principal officers of the Corporation shall be fixed by the board of directors. Any vacancy in any office shall be filled in such manner as the board of directors shall determine.
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Section 4.03. Subordinate Officers. In addition to the principal officers enumerated in Section 4.01, the Corporation may have one or more assistant secretaries and such other subordinate officers, agents and employees as the board of directors may deem necessary, each of whom shall hold office for such period as the board of directors may from time to time determine. The board of directors may delegate to any principal officer the power to appoint, fix the compensation of and remove any such subordinate officers, agents or employees.
Section 4.04. Removal. In addition to the authority granted pursuant to Section 4.03 with respect to subordinate officers, any officer may be removed, with or without cause, at any time, by resolution adopted by the board of directors.
Section 4.05. Resignations. Any officer may resign at any time by giving written notice to the Corporation. The resignation of any officer shall take effect upon receipt of notice thereof or at such later time as shall be specified in such notice; and unless otherwise specified therein, the acceptance of such resignation shall not be necessary to make it effective.
Section 4.06. Powers and Duties. The officers of the Corporation shall have such powers and perform such duties incident to each of their respective offices and such other duties as may from time to time be conferred upon or assigned to them by the board of directors.
Article 5
Capital Stock
Section 5.01. Certificates For Stock; Uncertificated Shares. The shares of the Corporation’s capital stock shall be uncertificated; provided that the board of directors of the Corporation may provide by resolution or resolutions that some or all of any or all classes or series of its stock shall be represented by one or more certificates. Except as otherwise provided by law, the rights and obligations of the holders of uncertificated shares and the rights and obligations of the holders of shares of the same class and series represented by certificates shall be identical. Every holder of stock represented by certificates shall be entitled to have a certificate signed by or in the name of the Corporation by any officers or agents so authorized by the board of directors representing the number of shares registered in certificate form. Any or all of the signatures on the certificate may be a facsimile. In case any officer, transfer agent or registrar who has signed or whose facsimile signature has been placed upon a certificate shall have ceased to be such officer, transfer agent or registrar before such certificate is issued, it may be issued by the Corporation with the same effect as if such person were such officer, transfer agent or registrar at the date of issue.
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Section 5.02. Transfer of Shares. Shares of the stock of the Corporation may be transferred on the record of stockholders of the Corporation by the holder thereof or by such holder’s duly authorized attorney upon surrender of a certificate therefor properly endorsed or upon receipt of proper transfer instructions from the registered holder of uncertificated shares or by such holder’s duly authorized attorney and upon compliance with appropriate procedures for transferring shares in uncertificated form, unless waived by the Corporation.
Section 5.03. Authority for Additional Rules Regarding Transfer. The board of directors shall have the power and authority to make all such rules and regulations, not inconsistent with these bylaws, as they may deem expedient concerning the issue, transfer and registration of certificated or uncertificated shares of the stock of the Corporation, as well as for the issuance of new certificates in lieu of those which may be lost or destroyed, and may require of any stockholder requesting replacement of lost or destroyed certificates, bond in such amount and in such form as they may deem expedient to indemnify the Corporation and the transfer agents and registrars of its stock against any claims arising in connection therewith.
Section 5.04. Inapplicability of Controlling Interest Statutes. The provisions of NRS 78.378 to 78.3793, inclusive, or any successor statutes, relating to acquisitions of controlling interests in the Corporation shall not apply to the Corporation or to any acquisition of any shares of the Corporation’s capital stock.
Article 6
Exclusive Jurisdiction
Section 6.01. To the fullest extent permitted by Nevada Law, and unless the Corporation consents in writing to the selection of an alternative forum, the Eighth Judicial District Court of Clark County, Nevada, shall be the sole and exclusive forum for any actions, suits or proceedings, whether civil, administrative or investigative, (a) brought in the name or right of the Corporation or on its behalf, (b) asserting a claim for or based upon any breach of any fiduciary duty owed by any current or former director, officer or controlling stockholder of the Corporation in such capacity, (c) for any other internal action (as defined in NRS 78.046), including any action asserting a claim against the Corporation arising pursuant to, or to interpret, apply, enforce or determine the validity of, any provision of NRS Title 7 (including NRS Chapters 78 and 92A), the articles of incorporation, these bylaws or any agreement entered into pursuant to NRS 78.365 to which the corporation is a party or a stated beneficiary thereof, or (d) asserting a claim governed by the internal affairs doctrine; provided that such exclusive forum provisions will not apply to suits brought to enforce any liability or duty created by the Exchange Act or any other claim for which the federal courts have exclusive jurisdiction. In the event that the Eighth Judicial District Court of Clark County, Nevada does not have jurisdiction over any such action, suit or proceeding, then any other state district court located in the State of Nevada shall be the sole and exclusive forum therefor and in the event that no state district court in the State of Nevada has jurisdiction over any such action, suit or proceeding, then a federal court located within the State of Nevada shall be the sole and exclusive forum therefor. Unless the Corporation consents in writing to the selection of an alternative forum, the federal district courts of the United States of America shall be the sole and exclusive forum for the resolution of any claim asserting a cause of action arising under the Securities Act of 1933, as amended. Any person or entity purchasing or otherwise acquiring any interest in shares of capital stock of the Corporation shall be deemed to have notice of and, to the fullest extent permitted by law, to have consented to the provisions of this Article 6.
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Article 7
General Provisions
Section 7.01. Fixing the Record Date. (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 not be more than 60 nor less than 10 days before the date of such meeting. If the board of directors so fixes a record date for notice of any meeting of stockholders, such date shall also be the record date for determining the stockholders entitled to vote at such meeting. 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 next preceding the day on which notice is given, or, if notice is waived, at the close of business on the day next preceding the day on which the meeting is held. A determination of stockholders of record entitled to notice of and to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided that the board of directors may fix a new record date for determination of stockholders entitled to notice of, and to vote at, the adjourned meeting in accordance with the foregoing provisions of this Section 7.01(a).
(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 the stockholders 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 be not more than 60 days prior to such action. If no 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.
Section 7.02. Dividends and Other Distributions. Subject to limitations contained in Nevada Law and the articles of incorporation, if any, the board of directors may declare and pay dividends and other distributions upon the shares of capital stock of the Corporation, which dividends or other distributions may be paid either in cash, in property or in shares of the capital stock of the Corporation.
Section 7.03. Year. The fiscal year of the Corporation shall be fixed by resolution of the board of directors.
Section 7.04. Representation of Securities Owned by the Corporation. The chair of the board, the chief executive officer or any other person authorized by the board of directors, the chair of the board or the chief executive officer may vote, represent and exercise on behalf of the Corporation all rights incident to any and all shares or other securities of, or interests in, or issued by, any other entity or entities, and all rights incident to any management authority conferred on the Corporation in accordance with the governing documents of any entity or entities, standing in the name of the Corporation, including the right to act by written consent. 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 7.05. Amendments. The board of directors shall have the non-exclusive power, and is expressly authorized, to adopt, amend or repeal, in whole or in part, these bylaws. In addition, these bylaws or any of them, may be altered, amended or repealed, or new bylaws may be made, by the affirmative vote of stockholders holding at least 66 2/3% of the outstanding voting power of the Corporation entitled to vote thereon, voting together as a single class, at any annual or special meeting.
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Exhibit 4.1
COMMON STOCK PURCHASE WARRANT
POWERUS CORPORATION
| Warrant Shares: ___________ | Original Issue Date:_________, 2026 |
This COMMON STOCK PURCHASE WARRANT (this “Warrant”) certifies that, for value received, _______________ or registered assigns (the “Holder”) is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter set forth, at any time on or after the date hereof (the “Initial Exercise Date”) and until this Warrant is exercised in full (the “Termination Date”) but not thereafter, to subscribe for and purchase from Powerus Corporation, a Nevada corporation (the “Company”), up to _____________ shares of Common Stock, par value $0.001 per share (“Common Stock”) of the Company (as subject to adjustment hereunder, the “Warrant Shares”). The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price, as defined in Section 2(b).
Section 1. Exercise.
(a) Exercise of Warrant. Exercise of the purchase rights represented by this Warrant may be made, in whole or in part, at any time or times on or after the Initial Exercise Date and on or before the Termination Date by delivery to the Company of a duly executed digital notice in .PDF or comparable digital format submitted by e-mail or comparable electronic or digital transmission of the notice of exercise in the form annexed hereto (the “Notice of Exercise”) in the form attached hereto as Exhibit A. Within the earlier of (i) two (2) Business Days and (ii) the number of Business Days comprising the Standard Settlement Period (as defined in Section 1(d)(i) herein) following the date of exercise as aforesaid, the Holder shall deliver to the Company the aggregate Exercise Price for the Warrant Shares specified in the applicable Notice of Exercise by wire transfer or cashier’s check drawn on a United States bank unless the cashless exercise procedure specified in Section 1(c) below is specified in the applicable Notice of Exercise. No ink-original Notice of Exercise shall be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Notice of Exercise be required. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this Warrant to the Company until the Holder has purchased all of the Warrant Shares available hereunder and the Warrant has been exercised in full, in which case, the Holder shall surrender this Warrant to the Company for cancellation within three (3) Business Days of the date on which the final Notice of Exercise is delivered to the Company. Partial exercises of this Warrant resulting in purchases of a portion of the total number of Warrant Shares available hereunder shall have the effect of lowering the outstanding number of Warrant Shares purchasable hereunder in an amount equal to the applicable number of Warrant Shares purchased. The Holder and the Company shall maintain records showing the number of Warrant Shares purchased and the date of such purchases. The Company shall deliver to the Holder any objection to any Notice of Exercise within one (1) Business Day of receipt of such notice. The Holder and any assignee, by acceptance of this Warrant, acknowledge and agree that, by reason of the provisions of this paragraph, following the purchase of a portion of the Warrant Shares hereunder, the number of Warrant Shares available for purchase hereunder at any given time may be less than the amount stated on the face hereof.
(b) Exercise Price. The aggregate exercise price of this Warrant, except for a nominal exercise price of $0.001 per Warrant Share, was pre-funded to the Company on or prior to the Initial Exercise Date and, consequently, no additional consideration (other than the nominal exercise price of $0.001 per Warrant Share) shall be required to be paid by the Holder to any Person to effect any exercise of this Warrant. The Holder shall not be entitled to the return or refund of all, or any portion, of such pre-paid aggregate exercise price under any circumstance or for any reason whatsoever, including in the event this Warrant shall not have been exercised prior to the Termination Date. The remaining unpaid exercise price per share of Common Stock shall be $0.001 (subject to adjustment hereunder, the “Exercise Price”).
(c) Cashless Exercise. If at the time of exercise hereof there is no effective registration statement registering, or the prospectus contained therein is not available for the issuance of the Warrant Shares to the Holder, then this Warrant may also be exercised, in whole or in part, at such time by means of a “cashless exercise” in which the Holder shall be entitled to receive a number of Warrant Shares equal to the quotient obtained by dividing [(A-B) (X)] by (A), where:
(A) = as applicable: (i) the VWAP on the Business Day immediately preceding the date of the applicable Notice of Exercise if such Notice of Exercise is (1) both executed and delivered pursuant to Section 1(a) hereof on a day that is not a Business Day or (2) both executed and delivered pursuant to Section 1(a) hereof on a Business Day prior to the opening of “regular trading hours” (as defined in Rule 600(b) of Regulation NMS promulgated under the federal securities laws) on such Business Day, (ii) at the option of the Holder, either (y) the VWAP on the Business Day immediately preceding the date of the applicable Notice of Exercise or (z) the Bid Price on the principal Trading Market as reported by Bloomberg L.P. (“Bloomberg”) as of the time of the Holder’s execution of the applicable Notice of Exercise if such Notice of Exercise is executed during “regular trading hours” on a Business Day and is delivered within two (2) hours thereafter (including until two (2) hours after the close of “regular trading hours” on a Business Day) pursuant to Section 1(a) hereof or (iii) the VWAP on the date of the applicable Notice of Exercise if the date of such Notice of Exercise is a Business Day and such Notice of Exercise is both executed and delivered pursuant to Section 1(a) hereof after the close of “regular trading hours” on such Business Day;
(B) = the Exercise Price of this Warrant, as adjusted hereunder; and
(X) = the number of Warrant Shares that would be issuable upon exercise of this Warrant in accordance wit h the terms of this Warrant if such exercise were by means of a cash exercise rather than a cashless exercise.
If Warrant Shares are issued in such a cashless exercise, the parties acknowledge and agree that in accordance with Section 3(a)(9) of the Securities Act, the Warrant Shares shall take on the registered characteristics of the Warrants being exercised. The Company agrees not to take any position contrary to this Section 1(c).
“Bid Price” means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then listed or quoted on a Trading Market, the bid price of the Common Stock for the time in question (or the nearest preceding date) on the Trading Market on which the Common Stock are then listed or quoted as reported by Bloomberg (based on a Business Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if the Common Stock is not then listed or quoted on a Trading Market but is quoted on OTCQB or OTCQX, the volume weighted average price of the Common Stock for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, (c) if the Common Stock are not then listed or quoted for trading on a Trading Market, OTCQB or OTCQX and if prices for the Common Stock are then reported on The Pink Open Market (or a similar organization or agency succeeding to its functions of reporting prices), the most recent Bid Price per share of the Common Stock so reported, or (d) in all other cases, the fair market value of a Common Stock as determined by an independent appraiser selected in good faith by the holder of a majority in interest of the Securities then outstanding and reasonably acceptable to the Company, the fees and expenses of which shall be paid by the Company.
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“Trading Market” means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date in question: the NYSE, the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, or the Nasdaq Global Select Market (or any successors to any of the foregoing).
“VWAP” means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock are then listed or quoted on a Trading Market, the daily volume weighted average price of the share of Common Stock for such date (or the nearest preceding date) on the Trading Market on which the Common Stock are then listed or quoted as reported by Bloomberg (based on a Business Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX is not a Trading Market, the volume weighted average price of the Common Stock for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, (c) if the Common Stock are not then listed or quoted for trading on OTCQB or OTCQX and if prices for the Common Stock are then reported on The Pink Open Market (or a similar organization or agency succeeding to its functions of reporting prices), the most recent Bid Price per share of Common Stock so reported, or (d) in all other cases, the fair market value of a share of Common Stock as determined jointly by the Board and the Holder; provided, that if the Board and the Holder are unable to agree on the fair market value per share of the Common Stock within a reasonable period of time (not to exceed ten days from the Company’s receipt of the Exercise Notice), such fair market value shall be determined by an nationally recognized investment banking, accounting or valuation firm jointly selected by the Board and the Holder, the fees and expenses of which shall be paid by the Company.
(d) Mechanics of Exercise.
(i) Delivery of Warrant Shares Upon Exercise. The Company shall cause the Warrant Shares purchased hereunder to be transmitted by the Transfer Agent to the Holder by crediting the account of the Holder’s or its designee’s balance account with The Depository Trust Company through its Deposit or Withdrawal at Custodian system (“DWAC”) if the Company is then a participant in such system and either (A) there is an effective registration statement permitting the issuance of the Warrant Shares to or resale of the Warrant Shares by Holder or (B) this Warrant is being exercised via cashless exercise, and otherwise by physical delivery of a certificate, registered in the Company’s share register in the name of the Holder or its designee, for the number of Warrant Shares to which the Holder is entitled pursuant to such exercise to the address specified by the Holder in the Notice of Exercise by the date that is the earliest of (i) two (2) Business Days after the delivery to the Company of the Notice of Exercise, (ii) one (1) Business Day after delivery of the aggregate Exercise Price to the Company and (iii) the number of Business Days comprising the Standard Settlement Period after the delivery to the Company of the Notice of Exercise (such date, the “Warrant Share Delivery Date”). Upon delivery of the Notice of Exercise, the Holder shall be deemed for all corporate purposes to have become the holder of record of the Warrant Shares with respect to which this Warrant has been exercised, irrespective of the date of delivery of the Warrant Shares, provided that payment of the aggregate Exercise Price (other than in the case of a cashless exercise) is received within the earlier of (i) two (2) Business Days and (ii) the number of Business Days comprising the Standard Settlement Period following delivery of the Notice of Exercise. If the Company fails for any reason to deliver to the Holder the Warrant Shares subject to a Notice of Exercise by the Warrant Share Delivery Date, the Company shall pay to the Holder, in cash, as liquidated damages and not as a penalty, for each $1,000 of Warrant Shares subject to such exercise (based on the VWAP of the Common Stock on the date of the applicable Notice of Exercise), $10 per Business Day (increasing to $20 per Business Day on the fifth Business Day after the Warrant Share Delivery Date) for each Business Day after such Warrant Share Delivery Date until such Warrant Shares are delivered or Holder rescinds such exercise. The Company agrees to maintain a transfer agent that is a participant in the FAST program so long as this Warrant remains outstanding and exercisable. As used herein, “Standard Settlement Period” means the standard settlement period, expressed in a number of Business Days, on the Company’s primary Trading Market with respect to the Common Stock as in effect on the date of delivery of the Notice of Exercise. Notwithstanding the foregoing, with respect to any Notice(s) of Exercise delivered on or prior to 12:00 p.m. (New York City time) on the Initial Exercise Date, and the Company agrees to deliver the Warrant Shares subject to such notice(s) by 4:00 p.m. (New York City time) on the Initial Exercise Date and the Initial Exercise Date shall be the Warrant Share Delivery Date for purposes hereunder, provided that payment of the aggregate Exercise Price (other than in the case of a cashless exercise) is received by such Warrant Share Delivery Date.
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(ii) Delivery of New Warrants Upon Exercise. If this Warrant shall have been exercised in part, the Company shall, at the request of a Holder and upon surrender of this Warrant, at the time of delivery of the Warrant Shares, deliver to the Holder a new Warrant evidencing the rights of the Holder to purchase the unpurchased Warrant Shares called for by this Warrant, which new Warrant shall in all other respects be identical with this Warrant.
(iii) Rescission Rights. If the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares pursuant Section 1(d)(i) by the Warrant Share Delivery Date, then the Holder will have the right to rescind such exercise.
(iv) Compensation for Buy-In on Failure to Timely Deliver Warrant Shares Upon Exercise. In addition to any other rights available to the Holder, if the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares in accordance with the provisions of Section 1(d)(i) above pursuant to an exercise on or before the Warrant Share Delivery Date, and if after such date the Holder is required by its broker to purchase (in an open market transaction or otherwise) or the Holder’s brokerage firm otherwise purchases, Common Stock to deliver in satisfaction of a sale by the Holder of the Warrant Shares which the Holder anticipated receiving upon such exercise (a “Buy-In”), then the Company shall (A) pay in cash to the Holder the amount, if any, by which (x) the Holder’s total purchase price (including brokerage commissions, if any) for the Common Stock so purchased exceeds (y) the amount obtained by multiplying (1) the number of Warrant Shares that the Company was required to deliver to the Holder in connection with the exercise at issue times (2) the price at which the sell order giving rise to such purchase obligation was executed, and (B) at the option of the Holder, either reinstate the portion of the Warrant and equivalent number of Warrant Shares for which such exercise was not honored (in which case such exercise shall be deemed rescinded) or deliver to the Holder the number of shares of Common Stock that would have been issued had the Company timely complied with its exercise and delivery obligations hereunder. For example, if the Holder purchases shares of Common Stock having a total purchase price of $11,000 to cover a Buy-In with respect to an attempted exercise Common Stock with an aggregate sale price giving rise to such purchase obligation of $10,000, under clause (A) of the immediately preceding sentence the Company shall be required to pay the Holder $1,000. The Holder shall provide the Company written notice indicating the amounts payable to the Holder in respect of the Buy-In and, upon request of the Company, evidence of the amount of such loss. Nothing herein shall limit a Holder’s right to pursue any other remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company’s failure to timely deliver the Common Stock upon exercise of the Warrant as required pursuant to the terms hereof.
(v) No Fractional Shares or Scrip. No fractional shares or scrip representing fractional shares shall be issued upon the exercise of this Warrant. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such exercise, the Company shall, at its election, either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by the Exercise Price or round up to the next whole share.
(vi) Charges, Taxes and Expenses. Issuance of Warrant Shares shall be made without charge to the Holder for any issue or transfer tax or other incidental expense in respect of the issuance of such Warrant Shares, all of which taxes and expenses shall be paid by the Company, and such Warrant Shares shall be issued in the name of the Holder or in such name or names as may be directed by the Holder; provided, however, that, in the event that Warrant Shares are to be issued in a name other than the name of the Holder, this Warrant when surrendered for exercise shall be accompanied by an Assignment Form in the form attached hereto as Exhibit B duly executed by the Holder and the Company may require, as a condition thereto, the payment of a sum sufficient to reimburse it for any transfer tax incidental thereto. The Company shall pay all Transfer Agent fees required for same-day processing of any Notice of Exercise and all fees to the Depository Trust Company (or another established clearing corporation performing similar functions) required for same-day electronic delivery of the Warrant Shares.
(vii) Closing of Books. The Company will not close its shareholder books or records in any manner which prevents the timely exercise of this Warrant, pursuant to the terms hereof.
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(e) Holder’s Exercise Limitations. As of the date hereof, the Company shall not effect any exercise of this Warrant, and a Holder shall not have the right to exercise any portion of this Warrant, pursuant to Section 1 or otherwise, to the extent that after giving effect to such issuance after exercise as set forth on the applicable Notice of Exercise, the Holder (together with the Holder’s Affiliates, and any other Persons acting as a group together with the Holder or any of the Holder’s Affiliates (such Persons, “Attribution Parties”)), would beneficially own in excess of the Beneficial Ownership Limitation (as defined below). For purposes of the foregoing sentence, the number of shares of Common Stock beneficially owned by the Holder and its Affiliates and Attribution Parties shall include the number of shares of Common Stock issuable upon exercise of this Warrant with respect to which such determination is being made, but shall exclude the number of shares of Common Stock which would be issuable upon (i) exercise of the remaining, non-exercised portion of this Warrant beneficially owned by the Holder or any of its Affiliates or Attribution Parties and (ii) exercise or conversion of the unexercised or non-converted portion of any other securities of the Company (including, without limitation, any other share of Common Stock Equivalents) subject to a limitation on conversion or exercise analogous to the limitation contained herein beneficially owned by the Holder or any of its Affiliates or Attribution Parties. Except as set forth in the preceding sentence, for purposes of this Section 1(e), beneficial ownership shall be calculated in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder, it being acknowledged by the Holder that the Company is not representing to the Holder that such calculation is in compliance with Section 13(d) of the Exchange Act and the Holder is solely responsible for any schedules required to be filed in accordance therewith. To the extent that the limitation contained in this Section 1(e) applies, the determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder together with any Affiliates and Attribution Parties) and of which portion of this Warrant is exercisable shall be in the sole discretion of the Holder, and the submission of a Notice of Exercise shall be deemed to be the Holder’s determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder together with any Affiliates and Attribution Parties) and of which portion of this Warrant is exercisable, in each case subject to the Beneficial Ownership Limitation, and the Company shall have no obligation to verify or confirm the accuracy of such determination. In addition, a determination as to any group status as contemplated above shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. For purposes of this Section 1(e), in determining the number of outstanding shares of Common Stock, a Holder may rely on the number of outstanding shares of Common Stock, as reflected in (A) the Company’s most recent periodic or annual report filed with the Commission, as the case may be, (B) a more recent public announcement by the Company or (C) a more recent written notice by the Company setting forth the number of shares of Common Stock outstanding. Upon the written request of a Holder, the Company shall within one Business Day confirm to the Holder the number of shares of Common Stock then outstanding. In any case, the number of outstanding shares of Common Stock shall be determined after giving effect to the conversion or exercise of securities of the Company, including this Warrant, by the Holder or its Affiliates or Attribution Parties since the date as of which such number of outstanding shares of Common Stock was reported. The “Beneficial Ownership Limitation” shall be 9.99% of the number of shares of Common Stock, outstanding immediately after giving effect to the issuance of Common Stock issuable upon exercise of this Warrant. The Holder, upon notice to the Company, may increase or decrease the Beneficial Ownership Limitation provisions of this Section 1(e), provided that the Beneficial Ownership Limitation in no event exceeds 9.99% of the number of shares of Common Stock outstanding immediately after giving effect to the issuance of Common Stock upon exercise of this Warrant held by the Holder and the provisions of this Section 1(e) shall continue to apply. Any increase in the Beneficial Ownership Limitation will not be effective until the 61st day after such notice is delivered to the Company. The provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity with the terms of this Section 1(e) to correct this paragraph (or any portion hereof) which may be defective or inconsistent with the intended Beneficial Ownership Limitation herein contained or to make changes or supplements necessary or desirable to properly give effect to such limitation. The limitations contained in this paragraph shall apply to a successor holder of this Warrant.
Section 2. Certain Adjustments.
(a) Share Dividends and Splits. If the Company, at any time while this Warrant is outstanding: (i) pays a share dividend or otherwise makes a distribution or distributions on its Common Stock, (ii) subdivides outstanding Common Stock into a larger number of shares, (iii) combines (including by way of reverse split) outstanding Common Stock into a smaller number of shares, or (iv) issues by reclassification of the Common Stock any shares of the Company, then in each case the Exercise Price shall be multiplied by a fraction of which the numerator shall be the number of Common Stock (excluding treasury shares, if any) outstanding immediately before such event and of which the denominator shall be the number of Common Stock outstanding immediately after such event, and the number of shares issuable upon exercise of this Warrant shall be proportionately adjusted such that the aggregate Exercise Price of this Warrant shall remain unchanged. Any adjustment made pursuant to this Section 2(a) shall become effective immediately after the record date for the determination of shareholders entitled to receive such dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or re-classification.
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(b) Subsequent Rights Offerings. In addition to (but without duplication of) any adjustments pursuant to Section 2(a) above, if at any time the Company grants, issues or sells any share of Common Stock Equivalents or rights to purchase shares, warrants, securities or other property pro rata to the record holders of the Common Stock (the “Purchase Rights”), then the Holder will be entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired if the Holder had held the number of Common Stock acquirable upon complete exercise of this Warrant (without regard to any limitations on exercise hereof, including without limitation, the Beneficial Ownership Limitation) immediately before the date on which a record is taken for the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record holders of Common Stock are to be determined for the grant, issue or sale of such Purchase Rights (provided, however, that, to the extent that the Holder’s right to participate in any such Purchase Right would result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such Purchase Right to such extent (or beneficial ownership of such Common Stock as a result of such Purchase Right to such extent) and such Purchase Right to such extent shall be held in abeyance for the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation).
(c) Pro Rata Distributions. During such time as this Warrant is outstanding, if the Company shall declare or make any dividend or other distribution of its assets (or rights to acquire its assets) to holders of Common Stock, by way of return of capital or otherwise (including, without limitation, any distribution of cash, stock or other securities, property or options by way of a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a “Distribution”), other than a dividend or distribution covered by Section 2(a) or 3(b), at any time after the issuance of this Warrant, then, in each such case, the Holder shall be entitled to participate in such Distribution to the same extent that the Holder would have participated therein if the Holder had held the number of Common Stock acquirable upon complete exercise of this Warrant (without regard to any limitations on exercise hereof, including without limitation, the Beneficial Ownership Limitation) immediately before the date of which a record is taken for such Distribution, or, if no such record is taken, the date as of which the record holders of Common Stock are to be determined for the participation in such Distribution (provided, however, that, to the extent that the Holder’s right to participate in any such Distribution would result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such Distribution to such extent (or in the beneficial ownership of any Common Stock as a result of such Distribution to such extent) and the portion of such Distribution shall be held in abeyance for the benefit of the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation).
(d) Fundamental Transaction. If, at any time while this Warrant is outstanding, (i) the Company, directly or indirectly, in one or more related transactions effects any merger or consolidation of the Company with or into another Person, (ii) the Company or any Subsidiary, directly or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially all of its assets in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange offer (whether by the Company or another Person) is completed pursuant to which holders of Common Stock are permitted to sell, tender or exchange their shares for other securities, cash or property and has been accepted by the holders of 50% or more of the outstanding Common Stock, (iv) the Company, directly or indirectly, in one or more related transactions effects any reclassification, reorganization or recapitalization of the Common Stock or any compulsory share exchange pursuant to which the shares of Common Stock are effectively converted into or exchanged for other securities, cash or property, or (v) the Company, directly or indirectly, in one or more related transactions consummates a stock or share purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization, spin-off, merger or scheme of arrangement) with another Person or group of Persons whereby such other Person or group acquires more than 50% of the outstanding Common Stock or becomes the beneficial owner of 50% of the voting power represented by our outstanding Common Stock (not including any shares of Common Stock held by the other Person or other Persons making or party to, or associated or affiliated with the other Persons making or party to, such stock or share purchase agreement or other business combination) (each a “Fundamental Transaction”), then, upon any subsequent exercise of this Warrant, the Holder shall have the right to receive, for each Warrant Share that would have been issuable upon such exercise immediately prior to the occurrence of such Fundamental Transaction, at the option of the Holder (without regard to any limitation in Section 1(e) on the exercise of this Warrant), the number of Common Stock of the successor or acquiring corporation or of the Company, if it is the surviving corporation, and any additional consideration (the “Alternate Consideration”) receivable as a result of such Fundamental Transaction by a holder of the number of Common Stock for which this Warrant is exercisable immediately prior to such Fundamental Transaction (without regard to any limitation in Section 1(e) on the exercise of this Warrant). For purposes of any such exercise, the determination of the Exercise Price shall be appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration issuable in respect of one share of Common Stock in such Fundamental Transaction, and the Company shall apportion the Exercise Price among the Alternate Consideration in a reasonable manner reflecting the relative value of any different components of the Alternate Consideration. If holders of Common Stock are given any choice as to the securities, cash or property to be received in a Fundamental Transaction, then the Holder shall be given the same choice as to the Alternate Consideration it receives upon any exercise of this Warrant following such Fundamental Transaction.
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(e) Calculations. All calculations under this Section 2 shall be made by the Company to the nearest cent or the nearest 1/100th of a share, as the case may be. For purposes of this Section 2, the number of shares of Common Stock deemed to be issued and outstanding as of a given date shall be the sum of the number of shares of Common Stock (excluding treasury shares, if any) issued and outstanding.
(f) Notice to Holder.
(i) Adjustment to Exercise Price. Whenever the Exercise Price is adjusted pursuant to any provision of this Section 2, the Company shall promptly deliver to the Holder by email or comparable electronic or digital transmission a notice setting forth the Exercise Price after such adjustment and any resulting adjustment to the number of Warrant Shares and setting forth a brief statement of the facts requiring such adjustment.
(g) Notice to Allow Exercise by Holder. If (A) the Company shall declare a dividend (or any other distribution in whatever form) on the Common Stock, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common Stock, (C) the Company shall authorize the granting to all holders of the Common Stock rights or warrants to subscribe for or purchase any shares of capital stock of any class or of any rights, (D) the approval of any shareholders of the Company shall be required in connection with any reclassification of the Common Stock, any consolidation or merger to which the Company (or any of its Subsidiaries) is a party, any sale or transfer of all or substantially all of the assets of the Company, or any compulsory share exchange whereby the Common Stock are converted into other securities, cash or property, or (E) the Company shall authorize the voluntary or involuntary dissolution, liquidation or winding up of the affairs of the Company (each such event described in clauses (A) through (E), a “Notice Triggering Event”), then, in each case, the Company shall provide notice of such Notice Triggering Event to the Holder describing the material terms of the Notice Triggering Event, including but not limited to (x) the date on which a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants, or if a record is not to be taken, the date as of which the holders of the Common Stock of record to be entitled to such receive any applicable dividend, distributions, redemption, rights or warrants are to be determined or (y) the date on which such reclassification, consolidation, merger, sale, transfer or share exchange is expected to become effective or close, and the date as of which it is expected that holders of Common Stock of record shall be entitled to exchange their Common Stock for securities, cash or other property deliverable upon such reclassification, consolidation, merger, sale, transfer or share exchange; provided that the failure to deliver such notice or any defect therein or in the delivery thereof shall not affect the validity of the corporate action required to be specified in such notice. The Holder shall remain entitled to exercise this Warrant during the period commencing on the date of such notice to the date of Notice Triggering Event except as may otherwise be expressly set forth herein, provided that any such exercise of this Warrant remains subject to any shareholder record date established by the Board of Directors of the Company with respect to such Notice Triggering Event.
(h) Voluntary Adjustment By Company. Subject to the rules and regulations of the Trading Market, the Company may at any time during the term of this Warrant reduce the then current Exercise Price to any amount and for any period of time deemed appropriate by the Board of Directors of the Company.
Section 3. Transfer of Warrant.
(a) Transferability. This Warrant and all rights hereunder (including, without limitation, any registration rights) are transferable, in whole or in part, upon surrender of this Warrant to the Company, together with a written assignment of this Warrant substantially in the form attached hereto duly executed by the Holder or its agent or attorney and funds sufficient to pay any transfer taxes payable upon the making of such transfer. Upon such surrender and, if required, such payment, the Company shall execute and deliver a new Warrant or Warrants in the name of the assignee or assignees, as applicable, and in the denomination or denominations specified in such instrument of assignment, and shall issue to the assignor a new Warrant evidencing the portion of this Warrant not so assigned, and this Warrant shall promptly be cancelled. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this Warrant to the Company unless the Holder has assigned this Warrant in full, in which case, the Holder shall surrender this Warrant to the Company within three (3) Business Days of the date on which the Holder delivers an Assignment Form in the form attached hereto as Exhibit B to the Company assigning this Warrant in full. The Warrant, if properly assigned in accordance herewith, may be exercised by a new holder for the purchase of Warrant Shares without having a new Warrant issued.
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(b) New Warrants. This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of the Company, together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by the Holder or its agent or attorney. Subject to compliance with Section 3(a), as to any transfer which may be involved in such division or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided or combined in accordance with such notice. All Warrants issued on transfers or exchanges shall be dated the initial issuance date of this Warrant and shall be identical with this Warrant except as to the number of Warrant Shares issuable pursuant thereto.
(c) Warrant Register. The Company shall register this Warrant upon its records for that purpose (the “Warrant Register”) in the name of the record Holder hereof from time to time. The Company may deem and treat the registered Holder of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder, and for all other purposes, absent actual notice to the contrary.
(d) Representation by the Holder. The Holder, by the acceptance hereof, represents and warrants that it is an “accredited investor”, as defined in Regulation D promulgated under the Securities Act acquiring this Warrant and, upon any exercise hereof, will acquire the Warrant Shares issuable upon such exercise, for its own account and not with a view to or for distributing or reselling such Warrant Shares or any part thereof in violation of the Securities Act or any applicable state securities law, except pursuant to sales registered or exempted under the Securities Act. As provided in the Notice of Exercise, upon any exercise of this Warrant, the Holder will be again be required to represent that it is an “accredited investor”, as defined in Regulation D promulgated under the Securities Act.
Section 4. Miscellaneous.
(a) No Rights as Shareholder Until Exercise; No Settlement in Cash. This Warrant does not entitle the Holder to any voting rights, dividends or other rights as a shareholder of the Company prior to the exercise hereof as set forth in Section 1(d)(i), except as expressly set forth in Section 2. Without limiting any rights of a Holder to receive Warrant Shares on a “cashless exercise” pursuant to Section 1(c) or to receive cash payments pursuant to Section 1(d)(i) and Section 1(d)(iv) herein, in no event shall the Company be required to net cash settle an exercise of this Warrant.
(b) Loss, Theft, Destruction or Mutilation of Warrant. The Company covenants that upon receipt by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any stock certificate relating to the Warrant Shares, and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it, and upon surrender and cancellation of such Warrant or stock certificate, if mutilated, the Company will make and deliver a new Warrant or stock certificate of like tenor and dated as of such cancellation, in lieu of such Warrant or stock certificate.
(c) Saturdays, Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right required or granted herein shall not be a Business Day, then such action may be taken or such right may be exercised on the next succeeding Business Day.
(d) Authorized Shares. The Company covenants that, during the period the Warrant is outstanding, it will reserve from its authorized and unissued Common Stock a sufficient number of shares to provide for the issuance of the Warrant Shares upon the exercise of any purchase rights under this Warrant. The Company further covenants that its issuance of this Warrant shall constitute full authority to its officers who are charged with the duty of issuing the necessary Warrant Shares upon the exercise of the purchase rights under this Warrant. The Company will take all such reasonable action as may be necessary to assure that such Warrant Shares may be issued as provided herein without violation of any applicable law or regulation, or of any requirements of the Trading Market upon which the Common Stock may be listed. The Company covenants that all Warrant Shares which may be issued upon the exercise of the purchase rights represented by this Warrant will, upon exercise of the purchase rights represented by this Warrant and payment for such Warrant Shares in accordance herewith, be duly authorized, validly issued, fully paid and non-assessable and free from all taxes, liens and charges created by the Company in respect of the issue thereof (other than taxes in respect of any transfer occurring contemporaneously with such issue). Except and to the extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending its certificate of formation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such actions as may be necessary or appropriate to protect the rights of Holder as set forth in this Warrant against impairment. Without limiting the generality of the foregoing, the Company will (i) not increase the par value of any Warrant Shares above the amount payable therefor upon such exercise immediately prior to such increase in par value, (ii) take all such action as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and non-assessable Warrant Shares upon the exercise of this Warrant and (iii) use commercially reasonable efforts to obtain all such authorizations, exemptions or consents from any public regulatory body having jurisdiction thereof, as may be, necessary to enable the Company to perform its obligations under this Warrant. Before taking any action which would result in an adjustment in the number of Warrant Shares for which this Warrant is exercisable or in the Exercise Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from any public regulatory body or bodies having jurisdiction thereof.
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(e) Governing Law and Jurisdiction. All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be governed by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles of conflicts of law thereof.
(f) Restrictions; Earn Out Shares. The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered, and the Holder does not utilize cashless exercise, will have restrictions upon resale imposed by state and federal securities laws. Notwithstanding anything herein to the contrary, the Holder acknowledges and agrees that this Warrant does not, and shall not, entitle the Holder to any Earn Out Shares (as defined in the Agreement and Plan of Merger, dated as of March 8, 2026, among the Company, Autonomous Power Corporation, Merger Sub, and the Stockholder Representative named therein.
(g) Non-waiver and Expenses. No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall operate as a waiver of such right or otherwise prejudice the Holder’s rights, powers or remedies. Without limiting any other provision of this Warrant, if the Company willfully and knowingly fails to comply with any provision of this Warrant, which results in any material damages to the Holder, the Company shall pay to the Holder such amounts as shall be sufficient to cover any costs and expenses including, but not limited to, reasonable attorneys’ fees, including those of appellate proceedings, incurred by the Holder in collecting any amounts due pursuant hereto or in otherwise enforcing any of its rights, powers or remedies hereunder.
(h) Notices. Any notice, request or other document required or permitted to be given or delivered to the Holder by the Company shall be in writing and shall be deemed given and effective on the earliest of: (a) the time of transmission, if such notice or communication is delivered via email attachment at the email address as set forth on the signature pages attached hereto at or prior to 5:30 p.m. (New York City time) on a trading day, (b) the next trading day after the time of transmission, if such notice or communication is delivered via email attachment at the email address as set forth on the signature pages attached hereto on a day that is not a trading day or later than 5:30 p.m. (New York City time) on any Trading Day, (c) the second (2nd) trading day following the date of mailing, if sent by U.S. nationally recognized overnight courier service or (d) upon actual receipt by the party to whom such notice is required to be given..
(i) Limitation of Liability. No provision hereof, in the absence of any affirmative action by the Holder to exercise this Warrant to purchase Warrant Shares, and no enumeration herein of the rights or privileges of the Holder, shall give rise to any liability of the Holder for the purchase price of any Common Stock or as a shareholder of the Company, whether such liability is asserted by the Company or by creditors of the Company.
(j) Remedies. The Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will be entitled to specific performance of its rights under this Warrant. The Company agrees that monetary damages would not be adequate compensation for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees to waive and not to assert the defense in any action for specific performance that a remedy at law would be adequate.
(k) Successors and Assigns. Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby shall inure to the benefit of and be binding upon the successors and permitted assigns of the Company and the successors and permitted assigns of Holder. The provisions of this Warrant are intended to be for the benefit of any Holder from time to time of this Warrant and shall be enforceable by the Holder or holder of Warrant Shares.
(l) Amendment. This Warrant may be amended by the Holder with the prior written consent of the Company.
(m) Severability. Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining provisions of this Warrant.
(n) Headings. The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed a part of this Warrant.
(Signature Page Follows)
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IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by its officer thereunto duly authorized as of the date first above indicated.
| POWERUS CORPORATION | ||
| By: | ||
| Name: | ||
| Title: | ||
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Exhibit A
NOTICE OF EXERCISE
TO: POWERUS CORPORATION
(1) The undersigned hereby elects to purchase _______________Warrant Shares of the Company pursuant to the terms of the attached Warrant (only if exercised in full), and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes, if any.
(2) Payment shall take the form of (check applicable box):
☐ in lawful money of the United States; or
☐ if permitted the cancellation of such number of Warrant Shares as is necessary, in accordance with the formula set forth in subsection 1(c), to exercise this Warrant with respect to the maximum number of Warrant Shares purchasable pursuant to the cashless exercise procedure set forth in subsection 1(c).
(3) Please issue said Warrant Shares in the name of the undersigned or in such other name as is specified below:___
The Warrant Shares shall be delivered to the following DWAC Account Number:
Name of Broker: ________________________________________________
DTC Participant ID: _____________________________________________
Account Number: ______________________________________________
Account Name: ________________________________________________
[SIGNATURE OF HOLDER]
Name of Holder: __________________________________________________________________________
Signature of Authorized Signatory of Holder: ___________________________________________________
Name of Authorized Signatory: ____________________________________
Title of Authorized Signatory: _____________________________________
Date: ____________________
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Exhibit B
ASSIGNMENT FORM
(To assign the foregoing Warrant, execute this form and supply required information. Do not use this form to
purchase shares.)
FOR VALUE RECEIVED, the foregoing Warrant and all rights evidenced thereby are hereby assigned to
Name: _______________________________________________________________________________________________
Address: ________________________________________________________________________________________
________________________________________________________________________________________________
_______
Phone Number: ___________________
Email Address: _____________________________________
[SIGNATURE OF HOLDER]
Name of Holder: ____________________________________________________________________________
Signature of Authorized Signatory of Holder: ______________________________________________________
Name of Authorized Signatory: ______________________________________
Title of Authorized Signatory: _________________________________________
Date: ________________________
NOTE: The assignee of the foregoing Warrant agrees to be bound by all the terms and obligations of the foregoing Warrant, including, without limitation, the representations and warranties of the Holder in Section 3(d) of the Warrant, as if assignee were the original Holder party thereto.
Any terms that are capitalized but not defined in this Exhibit B have the meanings ascribed to them in the foregoing Warrant.
Acknowledged and Agreed: Assignee
| Name: | ||
| By: | ||
| Name: | ||
| Title: | ||
| Email: |
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Exhibit 10.1
POWERUS CORPORATION
515 North Flagler Drive, Suite 350
West Palm Beach, Florida 33401
October 1, 2026
Andrew Fox
[***]
[***]
Dear Andrew:
This letter sets forth our agreement with respect to your continued employment (hereinafter “letter agreement”) with Powerus Corporation, a Nevada corporation (the “Company”).
1. Employment. Your employment with the Company will be upon the terms and conditions set forth in this letter agreement beginning on October 1, 2026 (the “Effective Date”) and ending as provided in Section 4 (the “Employment Period”).
2. Position and Duties. During the Employment Period, you will serve as Chief Executive Officer of the Company and will have the usual and customary duties, responsibilities and authorities of a person in such position and such other duties assigned to you by the Board of Directors of the Company (the “Board”) which are consistent with your position. You will report directly to the Board. You will devote your full working time, efforts and attention to, and diligently and conscientiously perform the duties of, such position. In addition to performing such duties for the Company, you may be required to perform similar duties for the Company’s existing subsidiaries or affiliates, and/or any subsidiaries and/or affiliates which may be formed or acquired from time to time in the future (collectively, all such subsidiaries and/or affiliates, including subsidiaries formed after the date hereof, shall be referred to as the “Company Affiliates”). Except for travel for business purposes, you will be employed, and your primary offices will be located, at your home office (“Primary Office”). You represent to the Company that you are not subject to or a party to any employment agreement, non-competition covenant, or other agreement that would be breached by, or prohibit you from executing, this letter agreement and performing fully your duties and responsibilities hereunder.
3. Compensation.
(a) Base Salary. During the Employment Period, your base salary will be $350,000 per annum (your “Base Salary”). Your Base Salary will be payable in regular installments in accordance with the Company’s general payroll practices and subject to withholding and other payroll taxes. Your Base Salary may be reviewed annually (consistent with the Company’s past practice and timing) by the Compensation Committee of the Board (the “Compensation Committee”) and may be increased by the Compensation Committee in its sole discretion (for the avoidance of doubt, such increased amount shall be considered your “Base Salary” for all purposes of this letter agreement). Unless agreed by you in writing, your Base Salary may not be decreased below your then-current Base Salary by the Board, Compensation Committee or otherwise.
(b) Cash Incentive Plan. Effective February 1, 2026, with respect to each fiscal year of the Company ending during the Employment Period, you shall be eligible to earn an incentive award (an “Annual Incentive Award”) under the Company’s bonus program or cash incentive plan (once established), or any successor plan (the “Cash Incentive Plan”) pursuant to the terms and conditions of the Cash Incentive Plan. Your Annual Incentive Award under the Cash Incentive Plan for fiscal year 2026 shall be $150,000 guaranteed. In the event of your termination of employment, the terms of the Cash Incentive Plan shall control to determine whether you are entitled to payment of any yet unpaid Annual Incentive Award for the prior fiscal year; provided that if the Cash Incentive Plan does not set forth the treatment of an Annual Incentive Award upon termination of employment, you must remain employed until regular date of payment for Annual Incentive Awards for the applicable fiscal year.
(c) Target Compensation after Fiscal Year 2026. Your target award values under the Cash Incentive Plan and the Company’s Equity Incentive Plan, as amended from time to time, or any successor equity incentive plan (the “Equity Plan”) shall be reviewed annually by the Board or the Compensation Committee pursuant to the normal performance review policies for the CEO, with such targets and objectives established by the Board or Compensation Committee in its sole discretion, provided that the Annual Incentive Award shall not be less than 100% of Base Salary with a guaranteed cash bonus of at least $150,000.
(d) Employee Benefits. During the Employment Period, you will be entitled to participate in all employee benefit programs, including without limitation health/medical insurance, for which senior executive employees of the Company are generally eligible, subject to applicable plans and policies as may be amended from time to time, in the sole discretion of the Board. During the Employment Period, you will be entitled to 27 days paid time off (“PTO”) during each calendar year, to be used and managed consistent with applicable Company policy. PTO shall accrue evenly over the course of each calendar year during the Employment Period.
(e) Expenses. The Company shall reimburse you for all reasonable out-of-pocket business expenses incurred by you on behalf of the Company during the Employment Period, in accordance with applicable policies of the Company; provided that you properly account to the Company for all such expenses in accordance with the policies of the Company and the rules, regulations and interpretations of the U.S. Internal Revenue Service relating to reimbursement of business expenses (“Expenses”).
(f) Insurance. During the Employment Period, to the extent commercially available, the Company will maintain Directors and Officers Liability Insurance coverage that includes coverage of you, subject to the terms and conditions of such policy as applicable to other executive officers of the company, and with limits customary for similarly situated companies.
4. Termination.
(a) The initial term of your employment shall be three (3) years from the Effective Date (the “Initial Term”). After the Initial Term, your employment will be on an at-will basis, for no set period of time. The Employment Period, whether during the Initial Term or thereafter, (i) will automatically terminate upon your death, (ii) may be terminated by the Company upon Notice of Termination (as defined in Section 5(f) below) delivered to you as a result of your Disability (as defined in Section 5(h) below), (iii) may be terminated by the Company upon Notice of Termination at any time for Cause (as defined in Section 5(g) below), (iv) may be terminated by you upon Notice of Termination for Good Reason (as defined in Section 5(i) below), (v) may be terminated by the Company upon Notice of Termination without Cause, and (vi) may be terminated by you for any other reason.
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(b) Effective as of the date of any Termination Date (as defined in Section 5(f) below), you shall be deemed, without any further action on your part, to have automatically resigned from all Company-related positions, including as an officer of the Company and Company Affiliates and you agree to resign from any positions as a member of the Board of the Company and Company Affiliates (if applicable).
5. Severance.
(a) If the Employment Period is terminated by the Company without Cause (other than due to your Disability) or by you for Good Reason, then, unless Section 5(b) applies, you will be entitled to receive, subject to applicable taxes and withholdings:
(i) your Base Salary as in effect at the time of such termination to the extent such amount has accrued through the Termination Date (as defined in Section 5(f) below) and remains unpaid, any accrued and unpaid PTO required to be paid out pursuant to the Company’s PTO policy and applicable law, all other vested payments, benefits or fringe benefits to which you are entitled to under the Company’s employee benefit programs, and any unpaid Expenses that have not been reimbursed by the Company as of the Termination Date that were incurred prior to the Termination Date (the sum of these amounts, the “Accrued Obligations”);
(ii) an amount equal to the greater of (A) 18 months of your Base Salary and (B) the aggregate amount of Base Salary that would have otherwise have been paid during the remainder of the Initial Term (if terminated during the Initial Term), which shall be payable in a single lump sum cash payment within 60 days following the Termination Date;
(iii) if your Termination Date occurs more than six months after the beginning of the then-current fiscal year (and at least six months after the Effective Date), a prorated Annual Incentive Award in respect of the fiscal year in which the Termination Date occurs in an amount equal to the product of (A) the Annual Incentive Award, if any, that you would have received for such fiscal year if you had remained employed through the date on which the Annual Incentive Award is to be paid, and (B) a fraction, the numerator of which is the number of calendar days you were employed by the Company during such fiscal year and the denominator of which is 365, which amount shall be paid in the same manner and at the same time that the Company pays other Company executive incentive awards under the Annual Incentive Plan for such fiscal year; provided that payment under this subsection (iii) shall not be duplicative of payments that you are entitled to under the Annual Incentive Plan, and any such amounts payable pursuant to the terms of the Annual Incentive Plan will be deducted from the payment provided for under this subsection (iii);
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(iv) any time-based vesting equity awards granted to you under the Equity Plan shall immediately become vested upon your Termination Date;
(v) any performance-based vesting equity awards granted to you under the Equity Plan shall vest according to the terms of the applicable award agreement, or if not specified in the applicable award agreement, will vest at 100%;
(vi) the Company will extend the post-termination exercise period with respect to all outstanding stock options granted under the Equity Plan held by you until the earlier of (A) the date that is two (2) years after the Termination Date, or (B) the original expiration date of the stock options; and
(vii) if you timely elect continued coverage pursuant to COBRA, the Company will reimburse you for your individual monthly COBRA premiums until the earliest to occur of (A) the date that is eighteen (18) months after the Termination Date, or (B) the date on which you are no longer eligible for COBRA coverage, provided that subsidized COBRA continuation coverage contemplated herein may be subject to taxes and withholdings to the extent the Company determines necessary to ensure compliance with the non-discrimination requirements of Section 105(h) or other provisions of the Internal Revenue Code of 1986, as amended (the “Code”).
The Company’s obligation to make the payments or provide the benefits to you described in clauses (ii)-(vi) of this Section 5(a) is conditioned upon your executing and delivering, no later than 45 days following the Termination Date (and not revoking), a release relating to your employment with and service to the Company in favor of the Company, the Company Affiliates and their respective stockholders, officers, members, managers, directors, employees, subsidiaries and affiliates (the “Release Requirement”) in the form provided by the Company (a “Release”).
(b) Change in Control Termination. If the Employment Period is terminated by the Company without Cause (other than due to your Disability) or by you for Good Reason, in each case, within three months prior, upon or within 12 months following the consummation of a Change in Control (as defined below), then, subject to your compliance with the Release Requirement (except with respect to payment of Accrued Obligations, which shall not be subject to such Release Requirement), you will be entitled to receive in lieu of the severance pay and benefits described in Section 5(a) above:
(i) the Accrued Obligations;
(ii) an amount equal to the greater of (A) the aggregate amount of Base Salary that would otherwise have been paid during the remainder of the Initial Term (if terminated during the Initial Term), and (B) two times (2.0x) the greater of your annual Base Salary immediately prior to the Termination Date, or your annual Base Salary in effect immediately prior to the Change in Control, which shall be paid in a single lump-sum cash payment within 60 days following the Termination Date;
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(iii) an amount equal to two times (2.0x) the greater of your target Annual Incentive Award for the year in which the Termination Date occurs (or if it has not yet been established, the target Annual Incentive Award established for the immediately preceding year), or your target Annual Incentive Award for the year immediately preceding the year in which the Change in Control occurs, which shall be paid in addition to any Annual Incentive Award actually earned and payable under the Cash Incentive Plan for the relevant year, in a single lump sum cash payment within 60 days following the Termination Date;
(iv) any time-based vesting equity awards granted to you under the Equity Plan shall immediately become vested upon your Termination Date;
(v) any performance-based vesting equity awards granted to you under the Equity Plan shall vest according to the terms of the applicable award agreement, or if not specified in the applicable award agreement, will vest at 100%;
(vi) the Company will extend the post-termination exercise period with respect to all outstanding stock options granted under the Equity Plan held by you until the earlier of (A) the date that is two (2) years after the Termination Date, or (B) the original expiration date of the stock options; and
(vii) if you timely elect continued coverage pursuant to COBRA, the Company will reimburse you for your monthly individual COBRA premiums until the earliest to occur of (A) the date that is eighteen (18) months after the Termination Date, or (B) the date on which you are no longer eligible for COBRA coverage; provided that the subsidized COBRA continuation coverage contemplated herein may be subject to taxes and withholdings to the extent the Company determines necessary to ensure compliance with the non-discrimination requirements of Section 105(h) or other provisions of the Code.
For purposes of this letter agreement, a “Change in Control” shall be deemed to occur when and only when any of the following events first occurs: (A) any person other than a Permitted Investor (as defined below), or a group consisting solely of one or more Permitted Investors, becomes the beneficial owner, directly or indirectly, of securities of the Company representing 55% or more of the combined voting power of the Company’s then-outstanding voting securities; (B) a majority of the members of the Board are replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of such Board prior to the date of the appointment or election; or (C) the consummation of any merger (other than a merger where the Company is the survivor and there is no accompanying Change in Control under clauses (A) or (B), consolidation, liquidation or dissolution of the Company, or the sale of all or substantially all of the assets of the Company. Notwithstanding the foregoing, a Change in Control shall not be deemed to occur pursuant to clause (A) solely because 50% or more of the combined voting power of the Company’s outstanding securities is acquired by (I) one or more employee benefit plans maintained by the Company or by any other employer, the majority interest in which is held, directly or indirectly, by the Company or (II) any person who is the beneficial owner of securities of the Company representing 30% or more of the combined voting power of the Company’s then-outstanding voting securities. For purposes of this paragraph, the terms “person” and “beneficial owner” shall have the meanings set forth in Sections 3(a) and 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and in the regulations promulgated thereunder, and “Permitted Investor” means any of (i) Andrew Fox, (ii) Brett Velicovich, (iii) Roman Vintfeld, (iv) Michael Sinesky, or any entities controlled by such individual(s) or any trust for the primary benefit of such individual(s), his or her spouse or his or her lineal descendants.
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(c) Termination For Cause, Resignation without Good Reason, Death or Disability. If the Employment Period is terminated by the Company for Cause, by you other than for Good Reason, or due to death or Disability, (i) the Company will pay you the Accrued Obligations as of the Termination Date, and (ii) the post-termination exercise period with respect to all outstanding stock options granted under the Equity Plan held by you will extend until the earlier of (A) the date that is two (2) years after the Termination Date, or (B) the original expiration date of the stock options, and the Company will have no further obligation to you under this letter agreement with respect to your employment with the Company.
(d) Any termination of the Employment Period by the Company (other than termination upon your death) or by you must be communicated by written notice (in either case, a “Notice of Termination”) to you, if the Company is the terminating party, or to the Company, if you are the terminating party. For purposes of this letter agreement, “Termination Date” means (i) if the Employment Period is terminated due to your death, the date of your death and (ii) if the Employment Period is terminated due to your Disability, by the Company (for Cause or without Cause) or by you (for Good Reason or without Good Reason), the date specified in the Notice of Termination (which may not be earlier than the date of such Notice of Termination). Notwithstanding anything contained herein to the contrary, you must provide at least 30 days’ written notice to the Company prior to any intended termination of your employment by you (except if your termination is for Good Reason, in which case the time periods set forth in the definition of Good Reason apply)); provided, however, that the Company’s decision to shorten or eliminate the 30-day notice period shall not constitute a termination by the Company or entitle you to any severance.
(e) For purposes of this letter agreement, “Cause” means any one of the following: (i) a material breach by you of this letter agreement or any other written agreement with the Company, (ii) your conviction of, guilty plea to, or confession of guilt of, a felony, (iii) materially fraudulent, dishonest or illegal conduct by you in the performance of services for or on behalf of the Company or any of the Company Affiliates, (iv) any repeated conduct by you in material violation of Company written policy, (v) any conduct by you that is materially detrimental to the reputation of the Company or any of the Company Affiliates, (vi) your misappropriation of funds of the Company or any of the Company Affiliates, (vii) your gross negligence or willful misconduct or willful failure to comply with lawful written directions of the Board which directions are within the scope of your duties hereunder, or (viii) your engaging in discrimination, sexual or other harassment, retaliation, or any conduct involving an act of moral turpitude. A purported termination of your employment for Cause shall not be effective unless (A) the Company provides written notice to you of the facts alleged by the Company to constitute Cause and such notice is delivered to you and (B) you have been given an opportunity of no less than 30 days after receipt of such notice to cure the circumstances alleged to give rise to Cause and the Company has cooperated in good faith with your efforts to cure such condition or circumstance, but only to the extent that such circumstances are reasonably curable. For avoidance of doubt, the circumstances set forth in clauses (ii), (iii), (v), (vi) and (viii) are not curable.
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(f) For purposes of this letter agreement “Disability” means any accident, sickness, incapacity or other physical or mental impairment that prevents you from performing, with or without reasonable accommodation, the essential functions of your position pursuant to this letter agreement for either (i) 90 consecutive days or (ii) 180 days during any period of 365 consecutive days, in each case as determined in good faith by the Board. During the time periods specified above, the Company will continue to provide you with the compensation stated in Section 3 above unless you are receiving disability benefits under a short- or long-term disability plan sponsored by the Company.
(g) For purposes of this letter agreement, “Good Reason” means (i) a material diminution in your authority, title, duties or responsibilities, (ii) the failure of the Company to make all material payments due to you under this letter agreement or otherwise or (iii) the relocation of your primary office to a location more than 25 miles from your Primary Office. A purported termination of your employment for Good Reason shall not be effective unless (A) you provide written notice to the Company of the facts alleged by you to constitute Good Reason and such notice is delivered to the Board no more than 60 days after the occurrence of such event, (B) the Company has been given an opportunity of no less than 30 days after receipt of such notice to cure the circumstances alleged to give rise to Good Reason and you have cooperated in good faith with the Company’s efforts to cure such condition or circumstance (which cooperation will not require you to waive or diminish any of your rights hereunder), but only to the extent that such circumstances are reasonably curable, and (C) you elect to terminate the Employment Period within 30 days following the end of the Company’s cure period due to the Company’s failure to cure.
6. Section 280G. Notwithstanding any other provision of this letter agreement:
(a) In the event it is determined by the accounting firm that was the Company’s independent auditor (the “Accountant”) immediately before the consummation of any transaction constituting a change in ownership or effective control of a corporation, or change in the ownership of a substantial portion of the assets of a corporation (as determined in accordance with the regulations promulgated under Section 280G of the Code), that part or all of the consideration, compensation or benefits to be paid to you under this letter agreement or otherwise constitute “parachute payments” under Section 280G(b)(2) of the Code, then, if the aggregate present value of such parachute payments, singularly or together with the aggregate present value of any consideration, compensation or benefits to be paid to you under any other plan, arrangement or agreement which constitute “parachute payments” (collectively, the “Parachute Payments”) exceeds the maximum amount that would not give rise to any excise taxes payable by you under Section 4999 of the Code, the amounts constituting Parachute Payments which would otherwise be payable to you or for your benefit shall be reduced to the maximum amount that would not give rise to any excise taxes payable by you under Section 4999 of the Code (the “Reduced Amount”); provided that such amounts shall not be so reduced if the Accountant determines that without such reduction you would be entitled to receive and retain, on a net after-tax basis (including, without limitation, any excise taxes payable under Section 4999 of the Code), an amount which is greater than the amount that you would be entitled to retain upon receipt of the Reduced Amount. In connection with making determinations under this Section 6, the Accountant shall take into account any positions to mitigate any excise taxes payable under Section 4999 of the Code, such as the value of any reasonable compensation for services to be rendered by you before or after the transaction. You and the Company shall provide the Accountant with such information and documents as the Accountant may reasonably request in order to make a determination under this Section 6. The Company shall be responsible for all fees and expenses of the Accountant.
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(b) If the determination made pursuant to Section 6(a) results in a reduction of the Parachute Payments that would otherwise be paid to you but for the application of this Section 6, the Company or the Accountant shall promptly give you written notice of such determination, which shall provide detailed supporting calculations. Such reduction in payments shall be made in accordance with Section 409A of the Code and the following: (i) the Parachute Payments which do not constitute deferred compensation subject to Section 409A shall be reduced first, and (ii) Parachute Payments that are cash payments shall be reduced before non-cash payments, and (iii) Parachute Payments to be made on a later payment date shall be reduced before payments to be made on an earlier payment date, unless, to the extent permitted by Section 409A of the Code, you elect to have the reduction in payments applied in a different order.
(c) If the initial application of this Section 6 determined that a Reduced Amount would be paid, and notwithstanding that determination, the IRS determines that any Parachute Payment that was paid constitutes an “excess parachute payment” (as defined by Section 280G(b) of the Code), this Section 6 will be reapplied based on the IRS’s determination, and you will be required to promptly repay the portion of the Parachute Payments required to avoid imposition of the excise tax payable by you under Section 4999 of the Code. In the event that you are paid a Reduced Amount and the Accountant, based on controlling precedent or substantial authority, determines that additional amounts that were not paid or distributed by the Company to or for your benefit pursuant to this letter agreement could have been so paid or distributed without causing imposition of the excise tax under Section 4999 of the Code to you (an “Underpayment”) has occurred, any such Underpayment shall be promptly paid by the Company to or for your benefit.
7. Confidential Information.
(a) You will not disclose or use at any time any Confidential Information (as defined below in Section 7(c)), whether or not such information is developed by you, except to the extent that such disclosure or use is required in the performance or exercise by you in good faith of (i) duties assigned to you under this letter agreement or otherwise by the Board, (ii) rights as an employee, officer, director or shareholder of the Company or any of the Company Affiliates or (iii) rights under any agreement with the Company or any of the Company Affiliates.
(b) You will deliver to the Company at the termination of the Employment Period, or at any time the Company may request, all memoranda, notes, plans, designs, records, reports, computer files and software and other documents and data (and copies thereof) that are Confidential Information or Work Product (as defined below) or information relating to the business of the Company or the Company Affiliates which you may then possess or have under your control. Upon request, you will also make available to the Company any smartphones or other devices on which you store Company information, so that the Company may remove such information. You acknowledge that, in the course of accessing any such smartphones or other devices for the purpose of removing Confidential Information or Work Product, the Company or its designated agents may inadvertently view or otherwise become aware of your personal information, data, files, photographs, communications, or other content unrelated to the Company (collectively, “Personal Information”). You hereby acknowledge and accept this possibility and agree that such incidental exposure shall not give rise to any claim, cause of action, or liability against the Company, its officers, directors, employees, agents, or representatives.
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(c) As used in this letter agreement, the term “Confidential Information” means information belonging to the Company or any of the Company Affiliates that is not generally known or available to the public and that is used, developed or obtained by the Company or any of the Company Affiliates in connection with its or their businesses, including without limitation (i) information, observations and data concerning its and their business and affairs, products or services, and fees, costs and pricing structures, (ii) designs, (iii) analyses, (iv) drawings, designs, photographs, artwork and reports, (v) computer software, including operating systems, applications and program listings, (vi) flow charts, manuals and documentation, (vii) databases, (viii) information concerning its accounting and business methods, (ix) inventions, devices, new developments, methods and processes, whether patentable or unpatentable and whether or not reduced to practice, (x) other copyrightable works, (xi) all production methods, processes, technology and trade secrets, (xii) product and product candidate formulae and any trade secrets with respect to such products and product candidates and (xiii) all similar and related information in whatever form.
(d) Notwithstanding the provisions of this letter agreement to the contrary, you will have no liability to the Company for disclosure of Confidential Information if the Confidential Information:
(i) is in the public domain or becomes publicly known in the industry in which the Company or any of the Company Affiliates operates or is disclosed by the Company or any of the Company Affiliates other than as the result of a breach of this letter agreement or any other agreement by you; or
(ii) is required to be disclosed by law, court order, or similar compulsion or in connection with any legal proceeding; provided, however, that such disclosure will be limited to the extent so required and, subject to the requirements of law, you will give the Company notice of your intent to so disclose such Confidential Information and will cooperate with the Company in seeking confidentiality protections.
(e) Notwithstanding the foregoing, nothing in or about this letter agreement prohibits you from (i) filing and, as provided for under Section 21F of the Exchange Act, maintaining the confidentiality of a claim with the Securities and Exchange Commission (the “SEC”); (ii) providing Confidential Information to the SEC, or providing the SEC with information that would otherwise violate this Section 7, to the extent permitted by Section 21F of the Exchange Act; (iii) cooperating, participating or assisting in an SEC investigation or proceeding concerning the Company without notifying the Company; or (iv) receiving a monetary award as set forth in Section 21F of the Exchange Act. Furthermore, you are advised that you shall not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of any Confidential Information that constitutes a trade secret to which the Defend Trade Secrets Act (18 U.S.C. Section 1833(b)) applies that is made (A) in confidence to a federal, state or local government official, either directly or indirectly, or to an attorney, in each case, solely for the purpose of reporting or investigating a suspected violation of law or (B) in a complaint or other document filed in a lawsuit or proceeding, if such filings are made under seal.
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8. Inventions and Patents. You agree that all inventions, innovations, improvements, technical information, trade secrets, systems, software developments, ideas, results, methods, designs, artwork, analyses, drawings, reports, copyrights, service marks, trademarks, trade names, logos and all similar or related information (whether patentable or unpatentable) which relate to the Company’s or any of the Company Affiliates’ businesses, research and development or existing products (or products under development) or services and which are conceived, developed or made by you (whether or not during usual business hours and whether or not alone or in conjunction with any other person) during your employment with the Company, together with all intellectual property rights therein, including without limitation any patent applications, letters patent, trademark, trade name and service mark applications or registrations, copyrights and reissues thereof that may be granted for or upon any of the foregoing (collectively referred to herein as “Work Product”), is the exclusive property of the Company and/or the Company Affiliates. For the avoidance of doubt and without limiting the foregoing, (x) the Company or any of the Company Affiliates shall be the sole owner of all right, title and interest in such Work Product, including without limitation all intellectual property rights relating to such Work Product, without you retaining any license or other residual right whatsoever, and (y) any rights to any new or an existing Work Product are automatically conveyed, assigned and transferred to the Company pursuant to this letter agreement. You hereby waive and renounce all moral rights related, directly or indirectly, to any such existing or new Work Product. You will take reasonable steps to promptly disclose such Work Product to the Board and perform all actions reasonably requested by the Board (whether during or after the Employment Period) to establish and confirm such ownership (including without limitation the execution and delivery of assignments, consents, powers of attorney and other instruments) and to provide reasonable assistance to the Company and the Company Affiliates in connection with the prosecution of any applications for patents, trademarks, trade names, service marks or reissues thereof or in the prosecution or defense of interferences relating to any Work Product.
9. Non-Competition; Non-Solicitation.
(a) You acknowledge that, in the course of your employment with the Company, you will become familiar with the Company’s and the Company Affiliates’ trade secrets and other Confidential Information as well as the Company’s customer information and goodwill, and that your services will be of special, unique, and extraordinary value to the Company and the Company Affiliates. Therefore, you agree that, during the Employment Period and any other period during which you are employed by the Company or any of its Affiliates, whether pursuant to this letter agreement or otherwise, plus an additional twelve (12) months after your separation (the “Restriction Period”) (regardless of the reason for your separation from the Company and whether caused by you or the Company), you will not (x) in the United States or any other country where, as of the time at issue, the Company or any of the Company Affiliates conducts business or (y) anywhere else that, during the then prior two-year period, the Company or any of the Company Affiliates has spent time and resources in connection with expanding its business, directly or indirectly, either on your own behalf or on behalf of any other person, firm or entity: engage in, or own, manage, operate, work as an employee for, consult with, provide services or financing to, or join, control or participate in the ownership, management, operation or control of, any business (whether in corporate, proprietorship or partnership form or otherwise) that is engaged in the business of (i) research and development, manufacturing, marketing, and selling autonomous systems across air, ground and maritime, and software-defined autonomy capabilities and other similar platforms or (ii) such other business in which the Company or any Company Affiliates with which you worked was engaged at any time during the then immediately prior two years.
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(b) Nothing in Section 9(a) will prohibit you from being a passive owner of not more than 2% of the outstanding stock of a publicly-traded corporation, so long as you have no active participation in the business of such corporation.
(c) During the Restriction Period, you also will not:
(i) induce or attempt to induce any customer, supplier or other business relation of the Company or any of the Company Affiliates to cease doing business with the Company or any of the Company Affiliates, or in any way interfere with the relationship between any such customer, supplier or business relation, on the one hand, and the Company or any of the Company Affiliates, on the other hand;
(ii) engage, employ, solicit or contact with a view to the engagement or employment of, any employee, officer or manager of, or full-time consultant to, the Company or any of the Company Affiliates with which you worked or any person who has been an employee, officer or manager of, or consultant to, the Company or any of the Company Affiliates with which you worked, if he or she has been in such a role at any time within the then immediately prior three months; or
(iii) assist any individual or entity to engage in the conduct referenced in clauses (i) and (ii) immediately above.
10. Enforcement.
(a) Because the employment relationship between you and the Company is unique and because you have access to Confidential Information, Work Product and Company goodwill, you agree that money damages would be an inadequate remedy for any breach of Section 7, 8 or 9. Therefore, in the event of a breach or threatened breach of Section 7, 8 or 9 (or any portion(s) thereof), you agree that the Company is entitled to enforce this letter agreement, and hereby specifically consent to entry by a court of a temporary, preliminary and/or permanent injunction (as well as any other appropriate equitable relief) to prevent any actual or threatened breach by you of said Sections 7, 8, or 9. Nothing contained in this Section 10, however, shall prohibit the Company from pursuing and recovering any remedies at law or in equity in addition to injunctive relief, specifically including the recovery of damages. Furthermore, you agree that in the event of a breach of Section 9, the time periods set forth in Section 9 shall be extended by the amount of time that you are in breach. Sections 5, 6, 7, 8 and 9 will expressly survive termination of the Employment Period and this letter agreement.
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(b) The existence of any claim or cause of action by you against the Company and/or any of the Company Affiliates shall not constitute a defense to the enforcement by the Company of the covenants contained in Section 6(b), 7, 8 or 9, but such claim or cause of action shall be litigated separately.
11. Notices. All notices, requests, demands, claims, and other communications hereunder will be in writing. Any notice, request, demand, claim or other communication hereunder will be deemed duly given (a) upon delivery, if delivered personally to the recipient, against written receipt therefor, or (b) upon the first Business Day after the date sent, if sent priority next Business Day delivery to the intended recipient by a reputable express courier service (charges prepaid) and addressed to the intended recipient as set forth below:
If to the Company, to:
Attention: Chief Legal Officer
Powerus Corporation
515 North Flagler Drive, Suite 350
West Palm Beach, Florida 33401
If to you, to the address appearing in the Company’s records.
Any party hereto may send any notice, request, demand, claim or other communication hereunder to the intended recipient at the address set forth above using any other means, but no such notice, request, demand, claim or other communication will be deemed to have been duly given unless and until it actually is received and acknowledged by the intended recipient. Any party hereto may change the address (or add new parties and their addresses) to which notices, requests, demands, claims, and other communications hereunder are to be delivered by giving the other parties hereto notice in the manner set forth in this Section 11.
12. Representations and Warranties. You hereby represent and warrant to the Company that (a) the execution, delivery and performance of this letter agreement by you does not and will not conflict with, breach, violate or cause a default under any agreement, contract or instrument to which you are a party or any judgment, order or decree to which you are subject, (b) you are not a party to or bound by any employment agreement, consulting agreement, non-compete agreement, confidentiality agreement or similar agreement with any other person or entity that is inconsistent with the provisions of this letter agreement or that would limit you in your duties hereunder, (c) upon the execution and delivery of this letter agreement by the Company and you, this letter agreement will be a valid and binding obligation of you and (d) you are able to perform the services described in this letter agreement. The Company hereby represents and warrants to you that (i) the execution, delivery and performance of this letter agreement does not and will not conflict with, breach, violate or cause a default under any agreement, contract or instrument to which it is a party or any judgment, order or decree to which it is subject and (ii) upon the execution and delivery of this letter agreement by the Company and you, such agreements will be valid and binding obligations of the Company.
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13. Lock-Up Agreement. In connection with a registration with the United States Securities and Exchange Commission under the Securities Act of the public sale of shares of Common Stock, you shall not sell, make any short sale of, loan, grant any option for the purchase of, or otherwise dispose of any securities of the Company (other than those included in the registration) without the prior written consent of the Company or such underwriters, as the case may be, for such period of time prior to the effective date of such registration and continuing through and following the effective date of such registration (not to exceed 180 days) as the Company or the underwriters, as the case may be, shall specify. You agree that the Company may instruct its transfer agent to place stop-transfer notations in its records to enforce the provisions of this Section. You shall execute a form of agreement reflecting the foregoing restrictions as requested by the underwriters managing such offering.
14. General Provisions.
(a) Severability. It is the desire and intent of the parties hereto that the provisions of this letter agreement be enforced to the fullest extent permissible under the laws and public policies applied in each jurisdiction in which enforcement is sought. Accordingly, if any particular provision of this letter agreement will be adjudicated by a court of competent jurisdiction to be invalid, prohibited or unenforceable for any reason, such provision, as to such jurisdiction, will be ineffective, without invalidating the remaining provisions of this letter agreement or affecting the validity or enforceability of this letter agreement or affecting the validity or enforceability of such provision in any other jurisdiction. Notwithstanding the foregoing, if such provision could be more narrowly drawn so as not to be invalid, prohibited or unenforceable in such jurisdiction, it will, as to such jurisdiction, be so narrowly drawn, without invalidating the remaining provisions of this letter agreement or affecting the validity or enforceability of such provision in any other jurisdiction.
(b) Complete Agreement. This letter agreement and any schedules or exhibits expressly constitute the entire agreement among the parties hereto with respect to the subject matter hereof and supersedes and pre-empts any prior understandings, agreements or representations by or among the parties, written or oral, which may have related to the subject matter hereof in any way, except with regard to outstanding equity awards granted under the Equity Plan, or as expressly set forth in this letter agreement. For the avoidance of doubt, the compensation and benefits provided upon a termination of employment under this letter agreement shall not result in duplication of compensation or benefits provided under any other plan, policy, agreement or arrangement, except as specifically provided herein.
(c) Successors and Assigns. The Company may freely assign this letter agreement, including to any Affiliate or in connection with any merger or sale of equity or assets, and upon such assignment the references herein to the Company shall be deemed to include the assignee. You may not assign your rights and obligations under this letter agreement without the prior written consent of the Company. Except as otherwise provided herein, this letter agreement will be binding upon and inure to the benefit of you and the Company and our respective successors, permitted assigns, personal representatives, heirs and estates, as the case may be.
(d) Governing Law. This letter agreement will be governed by and construed in accordance with the domestic laws of Florida, without giving effect to the choice of law provisions thereof. The parties agree that any dispute under this letter agreement may be brought in the federal and state courts sitting in Florida and by this letter agreement the parties expressly consent to such courts’ jurisdiction.
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(e) Amendment and Waiver. The provisions of this letter agreement may be amended and waived only with the prior written consent of the Company (with the approval of the Board) and you, and no course of conduct or failure or delay in enforcing the provisions of this letter agreement will affect the validity, binding effect or enforceability of this letter agreement or any provision hereof.
(f) Headings. The section headings contained in this letter agreement are inserted for convenience only and will not affect in any way the meaning or interpretation of this letter agreement.
(g) Counterparts. This letter agreement may be executed in counterparts, each of which will be deemed an original and all of which together will constitute one and the same instrument. The signatures of any of the persons executing this letter agreement may be transmitted via facsimile or other electronic means and shall be sufficient evidence of the execution of this letter agreement.
(h) 409A Provision.
(i) The Company and you intend that this letter agreement and the payments and benefits provided hereunder comply in form and operation with the requirements of Section 409A of the Internal Revenue Code of 1986, as amended, and the final regulations issued thereunder (“Section 409A”), and accordingly, to the maximum extent permitted, all provisions of this letter agreement shall be construed and interpreted in a manner consistent with the requirements for avoiding taxes or penalties under Section 409A.
(ii) If a payment under this letter agreement is to be made within a designated period which does not begin and end within one calendar year, you do not have a right to designate the calendar year of the payment, and the actual date of payment within the specified period shall be within the sole discretion of the Company. For purposes of Section 409A, each of the payments and benefits that may be made hereunder is designated as a separate and distinct payment.
(iii) For purposes of this letter agreement, to the extent required to avoid accelerated income recognition and/or tax penalties under Section 409A, (A) you shall not be considered to have terminated employment with the Company for purposes of any payments under this letter agreement which are subject to Section 409A until you would be considered to have incurred a “separation from service” from the Company within the meaning of Section 409A, and (B) if, as of the date of your separation from service, you are a “specified employee” within the meaning of Section 409A, then to the extent necessary to comply with Section 409A, payment to you of any amount or benefit that constitutes “nonqualified deferred compensation” under Section 409A and which under the terms of this letter agreement would otherwise be payable as a result of and within six (6) months following such separation from service shall be delayed until the date that is six months following your separation from service or, if earlier, the earliest other date as is permitted under Section 409A (and any amounts that otherwise would have been paid during this deferral period will be paid in a lump sum on the day after the expiration of the six (6) month period or such shorter period, if applicable). The term “specified employee” means an individual determined by the Company to be a specified employee under Treasury regulation Section 1.409A-1(i).
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(iv) Except as otherwise permitted by Section 409A, the benefits and reimbursements provided to you under this letter agreement and any Company plan or policy during any calendar year shall not affect the benefits and reimbursements to be provided to you under the relevant section of this letter agreement or any Company plan or policy in any other calendar year, and the right to such benefits and reimbursements cannot be liquidated or exchanged for any other benefit and shall be provided in accordance with Treas. Reg. Section 1.409A-3(i)(1)(iv) or any successor thereto. Further, in the case of reimbursement payments, reimbursement payments shall be made to you as soon as practicable following the date that the applicable expense is incurred and proper documentation is provided to the Company, but in no event later than the last day of the calendar year following the calendar year in which the underlying expense is incurred.
(v) If you incur any tax, interest, or penalty under Section 409A (“409A Taxes”) as a result of the Company’s act or omission which causes a failure to comply with Section 409A with respect to any Company compensation arrangements with you, the Company shall indemnify and hold you harmless from and against such 409A Taxes, including by making any additional payments necessary so that you retain the same after-tax amount that would have been received absent such 409A Taxes. The Company shall have no liability under this subsection (v) to the extent that the 409A Taxes arise from (i) any action (or failure to act) taken by you, or (ii) a change in applicable law, published guidance, or interpretation occurring after the effective date of this Agreement, if the Company operated in good faith and in a manner reasonably consistent with applicable authority existing at the time the relevant action was taken.
(i) “Business Day” Defined. For purposes of this letter agreement, the capitalized term “Business Day” shall mean any calendar day other than a Saturday, Sunday or other day on which banks in New York, New York are authorized or required to be closed.
(j) Clawback Acknowledgement. This letter agreement and the compensation payable hereunder, as applicable, shall be subject to any applicable clawback or recoupment policies, stock ownership policies, share trading policies, and other codes of conduct and written policies that are in place as of the Effective Date and as may be revised or implemented by the Company from time to time as applicable to officers of the Company. For the avoidance of doubt, notwithstanding any other provision herein, any incentive compensation awarded to you that is subject to recovery under any law, government regulation, stock exchange listing requirement or recoupment policy adopted by the Company will be subject to such deductions and clawback as may be required to be made pursuant to such law, government regulation, stock exchange listing requirement or recoupment policy adopted by the Company (including a policy adopted by the Company in response to any such law, government regulation or stock exchange listing requirement).
(k) Original Employment Letter. This letter agreement replaces and supersedes your letter agreement dated February 1, 2026 with Autonomous Power Corporation (“APC”), a wholly owned subsidiary of the Company resulting from the transactions under the Merger Agreement, dated March 8, 2026, by and among the Company (formerly known as Aureus Greenway Holdings, Inc.), APC and the other parties named therein.
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If this letter agreement correctly expresses our mutual understanding, please sign and date a copy of this letter agreement and return it to the Company.
| Very truly yours, | ||
| POWERUS CORPORATION | ||
| By: | /s/ Jim Biehl | |
| Name: | Jim Biehl | |
| Title: | Chief Legal Officer | |
The
terms of this letter agreement are accepted
and agreed to as of the date set forth below by:
| /s/ Andrew Fox | |
| Andrew Fox | |
| October 1, 2026 | |
| Date |
Exhibit 10.2
POWERUS CORPORATION
515 North Flagler Drive, Suite 350
West Palm Beach, Florida 33401
October 1, 2026
Brett Velicovich
[***]
[***]
Dear Brett:
This letter sets forth our agreement with respect to your continued employment (hereinafter “letter agreement”) with Powerus Corporation, a Nevada corporation (the “Company”).
1. Employment. Your employment with the Company will be upon the terms and conditions set forth in this letter agreement beginning on October 1, 2026 (the “Effective Date”) and ending as provided in Section 4 (the “Employment Period”).
2. Position and Duties. During the Employment Period, you will serve as President of the Company and will have the usual and customary duties, responsibilities and authorities of a person in such position and such other duties assigned to you by the Chief Executive Officer of the Company (the “CEO”) which are consistent with your position. You will report directly to the CEO. You will devote your full working time, efforts and attention to, and diligently and conscientiously perform the duties of, such position. In addition to performing such duties for the Company, you may be required to perform similar duties for the Company’s existing subsidiaries or affiliates, and/or any subsidiaries and/or affiliates which may be formed or acquired from time to time in the future (collectively, all such subsidiaries and/or affiliates, including subsidiaries formed after the date hereof, shall be referred to as the “Company Affiliates”). Except for travel for business purposes, you will be employed, and your primary offices will be located, at your home office (“Primary Office”). You represent to the Company that you are not subject to or a party to any employment agreement, non-competition covenant, or other agreement that would be breached by, or prohibit you from executing, this letter agreement and performing fully your duties and responsibilities hereunder.
3. Compensation.
(a) Base Salary. During the Employment Period, your base salary will be $350,000 per annum (your “Base Salary”). Your Base Salary will be payable in regular installments in accordance with the Company’s general payroll practices and subject to withholding and other payroll taxes. Your Base Salary may be reviewed annually (consistent with the Company’s past practice and timing) by the Compensation Committee of the Board (the “Compensation Committee”) and may be increased by the Compensation Committee in its sole discretion (for the avoidance of doubt, such increased amount shall be considered your “Base Salary” for all purposes of this letter agreement). Unless agreed by you in writing, your Base Salary may not be decreased below your then-current Base Salary by the Board, Compensation Committee or otherwise.
(b) Cash Incentive Plan. Effective February 1, 2026, with respect to each fiscal year of the Company ending during the Employment Period, you shall be eligible to earn an incentive award (an “Annual Incentive Award”) under the Company’s bonus program or cash incentive plan (once established), or any successor plan (the “Cash Incentive Plan”) pursuant to the terms and conditions of the Cash Incentive Plan. Your Annual Incentive Award under the Cash Incentive Plan for fiscal year 2026 shall be $150,000 guaranteed. In the event of your termination of employment, the terms of the Cash Incentive Plan shall control to determine whether you are entitled to payment of any yet unpaid Annual Incentive Award for the prior fiscal year; provided that if the Cash Incentive Plan does not set forth the treatment of an Annual Incentive Award upon termination of employment, you must remain employed until regular date of payment for Annual Incentive Awards for the applicable fiscal year.
(c) Target Compensation after Fiscal Year 2026. Your target award values under the Cash Incentive Plan and the Company’s Equity Incentive Plan, as amended from time to time, or any successor equity incentive plan (the “Equity Plan”) shall be reviewed annually by the Board or the Compensation Committee pursuant to the normal performance review policies for the President, with such targets and objectives established by the Board or Compensation Committee in its sole discretion, provided that the Annual Incentive Award shall not be less than 100% of Base Salary with a guaranteed cash bonus of at least $150,000.
(d) Employee Benefits. During the Employment Period, you will be entitled to participate in all employee benefit programs, including without limitation health/medical insurance, for which senior executive employees of the Company are generally eligible, subject to applicable plans and policies as may be amended from time to time, in the sole discretion of the Board. During the Employment Period, you will be entitled to 27 days paid time off (“PTO”) during each calendar year, to be used and managed consistent with applicable Company policy. PTO shall accrue evenly over the course of each calendar year during the Employment Period.
(e) Expenses. The Company shall reimburse you for all reasonable out-of-pocket business expenses incurred by you on behalf of the Company during the Employment Period, in accordance with applicable policies of the Company; provided that you properly account to the Company for all such expenses in accordance with the policies of the Company and the rules, regulations and interpretations of the U.S. Internal Revenue Service relating to reimbursement of business expenses (“Expenses”).
(f) Insurance. During the Employment Period, to the extent commercially available, the Company will maintain Directors and Officers Liability Insurance coverage that includes coverage of you, subject to the terms and conditions of such policy as applicable to other executive officers of the company, and with limits customary for similarly situated companies.
4. Termination.
(a) The initial term of your employment shall be three (3) years from the Effective Date (the “Initial Term”). After the Initial Term, your employment will be on an at-will basis, for no set period of time. The Employment Period, whether during the Initial Term or thereafter, (i) will automatically terminate upon your death, (ii) may be terminated by the Company upon Notice of Termination (as defined in Section 5(f) below) delivered to you as a result of your Disability (as defined in Section 5(h) below), (iii) may be terminated by the Company upon Notice of Termination at any time for Cause (as defined in Section 5(g) below), (iv) may be terminated by you upon Notice of Termination for Good Reason (as defined in Section 5(i) below), (v) may be terminated by the Company upon Notice of Termination without Cause, and (vi) may be terminated by you for any other reason.
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(b) Effective as of the date of any Termination Date (as defined in Section 5(f) below), you shall be deemed, without any further action on your part, to have automatically resigned from all Company-related positions, including as an officer of the Company and Company Affiliates and you agree to resign from any positions as a member of the Board of the Company and Company Affiliates (if applicable).
5. Severance.
(a) If the Employment Period is terminated by the Company without Cause (other than due to your Disability) or by you for Good Reason, then, unless Section 5(b) applies, you will be entitled to receive, subject to applicable taxes and withholdings:
(i) your Base Salary as in effect at the time of such termination to the extent such amount has accrued through the Termination Date (as defined in Section 5(f) below) and remains unpaid, any accrued and unpaid PTO required to be paid out pursuant to the Company’s PTO policy and applicable law, all other vested payments, benefits or fringe benefits to which you are entitled to under the Company’s employee benefit programs, and any unpaid Expenses that have not been reimbursed by the Company as of the Termination Date that were incurred prior to the Termination Date (the sum of these amounts, the “Accrued Obligations”);
(ii) an amount equal to the greater of (A) 18 months of your Base Salary and (B) the aggregate amount of Base Salary that would have otherwise have been paid during the remainder of the Initial Term (if terminated during the Initial Term), which shall be payable in a single lump sum cash payment within 60 days following the Termination Date;
(iii) if your Termination Date occurs more than six months after the beginning of the then-current fiscal year (and at least six months after the Effective Date), a prorated Annual Incentive Award in respect of the fiscal year in which the Termination Date occurs in an amount equal to the product of (A) the Annual Incentive Award, if any, that you would have received for such fiscal year if you had remained employed through the date on which the Annual Incentive Award is to be paid, and (B) a fraction, the numerator of which is the number of calendar days you were employed by the Company during such fiscal year and the denominator of which is 365, which amount shall be paid in the same manner and at the same time that the Company pays other Company executive incentive awards under the Annual Incentive Plan for such fiscal year; provided that payment under this subsection (iii) shall not be duplicative of payments that you are entitled to under the Annual Incentive Plan, and any such amounts payable pursuant to the terms of the Annual Incentive Plan will be deducted from the payment provided for under this subsection (iii);
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(iv) any time-based vesting equity awards granted to you under the Equity Plan shall immediately become vested upon your Termination Date;
(v) any performance-based vesting equity awards granted to you under the Equity Plan shall vest according to the terms of the applicable award agreement, or if not specified in the applicable award agreement, will vest at 100%;
(vi) the Company will extend the post-termination exercise period with respect to all outstanding stock options granted under the Equity Plan held by you until the earlier of (A) the date that is two (2) years after the Termination Date, or (B) the original expiration date of the stock options; and
(vii) if you timely elect continued coverage pursuant to COBRA, the Company will reimburse you for your individual monthly COBRA premiums until the earliest to occur of (A) the date that is eighteen (18) months after the Termination Date, or (B) the date on which you are no longer eligible for COBRA coverage, provided that subsidized COBRA continuation coverage contemplated herein may be subject to taxes and withholdings to the extent the Company determines necessary to ensure compliance with the non-discrimination requirements of Section 105(h) or other provisions of the Internal Revenue Code of 1986, as amended (the “Code”).
The Company’s obligation to make the payments or provide the benefits to you described in clauses (ii)-(vi) of this Section 5(a) is conditioned upon your executing and delivering, no later than 45 days following the Termination Date (and not revoking), a release relating to your employment with and service to the Company in favor of the Company, the Company Affiliates and their respective stockholders, officers, members, managers, directors, employees, subsidiaries and affiliates (the “Release Requirement”) in the form provided by the Company (a “Release”).
(b) Change in Control Termination. If the Employment Period is terminated by the Company without Cause (other than due to your Disability) or by you for Good Reason, in each case, within three months prior, upon or within 12 months following the consummation of a Change in Control (as defined below), then, subject to your compliance with the Release Requirement (except with respect to payment of Accrued Obligations, which shall not be subject to such Release Requirement), you will be entitled to receive in lieu of the severance pay and benefits described in Section 5(a) above:
(i) the Accrued Obligations;
(ii) an amount equal to the greater of (A) the aggregate amount of Base Salary that would otherwise have been paid during the remainder of the Initial Term (if terminated during the Initial Term), and (B) two times (2.0x) the greater of your annual Base Salary immediately prior to the Termination Date, or your annual Base Salary in effect immediately prior to the Change in Control, which shall be paid in a single lump-sum cash payment within 60 days following the Termination Date;
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(iii) an amount equal to two times (2.0x) the greater of your target Annual Incentive Award for the year in which the Termination Date occurs (or if it has not yet been established, the target Annual Incentive Award established for the immediately preceding year), or your target Annual Incentive Award for the year immediately preceding the year in which the Change in Control occurs, which shall be paid in addition to any Annual Incentive Award actually earned and payable under the Cash Incentive Plan for the relevant year, in a single lump sum cash payment within 60 days following the Termination Date;
(iv) any time-based vesting equity awards granted to you under the Equity Plan shall immediately become vested upon your Termination Date;
(v) any performance-based vesting equity awards granted to you under the Equity Plan shall vest according to the terms of the applicable award agreement, or if not specified in the applicable award agreement, will vest at 100%;
(vi) the Company will extend the post-termination exercise period with respect to all outstanding stock options granted under the Equity Plan held by you until the earlier of (A) the date that is two (2) years after the Termination Date, or (B) the original expiration date of the stock options; and
(vii) if you timely elect continued coverage pursuant to COBRA, the Company will reimburse you for your monthly individual COBRA premiums until the earliest to occur of (A) the date that is eighteen (18) months after the Termination Date, or (B) the date on which you are no longer eligible for COBRA coverage; provided that the subsidized COBRA continuation coverage contemplated herein may be subject to taxes and withholdings to the extent the Company determines necessary to ensure compliance with the non-discrimination requirements of Section 105(h) or other provisions of the Code.
For purposes of this letter agreement, a “Change in Control” shall be deemed to occur when and only when any of the following events first occurs: (A) any person other than a Permitted Investor (as defined below), or a group consisting solely of one or more Permitted Investors, becomes the beneficial owner, directly or indirectly, of securities of the Company representing 55% or more of the combined voting power of the Company’s then-outstanding voting securities; (B) a majority of the members of the Board are replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of such Board prior to the date of the appointment or election; or (C) the consummation of any merger (other than a merger where the Company is the survivor and there is no accompanying Change in Control under clauses (A) or (B), consolidation, liquidation or dissolution of the Company, or the sale of all or substantially all of the assets of the Company. Notwithstanding the foregoing, a Change in Control shall not be deemed to occur pursuant to clause (A) solely because 50% or more of the combined voting power of the Company’s outstanding securities is acquired by (I) one or more employee benefit plans maintained by the Company or by any other employer, the majority interest in which is held, directly or indirectly, by the Company or (II) any person who is the beneficial owner of securities of the Company representing 30% or more of the combined voting power of the Company’s then-outstanding voting securities. For purposes of this paragraph, the terms “person” and “beneficial owner” shall have the meanings set forth in Sections 3(a) and 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and in the regulations promulgated thereunder, and “Permitted Investor” means any of (i) Andrew Fox, (ii) Brett Velicovich, (iii) Roman Vintfeld, (iv) Michael Sinesky, or any entities controlled by such individual(s) or any trust for the primary benefit of such individual(s), his or her spouse or his or her lineal descendants.
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(c) Termination For Cause, Resignation without Good Reason, Death or Disability. If the Employment Period is terminated by the Company for Cause, by you other than for Good Reason, or due to death or Disability, (i) the Company will pay you the Accrued Obligations as of the Termination Date, and (ii) the post-termination exercise period with respect to all outstanding stock options granted under the Equity Plan held by you will extend until the earlier of (A) the date that is two (2) years after the Termination Date, or (B) the original expiration date of the stock options, and the Company will have no further obligation to you under this letter agreement with respect to your employment with the Company.
(d) Any termination of the Employment Period by the Company (other than termination upon your death) or by you must be communicated by written notice (in either case, a “Notice of Termination”) to you, if the Company is the terminating party, or to the Company, if you are the terminating party. For purposes of this letter agreement, “Termination Date” means (i) if the Employment Period is terminated due to your death, the date of your death and (ii) if the Employment Period is terminated due to your Disability, by the Company (for Cause or without Cause) or by you (for Good Reason or without Good Reason), the date specified in the Notice of Termination (which may not be earlier than the date of such Notice of Termination). Notwithstanding anything contained herein to the contrary, you must provide at least 30 days’ written notice to the Company prior to any intended termination of your employment by you (except if your termination is for Good Reason, in which case the time periods set forth in the definition of Good Reason apply)); provided, however, that the Company’s decision to shorten or eliminate the 30-day notice period shall not constitute a termination by the Company or entitle you to any severance.
(e) For purposes of this letter agreement, “Cause” means any one of the following: (i) a material breach by you of this letter agreement or any other written agreement with the Company, (ii) your conviction of, guilty plea to, or confession of guilt of, a felony, (iii) materially fraudulent, dishonest or illegal conduct by you in the performance of services for or on behalf of the Company or any of the Company Affiliates, (iv) any repeated conduct by you in material violation of Company written policy, (v) any conduct by you that is materially detrimental to the reputation of the Company or any of the Company Affiliates, (vi) your misappropriation of funds of the Company or any of the Company Affiliates, (vii) your gross negligence or willful misconduct or willful failure to comply with lawful written directions of the Board which directions are within the scope of your duties hereunder, or (viii) your engaging in discrimination, sexual or other harassment, retaliation, or any conduct involving an act of moral turpitude. A purported termination of your employment for Cause shall not be effective unless (A) the Company provides written notice to you of the facts alleged by the Company to constitute Cause and such notice is delivered to you and (B) you have been given an opportunity of no less than 30 days after receipt of such notice to cure the circumstances alleged to give rise to Cause and the Company has cooperated in good faith with your efforts to cure such condition or circumstance, but only to the extent that such circumstances are reasonably curable. For avoidance of doubt, the circumstances set forth in clauses (ii), (iii), (v), (vi) and (viii) are not curable.
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(f) For purposes of this letter agreement “Disability” means any accident, sickness, incapacity or other physical or mental impairment that prevents you from performing, with or without reasonable accommodation, the essential functions of your position pursuant to this letter agreement for either (i) 90 consecutive days or (ii) 180 days during any period of 365 consecutive days, in each case as determined in good faith by the Board. During the time periods specified above, the Company will continue to provide you with the compensation stated in Section 3 above unless you are receiving disability benefits under a short- or long-term disability plan sponsored by the Company.
(g) For purposes of this letter agreement, “Good Reason” means (i) a material diminution in your authority, title, duties or responsibilities, (ii) the failure of the Company to make all material payments due to you under this letter agreement or otherwise or (iii) the relocation of your primary office to a location more than 25 miles from your Primary Office. A purported termination of your employment for Good Reason shall not be effective unless (A) you provide written notice to the Company of the facts alleged by you to constitute Good Reason and such notice is delivered to the Board no more than 60 days after the occurrence of such event, (B) the Company has been given an opportunity of no less than 30 days after receipt of such notice to cure the circumstances alleged to give rise to Good Reason and you have cooperated in good faith with the Company’s efforts to cure such condition or circumstance (which cooperation will not require you to waive or diminish any of your rights hereunder), but only to the extent that such circumstances are reasonably curable, and (C) you elect to terminate the Employment Period within 30 days following the end of the Company’s cure period due to the Company’s failure to cure.
6. Section 280G. Notwithstanding any other provision of this letter agreement:
(a) In the event it is determined by the accounting firm that was the Company’s independent auditor (the “Accountant”) immediately before the consummation of any transaction constituting a change in ownership or effective control of a corporation, or change in the ownership of a substantial portion of the assets of a corporation (as determined in accordance with the regulations promulgated under Section 280G of the Code), that part or all of the consideration, compensation or benefits to be paid to you under this letter agreement or otherwise constitute “parachute payments” under Section 280G(b)(2) of the Code, then, if the aggregate present value of such parachute payments, singularly or together with the aggregate present value of any consideration, compensation or benefits to be paid to you under any other plan, arrangement or agreement which constitute “parachute payments” (collectively, the “Parachute Payments”) exceeds the maximum amount that would not give rise to any excise taxes payable by you under Section 4999 of the Code, the amounts constituting Parachute Payments which would otherwise be payable to you or for your benefit shall be reduced to the maximum amount that would not give rise to any excise taxes payable by you under Section 4999 of the Code (the “Reduced Amount”); provided that such amounts shall not be so reduced if the Accountant determines that without such reduction you would be entitled to receive and retain, on a net after-tax basis (including, without limitation, any excise taxes payable under Section 4999 of the Code), an amount which is greater than the amount that you would be entitled to retain upon receipt of the Reduced Amount. In connection with making determinations under this Section 6, the Accountant shall take into account any positions to mitigate any excise taxes payable under Section 4999 of the Code, such as the value of any reasonable compensation for services to be rendered by you before or after the transaction. You and the Company shall provide the Accountant with such information and documents as the Accountant may reasonably request in order to make a determination under this Section 6. The Company shall be responsible for all fees and expenses of the Accountant.
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(b) If the determination made pursuant to Section 6(a) results in a reduction of the Parachute Payments that would otherwise be paid to you but for the application of this Section 6, the Company or the Accountant shall promptly give you written notice of such determination, which shall provide detailed supporting calculations. Such reduction in payments shall be made in accordance with Section 409A of the Code and the following: (i) the Parachute Payments which do not constitute deferred compensation subject to Section 409A shall be reduced first, and (ii) Parachute Payments that are cash payments shall be reduced before non-cash payments, and (iii) Parachute Payments to be made on a later payment date shall be reduced before payments to be made on an earlier payment date, unless, to the extent permitted by Section 409A of the Code, you elect to have the reduction in payments applied in a different order.
(c) If the initial application of this Section 6 determined that a Reduced Amount would be paid, and notwithstanding that determination, the IRS determines that any Parachute Payment that was paid constitutes an “excess parachute payment” (as defined by Section 280G(b) of the Code), this Section 6 will be reapplied based on the IRS’s determination, and you will be required to promptly repay the portion of the Parachute Payments required to avoid imposition of the excise tax payable by you under Section 4999 of the Code. In the event that you are paid a Reduced Amount and the Accountant, based on controlling precedent or substantial authority, determines that additional amounts that were not paid or distributed by the Company to or for your benefit pursuant to this letter agreement could have been so paid or distributed without causing imposition of the excise tax under Section 4999 of the Code to you (an “Underpayment”) has occurred, any such Underpayment shall be promptly paid by the Company to or for your benefit.
7. Confidential Information.
(a) You will not disclose or use at any time any Confidential Information (as defined below in Section 7(c)), whether or not such information is developed by you, except to the extent that such disclosure or use is required in the performance or exercise by you in good faith of (i) duties assigned to you under this letter agreement or otherwise by the Board, (ii) rights as an employee, officer, director or shareholder of the Company or any of the Company Affiliates or (iii) rights under any agreement with the Company or any of the Company Affiliates.
(b) You will deliver to the Company at the termination of the Employment Period, or at any time the Company may request, all memoranda, notes, plans, designs, records, reports, computer files and software and other documents and data (and copies thereof) that are Confidential Information or Work Product (as defined below) or information relating to the business of the Company or the Company Affiliates which you may then possess or have under your control. Upon request, you will also make available to the Company any smartphones or other devices on which you store Company information, so that the Company may remove such information. You acknowledge that, in the course of accessing any such smartphones or other devices for the purpose of removing Confidential Information or Work Product, the Company or its designated agents may inadvertently view or otherwise become aware of your personal information, data, files, photographs, communications, or other content unrelated to the Company (collectively, “Personal Information”). You hereby acknowledge and accept this possibility and agree that such incidental exposure shall not give rise to any claim, cause of action, or liability against the Company, its officers, directors, employees, agents, or representatives.
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(c) As used in this letter agreement, the term “Confidential Information” means information belonging to the Company or any of the Company Affiliates that is not generally known or available to the public and that is used, developed or obtained by the Company or any of the Company Affiliates in connection with its or their businesses, including without limitation (i) information, observations and data concerning its and their business and affairs, products or services, and fees, costs and pricing structures, (ii) designs, (iii) analyses, (iv) drawings, designs, photographs, artwork and reports, (v) computer software, including operating systems, applications and program listings, (vi) flow charts, manuals and documentation, (vii) databases, (viii) information concerning its accounting and business methods, (ix) inventions, devices, new developments, methods and processes, whether patentable or unpatentable and whether or not reduced to practice, (x) other copyrightable works, (xi) all production methods, processes, technology and trade secrets, (xii) product and product candidate formulae and any trade secrets with respect to such products and product candidates and (xiii) all similar and related information in whatever form.
(d) Notwithstanding the provisions of this letter agreement to the contrary, you will have no liability to the Company for disclosure of Confidential Information if the Confidential Information:
(i) is in the public domain or becomes publicly known in the industry in which the Company or any of the Company Affiliates operates or is disclosed by the Company or any of the Company Affiliates other than as the result of a breach of this letter agreement or any other agreement by you; or
(ii) is required to be disclosed by law, court order, or similar compulsion or in connection with any legal proceeding; provided, however, that such disclosure will be limited to the extent so required and, subject to the requirements of law, you will give the Company notice of your intent to so disclose such Confidential Information and will cooperate with the Company in seeking confidentiality protections.
(e) Notwithstanding the foregoing, nothing in or about this letter agreement prohibits you from (i) filing and, as provided for under Section 21F of the Exchange Act, maintaining the confidentiality of a claim with the Securities and Exchange Commission (the “SEC”); (ii) providing Confidential Information to the SEC, or providing the SEC with information that would otherwise violate this Section 7, to the extent permitted by Section 21F of the Exchange Act; (iii) cooperating, participating or assisting in an SEC investigation or proceeding concerning the Company without notifying the Company; or (iv) receiving a monetary award as set forth in Section 21F of the Exchange Act. Furthermore, you are advised that you shall not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of any Confidential Information that constitutes a trade secret to which the Defend Trade Secrets Act (18 U.S.C. Section 1833(b)) applies that is made (A) in confidence to a federal, state or local government official, either directly or indirectly, or to an attorney, in each case, solely for the purpose of reporting or investigating a suspected violation of law or (B) in a complaint or other document filed in a lawsuit or proceeding, if such filings are made under seal.
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8. Inventions and Patents. You agree that all inventions, innovations, improvements, technical information, trade secrets, systems, software developments, ideas, results, methods, designs, artwork, analyses, drawings, reports, copyrights, service marks, trademarks, trade names, logos and all similar or related information (whether patentable or unpatentable) which relate to the Company’s or any of the Company Affiliates’ businesses, research and development or existing products (or products under development) or services and which are conceived, developed or made by you (whether or not during usual business hours and whether or not alone or in conjunction with any other person) during your employment with the Company, together with all intellectual property rights therein, including without limitation any patent applications, letters patent, trademark, trade name and service mark applications or registrations, copyrights and reissues thereof that may be granted for or upon any of the foregoing (collectively referred to herein as “Work Product”), is the exclusive property of the Company and/or the Company Affiliates. For the avoidance of doubt and without limiting the foregoing, (x) the Company or any of the Company Affiliates shall be the sole owner of all right, title and interest in such Work Product, including without limitation all intellectual property rights relating to such Work Product, without you retaining any license or other residual right whatsoever, and (y) any rights to any new or an existing Work Product are automatically conveyed, assigned and transferred to the Company pursuant to this letter agreement. You hereby waive and renounce all moral rights related, directly or indirectly, to any such existing or new Work Product. You will take reasonable steps to promptly disclose such Work Product to the Board and perform all actions reasonably requested by the Board (whether during or after the Employment Period) to establish and confirm such ownership (including without limitation the execution and delivery of assignments, consents, powers of attorney and other instruments) and to provide reasonable assistance to the Company and the Company Affiliates in connection with the prosecution of any applications for patents, trademarks, trade names, service marks or reissues thereof or in the prosecution or defense of interferences relating to any Work Product.
9. Non-Competition; Non-Solicitation.
(a) You acknowledge that, in the course of your employment with the Company, you will become familiar with the Company’s and the Company Affiliates’ trade secrets and other Confidential Information as well as the Company’s customer information and goodwill, and that your services will be of special, unique, and extraordinary value to the Company and the Company Affiliates. Therefore, you agree that, during the Employment Period and any other period during which you are employed by the Company or any of its Affiliates, whether pursuant to this letter agreement or otherwise, plus an additional twelve (12) months after your separation (the “Restriction Period”) (regardless of the reason for your separation from the Company and whether caused by you or the Company), you will not (x) in the United States or any other country where, as of the time at issue, the Company or any of the Company Affiliates conducts business or (y) anywhere else that, during the then prior two-year period, the Company or any of the Company Affiliates has spent time and resources in connection with expanding its business, directly or indirectly, either on your own behalf or on behalf of any other person, firm or entity: engage in, or own, manage, operate, work as an employee for, consult with, provide services or financing to, or join, control or participate in the ownership, management, operation or control of, any business (whether in corporate, proprietorship or partnership form or otherwise) that is engaged in the business of (i) research and development, manufacturing, marketing, and selling autonomous systems across air, ground and maritime, and software-defined autonomy capabilities and other similar platforms or (ii) such other business in which the Company or any Company Affiliates with which you worked was engaged at any time during the then immediately prior two years.
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(b) Nothing in Section 9(a) will prohibit you from being a passive owner of not more than 2% of the outstanding stock of a publicly-traded corporation, so long as you have no active participation in the business of such corporation.
(c) During the Restriction Period, you also will not:
(i) induce or attempt to induce any customer, supplier or other business relation of the Company or any of the Company Affiliates to cease doing business with the Company or any of the Company Affiliates, or in any way interfere with the relationship between any such customer, supplier or business relation, on the one hand, and the Company or any of the Company Affiliates, on the other hand;
(ii) engage, employ, solicit or contact with a view to the engagement or employment of, any employee, officer or manager of, or full-time consultant to, the Company or any of the Company Affiliates with which you worked or any person who has been an employee, officer or manager of, or consultant to, the Company or any of the Company Affiliates with which you worked, if he or she has been in such a role at any time within the then immediately prior three months; or
(iii) assist any individual or entity to engage in the conduct referenced in clauses (i) and (ii) immediately above.
10. Enforcement.
(a) Because the employment relationship between you and the Company is unique and because you have access to Confidential Information, Work Product and Company goodwill, you agree that money damages would be an inadequate remedy for any breach of Section 7, 8 or 9. Therefore, in the event of a breach or threatened breach of Section 7, 8 or 9 (or any portion(s) thereof), you agree that the Company is entitled to enforce this letter agreement, and hereby specifically consent to entry by a court of a temporary, preliminary and/or permanent injunction (as well as any other appropriate equitable relief) to prevent any actual or threatened breach by you of said Sections 7, 8, or 9. Nothing contained in this Section 10, however, shall prohibit the Company from pursuing and recovering any remedies at law or in equity in addition to injunctive relief, specifically including the recovery of damages. Furthermore, you agree that in the event of a breach of Section 9, the time periods set forth in Section 9 shall be extended by the amount of time that you are in breach. Sections 5, 6, 7, 8 and 9 will expressly survive termination of the Employment Period and this letter agreement.
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(b) The existence of any claim or cause of action by you against the Company and/or any of the Company Affiliates shall not constitute a defense to the enforcement by the Company of the covenants contained in Section 6(b), 7, 8 or 9, but such claim or cause of action shall be litigated separately.
11. Notices. All notices, requests, demands, claims, and other communications hereunder will be in writing. Any notice, request, demand, claim or other communication hereunder will be deemed duly given (a) upon delivery, if delivered personally to the recipient, against written receipt therefor, or (b) upon the first Business Day after the date sent, if sent priority next Business Day delivery to the intended recipient by a reputable express courier service (charges prepaid) and addressed to the intended recipient as set forth below:
If to the Company, to:
Attention: Chief Executive Officer and Chief Legal Officer
Powerus Corporation
515 North Flagler Drive, Suite 350
West Palm Beach, Florida 33401
If to you, to the address appearing in the Company’s records.
Any party hereto may send any notice, request, demand, claim or other communication hereunder to the intended recipient at the address set forth above using any other means, but no such notice, request, demand, claim or other communication will be deemed to have been duly given unless and until it actually is received and acknowledged by the intended recipient. Any party hereto may change the address (or add new parties and their addresses) to which notices, requests, demands, claims, and other communications hereunder are to be delivered by giving the other parties hereto notice in the manner set forth in this Section 11.
12. Representations and Warranties. You hereby represent and warrant to the Company that (a) the execution, delivery and performance of this letter agreement by you does not and will not conflict with, breach, violate or cause a default under any agreement, contract or instrument to which you are a party or any judgment, order or decree to which you are subject, (b) you are not a party to or bound by any employment agreement, consulting agreement, non-compete agreement, confidentiality agreement or similar agreement with any other person or entity that is inconsistent with the provisions of this letter agreement or that would limit you in your duties hereunder, (c) upon the execution and delivery of this letter agreement by the Company and you, this letter agreement will be a valid and binding obligation of you and (d) you are able to perform the services described in this letter agreement. The Company hereby represents and warrants to you that (i) the execution, delivery and performance of this letter agreement does not and will not conflict with, breach, violate or cause a default under any agreement, contract or instrument to which it is a party or any judgment, order or decree to which it is subject and (ii) upon the execution and delivery of this letter agreement by the Company and you, such agreements will be valid and binding obligations of the Company.
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13. Lock-Up Agreement. In connection with a registration with the United States Securities and Exchange Commission under the Securities Act of the public sale of shares of Common Stock, you shall not sell, make any short sale of, loan, grant any option for the purchase of, or otherwise dispose of any securities of the Company (other than those included in the registration) without the prior written consent of the Company or such underwriters, as the case may be, for such period of time prior to the effective date of such registration and continuing through and following the effective date of such registration (not to exceed 180 days) as the Company or the underwriters, as the case may be, shall specify. You agree that the Company may instruct its transfer agent to place stop-transfer notations in its records to enforce the provisions of this Section. You shall execute a form of agreement reflecting the foregoing restrictions as requested by the underwriters managing such offering.
14. General Provisions.
(a) Severability. It is the desire and intent of the parties hereto that the provisions of this letter agreement be enforced to the fullest extent permissible under the laws and public policies applied in each jurisdiction in which enforcement is sought. Accordingly, if any particular provision of this letter agreement will be adjudicated by a court of competent jurisdiction to be invalid, prohibited or unenforceable for any reason, such provision, as to such jurisdiction, will be ineffective, without invalidating the remaining provisions of this letter agreement or affecting the validity or enforceability of this letter agreement or affecting the validity or enforceability of such provision in any other jurisdiction. Notwithstanding the foregoing, if such provision could be more narrowly drawn so as not to be invalid, prohibited or unenforceable in such jurisdiction, it will, as to such jurisdiction, be so narrowly drawn, without invalidating the remaining provisions of this letter agreement or affecting the validity or enforceability of such provision in any other jurisdiction.
(b) Complete Agreement. This letter agreement and any schedules or exhibits expressly constitute the entire agreement among the parties hereto with respect to the subject matter hereof and supersedes and pre-empts any prior understandings, agreements or representations by or among the parties, written or oral, which may have related to the subject matter hereof in any way, except with regard to outstanding equity awards granted under the Equity Plan, or as expressly set forth in this letter agreement. For the avoidance of doubt, the compensation and benefits provided upon a termination of employment under this letter agreement shall not result in duplication of compensation or benefits provided under any other plan, policy, agreement or arrangement, except as specifically provided herein.
(c) Successors and Assigns. The Company may freely assign this letter agreement, including to any Affiliate or in connection with any merger or sale of equity or assets, and upon such assignment the references herein to the Company shall be deemed to include the assignee. You may not assign your rights and obligations under this letter agreement without the prior written consent of the Company. Except as otherwise provided herein, this letter agreement will be binding upon and inure to the benefit of you and the Company and our respective successors, permitted assigns, personal representatives, heirs and estates, as the case may be.
(d) Governing Law. This letter agreement will be governed by and construed in accordance with the domestic laws of Florida, without giving effect to the choice of law provisions thereof. The parties agree that any dispute under this letter agreement may be brought in the federal and state courts sitting in Florida and by this letter agreement the parties expressly consent to such courts’ jurisdiction.
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(e) Amendment and Waiver. The provisions of this letter agreement may be amended and waived only with the prior written consent of the Company (with the approval of the Board) and you, and no course of conduct or failure or delay in enforcing the provisions of this letter agreement will affect the validity, binding effect or enforceability of this letter agreement or any provision hereof.
(f) Headings. The section headings contained in this letter agreement are inserted for convenience only and will not affect in any way the meaning or interpretation of this letter agreement.
(g) Counterparts. This letter agreement may be executed in counterparts, each of which will be deemed an original and all of which together will constitute one and the same instrument. The signatures of any of the persons executing this letter agreement may be transmitted via facsimile or other electronic means and shall be sufficient evidence of the execution of this letter agreement.
(h) 409A Provision.
(i) The Company and you intend that this letter agreement and the payments and benefits provided hereunder comply in form and operation with the requirements of Section 409A of the Internal Revenue Code of 1986, as amended, and the final regulations issued thereunder (“Section 409A”), and accordingly, to the maximum extent permitted, all provisions of this letter agreement shall be construed and interpreted in a manner consistent with the requirements for avoiding taxes or penalties under Section 409A.
(ii) If a payment under this letter agreement is to be made within a designated period which does not begin and end within one calendar year, you do not have a right to designate the calendar year of the payment, and the actual date of payment within the specified period shall be within the sole discretion of the Company. For purposes of Section 409A, each of the payments and benefits that may be made hereunder is designated as a separate and distinct payment.
(iii) For purposes of this letter agreement, to the extent required to avoid accelerated income recognition and/or tax penalties under Section 409A, (A) you shall not be considered to have terminated employment with the Company for purposes of any payments under this letter agreement which are subject to Section 409A until you would be considered to have incurred a “separation from service” from the Company within the meaning of Section 409A, and (B) if, as of the date of your separation from service, you are a “specified employee” within the meaning of Section 409A, then to the extent necessary to comply with Section 409A, payment to you of any amount or benefit that constitutes “nonqualified deferred compensation” under Section 409A and which under the terms of this letter agreement would otherwise be payable as a result of and within six (6) months following such separation from service shall be delayed until the date that is six months following your separation from service or, if earlier, the earliest other date as is permitted under Section 409A (and any amounts that otherwise would have been paid during this deferral period will be paid in a lump sum on the day after the expiration of the six (6) month period or such shorter period, if applicable). The term “specified employee” means an individual determined by the Company to be a specified employee under Treasury regulation Section 1.409A-1(i).
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(iv) Except as otherwise permitted by Section 409A, the benefits and reimbursements provided to you under this letter agreement and any Company plan or policy during any calendar year shall not affect the benefits and reimbursements to be provided to you under the relevant section of this letter agreement or any Company plan or policy in any other calendar year, and the right to such benefits and reimbursements cannot be liquidated or exchanged for any other benefit and shall be provided in accordance with Treas. Reg. Section 1.409A-3(i)(1)(iv) or any successor thereto. Further, in the case of reimbursement payments, reimbursement payments shall be made to you as soon as practicable following the date that the applicable expense is incurred and proper documentation is provided to the Company, but in no event later than the last day of the calendar year following the calendar year in which the underlying expense is incurred.
(v) If you incur any tax, interest, or penalty under Section 409A (“409A Taxes”) as a result of the Company’s act or omission which causes a failure to comply with Section 409A with respect to any Company compensation arrangements with you, the Company shall indemnify and hold you harmless from and against such 409A Taxes, including by making any additional payments necessary so that you retain the same after-tax amount that would have been received absent such 409A Taxes. The Company shall have no liability under this subsection (v) to the extent that the 409A Taxes arise from (i) any action (or failure to act) taken by you, or (ii) a change in applicable law, published guidance, or interpretation occurring after the effective date of this Agreement, if the Company operated in good faith and in a manner reasonably consistent with applicable authority existing at the time the relevant action was taken.
(i) “Business Day” Defined. For purposes of this letter agreement, the capitalized term “Business Day” shall mean any calendar day other than a Saturday, Sunday or other day on which banks in New York, New York are authorized or required to be closed.
(j) Clawback Acknowledgement. This letter agreement and the compensation payable hereunder, as applicable, shall be subject to any applicable clawback or recoupment policies, stock ownership policies, share trading policies, and other codes of conduct and written policies that are in place as of the Effective Date and as may be revised or implemented by the Company from time to time as applicable to officers of the Company. For the avoidance of doubt, notwithstanding any other provision herein, any incentive compensation awarded to you that is subject to recovery under any law, government regulation, stock exchange listing requirement or recoupment policy adopted by the Company will be subject to such deductions and clawback as may be required to be made pursuant to such law, government regulation, stock exchange listing requirement or recoupment policy adopted by the Company (including a policy adopted by the Company in response to any such law, government regulation or stock exchange listing requirement).
(k) Original Employment Letter. This letter agreement replaces and supersedes your letter agreement dated February 19, 2026 with Autonomous Power Corporation (“APC”), a wholly owned subsidiary of the Company resulting from the transactions under the Merger Agreement, dated March 8, 2026, by and among the Company (formerly known as Aureus Greenway Holdings, Inc.), APC and the other parties named therein.
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If this letter agreement correctly expresses our mutual understanding, please sign and date a copy of this letter agreement and return it to the Company.
| Very truly yours, | ||
| POWERUS CORPORATION | ||
| By: | /s/ Jim Biehl | |
| Name: | Jim Biehl | |
| Title: | Chief Legal Officer | |
The
terms of this letter agreement are accepted
and agreed to as of the date set forth below by:
| /s/ Brett Velicovich | |
| Brett Velicovich | |
| October 1, 2026 | |
| Date |
Exhibit 10.4
POWERUS CORPORATION
2026 EQUITY INCENTIVE PLAN
1. Purpose. The purpose of the PowerUS Corporation 2026 Equity Incentive Plan (the “Plan”) is to attract and retain the best available personnel for positions of responsibility with the Company, to provide additional equity incentives to them and align their interests with those of the Company’s stockholders, and to thereby promote the Company’s long-term business success.
2. Definitions. In this Plan, the following definitions will apply.
(a) “Affiliate” means any entity that is a Subsidiary of the Company.
(b) “Agreement” means the written or electronic agreement or notice containing the terms and conditions applicable to each Award granted under the Plan, including all amendments thereto. An Agreement is subject to the terms and conditions of the Plan.
(c) “Award” means a grant made under the Plan in the form of Options, Stock Appreciation Rights, Restricted Stock, Stock Units or an Other Stock-Based Award.
(d) “Board” means the Board of Directors of the Company.
(e) “Cause” means what the term is expressly defined to mean in a then-effective written agreement (including an Agreement) between a Participant and the Company or any Affiliate, or in the absence of any such then-effective agreement or definition a Participant’s (i) embezzlement or misappropriation of Company funds or property, (ii) material violation of any law, rule, regulation, court order or regulatory directive (other than traffic violations, misdemeanors or other minor offenses which do not involve moral turpitude); (iii) gross neglect by Participant of material duties required of Participant; provided, however, that it is understood that failure to meet performance standards or performance objectives, by itself, shall not constitute Cause; (iv) violation of any material Company policy or Company code of conduct, or nondisclosure, non-solicitation, non-competition or similar obligation owed to the Company or any of its Affiliates, (v) material breach of any fiduciary duty to the Company or any Affiliate; or (vi) engaging in fraudulent, dishonest, unethical, dishonorable or disruptive behavior, practices or acts, or any other misconduct, which would be reasonably expected to harm or bring disrepute to the Company or any of its Affiliates, their business or any of their customers, employees or vendors, as determined by the Company.
(f) “Change in Control” means one of the following:
(1) An Exchange Act Person becomes the beneficial owner (within the meaning of Rule 13d-3 under the Exchange Act) of securities of the Company representing 50% or more of the combined voting power of the Company’s then outstanding Voting Securities, except that the following will not constitute a Change in Control:
(A) any acquisition of securities of the Company by an Exchange Act Person from the Company for the purpose of providing financing to the Company;
(B) any formation of a Group consisting solely of beneficial owners of the Company’s Voting Securities as of the effective date of this Plan; or
(C) any repurchase or other acquisition by the Company of its Voting Securities that causes any Exchange Act Person to become the beneficial owner of 30% or more of the Company’s Voting Securities; or
(D) with respect to any particular Participant, any acquisition of securities of the Company by the Participant, any Group including the Participant, or any entity controlled by the Participant or a Group including the Participant.
If, however, an Exchange Act Person referenced in clause (A), (B) or (C) or (D) above acquires beneficial ownership of additional Company Voting Securities after initially becoming the beneficial owner of 50% or more of the combined voting power of the Company’s Voting Securities by one of the means described in those clauses, then a Change in Control will be deemed to have occurred;
(2) Individuals who are Continuing Directors cease for any reason to constitute a majority of the members of the Board within a twelve-month period beginning after the Effective Date; or
(3) An Exchange Act Person acquires ownership of securities of the Company that, together with the securities held by such Exchange Act Person, constitutes more than fifty percent (50%) of the total fair market value of the Company. However, if such Exchange Act Person is considered to own more than fifty percent (50%) of the total fair market value before this transfer of the securities of the Company then outstanding, the acquisition of additional equity securities of the Company by the same Exchange Act Person shall not be considered to cause a Change in Control of the Company;
Notwithstanding the foregoing, to the extent that any Award constitutes a deferral of compensation subject to Section 409A and that Award provides for a change in the timing or form (lump sum or installments) of payment upon a Change in Control, or to the extent that which the payment date of an Award is determined solely with reference to a Change in Control, no Change in Control shall be deemed to have occurred upon an event described in this Section 2(f) unless the event would also constitute a change in ownership or effective control of, or a change in the ownership of a substantial portion of the assets of, the Company under Section 409A.
(g) “Code” means the Internal Revenue Code of 1986, as amended and in effect from time to time, and any applicable treasury regulations and guidance promulgated thereunder, and any successor or similar statutory provisions.
(h) “Committee” means two or more Non-Employee Directors designated by the Board to administer the Plan under Section 3, each member of which shall be (i) an independent director within the meaning of applicable stock exchange rules and regulations and (ii) a non-employee director within the meaning of Exchange Act Rule 16b-3. The Committee shall be the Compensation Committee of the Board unless otherwise specified by the Board.
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(i) “Company” means PowerUS Corporation, a Nevada corporation, and any successor thereto.
(j) “Consultant” means any consultant or advisor who is a natural person (other than an Employee or a Non-Employee Director) who provides services (other than in connection with (i) a capital-raising transaction or (ii) promoting or maintaining a market in Company securities) to the Company or an Affiliate.
(k) “Continuing Director” means an individual (i) who is, as of the effective date of the Plan, a director of the Company, or (ii) who becomes a director of the Company after the effective date hereof and whose initial election, or nomination for election by the Company’s stockholders, was approved by at least a majority of the then Continuing Directors, but excluding, for purposes of this clause (ii), an individual whose initial assumption of office occurs as the result of an actual or threatened proxy contest involving the solicitation of proxies or consents by a person or Group other than the Board, or by reason of an agreement intended to avoid or settle an actual or threatened proxy contest.
(l) “Continuous Service” means that the provision of Services by a Participant to the Company or any Affiliate in any Service Provider capacity is not interrupted or terminated. A Service Provider’s Continuous Service shall be deemed to have terminated upon a Separation from Service from the Company and its Affiliates. Except as otherwise provided in this Plan or any Agreement, Continuous Service shall not be deemed terminated in the case of (i) any approved leave of absence of up to three (3) months; (ii) transfers among the Company and any Affiliates in any Service Provider capacity; or (iii) any change in status so long as the individual remains in the service of the Company or any Affiliate in any Service Provider capacity. Notwithstanding the foregoing, except as otherwise determined by the Committee and as permitted by Section 409A, in the event of any sale or spin-off of an Affiliate, service as a Service Provider for such Affiliate following such spin-off shall be deemed to be Continuous Service for purposes of the Plan and any Award under the Plan.
(m) “Disability” means (A) any permanent and total disability entitling Participant to receive benefits under any long-term disability plan or policy of the Company or its Affiliates that covers the Participant, or (B) if there is no such long-term disability plan or policy, “total and permanent disability” within the meaning of Code Section 22(e)(3).
(n) “Employee” means an employee of the Company or an Affiliate.
(o) “Exchange Act” means the Securities Exchange Act of 1934, as amended and in effect from time to time.
(p) “Exchange Act Person” means any natural person, entity or Group within the meaning of Section 2(a)(2) of the Securities Act of 1933 and Section 14(d) of the Exchange Act other than (i) the Company or any Affiliate; (ii) any employee benefit plan (or related trust) sponsored or maintained by the Company or any Affiliate; (iii) an underwriter temporarily holding securities in connection with a registered public offering of such securities; or (iv) an entity whose Voting Securities are beneficially owned by the beneficial owners of the Company’s Voting Securities in substantially the same proportions as their beneficial ownership of the Company’s Voting Securities.
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(q) “Fair Market Value” means the fair market value of a Share determined as follows:
(1) If the Shares are readily tradable on an established securities market (as determined under Section 409A), then Fair Market Value will be the closing or last sales price for a Share on the principal securities market on which it trades on the date for which it is being determined, or if no sale of Shares occurred on that date, on the next preceding date on which a sale of Shares occurred; or
(2) If the Shares are not then readily tradable on an established securities market (as determined under Section 409A), then Fair Market Value will be determined by the Committee as the result of a reasonable application of a reasonable valuation method that satisfies the requirements of Section 409A.
(r) “Full Value Award” means an Award other than an Option Award or Stock Appreciation Right Award.
(s) “Fully Diluted Shares” means the number of Shares (i) outstanding and (ii) issuable upon exercise, conversion or settlement of outstanding options, warrants or other securities of the Company that are (directly or indirectly) convertible into, or exchangeable or exercisable for, Shares, in each case as of the close of business of the Company on the applicable date, without regard to any vesting conditions or other limitations on the immediate ability to convert, exchange or exercise such rights. For purposes of determining the number of Fully Diluted Shares, if the number of Shares subject to a right to acquire Shares is variable, then the number of Shares issuable upon conversion, exchange or exercise of such right will equal the maximum number of shares that could be received under such right.
(t) “Global Service Provider” means a Service Provider who is located outside of the United States, who is not compensated from a payroll maintained in the United States, or who is otherwise subject to (or could cause the Company to be subject to) legal, tax or regulatory requirements of countries outside of the United States.
(u) “Grant Date” means the date on which the Committee approves the grant of an Award under the Plan, or such later date as may be specified by the Committee on the date the Committee approves the Award.
(v) “Group” means two or more persons who act, or agree to act together, as a partnership, limited partnership, syndicate or other group for the purpose of acquiring, holding, voting or disposing of securities of the Company.
(w) “Merger” means the transaction described in that certain Agreement and Plan of Merger dated as of March 8, 2026, by and among Aureus Greenway, Aureus Merger Sub, Inc., Autonomous Power Corporation, and Andrew Fox, as Stockholder Representative.
(x) “Non-Employee Director” means a member of the Board who is not an Employee.
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(y) “Option” means a right granted under the Plan to purchase a specified number of Shares at a specified price. An “Incentive Stock Option” or “ISO” means any Option designated as such and granted in accordance with the requirements of Code Section 422. A “Non-Qualified Stock Option” or “NQSO” means an Option other than an Incentive Stock Option.
(z) “Other Stock-Based Award” means an Award described in Section 11 of this Plan.
(aa) “Parent” means a “parent corporation,” as defined in Code Section 424(e).
(bb) “Participant” means a Service Provider to whom a then-outstanding Award has been granted under the Plan.
(cc) “Performance-Based Award” means an Award that is conditioned on the achievement of specified performance goals.
(dd) “Plan” means this PowerUS Corporation 2026 Equity Incentive Plan, as amended and in effect from time to time.
(ee) “Restricted Stock” means Shares issued to a Participant that are subject to such restrictions on transfer, vesting conditions and other restrictions or limitations as may be set forth in this Plan and the applicable Agreement.
(ff) “Section 409A” means Section 409A of the Code.
(gg) “Separation from Service” means a “separation from service” as such term is defined for purposes of Section 409A.
(hh) “Service” means the provision of services by a Participant to the Company or any Affiliate in any Service Provider capacity.
(ii) “Service Provider” means an Employee, a Non-Employee Director, or a Consultant to the Company or any Affiliate.
(jj) “Share” means a share of Stock.
(kk) “Stock” means the common stock, $0.001 par value per Share, of the Company.
(ll) “Stock Appreciation Right” or “SAR” means the right to receive, in cash and/or Shares as determined by the Committee, an amount equal to the appreciation in value of a specified number of Shares between the Grant Date of the SAR and its exercise date.
(mm) “Stock Unit” means a right to receive, in cash and/or Shares as determined by the Committee, the Fair Market Value of a Share, subject to such restrictions on transfer, vesting conditions and other restrictions or limitations as may be set forth in this Plan and the applicable Agreement.
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(nn) “Subsidiary” means a “subsidiary corporation,” as defined in Code Section 424(f), of the Company.
(oo) “Substitute Award” means an Award granted upon the assumption of, or in substitution or exchange for, outstanding awards granted by a company or other entity acquired by the Company or any Affiliate or with which the Company or any Affiliate combines. The terms and conditions of a Substitute Award may vary from the terms and conditions set forth in the Plan to the extent that the Committee at the time of the grant may deem appropriate to conform, in whole or in part, to the provisions of the award in substitution for which it has been granted.
(pp) “Voting Securities” of an entity means the outstanding equity securities (or comparable equity interests) entitled to vote generally in the election of directors of such entity.
3. Administration of the Plan.
(a) Administration. The authority to control and manage the operations and administration of the Plan shall be vested in the Committee in accordance with this Section 3. Notwithstanding the designation of the Committee to administer the Plan, the Board shall retain and perform the duties and have the responsibilities of the Committee with respect to Awards made to Non-Employee Directors.
(b) Scope of Authority. Subject to the terms of the Plan, the Committee shall have the authority, in its discretion, to take such actions as it deems necessary or advisable to administer the Plan, including:
(1) determining the Service Providers to whom Awards will be granted, the timing of each such Award, the type of Award and the number of Shares covered by each Award, the terms, conditions, performance criteria, restrictions and other provisions of Awards, and the manner in which Awards are paid or settled;
(2) cancelling or suspending an Award, accelerating the vesting of an Award, extending the exercise period of an Award or otherwise amending the terms and conditions of any outstanding Award, subject to the requirements of Sections 15(d) and 15(e);
(3) adopting sub-plans or special provisions applicable to Awards, establishing, amending or rescinding rules to administer the Plan, interpreting the Plan and any Award or Agreement, correcting any defect or omission or reconciling any inconsistency in the Plan or any Agreement, and making all other determinations necessary or desirable for the administration of the Plan;
(4) granting Substitute Awards under the Plan;
(5) taking such actions as are provided in Section 3(c) with respect to Awards to Global Service Providers; and
(6) requiring or permitting the deferral of the settlement of an Award, and establishing the terms and conditions of any such deferral.
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(c) Awards to Global Service Providers. The Committee may grant Awards to Global Service Providers, on such terms and conditions different from those specified in the Plan as may, in the judgment of the Committee, be necessary or desirable to comply with applicable foreign laws and regulatory requirements and to promote achievement of the purposes of the Plan. In connection therewith, the Committee may establish such subplans or annexes to Agreements and modify exercise procedures and other Plan rules and procedures to the extent such actions are deemed necessary or desirable, and may take any other action that it deems advisable to obtain local regulatory approvals or to comply with any necessary local governmental regulatory exemptions.
(d) Acts of the Committee; Delegation. A majority of the members of the Committee shall constitute a quorum for any meeting of the Committee, and any act of a majority of the members present at any meeting at which a quorum is present or any act unanimously approved in writing by all members of the Committee shall be the act of the Committee. Any such action of the Committee shall be valid and effective even if one or more members of the Committee at the time of such action are later determined not to have satisfied all of the criteria for membership in clauses (i) and (ii) of Section 2(h). To the extent not inconsistent with applicable law or stock exchange rules, the Committee may delegate all or any portion of its authority under the Plan to any one or more of its members or, as to Awards to Participants who are not subject to Section 16 of the Exchange Act, to one or more executive officers of the Company. The Committee may also delegate non-discretionary administrative responsibilities in connection with the Plan to such other persons as it deems advisable.
(e) Finality of Decisions. The Committee’s interpretation of the Plan and of any Award or Agreement made under the Plan and all related decisions or resolutions of the Board or Committee shall be made in the sole discretion of the Board or Committee and be final and binding on all parties with an interest therein.
(f) Indemnification. Each person who is or has been a member of the Committee or of the Board, and any other person to whom the Committee delegates authority under the Plan, shall be indemnified by the Company, to the maximum extent permitted by law, against liabilities and expenses imposed upon or reasonably incurred by such person in connection with or resulting from any claims against such person by reason of the performance of the individual’s duties under the Plan. This right to indemnification is conditioned upon such person providing the Company an opportunity, at the Company’s expense, to handle and defend the claims before such person undertakes to handle and defend them on such person’s own behalf. The Company will not be required to indemnify any person for any amount paid in settlement of a claim unless the Company has first consented in writing to the settlement. The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to which such person or persons may be entitled under the Company’s Certificate of Incorporation or Bylaws, as a matter of law, or otherwise.
4. Shares Available Under the Plan.
(a) Maximum Shares Available. Subject to Section 4(b) and to adjustment as provided in Section 4(e) and Section 12(a), the number of Shares that may be the subject of Awards and issued under the Plan shall be 50,000,000. Shares issued under the Plan may come from authorized and unissued shares or treasury shares. In determining the number of Shares to be counted against this share reserve in connection with any Award, the following rules shall apply:
(1) Where the number of Shares subject to an Award is variable on the Grant Date, the number of Shares to be counted against the share reserve shall be the maximum number of Shares that could be received under that particular Award, until such time as it can be determined that only a lesser number of Shares could be received.
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(2) Where two or more types of Awards are granted to a Participant in tandem with each other, such that the exercise of one type of Award with respect to a number of Shares cancels at least an equal number of Shares of the other, the number of Shares to be counted against the share reserve shall be the largest number of Shares that would be counted against the share reserve under either of the Awards.
(3) Shares subject to Substitute Awards shall not be counted against the share reserve.
(4) Awards that will be settled solely in cash shall not be counted against the share reserve.
(b) Effect of Forfeitures and Other Actions. Any Shares subject to an Award that expires, is cancelled or forfeited, is settled for cash or otherwise does not result in the issuance of all of the Shares subject to such Award (including as a result of the settlement in Shares of the exercise of a Stock Appreciation Right) shall, to the extent of such cancellation, forfeiture, expiration, cash settlement or non-issuance, again become available for Awards under this Plan, and the share reserve under Section 4(a) shall be correspondingly replenished. In addition, if (i) payment of the exercise price of any Award is made through the tendering (either actually or by attestation) of Shares by the Participant or by the withholding of Shares by the Company, (ii) satisfaction of any tax withholding obligations arising from any Award occurs through the tendering (either actually or by attestation) of Shares by the Participant or by the withholding of Shares by the Company, or (iii) any Shares are repurchased by the Company with proceeds received from the exercise of a stock option issued under this Plan, then the Shares so tendered, withheld or repurchased shall become available for Awards under this Plan and the share reserve under Section 4(a) shall be correspondingly replenished.
(c) Effect of Plans Operated by Acquired Companies. If a company acquired by the Company or any Subsidiary or with which the Company or any Subsidiary 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 supplement the Share reserve under Section 4(a). 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 Service Providers of the Company and its Subsidiaries prior to such acquisition or combination.
(d) No Fractional Shares. Unless otherwise determined by the Committee, the number of Shares subject to an Award shall always be a whole number. No fractional Shares may be issued under the Plan, but the Committee may, in its discretion, adopt any rounding convention it deems suitable or pay cash in lieu of any fractional Share in settlement of an Award.
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(e) Automatic Share Reserve Increase. The share reserve specified in Section 4(a) will be increased on January 1 of each year, commencing on January 1, 2027 and ending on (and including) January 1, 2036, in an amount equal to the lesser of (i) 5% of the Fully Diluted Shares as of December 31 of the immediately preceding calendar year and (ii) such lower number of Shares determined by the Board or its Committee in advance of January 1 of each year.
5. Eligibility. Participation in the Plan is limited to Service Providers. Incentive Stock Options may only be granted to Employees who are not Global Service Providers.
6. General Terms of Awards.
(a) Award Agreement. Each Award shall be evidenced by an Agreement setting forth the number of shares subject to the Award together with such other terms and conditions applicable to the Award (and not inconsistent with the Plan) as determined by the Committee. An Award to a Participant may be made singly or in combination with any form of Award. Two types of Awards may be made in tandem with each other such that the exercise of one type of Award with respect to a number of Shares reduces the number of Shares subject to the related Award by at least an equal amount.
(b) Vesting and Term. Each Agreement shall set forth the period until the applicable Award is scheduled to vest and, if applicable, expire (which shall not be more than ten years from the Grant Date), and, consistent with the requirements of this Section 6, the applicable vesting conditions and any applicable performance period. The Committee may provide in an Agreement for such vesting conditions and timing as it may determine. Unless the Committee provides otherwise, the vesting of Awards granted hereunder will be suspended during any unpaid leave of absence.
(c) Transferability. Except as provided in this Section 6(c), (i) during the lifetime of a Participant, only the Participant or the Participant’s guardian or legal representative may exercise an Option or SAR, or receive payment with respect to any other Award; and (ii) no Award may be sold, assigned, transferred, exchanged or encumbered, voluntarily or involuntarily, other than by will or the laws of descent and distribution. Any attempted transfer in violation of this Section 6(c) shall be of no effect. The Committee may, however, provide in an Agreement or otherwise that an Award (other than an Incentive Stock Option) may be transferred pursuant to a domestic relations order or may be transferable by gift to any “family member” (as defined in General Instruction A.1(a)(5) to Form S-8 under the Securities Act of 1933) of the Participant. Any Award held by a transferee shall continue to be subject to the same terms and conditions that were applicable to that Award immediately before the transfer thereof. For purposes of any provision of the Plan relating to notice to a Participant or to acceleration or termination of an Award upon the death or Separation from Service of a Participant, the references to “Participant” shall mean the original grantee of an Award and not any transferee.
(d) Designation of Beneficiary. To the extent permitted by the Committee, a Participant may designate a beneficiary or beneficiaries to exercise any Award or receive a payment under any Award that is exercisable or payable on or after the Participant’s death. Any such designation shall be on a form approved by the Company and shall be effective upon its receipt by the Company.
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(e) Separation from Service. Unless otherwise provided by the Committee in an applicable Agreement or otherwise, in the event of a Participant’s Separation from Service, the following provisions shall apply (in all cases subject to the scheduled expiration of an Option or SAR Award, as applicable):
(1) Upon Separation from Service for Cause, or upon conduct during a post-termination exercise period that would constitute Cause, all unexercised Option and SAR Awards and all unvested portions of any other outstanding Awards shall be immediately forfeited without consideration.
(2) Upon Separation from Service for any other reason, all unvested and unexercisable portions of any outstanding Awards shall be immediately forfeited without consideration.
(3) Upon Separation from Service for any reason other than Cause, death or Disability, the currently vested and exercisable portions of Option and SAR Awards may be exercised for a period of three months after the date of such termination. However, if a Participant thereafter dies during such three-month period, the vested and exercisable portions of the Option and SAR Awards may be exercised for a period of one year after the date of such termination.
(4) Upon Separation from Service due to death or Disability, the currently vested and exercisable portions of Option and SAR Awards may be exercised for a period of one year after the date of such termination.
(f) Rights as Stockholder. No Participant shall have any rights as a stockholder with respect to any Shares covered by an Award unless and until the date the Participant becomes the holder of record of the Shares, if any, to which the Award relates.
(g) Performance-Based Awards.
(1) Any Award may be granted as a Performance-Based Award if the Committee establishes one or more measures of corporate, business unit or individual performance which must be attained, and the performance period over which the specified performance is to be attained, as a condition to the grant, vesting, exercisability, lapse of restrictions and/or settlement in cash or Shares of such Award. In connection with any such Award, the Committee shall determine the extent to which performance measures have been attained and other applicable terms and conditions have been satisfied, and the degree to which the grant, vesting, exercisability, lapse of restrictions and/or settlement of such Award has been earned. The Committee shall also have the authority to modify a performance period and/or adjust or waive the achievement of performance goals or measures.
(2) Performance measures will be determined by the Committee and may include (without limitation) one or more of the following: stock price, net sales, net earnings, pre-tax earnings, operating earnings, earnings before interest and taxes, earnings before interest, taxes, depreciation, and amortization, operating cash flow, free cash flow, cash flow from operations, return on equity, return on assets, return on invested capital, expenses, earnings per share or total stockholder return, or any other financial, operational or strategic measure approved by the Committee.
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(h) Dividends and Dividend Equivalents. No dividends, dividend equivalents or distributions will be paid with respect to Shares subject to an Option or SAR Award. In its discretion, the Committee may provide in an Agreement for a Stock Unit Award or an Other Stock-Based Award that the Participant will be entitled to receive dividend equivalents, based on dividends actually declared and paid on outstanding Shares, on the units or other Share equivalents subject to the Stock Unit Award or Other Stock-Based Award. The additional terms of any such dividend equivalents will be as set forth in the applicable Agreement, including the time and form of payment and whether such dividend equivalents will be credited with interest or deemed to be reinvested in additional units or Share equivalents.
(i) Deferrals of Full Value Awards. The Committee may, in its discretion, permit or require the deferral by a Participant of the issuance of Shares or payment of cash in settlement of any Full Value Award, subject to such terms, conditions, rules and procedures as it may establish or prescribe for such purpose and with the intention of complying with the applicable requirements of Section 409A. The terms, conditions, rules and procedures for any such deferral shall be set forth in writing in the relevant Agreement or in such other agreement, plan or document as the Committee may determine, or some combination of such documents. The terms, conditions, rules and procedures for any such deferral shall address, to the extent relevant, matters such as: (i) the amount of compensation that may or must be deferred (or the method for calculating the amount); (ii) the permissible time(s) and form(s) of payment of deferred amounts; (iii) the terms and conditions of any deferral elections by a Participant or of any deferral required by the Company; and (iv) the crediting of interest or dividend equivalents on deferred amounts.
7. Stock Option Awards.
(a) Type and Exercise Price. The Agreement pursuant to which an Option Award is granted shall specify whether the Option is an Incentive Stock Option or a Non-Qualified Stock Option. The exercise price at which each Share subject to an Option Award may be purchased shall be determined by the Committee and set forth in the Agreement, and shall not be less than the Fair Market Value of a Share on the Grant Date, except in the case of Substitute Awards (to the extent consistent with Section 409A and, in the case of Incentive Stock Options, Code Section 424).
(b) Payment of Exercise Price. The purchase price of the Shares with respect to which an Option Award is exercised shall be payable in full at the time of exercise. The purchase price may be paid in cash or in such other manner as the Committee may permit, including by payment under a broker-assisted sale and remittance program, by withholding Shares otherwise issuable to the Participant upon exercise of the Option or by delivery to the Company of Shares (by actual delivery or attestation) already owned by the Participant (in either case, such Shares having a Fair Market Value as of the date the Option is exercised equal to the purchase price of the Shares being purchased). Notwithstanding any other provision of the Plan to the contrary, no Participant who is a director or an “executive officer” of the Company within the meaning of Section 13(k) of the Exchange Act shall be permitted to pay the exercise price of an Option, or continue any extension of credit with respect to the exercise price of an Option, with a loan from the Company or a loan arranged by the Company in violation of Section 13(k) of the Exchange Act.
(c) Exercisability and Expiration. Each Option Award shall be exercisable in whole or in part on the terms provided in the Agreement. No Option Award shall be exercisable at any time after its scheduled expiration. When an Option Award is no longer exercisable, it shall be deemed to have terminated.
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(d) Incentive Stock Options.
(1) An Option Award will constitute an Incentive Stock Option Award only if the Participant receiving the Option Award is an Employee who is not a Global Service Provider, and only to the extent that (i) it is so designated in the applicable Agreement and (ii) the aggregate Fair Market Value (determined as of the Option Award’s Grant Date) of the Shares with respect to which Incentive Stock Option Awards held by the Participant first become exercisable in any calendar year (under the Plan and all other plans of the Company and its Affiliates) does not exceed $100,000 or such other amount specified by the Code. To the extent an Option Award granted to a Participant exceeds this limit, the Option Award shall be treated as a Non-Qualified Stock Option Award. The maximum number of Shares that may be issued upon the exercise of Incentive Stock Option Awards under the Plan shall be the total number of Shares in the Plan’s share reserve as specified in the first sentence of Section 4(a), subject to adjustment as provided in Section 12(a); provided, however, that the maximum number of Shares shall not be subject to adjustment as provided in Section 4(e).
(2) No Participant may receive an Incentive Stock Option Award under the Plan if, immediately after the grant of such Award, the Participant would own (after application of the rules contained in Code Section 424(d)) Shares possessing more than 10% of the total combined voting power of all classes of stock of the Company or an Affiliate, unless (i) the per Share exercise price for such Award is at least 110% of the Fair Market Value of a Share on the Grant Date and (ii) such Award will expire no later than five years after its Grant Date.
(3) For purposes of Continuous Service by a Participant who has been granted an Incentive Stock Option Award, no approved leave of absence may exceed three months unless reemployment upon expiration of such leave is provided by statute or contract. If reemployment is not so provided, then on the date six months following the first day of such leave, any Incentive Stock Option held by the Participant shall cease to be treated as an Incentive Stock Option and shall be treated for tax purposes as a Non-Qualified Stock Option.
(4) If an Incentive Stock Option Award is exercised after the expiration of the exercise periods that apply for purposes of Code Section 422, or otherwise fails to qualify as an Incentive Stock Option, such Option shall thereafter be treated as a Non-Qualified Stock Option.
(e) Extension if Exercise Prevented by Law. Notwithstanding the foregoing, if the exercise of an Option Award during the applicable post-termination of Service exercise period as set forth in Section 6(e) or in the applicable Agreement is prevented by Section16(c)c), the Option shall remain exercisable until the later of (i) 30 days after the date the exercise of the Option would no longer be prevented by such provision, or (ii) the end of the applicable post-termination exercise period, but in no event later than the scheduled expiration date of the Option as set forth in the applicable Agreement.
8. Stock Appreciation Right Awards.
(a) Nature of Award. An Award of Stock Appreciation Rights shall be subject to such terms and conditions as are determined by the Committee, and shall provide a Participant the right to receive upon exercise of the SAR Award all or a portion of the excess of (i) the Fair Market Value as of the date of exercise of the SAR Award of the number of Shares as to which the SAR Award is being exercised, over (ii) the aggregate exercise price for such number of Shares. The per Share exercise price for any SAR Award shall be determined by the Committee and set forth in the applicable Agreement, and shall not be less than the Fair Market Value of a Share on the Grant Date, except in the case of Substitute Awards (to the extent consistent with Section 409A).
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(b) Exercise of SAR. Each SAR Award may be exercisable in whole or in part at the times, on the terms and in the manner provided in the Agreement. No SAR Award shall be exercisable at any time after its scheduled expiration. When a SAR Award is no longer exercisable, it shall be deemed to have terminated. Upon exercise of a SAR Award, payment to the Participant shall be made at such time or times as shall be provided in the Agreement in the form of cash, Shares or a combination of cash and Shares as determined by the Committee. The Agreement may provide for a limitation upon the amount or percentage of the total appreciation on which payment (whether in cash and/or Shares) may be made in the event of the exercise of a SAR Award.
9. Restricted Stock Awards.
(a) Vesting and Consideration. Shares subject to a Restricted Stock Award shall be subject to vesting and the lapse of applicable restrictions based on such conditions or factors and occurring over such period of time as the Committee may determine in its discretion. The Committee may provide whether any consideration other than Services must be received by the Company or any Affiliate as a condition precedent to the grant of a Restricted Stock Award, and may correspondingly provide for Company reacquisition or repurchase rights if such additional consideration has been required and some or all of a Restricted Stock Award does not vest.
(b) Shares Subject to Restricted Stock Awards. Unvested Shares subject to a Restricted Stock Award shall be evidenced by a book-entry in the name of the Participant with the Company’s transfer agent or by one or more Stock certificates issued in the name of the Participant. Any such Stock certificate shall be deposited with the Company or its designee, together with an assignment separate from the certificate, in blank, signed by the Participant, and bear an appropriate legend referring to the restricted nature of the Restricted Stock evidenced thereby. Any book-entry shall be subject to comparable restrictions and corresponding stop transfer instructions. Upon the vesting of Shares of Restricted Stock, and the Company’s determination that any necessary conditions precedent to the release of vested Shares (such as satisfaction of tax withholding obligations and compliance with applicable legal requirements) have been satisfied, such vested Shares shall be made available to the Participant in such manner as may be prescribed or permitted by the Committee. Except as otherwise provided in the Plan or an applicable Agreement, a Participant with a Restricted Stock Award shall have all the rights of a stockholder, including the right to vote the Shares of Restricted Stock.
10. Stock Unit Awards.
(a) Vesting and Consideration. A Stock Unit Award shall be subject to vesting and the lapse of applicable restrictions based on such conditions or factors and occurring over such period of time as the Committee may determine in its discretion. If vesting of a Stock Unit Award is conditioned on the achievement of specified performance goals, the extent to which the goals are achieved over the specified performance period shall determine the number of Stock Units that will be earned and eligible to vest, which may be greater or less than the target number of Stock Units stated in the Agreement. The Committee may provide whether any consideration other than Services must be received by the Company or any Affiliate as a condition precedent to the settlement of a Stock Unit Award.
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(b) Settlement of Award. Following the vesting of a Stock Unit Award, and the Company’s determination that any necessary conditions precedent to the settlement of the Award (such as satisfaction of tax withholding obligations and compliance with applicable legal requirements) have been satisfied, settlement of the Award and payment to the Participant shall be made at such time or times set forth in the Agreement in the form of cash, Shares (which may themselves be considered Restricted Stock under the Plan) or a combination of cash and Shares as determined by the Committee.
11. Other Stock-Based Awards. The Committee may from time to time grant Shares and other Awards that are valued by reference to and/or payable in whole or in part in Shares under the Plan. The Committee shall determine the terms and conditions of such Awards, which shall be consistent with the terms and purposes of the Plan. The Committee may direct the Company to issue Shares subject to restrictive legends and/or stop transfer instructions that are consistent with the terms and conditions of the Award to which the Shares relate.
12. Changes in Capitalization, Change in Control.
(a) Adjustments for Changes in Capitalization. In the event of any equity restructuring (within the meaning of FASB ASC Topic 718) that causes the per share value of Shares to change, such as a stock dividend, stock split, spinoff, rights offering or recapitalization through an extraordinary dividend, the Committee shall make such adjustments as it deems equitable and appropriate to (i) the aggregate number and kind of Shares or other securities issued or reserved for issuance under the Plan, (ii) the number and kind of Shares or other securities subject to outstanding Awards, (iii) the exercise price of outstanding Options and SARs, and (iv) any maximum limitations prescribed by the Plan with respect to certain types of Awards or the grants to individuals of certain types of Awards. In the event of any other change in corporate capitalization, including a merger, consolidation, reorganization, or partial or complete liquidation of the Company, such equitable adjustments described in the foregoing sentence may be made as determined to be appropriate and equitable by the Committee to prevent dilution or enlargement of rights of Participants. In either case, any such adjustment shall be conclusive and binding for all purposes of the Plan. No adjustment shall be made pursuant to this Section 12(a) in connection with the conversion of any convertible securities of the Company, or in a manner that would cause Incentive Stock Options to violate Section 422(b) of the Code or cause an Award to be subject to adverse tax consequences under Section 409A.
(b) Change in Control. In the event of a Change in Control, the Committee may (subject to Section 16(g)), but shall not be obligated to, take one or more of the following actions (A) accelerate, vest or cause the restrictions to lapse with respect to all or any portion of an Award, which may be conditioned upon the Participant’s continued service to the Company or the successor following the Change in Control, (B) cancel such Awards for cash payment of fair value (as determined in the sole discretion of the Committee) which, in the case of Options and SARs, may equal the excess, if any, of value of the consideration to be paid in the Change in Control transaction to holders of the same number of Shares subject to such Options or SARs (or, if no consideration is paid in any such transaction, the Fair Market Value of the Shares subject to such Options or SARs) over the aggregate option price of such Options or exercise price of such SARs (and otherwise, the Committee may cancel Awards for no consideration if the aggregate Fair Market Value of the shares subject to such Awards is less than or equal to the aggregate option price of such Options or exercise price of such SARs), (C) provide for the issuance of Substitute Awards that will substantially preserve the otherwise applicable terms of any affected Awards previously granted hereunder as determined by the Committee in its sole discretion, (D) provide that for a period of at least thirty (30) days prior to the Change in Control, such Options or SARs shall be exercisable as to all shares subject thereto and that upon the occurrence of the Change in Control, such Options or SARs shall terminate and be of no further force and effect, (E) provide for the complete termination of the Plan and cancellation of outstanding Awards not exercised prior to a date specified by the Committee, or (F) provide for the continuance of the Plan with respect to outstanding Awards.
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(c) Dissolution or Liquidation. Unless otherwise provided in an applicable Agreement, in the event of a proposed dissolution or liquidation of the Company, the Committee will notify each Participant as soon as practicable prior to the effective date of such proposed transaction. Awards will terminate immediately prior to the consummation of such proposed action.
(d) Parachute Payment Limitation.
(1) Notwithstanding any other provision of this Plan or any other plan, arrangement or agreement to the contrary, if any of the payments or benefits provided or to be provided by the Company or its Affiliates to a Participant or for the Participant’s benefit pursuant to the terms of this Plan or otherwise (“Covered Payments”) constitute parachute payments (“Parachute Payments”) within the meaning of Section 280G of the Code, and would, but for this Section 12(d) be subject to the excise tax imposed under Section 4999 of the Code (or any successor provision thereto) or any similar tax imposed by state or local law and any interest or penalties with respect to such taxes (collectively, the “Excise Tax”), then the Covered Payments shall be payable either (i) in full or (ii) reduced to the minimum extent necessary to ensure that no portion of the Covered Payments is subject to the Excise Tax, whichever of the foregoing clauses (i) or (ii) results in the Participant’s receipt on an after-tax basis of the greatest amount of payments and benefits after taking into account the applicable federal, state, local and foreign income, employment and excise taxes (including the Excise Tax).
(2) Any such reduction shall be made in accordance with Section 409A and the following: (i) the Covered Payments which do not constitute deferred compensation subject to Section 409A shall be reduced first, and (ii) Covered Payments that are cash payments shall be reduced before non-cash payments, and (iii) Covered Payments to be made on a later payment date shall be reduced before payments to be made on an earlier payment date.
(3) If, notwithstanding the initial application of this Section 12(d), the Internal Revenue Service determines that any Covered Payment constitutes an “excess parachute payment” (as defined by Section 280G(b) of the Code), this Section 12(d) will be reapplied based on the Internal Revenue Service’s determination, and the Participant will be required to promptly repay the portion of the Covered Payments required to avoid imposition of the Excise Tax together with interest at the applicable federal rate (as defined in Section 7872(f)(2)(A) of the Code) from the date of the Participant’s receipt of the excess payments until the date of repayment.
(4) Any determination required under this Section 12(d) shall be made in writing by the accounting firm selected by the Company in its discretion (the “Accountants”), which shall provide detailed supporting calculations to the Company and the Participant as requested by the Company or the Participant. The Company and the Participant shall provide the Accountants with such information and documents as the Accountants may reasonably request in order to make a determination under this Section 12(d). The Company shall be responsible for all fees and expenses of the Accountants.
13. Plan Participation and Service Provider Status. Status as a Service Provider shall not be construed as a commitment that any Award will be made under the Plan to that Service Provider or to eligible Service Providers generally. Nothing in the Plan or in any Agreement or related documents shall confer upon any Service Provider or Participant any right to continued Service with the Company or any Affiliate, nor shall it interfere with or limit in any way any right of the Company or any Affiliate to terminate the person’s Service at any time with or without Cause or change such person’s compensation, other benefits, job responsibilities or title.
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14. Tax Withholding. The Company or any Affiliate, as applicable, shall have the right to (i) withhold from any cash payment under the Plan or any other compensation owed to a Participant an amount sufficient to cover any required withholding taxes related to the grant, vesting, exercise or settlement of an Award, and (ii) require a Participant or other person receiving Shares under the Plan to pay a cash amount sufficient to cover any required withholding taxes before actual receipt of those Shares. In lieu of all or any part of a cash payment from a person receiving Shares under the Plan, the Committee may permit the Participant to satisfy all or any part of the required tax withholding obligations (but not to exceed the maximum individual statutory tax rate in each applicable jurisdiction) by authorizing the Company to withhold a number of the Shares that would otherwise be delivered to the Participant pursuant to the Award, or by transferring to the Company Shares already owned by the Participant, with the Shares so withheld or delivered having a Fair Market Value on the date the taxes are required to be withheld equal to the amount of taxes to be withheld.
15. Effective Date, Duration, Amendment and Termination of the Plan.
(a) Effective Date. The Plan was approved by the Board on March 8, 2026, and shall become effective upon the consummation of the Merger, which shall be considered the date of its adoption for purposes of Treasury Regulation §1.422-2(b)(2)(i). No Awards shall be made under the Plan prior to its effective date. If the Company’s stockholders fail to approve the Plan by December 31, 2026, the Plan will be of no further force or effect.
(b) Duration of the Plan. The Plan shall remain in effect until all Shares subject to it are distributed, all Awards have expired or terminated, the Plan is terminated pursuant to Section 15(c), or the tenth anniversary of the effective date of the Plan, whichever occurs first (the “Termination Date”). Any Awards that are outstanding on the Termination Date shall remain in force according to the terms of the Plan and the applicable Agreement.
(c) Amendment and Termination of the Plan. The Board may at any time terminate, suspend or amend the Plan. The Company shall submit any amendment of the Plan to its stockholders for approval only to the extent required by applicable laws or regulations or the rules of any securities exchange on which the Shares may then be listed. No termination, suspension, or amendment of the Plan may materially impair the rights of any Participant under a previously granted Award without the Participant’s consent, unless such action is necessary to comply with applicable law or stock exchange rules.
(d) Amendment of Awards. Subject to Section 15(e), the Committee may unilaterally amend the terms of any Agreement evidencing an Award previously granted, except that no such amendment may materially impair the rights of any Participant under the applicable Award without the Participant’s consent, unless such amendment is necessary to comply with applicable law or stock exchange rules or any compensation recovery policy as provided in Section 16(i). Notwithstanding the foregoing, a Participant’s rights with respect to an Award will not be deemed to have been materially impaired by any amendment if the Committee, in its sole discretion, determines that the amendment, taken as a whole, does not materially diminish the overall economic benefit to Participant intended under such Award.
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(e) No Option or SAR Repricing. Except as provided in Section 12(a), no Option or Stock Appreciation Right Award granted under the Plan may be (i) amended to decrease the exercise price thereof, (ii) cancelled in conjunction with the grant of any new Option or Stock Appreciation Right Award with a lower exercise price, (iii) cancelled in exchange for cash, other property or the grant of any Full Value Award at a time when the per share exercise price of the Option or Stock Appreciation Right Award is greater than the current Fair Market Value of a Share, or (iv) otherwise subject to any action that would be treated under accounting rules as a “repricing” of such Option or Stock Appreciation Right Award, in each case unless such action is first approved by the Company’s stockholders.
16. Other Provisions.
(a) Unfunded Plan. The Plan shall be unfunded and the Company shall not be required to segregate any assets that may at any time be represented by Awards under the Plan. Neither the Company, its Affiliates, the Committee, nor the Board shall be deemed to be a trustee of any amounts to be paid under the Plan nor shall anything contained in the Plan or any action taken pursuant to its provisions create or be construed to create a fiduciary relationship between the Company and/or its Affiliates, and a Participant. To the extent any person has or acquires a right to receive a payment in connection with an Award under the Plan, this right shall be no greater than the right of an unsecured general creditor of the Company.
(b) Limits of Liability. Except as may be required by law, neither the Company nor any member of the Board or of the Committee, nor any other person participating (including participation pursuant to a delegation of authority under Section 3(d) of the Plan) in any determination of any question under the Plan, or in the interpretation, administration or application of the Plan, shall have any liability to any party for any action taken, or not taken, in good faith under the Plan.
(c) Compliance with Applicable Legal Requirements and Company Policies. No Shares distributable pursuant to the Plan shall be issued and delivered unless and until the issuance of the Shares complies with all applicable legal requirements, including compliance with the provisions of applicable state and federal securities laws, and the requirements of any securities exchanges on which the Company’s Shares may, at the time, be listed. During any period in which the offering and issuance of Shares under the Plan is not registered under federal or state securities laws, Participants shall acknowledge that they are acquiring Shares under the Plan for investment purposes and not for resale, and that Shares may not be transferred except pursuant to an effective registration statement under, or an exemption from the registration requirements of, such securities laws. Any stock certificate or book-entry evidencing Shares issued under the Plan that are subject to securities law restrictions shall bear or be accompanied by an appropriate restrictive legend or stop transfer instruction. Notwithstanding any other provision of this Plan, the acquisition, holding or disposition of Shares acquired pursuant to the Plan shall in all events be subject to compliance with applicable Company policies, including those relating to insider trading, pledging or hedging transactions, minimum post-vesting holding periods and stock ownership guidelines, and to forfeiture or recovery of compensation as provided in Section 16(i)(i).
| 17 |
(d) Other Benefit and Compensation Programs. Payments and other benefits received by a Participant under an Award made pursuant to the Plan shall not be deemed a part of a Participant’s regular, recurring compensation for purposes of the termination, indemnity or severance pay laws of any country.
(e) Governing Law. To the extent that federal laws do not otherwise control, the Plan and all determinations made and actions taken pursuant to the Plan shall be governed by the laws of the State of Nevada without regard to its conflicts-of-law principles and shall be construed accordingly.
(f) Severability. If any provision of the Plan shall be held illegal or invalid for any reason, the illegality or invalidity shall not affect the remaining parts of the Plan, and the Plan shall be construed and enforced as if the illegal or invalid provision had not been included.
(g) Section 409A. It is intended that all Awards under the Plan will be exempt from, or will comply with, Section 409A, and to the maximum extent permitted the Awards and the Plan will be interpreted and administered in accordance with this intent. Each amount to be paid or benefit to be provided under an Award shall be construed as a separate and distinct payment for purposes of Section 409A. If payment under an Award is to be made within a designated period which does not begin and end within one calendar year, the Participant does not have a right to designate the taxable year of the payment. Without limiting the foregoing and notwithstanding anything contained herein to the contrary, to the extent required to avoid accelerated income recognition and/or tax penalties under Section 409A:
(1) If any amount is payable under such Award upon a termination of Service, a termination of Service will be deemed to have occurred only at such time as the Participant has experienced a Separation from Service; and
(2) If any amount shall be payable with respect to any such Award as a result of a Participant’s Separation from Service at such time as the Participant is a “specified employee” within the meaning of Section 409A, then no payment shall be made, except as permitted under Section 409A, prior to the first business day after the earlier of (i) the date that is six months after the Participant’s Separation from Service or (ii) the Participant’s death. Unless the Committee has adopted a specified employee identification policy as contemplated by Section 409A, specified employees will be identified by the Board in its discretion in accordance with the default provisions specified under Section 409A.
None of the Company, the Board, the Committee nor any other person involved with the administration of this Plan shall (i) in any way be responsible for ensuring the exemption of any Award from, or compliance by any Award with, the requirements of Section 409A, (ii) have any obligation to design or administer the Plan or Awards granted thereunder in a manner that minimizes a Participant’s tax liabilities, including the avoidance of any additional tax liabilities under Section 409A, or (iii) shall have any liability to any Participant for any such tax liabilities.
(h) Rule 16b-3. It is intended that the Plan and all Awards granted pursuant to it shall be administered by the Committee so as to permit the Plan and Awards to comply with Exchange Act Rule 16b-3. If any provision of the Plan or of any Award would otherwise frustrate or conflict with the intent expressed in this Section 16(h), that provision to the extent possible shall be interpreted and deemed amended in the manner determined by the Committee so as to avoid the conflict. To the extent of any remaining irreconcilable conflict with this intent, the provision shall be deemed void as applied to Participants subject to Section 16 of the Exchange Act to the extent permitted by law and in the manner deemed advisable by the Committee.
(i) Forfeiture and Compensation Recovery.
(1) The Committee may specify in an Agreement that the Participant’s rights, payments, and benefits with respect to an Award will be subject to reduction, cancellation, forfeiture or recovery by the Company upon the occurrence of certain specified events, in addition to any otherwise applicable vesting or performance conditions of an Award. Such events may include termination of Service for Cause; violation of any material Company or Affiliate policy; breach of noncompetition, non-solicitation or confidentiality provisions that apply to the Participant; a determination that the payment of the Award was based on an incorrect determination that financial or other criteria were met; or other conduct by the Participant that is detrimental to the business or reputation of the Company or its Affiliates.
(2) Awards and any compensation associated therewith are subject to recoupment, forfeiture, recovery or other action pursuant to any compensation recovery policy adopted by the Board or the Committee at any time, as amended from time to time, which includes but is not limited to any compensation recovery policy adopted by the Board or the Committee in response to the requirements of Section 10D of the Exchange Act, the SEC’s final rules thereunder, and applicable listing rules or other rules and regulations implementing the foregoing or as otherwise required by law or stock exchange. Any Agreement will be automatically and unilaterally amended to comply with any such compensation recovery policy.
| 18 |
Exhibit 10.5
POWERUS CORPORATION
Non-Qualified Stock Option Agreement
Under the 2026 Equity Incentive Plan
PowerUS Corporation (the “Company”), pursuant to its PowerUS Corporation 2026 Equity Incentive Plan (the “Plan”), hereby grants an Option to purchase shares of the Company’s common stock to you, the Participant named below. The terms and conditions of the Option Award are set forth in this Agreement, consisting of this cover page and the Option Terms and Conditions on the following pages, and in the Plan document, a copy of which has been provided to you. Any capitalized term that is not defined in this Agreement shall have the meaning set forth in the Plan as it currently exists or as it is amended in the future.
Name of Participant: [_____________________] |
|
No. of Shares Covered: [________] |
Grant Date: ____________, 202_ |
Exercise Price Per Share: $[_______] |
Expiration Date: ____________, 202_ |
Vesting Commencement Date: ________, 202_1 |
|
Vesting and Exercise Schedule: |
|
| Dates | Portion of Shares as to Which Option Becomes Vested and Exercisable |
1 Delete if vesting commences on the Grant Date.
By signing below or otherwise evidencing your acceptance of this Agreement in a manner approved by the Company, you agree to all of the terms and conditions contained in this Agreement and in the Plan document. You acknowledge that you have received and reviewed these documents and that they set forth the entire agreement between you and the Company regarding your right to purchase shares of the Company’s common stock pursuant to this Option. You further acknowledge that the acceptance of this Award is voluntary and not a condition of employment, and that you may decline to accept this Award without adverse consequences to your continued employment relationship with the Company.
| PARTICIPANT: | POWERUS CORPORATION: | ||
| By: | |||
| Title: | |||
| Non-Qualified Stock Option Agreement (PowerUS Corporation 2026 Equity Incentive Plan) | Page 2 |
PowerUS Corporation
2026 Equity Incentive Plan
Non-Qualified Stock Option Agreement
Option Terms and Conditions
| 1. | Non-Qualified Stock Option. This Option is not intended to be an “incentive stock option” within the meaning of Section 422 of the Internal Revenue Code and will be interpreted accordingly. |
| 2. | Vesting and Exercisability of Option. |
(a) Scheduled Vesting. This Option will vest and become exercisable as to the number of Shares and on the dates specified in the Vesting and Exercise Schedule on the cover page to this Agreement, so long as your Continuous Service to the Company does not end. The Vesting and Exercise Schedule is cumulative, meaning that to the extent the Option has not already been exercised and has not expired or been terminated or cancelled, you or the person otherwise entitled to exercise the Option as provided in this Agreement may at any time purchase all or any portion of the Shares subject to the vested portion of the Option.
(b) Accelerated Vesting. Vesting and exercisability of this Option may be accelerated during the term of the Option [under the circumstances described in Section 12(b) of the Plan, and] at the discretion of the Committee in accordance with Section 3(b)(2) of the Plan.
(c) [Change of Control. If a Change in Control occurs while you provide Continuous Service to the Company, the Option shall fully vest and become exercisable as of immediately prior to such Change in Control.]
| 3. | Expiration. This Option will expire and will no longer be exercisable at 5:00 p.m. Central Time on the earliest of: |
| (a) | The expiration date specified on the cover page of this Agreement; | |
| (b) | Upon your termination of Continuous Service for Cause; | |
| (c) | Upon the expiration of any applicable period specified in Section 6(e) of the Plan or Section 2 of this Agreement during which this Option may be exercised after your Separation from Service; or | |
| (d) | The date (if any) fixed for termination or cancellation of this Option pursuant to Section 12(b) or (c) of the Plan. |
| 4. | Service Requirement. Except as otherwise provided in Section 6(e) of the Plan or Section 2 of this Agreement, this Option may be exercised only while you provide Continuous Service to the Company or any Affiliate from the Grant Date of this Option. |
| 5. | Exercise of Option. Subject to Section 4, the vested and exercisable portion of this Option may be exercised in whole or in part at any time during the Option term by delivering a written or electronic notice of exercise to the party designated by the Company, and by providing for payment of the exercise price of the Shares being acquired and any related withholding taxes. The notice of exercise must be in a form approved by the Company and state the number of Shares to be purchased, the method of payment of the aggregate exercise price and the directions for the delivery of the Shares to be acquired, and must be signed or otherwise authenticated by the person exercising the Option. If you are not the person exercising the Option, the person submitting the notice also must submit appropriate proof of his/her right to exercise the Option. |
| Non-Qualified Stock Option Agreement (PowerUS Corporation 2026 Equity Incentive Plan) | Page 3 |
| 6. | Payment of Exercise Price. When you submit your notice of exercise, you must include payment of the exercise price of the Shares being purchased through one or a combination of the following methods: |
| (a) | Cash (including personal check, cashier’s check or money order); | |
| (b) | By means of a broker-assisted cashless exercise in which you irrevocably instruct your broker to deliver proceeds of a sale of all or a portion of the Shares to be issued pursuant to the exercise to the Company in payment of the exercise price of such Shares; | |
| (c) | By delivery to the Company of Shares (by actual delivery or attestation of ownership in a form approved by the Company) already owned by you that are not subject to any security interest and that have an aggregate Fair Market Value on the date of exercise equal to the exercise price of the Shares being purchased; or | |
| (d) | By authorizing the Company to retain, from the total number of Shares as to which the Option is being exercised, that number of Shares having a Fair Market Value on the date of exercise equal to the exercise price for the total number of Shares as to which the Option is being exercised. |
| 7. | Withholding Taxes. You may not exercise this Option in whole or in part unless you make arrangements acceptable to the Company for payment of any federal, state, local or foreign withholding taxes that may be due as a result of the exercise of this Option. You hereby authorize the Company (or any Affiliate) to withhold from payroll or other amounts payable to you any sums required to satisfy such withholding tax obligations, and otherwise agree to satisfy such obligations in accordance with the provisions of Section 14 of the Plan. The Company may permit you to satisfy such withholding tax obligations by delivering Shares you already own or by having the Company retain a portion of the Shares being acquired upon exercise of the Option. Delivery of Shares upon exercise of this Option is subject to the satisfaction of applicable withholding tax obligations. |
| 8. | Delivery of Shares. As soon as practicable after the Company receives the notice of exercise and payment of the exercise price as provided above, and has determined that all other conditions to exercise, including satisfaction of withholding tax obligations and compliance with applicable laws as provided in Section 18(c) of the Plan, have been satisfied, it shall deliver to the person exercising the Option, in the name of such person, the Shares being purchased, as evidenced by issuance of a stock certificate or certificates, electronic delivery of such Shares to a brokerage account designated by such person, or book-entry registration of such Shares with the Company’s transfer agent. The Company shall pay any original issue or transfer taxes with respect to the issue or transfer of the Shares and all fees and expenses incurred by it in connection therewith. All Shares so issued shall be fully paid and nonassessable. |
| 9. | Compliance with Laws. This Option may be exercised only if the issuance of Shares upon such exercise complies with all applicable legal requirements, including compliance with the provisions of applicable federal and state securities laws. |
| Non-Qualified Stock Option Agreement (PowerUS Corporation 2026 Equity Incentive Plan) | Page 4 |
| 10. | Transfer of Option. During your lifetime, only you (or your guardian or legal representative in the event of legal incapacity) may exercise this Option except in the case of a transfer described below. You may not assign or transfer this Option except for a transfer upon your death in accordance with your will, by the laws of descent and distribution or pursuant to a beneficiary designation submitted in accordance with Section 6(d) of the Plan, or, with the prior written approval of the Company, (i) pursuant to a domestic relations order, or (ii) by gift to a “family member” as the term is defined under General Instruction A(5) to Form S-8 under the Securities Act. The Option held by any such transferee will continue to be subject to the same terms and conditions that were applicable to the Option immediately prior to its transfer and may be exercised by such transferee as and to the extent that the Option has become exercisable and has not terminated in accordance with the provisions of the Plan and this Agreement. |
| 11. | No Right to Continued Service. This Agreement does not give you a right to continued Service with the Company or any Affiliate, and the Company or any such Affiliate may terminate your Service at any time and otherwise deal with you without regard to the effect it may have upon you under this Agreement. |
| 12. | No Stockholder Rights Before Exercise. Neither you nor any permitted transferee of this Option will have any of the rights of a stockholder of the Company with respect to any Shares subject to this Option until a certificate evidencing such Shares has been issued, electronic delivery of such Shares has been made to your designated brokerage account, or an appropriate book entry in the Company’s stock register has been made. No adjustments shall be made for dividends or other rights if the applicable record date occurs before your stock certificate has been issued, electronic delivery of your Shares has been made to your designated brokerage account, or an appropriate book entry in the Company’s stock register has been made, except as otherwise described in the Plan. |
| 13. | Governing Plan Document. This Agreement and Option are subject to all the provisions of the Plan, and to all interpretations, rules and regulations which may, from time to time, be adopted and promulgated by the Committee pursuant to the Plan. If there is any conflict between the provisions of this Agreement and the Plan, the provisions of the Plan will govern, except as expressly overridden or amended in this Agreement. |
| 14. | Choice of Law. This Agreement will be interpreted and enforced under the laws of the state of Nevada (without regard to its conflicts or choice of law principles). |
| 15. | Binding Effect. This Agreement will be binding in all respects on your heirs, representatives, successors and assigns, and on the successors and assigns of the Company. |
| 16. | Restrictive Legends. The Company may place a legend or legends on any certificate representing Shares issued upon the exercise of this Option summarizing transfer and other restrictions to which the Shares may be subject under applicable securities laws, or other provisions of this Agreement. You agree that in order to ensure compliance with the restrictions referred to in this Agreement, the Company may issue appropriate “stop transfer” instructions to its transfer agent. |
| 17. | Compensation Recovery Policy. This Agreement and Option grant and any stock acquired or compensation paid or payable pursuant to this Agreement shall be subject to potential forfeiture or recovery by the Company in accordance with any compensation recovery policy adopted by the Board of Directors of the Company or any committee thereof, including but not limited to in response to the requirements of Section 10D of the Exchange Act, the SEC’s final rules thereunder, and any listing rules and regulations implementing the foregoing, or as otherwise required by law. This Agreement will be automatically amended to comply with any such compensation recovery policy. |
| 18. | Electronic Delivery and Acceptance. The Company may deliver any documents related to this Option Award by electronic means and request your acceptance of this Agreement by electronic means. You hereby consent to receive all applicable documentation by electronic delivery and to participate in the Plan through an on-line (and/or voice activated) system established and maintained by the Company or the Company’s third-party stock plan administrator. |
By signing the cover page of this Agreement or otherwise accepting this Agreement in a manner approved by the Company, you agree to all the terms and conditions described above and in the Plan document.
| Non-Qualified Stock Option Agreement (PowerUS Corporation 2026 Equity Incentive Plan) | Page 5 |
Exhibit 10.6
POWERUS CORPORATION
2026 EQUITY INCENTIVE PLAN
Restricted Stock Unit Award Agreement
Grant Notice
Powerus Corporation (the “Company”), pursuant to its 2026 Equity Incentive Plan (the “Plan”), hereby grants an Award of restricted stock units (“RSUs”) to you, the Participant named below. The terms and conditions of this Award are set forth in this Restricted Stock Unit Award Agreement, consisting of this Grant Notice and the Terms and Conditions on the following pages (the “Agreement”), and in the Plan document, a copy of which has been provided to you. Any capitalized term that is used but not defined in this Agreement shall have the meaning assigned to it in the Plan as it currently exists or as it is amended in the future.
| Name of Participant: [_______________________] | ||
| Number of Restricted Stock Units: [_______] | Grant Date: __________, 202_ | |
| Vesting Schedule: | ||
Scheduled Vesting Dates |
Number of Restricted Stock Units that Vest | |
If the vesting schedule described above results in the vesting of a fractional Share, such fractional Share shall not be deemed vested pursuant to the vesting schedule and shall be aggregated and the Shares resulting from such aggregation shall vest on the final vesting date; provided that any fractional Shares vested on the final vesting date shall be rounded down to the nearest whole Share.
[Mandatory Sell to Cover Withholding Taxes. You understand that as a condition to acceptance of this Award, to the fullest extent permitted under the Plan, Section 8 of the Terms and Conditions to this Restricted Stock Unit Agreement and applicable law, withholding taxes and other tax related items will be satisfied through the sale of a number of the Shares of Stock issued on the settlement of vested Restricted Stock Units and the remittance of the cash proceeds to the Company. The Company is authorized and directed by you to make payment from the cash proceeds of this sale directly to the appropriate taxing authorities in an amount equal to the taxes required to be withheld. The mandatory sale of Shares to cover withholding taxes and tax related items is imposed by the Company on you in connection with the receipt of this Award, and it is intended to comply with the requirements of Rule 10b5-1(c)(1)(i)(B) under the Exchange Act and be interpreted to meet the requirements of Rule 10b5-1(c).]
By signing below or otherwise evidencing your acceptance of this Agreement in a manner approved by the Company, you agree to all of the terms and conditions contained in this Agreement and in the Plan document. You acknowledge that you have received and reviewed these documents and that they set forth the entire agreement between you and the Company regarding this Award of RSUs. This Grant Notice may be executed in one or more counterparts (including portable document format (.pdf) or electronic signature counterparts), each of which shall be deemed to be an original, but all of which together shall constitute one and the same agreement. You further acknowledge that the acceptance of this Award is voluntary and not a condition of Service, and that you may decline to accept this Award without adverse consequences to your continued Service relationship with the Company. If you fail to sign or accept this Agreement by ____________, 20__, this Award shall be void and of no further force or effect.
| PARTICIPANT | POWERUS CORPORATION | ||
| By: | |||
| Title: | |||
POWERUS CORPORATION
2026 Equity Incentive Plan
Restricted Stock Unit Award Agreement
Terms and Conditions
1. Grant of Restricted Stock Units. The Company hereby grants to the Participant named in the Grant Notice an Award of RSUs. Each RSU represents the right to receive one Share of the Company’s Stock.
2. Restrictions Applicable to RSUs. Neither this Award nor the RSUs subject to this Award may be sold, assigned, transferred, exchanged or encumbered, voluntarily or involuntarily, other than [(i)] a transfer upon your death in accordance with your will, by the laws of descent and distribution or pursuant to a beneficiary designation submitted in accordance with Section 6(d) of the Plan, or (ii) pursuant to a domestic relations order. Following any such transfer, this Award shall continue to be subject to the same terms and conditions that were applicable to this Award immediately prior to its transfer. Any attempted transfer in violation of this Section 2 shall be void and without effect. The RSUs and your right to receive Shares in settlement of the RSUs under this Agreement shall be subject to forfeiture as provided in Section 5 until satisfaction of the vesting conditions set forth in Section 4.
3. No Stockholder Rights. The RSUs subject to this Award do not entitle you to any rights of a holder of the Company’s Stock. You will not have any of the rights of a stockholder of the Company in connection with the grant of RSUs subject to this Agreement unless and until Shares are issued to you upon settlement of the RSUs as provided in Section 6.
4. Vesting of RSUs. For purposes of this Agreement, “Vesting Date” means any date, including the Scheduled Vesting Dates specified in the Vesting Schedule in the Grant Notice, on which RSUs subject to this Agreement vest as provided in this Section 4. In order for RSUs to vest, you must provide Continuous Service from the Grant Date until the date such vesting occurs.
(a) Scheduled Vesting. If you remain in Continuous Service from the Grant Date, then the RSUs will vest in the amounts and on the Scheduled Vesting Dates specified in the Vesting Schedule.
(b) [Accelerated or Continued Vesting. The vesting of outstanding RSUs will be accelerated or continued under the circumstances provided below:
(1) Death or Disability. If your Service terminates prior to the final Scheduled Vesting Date due to your death or Disability, then [all of the unvested RSUs] [a pro rata portion (based on the number of days during which you were a Service Provider since the most recent Scheduled Vesting Date (or since the Grant Date if there was no previous Scheduled Vesting Date) as a percentage of 365) of the RSUs scheduled to vest as of the next Scheduled Vesting Date] shall vest as of such termination date.
(2) Change in Control. Vesting of the RSUs may be accelerated during the term of this Award under the circumstances described in Sections 12(b) aof the Plan. If a Change in Control occurs while you continue to be a Service Provider and prior to the final Scheduled Vesting Date, the following provisions shall apply:
| RSU Agreement (2026 Equity Incentive Plan) | Page 2 |
(i) If, within 12 months after a Change in Control (A) described in paragraphs (1) or (2) of Section 2(f) of the Plan or (B) that constitutes a Corporate Transaction as defined in paragraph (3) of Section 2(f) of the Plan and in connection with which the surviving or acquiring entity (or its parent entity) has continued, assumed or replaced this Award, you cease to be a Service Provider due either to an involuntary termination for reasons other than Cause or a resignation for Good Reason, then all unvested RSUs shall immediately vest in full. “Good Reason” shall, if you have an agreement covering your employment relationship with the Company or an Affiliate, have the meaning set forth in your employment agreement. If you do not have an employment agreement with the Company, “Good Reason” means the existence of one or more of the following conditions without your written consent, so long as you provided written notice to the Company of the existence of the condition not later than thirty (30) days after the initial existence of the condition, the condition has not been remedied by the Company within thirty (30) days after its receipt of such notice and you terminate your Service no later than ninety (90) days after the condition’s initial occurrence: (i) any material, adverse change in your duties, responsibilities, or authority; (ii) a material reduction in your base salary or bonus opportunity that is not part of a general reduction applicable to employees in the same classification or grade as you; or (iii) a geographical relocation of your principal office location by more than 50 miles.
(ii) If this Award is not continued, assumed or replaced in connection with a Change in Control that constitutes a Corporate Transaction, then all unvested RSUs shall immediately vest in full upon the occurrence of the Change in Control.
(iii) For purposes of this Section 4(b)(3), this Award will be considered assumed or replaced under the circumstances specified in Section 12(b)(1) of the Plan.
5. Effect of Termination of Service. Except as otherwise provided in accordance with Section 4(b), if you cease to be a Service Provider prior to a Scheduled Vesting Date, you will forfeit all unvested RSUs.
6. Settlement of RSUs. After any RSUs vest pursuant to Section 4, the Company shall, as soon as practicable (but no later than the March 15 following the calendar year in which the Vesting Date occurs), and after the Company has determined that all other conditions to your receipt of Shares, including satisfaction of withholding tax obligations and compliance with applicable laws, have been satisfied, cause to be issued and delivered to you (or to your personal representative or your designated beneficiary or estate in the event of your death, as applicable) one Share in payment and settlement of each vested RSU. Delivery of the Shares shall be effected by the issuance of a stock certificate to you, by an appropriate entry in the stock register maintained by the Company’s transfer agent with a notice of issuance provided to you, or by the electronic delivery of the Shares to a brokerage account you designate, and shall be subject to the tax withholding provisions of Section 8 and compliance with all applicable legal requirements as provided in Section 16(c) of the Plan, and shall be in complete satisfaction and settlement of such vested RSUs. The Company will pay any original issue or transfer taxes with respect to the issue and transfer of Shares to you pursuant to this Agreement, and all fees and expenses incurred by it in connection therewith. Notwithstanding the foregoing, if the ownership or issuance of Shares to you as provided herein is not feasible due to applicable exchange controls, securities or tax laws or other provisions of applicable law, as determined by the Committee in its sole discretion, you (or your permitted transferee) shall receive in lieu of Shares cash in an amount equal to the Fair Market Value (as of the date vesting of the RSUs occurs) of the Shares otherwise issuable in settlement of the vested RSUs, net of any amount required to satisfy withholding tax obligations as provided in Section 8. Notwithstanding the foregoing, if so determined by the Committee in its sole discretion, you (or your permitted transferee) shall receive in lieu of Shares cash in an amount equal to the Fair Market Value (as of the date vesting of the RSUs occurs) of the Shares otherwise issuable in settlement of the vested RSUs, net of any amount required to satisfy withholding tax obligations as provided in Section 8.
| RSU Agreement (2026 Equity Incentive Plan) | Page 3 |
7. Dividends and Dividend Equivalents The RSUs do not provide any dividends or dividend equivalents.
8. Tax Consequences and Withholding. No Shares will be delivered to you in settlement of vested RSUs unless you have made arrangements acceptable to the Company for payment of any federal, state, local or foreign withholding taxes that may be due as a result of the delivery of the Shares. You hereby authorize the Company (or any Affiliate) to withhold from payroll or other amounts payable to you any sums required to satisfy such withholding tax obligations, and otherwise agree to satisfy such obligations in accordance with the provisions of Section 14 of the Plan. You may elect to satisfy such withholding tax obligations by having the Company withhold a number of Shares that would otherwise be issued to you in settlement of the RSUs and that have a fair market value equal to the amount of such withholding tax obligations by notifying the Company of such election prior to the Vesting Date. [If net withholding is the method by which such withholding obligations are satisfied, the Company will not withhold on a fractional Share basis to satisfy any portion of the withholding obligations and, unless the Company determines otherwise, no refund will be made to you for the value of the portion of a Share, if any, withheld in excess of the withholding obligations.]
[Sell-to-Cover:
(a) No Shares will be delivered to you in settlement of vested RSUs unless you have made arrangements acceptable to the Company for payment of any federal, state, local or foreign withholding taxes that may be due as a result of the delivery of the Shares (the “Withholding Taxes”). Specifically, pursuant to the Grant Notice and this Section 8, you hereby agree to a “same day sale” commitment with a broker-dealer that is a member of the Financial Industry Regulatory Authority (a “ FINRA Dealer”) as your agent (the “Agent”) whereby the Agent is irrevocably authorized to sell a portion of the Shares to be issued on a Vesting Date necessary to satisfy the Withholding Taxes and whereby the FINRA Dealer will forward the proceeds necessary to satisfy the Withholding Taxes directly to the Company. If, for any reason, such “same day sale” commitment pursuant to this Section 8 does not result in sufficient proceeds to satisfy the Withholding Taxes or would be prohibited by applicable law at the applicable time, you hereby authorize the Company to satisfy the obligations with regard to all Withholding Taxes by one or a combination of the following: (a) withholding from any compensation otherwise payable to you by the Company; (b) causing you to tender a cash payment (which may be in the form of a check, electronic wire transfer or other method permitted by the Company); or (c) withholding a number of whole Shares having a fair market value, as determined by the Company as of the date on which the tax withholding obligations arise.
(b) By accepting this Award, you agree to the following “sell to cover” provisions:
(i) You hereby authorize the Agent to:
(A) Sell on the open market at the then prevailing market price(s), on your behalf, as soon as practicable on or after each Vesting Date on which Shares are issued to you, only the number (rounded down to the prior whole number) of the Shares issued on the Vesting Date sufficient to generate proceeds to cover (A) the Withholding Taxes resulting exclusively from the issuance of such Shares and (B) all applicable fees and commissions due to, or required to be collected by, the Agent with respect thereto; and
| RSU Agreement (2026 Equity Incentive Plan) | Page 4 |
(B) Remit any remaining funds to you.
(ii) You hereby authorize the Company and the Agent to cooperate and communicate with one another to determine the number of Shares that must be sold pursuant to this Section 8.
(iii) You understand that the Agent may effect sales as provided in this Section 8 in one or more sales and that the average price for executions resulting from bunched orders will be assigned to your account. In addition, you acknowledge that it may not be possible to sell Shares as provided by in this Section 8 due to (A) a legal or contractual restriction applicable to you or the Agent, (B) a market disruption, or (C) rules governing order execution priority on the national exchange where the Stock may be traded. In the event of the Agent’s inability to sell Shares, you will continue to be responsible for the timely payment to the Company of all Withholding Taxes and any other 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 this Section 8.
(iv) You further acknowledge and agree as follows:
(A) You represent that you have reviewed with your own tax advisors the federal, state and local tax consequences of the transactions contemplated by this Agreement and that you are relying solely on such advisors and not on any statements or representations of the Company, the FINRA Dealer or any of their respective agents.
(B) The instruction to the Agent to sell in connection with this Section 8 is intended to comply with the requirements of Rule 10b5-1(c)(1)(i)(B) under the Exchange Act, and is to be interpreted to comply with the requirements of Rule 10b5-1(c)(1) under the Exchange Act.
(C) You are not aware of any material, nonpublic information with respect to the Company or any securities of the Company as of the date of this Agreement.
(D) You hereby appoint the Company has your attorney-in-fact to instruct the Agent with respect to the number of Shares to be sold under the sell-to-cover contemplated in this Section 8.]2
9. Notices. Every notice or other communication relating to this Agreement shall be in writing and shall be mailed to or delivered (including electronically) to the party for whom it is intended at such address as may from time to time be designated by it in a notice mailed or delivered to the other party as herein provided. Unless and until some other address is so designated, all notices or communications by you to the Company shall be mailed or delivered to the Company, to [the party designated by the Company] // [the attention of its [__________], at its office at [_________________], [email address]], and all notices or communications by the Company to you may be given to you personally or may be mailed or, if you are still a Service Provider, emailed to you at the address indicated in the Company’s records as your most recent mailing or email address.
10. Additional Provisions.
(a) No Right to Continued Service. This Agreement does not give you a right to continued Service with the Company or any Affiliate, and the Company or any such Affiliate may terminate your Service at any time without regard to the effect it may have upon you under this Agreement.
2 Alternative Section 8 for mandatory sell-to-cover.
| RSU Agreement (2026 Equity Incentive Plan) | Page 5 |
(b) Governing Plan Document. This Agreement and this Award are subject to all the provisions of the Plan, which is incorporated herein by reference, and to all interpretations, rules and regulations which may, from time to time, be adopted and promulgated by the Committee pursuant to the Plan. If there is any conflict between the provisions of this Agreement and the Plan, the provisions of the Plan will govern, except as expressly overridden or amended in this Agreement.
(c) Governing Law. This Agreement, the parties’ performance hereunder, and the relationship between them shall be governed by, construed, and enforced in accordance with the laws of the State of Nevada without giving effect to the choice of law principles thereof. You further consent to personal jurisdiction and venue in both such courts and to service of process by United States Mail or express courier service in any such action.]
(d) Severability. The provisions of this Agreement shall be severable and if any provision of this Agreement is found by any court to be unenforceable, in whole or in part, the remainder of this Agreement shall nevertheless be enforceable and binding on the parties. You also agree that any trier of fact may modify any invalid, overbroad or unenforceable provision of this Agreement so that such provision, as modified, is valid and enforceable under applicable law.
(e) Binding Effect. This Agreement will be binding in all respects on your heirs, representatives, successors and assigns, and on the successors and assigns of the Company.
(f) Section 409A of the Code. The payments and benefits provided pursuant to this Agreement are intended to be exempt from Section 409A under the short-term deferral exception specified in Treas. Reg. § 1.409A-l(b)(4), and to the maximum extent permitted this Agreement will be interpreted and administered in accordance with this intent. If any amount is payable under this Agreement upon a termination of Service, a termination of Service will be deemed to have occurred only at such time as you have experienced a Separation from Service. Each amount to be paid or benefit to be provided under this Agreement shall be construed as a separate and distinct payment for purposes of Section 409A.
(g) Electronic Delivery and Acceptance. The Company may deliver any documents related to this Award by electronic means and may request your acceptance of this Agreement by electronic means. You hereby consent to receive all applicable documentation by electronic delivery and to participate in the Plan through an on-line (and/or voice activated) or electronic system established and maintained by the Company or the Company’s third-party stock plan administrator.
(h) Forfeiture and Compensation Recovery Policy.
(i) Forfeiture of Award. Notwithstanding anything to the contrary in this Agreement, if you cease to be Service Provider because your Continuous Service is terminated for Cause, then (i) you shall immediately forfeit this Award and any right to receive Shares that have not yet been issued pursuant to Section 6, and (ii) with respect to Shares that have been issued pursuant to this Award, either (A) you shall return such Shares to the Company, or (B) you shall pay to the Company in cash an amount equal to the Fair Market Value of such Shares as of the respective Vesting Dates of the underlying RSUs.
(ii) Compensation Recovery Policy. In addition to the forfeiture provisions set forth in this Agreement, this Award, the RSUs, cash or stock issued in settlement under this Award, and any other compensation associated therewith is subject to forfeiture, recovery by the Company or other action pursuant to any compensation recovery policy adopted by the Board or any Committee thereof any time, or as otherwise required by law or stock exchange. This Agreement will be automatically amended to comply with any such compensation recovery policy.
By signing the Grant Notice of this Agreement or otherwise accepting this Agreement in a manner approved by the Company, you agree to all the terms and conditions described above and in the Plan document.
| RSU Agreement (2026 Equity Incentive Plan) | Page 6 |
Exhibit 10.7
POWERUS CORPORATION
INDEMNIFICATION AGREEMENT
This Indemnification Agreement (“Agreement”), dated as of [DATE], 2026, is by and between Powerus, Inc., a Nevada corporation (the “Company”) and [NAME OF DIRECTOR/OFFICER] (the “Indemnitee”).
WHEREAS, Indemnitee is [a director/an officer] of the Company;
WHEREAS, both the Company and Indemnitee recognize the increased risk of litigation and other claims being asserted against directors and officers of public companies;
WHEREAS, the board of directors of the Company (the “Board”) has determined that enhancing the ability of the Company to retain and attract as directors and officers the most capable persons is in the interests of the Company and that the Company therefore should seek to assure such persons that indemnification and insurance coverage is available; and
WHEREAS, in recognition of the need to provide Indemnitee with substantial protection against personal liability, in order to procure Indemnitee’s continued service as a [director/officer] of the Company and to enhance Indemnitee’s ability to serve the Company in an effective manner, and in order to provide such protection pursuant to express contract rights (intended to be enforceable irrespective of, among other things, any amendment to the Company’s articles of incorporation or bylaws (collectively, the “Constituent Documents”), any change in the composition of the Board or any change in control or business combination transaction relating to the Company), the Company wishes to provide in this Agreement for the indemnification of, and the advancement of Expenses (as defined in Section 1(g) below) to, Indemnitee as set forth in this Agreement and for the continued coverage of Indemnitee under the Company’s directors’ and officers’ liability insurance policies.
NOW, THEREFORE, in consideration of the foregoing and the Indemnitee’s continuing to provide services to the Company, the parties agree as follows:
1. Definitions. For purposes of this Agreement, the following terms shall have the following meanings:
(a) “Beneficial Owner” has the meaning given to the term “beneficial owner” in Rule 13d-3 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”).
(b) “Change in Control” means the occurrence after the date of this Agreement of any of the following events:
(i) any Person is or becomes the Beneficial Owner, directly or indirectly, of securities of the Company representing 65% or more of the Company’s then outstanding Voting Securities;
(ii) the consummation of a reorganization, merger or consolidation, unless immediately following such reorganization, merger or consolidation, all of the Beneficial Owners of the Voting Securities of the Company immediately prior to such transaction beneficially own, directly or indirectly, more than 51% of the combined voting power of the outstanding Voting Securities of the entity resulting from such transaction;
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(iii) during any period of two consecutive years, not including any period prior to the execution of this Agreement, individuals who at the beginning of such period constituted the Board (including for this purpose any new directors whose election by the Board or nomination for election by the Company’s stockholders was approved by a vote of at least two-thirds (2/3) 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 Board; or
(iv) the stockholders of the Company approve a plan of complete liquidation or dissolution of the Company or an agreement for the sale or disposition by the Company of all or substantially all of the Company’s assets.
(c) “Claim” means:
(i) any threatened, pending or completed action, suit, proceeding, counterclaim, cross claim, mediation or alternative dispute resolution mechanism, whether civil, criminal, administrative, arbitrative, investigative or other, and whether made pursuant to federal, state or other law; or
(ii) any formal or informal inquiry, hearing or investigation that the Indemnitee reasonably determines in good faith might lead to the institution of any such action, suit, proceeding or alternative dispute resolution mechanism.
(d) “Corporate Status” describes the status of a person who is or was a director, manager, officer, employee, agent or fiduciary of the Company or of any other corporation, limited liability company, partnership, joint venture, trust, employee benefit plan or other Enterprise that such person is or was serving at the express written request of the Company
(e) “Disinterested Director” means a director of the Company who is not and was not a party to the Claim in respect of which indemnification is sought by Indemnitee.
(f) “Expense Advance” means any payment of Expenses advanced to Indemnitee by the Company pursuant to Section 3 or Section 4 hereof.
(g) “Expenses” means any and all expenses, including attorneys’ and experts’ fees, court costs, transcript costs, travel expenses, duplicating, printing and binding costs, telecommunications charges, and all other costs and expenses incurred in connection with investigating, defending, being a witness in, being made (or asked) to respond to discovery requests or other requests for information, or participating in (including on appeal), or preparing to defend, be a witness in, or make or respond to discovery requests or other requests for information, or participate in, any Claim. Expenses also shall include (i) Expenses incurred in connection with any appeal resulting from any Claim, 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 any federal, state, local or foreign taxes imposed on the Indemnitee as a result of the actual or deemed receipt of any payments under this Agreement (net of deductions attributable to such taxes paid), and (ii) for purposes of Section 4 only, Expenses incurred by Indemnitee in connection with the interpretation, enforcement or defense of Indemnitee’s rights under this Agreement, the Constituent Documents or under any directors’ and officers’ liability insurance policies maintained by the Company, by litigation or otherwise. Expenses, however, shall not include amounts paid in settlement by Indemnitee or the amount of judgments or fines against Indemnitee. The parties agree that, for 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 shall be rebuttably presumed to be reasonable. Any dispute as to the reasonableness of any Expense shall not delay an Expense advance by the Company, and the Company agrees that any such dispute shall be resolved only upon the disposition or conclusion of the Proceeding.
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(h) “Indemnifiable Event” means any event or occurrence, whether occurring before, on or after the date of this Agreement, related to the fact that Indemnitee is or was a director, officer, employee, agent, manager or fiduciary of the Company or any subsidiary of the Company, or is or was serving at the request of the Company as a director, officer, employee, member, manager, trustee, agent or fiduciary of any other corporation, limited liability company, partnership, joint venture, trust or other entity or enterprise (collectively with the Company, “Enterprise”) or by reason of an action or inaction by Indemnitee in any such capacity (whether or not serving in such capacity at the time any Loss is incurred for which indemnification can be provided under this Agreement).
(i) “Independent Counsel” means a law firm, or a member of a law firm, that is experienced in matters of corporation law and neither presently performs, nor in the past five years has performed, services for either: (i) the Company or Indemnitee (other than in connection with matters concerning Indemnitee under this Agreement or of other indemnitees under similar agreements) or (ii) any other party to the Claim giving rise to a claim for indemnification hereunder. Notwithstanding the foregoing, the term “Independent Counsel” shall 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.
(j) “Losses” means any and all Expenses, damages, losses, liabilities, judgments, fines, penalties (whether civil, criminal or other), ERISA excise taxes, amounts paid or payable in settlement, including any interest, assessments, any federal, state, local or foreign taxes imposed as a result of the actual or deemed receipt of any payments under this Agreement (net of deductions attributable to such taxes paid) and all other charges paid or payable in connection with investigating, defending, being a witness in or participating in (including on appeal), or preparing to defend, be a witness or participate in, any Claim.
(k) “Nevada Court” shall have the meaning ascribed to it in Section 9(e) below.
(l) “Person” means any individual, corporation, firm, partnership, joint venture, limited liability company, estate, trust, business association, organization, governmental entity or other entity and includes the meaning set forth in Sections 13(d) and 14(d) of the Exchange Act.
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(m) “Proceeding” means 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 by or in the right of the Company or otherwise and whether civil, criminal, administrative or investigative, including any appeal therefrom, in which Indemnitee was, is or will be involved as a party or otherwise, by reason of Indemnitee’s Corporate Status, or by reason of any action taken by Indemnitee or Indemnitee’s failure to act while acting in Indemnitee’s Corporate Status; in each case whether or not Indemnitee is acting or serving in any 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; including one pending on or before the date of this Agreement, but excluding one initiated by an Indemnitee to enforce Indemnitee’s rights under this Agreement.
(n) “Standard of Conduct Determination” shall have the meaning ascribed to it in Section 9(b) below.
(o) “Voting Securities” means any securities of the Company that vote generally in the election of directors.
2. Indemnification.
(a) Subject to Section 9 and Section 10 of this Agreement, the Company shall indemnify Indemnitee, to the fullest extent permitted by the laws of the State of Nevada in effect on the date hereof (including, without limitation, pursuant to NRS 78.7502 and in accordance with NRS 78.751), or as such laws may from time to time hereafter be amended to increase the scope of such permitted indemnification, as follows: (a) Third-Party Proceedings. Indemnitee shall be entitled to indemnification under this Section 2(a) if, by reason of an Indemnifiable Event, Indemnitee is, or is threatened to be made, a party to or participant in any Claim other than a Claim brought by or in the right of the Company. The Company shall indemnify Indemnitee against all Losses actually and reasonably incurred by Indemnitee, or on Indemnitee’s behalf, in connection with such Claim or any claim, issue or matter therein, if Indemnitee is not liable pursuant to NRS 78.138 or 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, with respect to any criminal Claim, had no reasonable cause to believe Indemnitee’s conduct was unlawful.
(b) Proceedings by or in the Right of the Company. Indemnitee shall be entitled to indemnification under this Section 2(b) if, by reason of an Indemnifiable Event, Indemnitee is, or is threatened to be made, a party to or participant in any Claim brought by or in the right of the Company. The Company shall indemnify Indemnitee against all Expenses actually and reasonably incurred by Indemnitee, or on Indemnitee’s behalf, in connection with such Claim if Indemnitee is not liable pursuant to NRS 78.138 or acted in good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the best interests of the Company; provided, however, if applicable law so provides, no indemnification against such Expenses shall be made in respect of any claim, issue or matter in such Claim as to which Indemnitee has been adjudged, after exhaustion of any appeals taken therefrom, to be liable to the Company unless and to the extent that a court of competent jurisdiction shall determine that such indemnification may be made.
(c) Indemnification for Expenses of a Party Who is Wholly or Partly Successful. Notwithstanding any other provision of this Agreement, to the extent that Indemnitee is, by reason of an Indemnifiable Event, a party to (or participant in) and is successful, on the merits or otherwise, in any Claim, the Company shall indemnify Indemnitee to the maximum extent permitted by law (including, without limitation, NRS 78.7502, NRS 78.751 and NRS 78.752), as such may be amended from time to time, against all Expenses actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection therewith. If Indemnitee is not wholly successful in such Claim but is successful, on the merits or otherwise, as to one or more but less than all claims, issues or matters in such Claim, the Company shall indemnify Indemnitee against all Expenses actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection with each successfully resolved claim, issue or matter. For purposes of this Section 2(c) and without limitation, the termination of any claim, issue or matter in such Claim by dismissal, with or without prejudice, is deemed to be a successful result as to such claim, issue or matter.
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Notwithstanding the foregoing, no indemnification shall be made to or on behalf of Indemnitee if a final adjudication by a court of competent jurisdiction, after exhaustion of any appeals taken therefrom, establishes that Indemnitee is liable for intentional misconduct, fraud or a knowing violation of law, and such intentional misconduct, fraud or knowing violation of law was material to the cause of action.
3. Advancement of Expenses. Indemnitee shall have the right to advancement by the Company, prior to the final disposition of any Claim by final adjudication to which there are no further rights of appeal, of any and all Expenses actually and reasonably paid or incurred by Indemnitee in connection with any Claim arising out of an Indemnifiable Event. Indemnitee’s right to such advancement is not subject to the satisfaction of any standard of conduct. Without limiting the generality or effect of the foregoing, Indemnitee shall submit to the Company a written request therefor, including a brief description (based upon the information then available to the Indemnitee) of such Claim for which advancement is sought and the Expenses to be advanced. Unless otherwise agreed between the Company and the Indemnitee, within thirty (30) days after the receipt by the Company of any written request by Indemnitee, the Company shall, in accordance with such request, (a) pay such Expenses on behalf of Indemnitee, (b) advance to Indemnitee funds in an amount sufficient to pay such Expenses, or (c) reimburse Indemnitee for such Expenses. In connection with any request for Expense Advances, Indemnitee shall not be required to provide any documentation or information to the extent that the provision thereof would undermine or otherwise jeopardize attorney-client privilege. In connection with any request for Expense Advances, Indemnitee shall execute and deliver to the Company an undertaking (which shall be accepted without reference to the Indemnitee’s ability to repay the Expense Advances) any amounts paid, advanced or reimbursed by the Company for such Expenses to the extent that it is ultimately determined, pursuant to Section 9, following the final disposition of such Claim, that Indemnitee is not entitled to indemnification hereunder. Indemnitee’s obligation to reimburse the Company for Expense Advances shall be unsecured and no interest shall be charged thereon.
4. Indemnification for Expenses in Enforcing Rights. To the fullest extent allowable under applicable law, the Company shall also indemnify against, and, if requested by Indemnitee, shall advance to Indemnitee subject to and in accordance with Section 3, any Expenses actually and reasonably paid or incurred by Indemnitee in connection with any action or proceeding by Indemnitee for (a) indemnification or reimbursement or advance payment of Expenses by the Company under any provision of this Agreement, or under any other agreement or provision of the Constituent Documents now or hereafter in effect relating to Claims relating to Indemnifiable Events, and/or (b) recovery under any directors’ and officers’ liability insurance policies maintained by the Company. However, in the event that Indemnitee is ultimately determined not to be entitled to such indemnification or insurance recovery, as the case may be, then all amounts advanced under this Section 4 shall be repaid. Indemnitee shall be required to reimburse the Company in the event that a final judicial determination is made that such action brought by Indemnitee was brought in bad faith.
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5. Partial Indemnity. Without limiting the provisions of Section 2(c), if Indemnitee is entitled under any provision of this Agreement to indemnification by the Company for a portion of any Losses in respect of a Claim related to an Indemnifiable Event but not for the total amount thereof, the Company shall nevertheless indemnify Indemnitee for the portion thereof to which Indemnitee is entitled.
6. Contribution.
(a) Whether or not indemnification under this Agreement is available, in respect of any threatened, pending or completed Claim in which the Company is jointly liable with Indemnitee (or would be if joined in such Claim), the Company shall pay, in the first instance, the entire amount of any judgment or settlement of such Claim without requiring Indemnitee to contribute to such payment and the Company hereby waives and relinquishes any right of contribution it may have against Indemnitee. The Company shall not enter into any settlement of any Claim in which the Company is jointly liable with Indemnitee (or would be if joined in such Claim) unless such settlement provides for a full and final release of all claims against Indemnitee or Indemnitee provides prior written consent to such settlement.
(b) Without diminishing or impairing the obligations of the Company set forth in the preceding subparagraph, if, for any reason, Indemnitee shall elect or be required to pay all or any portion of any judgment or settlement in any threatened, pending or completed Claim in which the Company is jointly liable with Indemnitee (or would be if joined in such Claim), the Company shall contribute to the amount of Expenses and Losses actually and reasonably incurred and paid or payable by Indemnitee in proportion to the relative benefits received by the Company and all officers, directors or employees of the Company, other than Indemnitee, who are jointly liable with Indemnitee (or would be if joined in such Claim), on the one hand, and Indemnitee, on the other hand, from the transaction or events from which such Claim arose; provided, however, that the proportion determined on the basis of relative benefit may, to the extent necessary to conform to law, be further adjusted by reference to the relative fault of the Company and all officers, directors or employees of the Company other than Indemnitee who are jointly liable with Indemnitee (or would be if joined in such Claim), on the one hand, and Indemnitee, on the other hand, in connection with the transaction or events that resulted in such Expenses or Losses, as well as any other equitable considerations which applicable law may require to be considered. The relative fault of the Company and all officers, directors or employees of the Company, other than Indemnitee, who are jointly liable with Indemnitee (or would be if joined in such Claim), on the one hand, and Indemnitee, on the other hand, shall be determined by reference to, among other things, the degree to which their actions were motivated by intent to gain personal profit or advantage, the degree to which their liability is primary or secondary and the degree to which their conduct is active or passive.
(c) The Company shall indemnify Indemnitee from any claims of contribution which may be brought by officers, directors, or employees of the Company, other than Indemnitee, who may be jointly liable with Indemnitee.
(d) 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, shall 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 and Losses, 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 Claim 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 Claim 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).
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7. Notification and Defense of Claims.
(a) Notification of Claims. Indemnitee shall notify the Company in writing as soon as practicable of any Claim which could relate to an Indemnifiable Event or for which Indemnitee could seek Expense Advances, including a brief description (based upon information then available to Indemnitee) of the nature of, and the facts underlying, such Claim. If at the time of the receipt of such notice, the Company has directors’ and officers’ liability insurance in effect under which coverage for Claims related to Indemnifiable Events is potentially available, the Company shall give prompt written notice to the applicable insurers in accordance with the procedures set forth in the applicable policies. The Company shall provide to Indemnitee a copy of such notice delivered to the applicable insurers, and copies of all subsequent correspondence between the Company and such insurers regarding the Claim, in each case substantially concurrently with the delivery or receipt thereof by the Company. The failure by Indemnitee to timely notify the Company hereunder shall not relieve the Company from any liability hereunder, unless, and only to the extent that, the Company is actually and materially prejudiced as a result of such failure.
(b) Defense of Claims. The Company shall be entitled to participate in the defense of any Claim relating to an Indemnifiable Event at its own expense and, except as otherwise provided below, to the extent the Company so wishes, it may assume the defense thereof with counsel reasonably satisfactory to Indemnitee. After notice from the Company to Indemnitee of its election to assume the defense of any such Claim, the Company shall not be liable to Indemnitee under this Agreement or otherwise for any Expenses subsequently directly incurred by Indemnitee in connection with Indemnitee’s defense of such Claim other than reasonable costs of investigation or as otherwise provided below. Indemnitee shall have the right to employ its own legal counsel in such Claim, but all Expenses related to such counsel incurred after notice from the Company of its assumption of the defense shall be at Indemnitee’s own expense; provided, however, that if (i) Indemnitee’s employment of its own legal counsel has been authorized by the Company, (ii) Indemnitee has reasonably determined that there may be a conflict of interest between Indemnitee and the Company in the defense of such Claim, (iii) after a Change in Control, Indemnitee’s employment of its own counsel has been approved by the Independent Counsel or (iv) the Company shall not in fact have employed counsel to assume the defense of such Claim, then Indemnitee shall be entitled to retain its own separate counsel (but not more than one law firm plus, if applicable, local counsel in respect of any such Claim) and all Expenses related to such separate counsel shall be borne by the Company.
8. Procedure upon Application for Indemnification. In order to obtain indemnification pursuant to this Agreement, Indemnitee shall submit to the Company a written request therefor, including in such request 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 indemnification following the final disposition of the Claim, provided that documentation and information need not be so provided to the extent that the provision thereof would undermine or otherwise jeopardize attorney-client privilege. Indemnification shall be made insofar as the Company determines Indemnitee is entitled to indemnification in accordance with Section 9 below.
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9. Determination of Right to Indemnification.
(a) Mandatory Indemnification; Indemnification as a Witness.
(i) To the extent that Indemnitee is entitled to indemnification under Section 2(c), no Standard of Conduct Determination shall be required, and the Company shall pay such indemnification in accordance with Section 9(d).
(ii) To the extent that Indemnitee’s involvement in a Claim relating to an Indemnifiable Event is to prepare to serve and serve as a witness, and not as a party, the Indemnitee shall be indemnified against all Losses incurred in connection therewith to the fullest extent allowable by law and no Standard of Conduct Determination (as defined in Section 9(b)) shall be required.
(b) Standard of Conduct. To the extent that the provisions of Section 9(a) are inapplicable to a Claim related to an Indemnifiable Event that shall have been finally disposed of, any determination of whether Indemnitee has satisfied any applicable standard of conduct under Nevada law that is a legally required condition to indemnification of Indemnitee hereunder against Losses relating to such Claim and any determination that Expense Advances must be repaid to the Company (a “Standard of Conduct Determination”) shall be made as follows:
(i) if no Change in Control has occurred, (A) by a majority vote of the Disinterested Directors, even if less than a quorum of the Board, (B) by a committee of Disinterested Directors designated by a majority vote of the Disinterested Directors, even though less than a quorum, (C) if there are no such Disinterested Directors, by Independent Counsel in a written opinion addressed to the Board, a copy of which shall be delivered to Indemnitee or (D) by the stockholders in a vote that excludes the shares held by Indemnitee who are parties to the Proceedings; and
(ii) if a Change in Control shall have occurred, (A) if the Indemnitee so requests in writing, by a majority vote of the Disinterested Directors, even if less than a quorum of the Board or (B) otherwise, by Independent Counsel in a written opinion addressed to the Board, a copy of which shall be delivered to Indemnitee.
Any and all Expenses incurred by Indemnitee in cooperating with the person or persons making such Standard of Conduct Determination shall be borne by the Company (irrespective of the determination as to Indemnitee’s entitlement to indemnification) and the Company hereby indemnifies and agrees to hold Indemnitee harmless therefrom.
(c) Making the Standard of Conduct Determination. The Company shall use its reasonable best efforts to cause any Standard of Conduct Determination required under Section 9(b) to be made as promptly as practicable. If the person or persons designated to make the Standard of Conduct Determination under Section 9(b) shall not have made a determination within 30 days after the later of (A) receipt by the Company of a written request from Indemnitee for indemnification pursuant to Section 8 (the date of such receipt being the “Notification Date”) and (B) the selection of an Independent Counsel, if such determination is to be made by Independent Counsel, then Indemnitee shall be deemed to have satisfied the applicable standard of conduct; provided that such 30-day period may be extended for a reasonable time, not to exceed an additional 30 days, if the person or persons making such determination in good faith requires such additional time to obtain or evaluate information relating thereto. Notwithstanding anything in this Agreement to the contrary, no determination as to entitlement of Indemnitee to indemnification under this Agreement shall be required to be made prior to the final disposition of any Claim.
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(d) Payment of Indemnification. If, in regard to any Losses:
(i) Indemnitee shall be entitled to indemnification pursuant to Section 9(a);
(ii) no Standard of Conduct Determination is legally required as a condition to indemnification of Indemnitee hereunder; or
(iii) Indemnitee has been determined or deemed pursuant to Section 9(b) or Section 9(c) to have satisfied the Standard of Conduct Determination,
then the Company shall pay to Indemnitee, within five business days after the later of (A) the Notification Date or (B) the earliest date on which the applicable criterion specified in clause (i), (ii) or (iii) is satisfied, an amount equal to such Losses.
(e) Selection of Independent Counsel for Standard of Conduct Determination. If a Standard of Conduct Determination is to be made by Independent Counsel pursuant to Section 9(b)(i), the Independent Counsel shall be selected by the Board of Directors, and the Company shall give written notice to Indemnitee advising the Indemnitee of the identity of the Independent Counsel so selected. If a Standard of Conduct Determination is to be made by Independent Counsel pursuant to Section 9(b)(ii), the Independent Counsel shall be selected by Indemnitee, and Indemnitee shall give written notice to the Company advising it of the identity of the Independent Counsel so selected. In either case, Indemnitee or the Company, as applicable, may, within ten days after receiving written notice of selection from the other, deliver to the other 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 satisfy the criteria set forth in the definition of “Independent Counsel” in Section 1(i), and the objection shall set forth with particularity the factual basis of such assertion. Absent a proper and timely objection, the person or firm so selected shall act as Independent Counsel. If such written objection is properly and timely made and substantiated, (i) the Independent Counsel so selected may not serve as Independent Counsel unless and until such objection is withdrawn or a court has determined that such objection is without merit; and (ii) the non-objecting party may, at its option, select an alternative Independent Counsel and give written notice to the other party advising such other party of the identity of the alternative Independent Counsel so selected, in which case the provisions of the two immediately preceding sentences, the introductory clause of this sentence and numbered clause (i) of this sentence shall apply to such subsequent selection and notice. If applicable, the provisions of clause (ii) of the immediately preceding sentence shall apply to successive alternative selections. If no Independent Counsel that is permitted under the foregoing provisions of this Section 9(e) to make the Standard of Conduct Determination shall have been selected within 30 days after the Company gives its initial notice pursuant to the first sentence of this Section 9(e) or Indemnitee gives its initial notice pursuant to the second sentence of this Section 9(e), as the case may be, either the Company or Indemnitee may petition the Eighth Judicial District Court of the State of Nevada, Clark County (the “Nevada Court”) to resolve any objection which shall have been made by the Company or Indemnitee to the other’s selection of Independent Counsel and/or to appoint as Independent Counsel a person to be selected by the Court or such other person as the Court shall designate, and the person or firm with respect to whom all objections are so resolved or the person or firm so appointed will act as Independent Counsel. In all events, the Company shall pay all of the reasonable fees and expenses of the Independent Counsel incurred in connection with the Independent Counsel’s determination pursuant to Section 9(b).
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(f) Presumptions and Defenses.
(i) Indemnitee’s Entitlement to Indemnification. In making any Standard of Conduct Determination, the person or persons making such determination shall presume that Indemnitee has satisfied the applicable standard of conduct and is entitled to indemnification. Anyone seeking to overcome this presumption shall have the burden of proof and the burden of persuasion by clear and convincing evidence. Any Standard of Conduct Determination that is adverse to Indemnitee may be challenged by the Indemnitee in the Nevada Court. No determination by the Company (including by its directors or any Independent Counsel) that Indemnitee has not satisfied any applicable standard of conduct may be used as a defense to any legal proceedings brought by Indemnitee to secure indemnification or reimbursement or advance payment of Expenses by the Company hereunder or create a presumption that Indemnitee has not met any applicable standard of conduct.
(ii) Reliance as a Safe Harbor. For purposes of this Agreement, and without creating any presumption as to a lack of good faith if the following circumstances do not exist, Indemnitee shall be deemed to have acted in good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the best interests of the Company if Indemnitee’s actions or omissions to act are taken in good faith reliance upon the records of the Company, including its financial statements, or upon information, opinions, reports or statements furnished to Indemnitee by the officers or employees of the Company or any of its subsidiaries in the course of their duties, or by committees of the Board or by any other Person (including legal counsel, accountants and financial advisors) as to matters Indemnitee reasonably believes are within such other Person’s professional or expert competence and who has been selected with reasonable care by or on behalf of the Company. In addition, the knowledge and/or actions, or failures to act, of any director, officer, agent or employee of the Company shall not be imputed to Indemnitee for purposes of determining the right to indemnity hereunder. Whether or not the foregoing provisions of this Section are satisfied, it shall in any event be presumed that Indemnitee has at all times acted in good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the best interests of the Company. Anyone seeking to overcome this presumption shall have the burden of proof and the burden of persuasion by clear and convincing evidence.
(iii) No Other Presumptions. For purposes of this Agreement, the termination of any Claim by judgment, order, settlement (whether with or without court approval) or conviction, or upon a plea of nolo contendere or its equivalent, will not create a presumption that Indemnitee did not meet any applicable standard of conduct or have any particular belief, or that indemnification hereunder is otherwise not permitted.
(iv) Defense to Indemnification and Burden of Proof. It shall be a defense to any action brought by Indemnitee against the Company to enforce this Agreement (other than an action brought to enforce a claim for Losses incurred in defending against a Claim related to an Indemnifiable Event in advance of its final disposition) that it is not permissible under applicable law for the Company to indemnify Indemnitee for the amount claimed. In connection with any such action or any related Standard of Conduct Determination, the burden of proving such a defense or that the Indemnitee did not satisfy the applicable standard of conduct shall be on the Company.
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(v) Resolution of Claims. The Company acknowledges that a settlement or other disposition short of final judgment may be successful on the merits or otherwise for purposes of Section 9(a)(i) if it permits a party to avoid expense, delay, distraction, disruption and uncertainty. In the event that any Claim relating to an Indemnifiable Event to which Indemnitee is a party is resolved in any manner other than by adverse judgment against Indemnitee (including, without limitation, settlement of such action, claim or proceeding with or without payment of money or other consideration) it shall be presumed that Indemnitee has been successful on the merits or otherwise for purposes of Section 9(a)(i). The Company shall have the burden of proof to overcome this presumption.
10. Exclusions from Indemnification. Notwithstanding anything in this Agreement to the contrary, the Company shall not be obligated to:
(a) indemnify or advance funds to Indemnitee for Expenses or Losses with respect to proceedings initiated by Indemnitee, including any proceedings against the Company or its directors, officers, employees or other indemnitees and not by way of defense, except:
(i) proceedings referenced in Section 4 above; or
(ii) where the Company has joined in or the Board has consented to the initiation of such proceedings.
(iii) such payment arises in connection with any mandatory counterclaim or cross claim brought or raised by Indemnitee in any Claim (or any part of any Claim); or
(iv) the Claim was initiated by Indemnitee to collect amounts payable hereunder to Indemnitee.
(b) indemnify Indemnitee if a final decision by a court of competent jurisdiction determines that such indemnification is prohibited by applicable law.
(c) indemnify Indemnitee for the disgorgement of profits arising from the purchase or sale by Indemnitee of securities of the Company in violation of Section 16(b) of the Exchange Act, or any similar successor statute.
(d) indemnify or advance funds to Indemnitee for Indemnitee’s reimbursement to the Company of any bonus or other incentive-based or equity-based compensation previously received by Indemnitee or payment of any profits realized by Indemnitee from the sale of securities of the Company, as required in each case under the Exchange Act (including any such reimbursements under Section 304 of the Sarbanes-Oxley Act of 2002 in connection with an accounting restatement of the Company or the payment to the Company of profits arising from the purchase or sale by Indemnitee of securities in violation of Section 306 of the Sarbanes-Oxley Act).
(e) for 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;
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11. Settlement of Claims. The Company shall not be liable to Indemnitee under this Agreement for any amounts paid in settlement of any threatened or pending Claim related to an Indemnifiable Event effected without the Company’s prior written consent, which shall not be unreasonably withheld; provided, however, that if a Change in Control has occurred, the Company shall be liable for indemnification of the Indemnitee for amounts paid in settlement if an Independent Counsel has approved the settlement. The Company shall not settle any Claim related to an Indemnifiable Event in any manner that would impose any Losses on the Indemnitee without the Indemnitee’s prior written consent.
12. Duration. All agreements and obligations of the Company contained herein shall continue during the period that Indemnitee is a director or officer of the Company (or is serving at the request of the Company as a director, officer, employee, member, trustee or agent of another Enterprise) and shall continue thereafter (i) so long as Indemnitee may be subject to any possible Claim relating to an Indemnifiable Event (including any rights of appeal thereto) and (ii) throughout the pendency of any proceeding (including any rights of appeal thereto) commenced by Indemnitee to enforce or interpret his or her rights under this Agreement, even if, in either case, he or she may have ceased to serve in such capacity at the time of any such Claim or proceeding.
13. Security. To the extent requested by Indemnitee and approved by the Board, the Company may at any time provide security to Indemnitee for the Company’s obligations hereunder through an irrevocable bank line of credit, funded trust or other collateral. Any such security, once provided to Indemnitee, may not be revoked or released without the prior written consent of the Indemnitee.
14. Non-Exclusivity. The rights of Indemnitee hereunder will be in addition to any other rights Indemnitee may have under the Constituent Documents, Chapter 78 of the Nevada Revised Statutes, any other contract or otherwise (collectively, “Other Indemnity Provisions”); provided, however, that (a) to the extent that Indemnitee otherwise would have any greater right to indemnification under any Other Indemnity Provision, Indemnitee will be deemed to have such greater right hereunder and (b) to the extent that any change is made to any Other Indemnity Provision which permits any greater right to indemnification than that provided under this Agreement as of the date hereof, Indemnitee will be deemed to have such greater right hereunder. The Company will not adopt any amendment to any of the Constituent Documents the effect of which would be to deny, diminish or encumber Indemnitee’s right to indemnification under this Agreement or any Other Indemnity Provision. For the avoidance of doubt, nothing hereunder shall reduce, diminish, abrogate or otherwise limit any rights to indemnification, exculpation or recovery to which Indemnitee may be entitled under the laws of any other jurisdiction.
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The Company hereby acknowledges that Indemnitee may have certain rights to indemnification, advancement of expenses and/or insurance provided by other persons or entities (collectively, the “Other Indemnitors”). The Company hereby acknowledges (i) that it is the indemnitor of first resort (i.e., its obligations to Indemnitee are primary and any obligation of the Other Indemnitors to advance expenses or to provide indemnification for the same expenses or liabilities incurred by Indemnitee are secondary), (ii) that it shall be required to advance the full amount of Expenses incurred by Indemnitee and shall be liable for the full amount of all Losses to the extent legally permitted and as required by the terms of this Agreement and the Constituent Documents, without regard to any rights Indemnitee may have against the Other Indemnitors, and (iii) that it irrevocably waives, relinquishes and releases the Other Indemnitors from any and all claims against the Other Indemnitors for contribution, subrogation or any other recovery of any kind in respect thereof. The Company further acknowledges that no advancement or payment by the Other Indemnitors on behalf of Indemnitee with respect to any claim for which Indemnitee has sought indemnification from the Company shall affect the foregoing and the Other Indemnitors shall have a right of contribution and/or shall be subrogated to the extent of such advancement or payment to all of the rights of recovery of Indemnitee against the Company. The Company and Indemnitee acknowledge that the Other Indemnitors are express third-party beneficiaries of the terms of this paragraph.
15. Liability Insurance. For the duration of Indemnitee’s service as a [director/officer] of the Company, and thereafter for so long as Indemnitee shall be subject to any pending Claim relating to an Indemnifiable Event, the Company shall use commercially reasonable efforts (taking into account the scope and amount of coverage available relative to the cost thereof) to continue to maintain in effect policies of directors’ and officers’ liability insurance providing coverage that is at least substantially comparable in scope and amount to that provided by the Company’s current policies of directors’ and officers’ liability insurance. In all policies of directors’ and officers’ liability insurance maintained by the Company, Indemnitee shall be named as an insured in such a manner as to provide Indemnitee the same rights and benefits as are provided to the most favorably insured of the Company’s directors, if Indemnitee is a director, or of the Company’s officers, if Indemnitee is an officer (and not a director) by such policy. Upon request, the Company will provide to Indemnitee copies of all directors’ and officers’ liability insurance applications, binders, policies, declarations, endorsements and other related materials. Coverage under each such policy shall be no less favorable than the coverage then provided to any other director or officer of the Company and in an amount that is customary and appropriate for a publicly traded company of similar size, industry and risk profile. Each policy shall be issued by one or more reputable insurers reasonably acceptable to the Board. The Company shall promptly notify Indemnitee of any material change in, lapse of, or cancellation or non-renewal of any such policy. In the event of a Change in Control, if the directors’ and officers’ liability insurance then in effect would, by its terms, terminate, lapse or otherwise cease to be in force as a result of such Change in Control, the Company shall purchase and maintain in effect, for a period of not less than six (6) years following the effective date of such Change in Control, a “tail” or run-off policy providing coverage for Indemnitee on terms no less favorable in the aggregate than those of the directors’ and officers’ liability insurance in effect immediately prior to such Change in Control. Notwithstanding the foregoing, the Company shall not be required to obtain or maintain such insurance (or any tail policy) if the Company determines in good faith, after reasonable inquiry, that such insurance is not reasonably available, is available only on terms or at premium levels that are not commercially reasonable, or provides only limited or restricted coverage that would provide no meaningful benefit to Indemnitee; provided, that in any such case the Company shall promptly so notify Indemnitee in writing and shall describe in reasonable detail the basis for such determination.
16. No Duplication of Payments. Except as provided in Section 14 with respect to Other Indemnitors, the Company shall not be liable under this Agreement to make any payment to Indemnitee in respect of any Losses to the extent Indemnitee has otherwise received payment under any insurance policy, the Constituent Documents, Other Indemnity Provisions or otherwise of the amounts otherwise indemnifiable by the Company hereunder.
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17. Subrogation. Except as provided in Section 14 with respect to Other Indemnitors, in the event of payment to Indemnitee under this Agreement, the Company shall be subrogated to the extent of such payment to all of the rights of recovery of Indemnitee. Indemnitee shall execute all papers required and shall do everything that may be necessary to secure such rights, including the execution of such documents necessary to enable the Company effectively to bring suit to enforce such rights.
18. Amendments. No supplement, modification or amendment of this Agreement shall be binding unless executed in writing by both of the parties hereto. No waiver of any of the provisions of this Agreement shall be binding unless in the form of a writing signed by the party against whom enforcement of the waiver is sought, and no such waiver shall operate as a waiver of any other provisions hereof (whether or not similar), nor shall such waiver constitute a continuing waiver. Except as specifically provided herein, no failure to exercise or any delay in exercising any right or remedy hereunder shall constitute a waiver thereof. The Company shall not seek from a court, or agree to, a “bar order” which would have the effect of prohibiting or limiting the Indemnitee’s rights to receive advancement of Expenses under this Agreement.
19. Binding Effect. This Agreement shall be binding upon and inure to the benefit of and be enforceable by the parties hereto and their respective successors (including any direct or indirect successor by purchase, merger, consolidation or otherwise to all or substantially all of the business and/or assets of the Company), assigns, spouses, domestic partners, heirs and personal and legal representatives. The Company shall require and cause any successor (whether direct or indirect by purchase, merger, consolidation or otherwise) to all, substantially all or a substantial part of the business and/or assets of the Company, by written agreement in form and substances satisfactory to Indemnitee, expressly to assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform if no such succession had taken place.
20. Severability. The provisions of this Agreement shall be severable in the event that any of the provisions hereof (including any portion thereof) are held by a court of competent jurisdiction to be invalid, illegal, void or otherwise unenforceable, and the remaining provisions shall remain enforceable to the fullest extent of the law. The invalidity or unenforceability of any provision hereof as to Indemnitee will not affect the validity or enforceability of any provision hereof as to the other. Without limiting the generality of the foregoing, this Agreement is intended to confer upon Indemnitee indemnification rights to the fullest extent permitted by applicable laws. In the event any provision hereof conflicts with any applicable law, such provision shall be deemed modified, consistent with the aforementioned intent, to the extent necessary to resolve such conflict.
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21. Notices. All notices, requests, demands and other communications hereunder shall be in writing and shall be deemed to have been duly given if delivered by hand, against receipt, or mailed, by postage prepaid, certified or registered mail:
(a) if to Indemnitee, to the address set forth on the signature page hereto.
(b) if to the Company, to:
Powerus
Corporation
Attn: Chief Legal Officer
885 Paragon Way
Rock Hill, SC 29730
Notice of change of address shall be effective only when given in accordance with this Section. All notices complying with this Section shall be deemed to have been received on the date of hand delivery or on the third business day after mailing.
22. Governing Law and Forum. This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Nevada applicable to contracts made and to be performed in such state without giving effect to its principles of conflicts of laws. The Company and Indemnitee hereby irrevocably and unconditionally: (a) agree that any action or proceeding arising out of or in connection with this Agreement shall be brought only in the Nevada Court and not in any other state or federal court in the United States, (b) consent to submit to the exclusive jurisdiction of the Nevada Court for purposes of any action or proceeding arising out of or in connection with this Agreement and (c) waive, and agree not to plead or make, any claim that the Nevada Court lacks venue or that any such action or proceeding brought in the Nevada Court has been brought in an improper or inconvenient forum.
23. Headings. The headings of the sections and paragraphs of this Agreement are inserted for convenience only and shall not be deemed to constitute part of this Agreement or to affect the construction or interpretation thereof.
24. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall for all purposes be deemed to be an original, but all of which together shall constitute one and the same Agreement.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written.
| Powerus Corporation | ||
| By: | ||
| Name: | Jim Biehl | |
| Title: | Chief Legal Offier | |
| INDEMNITEE | ||
| Name: | ||
| Address: | ||
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Exhibit 16.1
October 1, 2026
Office of the Chief Accountant
Securities and Exchange Commission
100 F Street, NE
Washington, D.C. 20549
Re: Powerus Corporation (formerly Aureus Greenway Holdings, Inc.)
Commission File No.: 001-42507
We have read the statements made by Powerus Corporation (formerly Aureus Greenway Holdings, Inc.) (the “Company”) included under Item 4.01 of the Company’s Current Report on Form 8-K dated October 1, 2026, regarding the Company’s change of auditors, and we agree with paragraph 1, 2, and 3 under item 4.01 and neither agree nor disagree on other parts.
Very truly yours,
WWC, P.C.
Certified Public Accountants
Exhibit 99.1
Powerus Completes Merger with Aureus Greenway Holdings; Powerus Corporation to Ring Nasdaq Opening Bell, Trading as PUSA
Powerus, a U.S. defense technology company focused on autonomous drones and other unmanned systems, is now publicly traded on Nasdaq.
| ● | Powerus and Aureus Greenway Holdings completed their previously announced merger, effective October 1, 2026. |
| ● | AGH has been renamed Powerus Corporation, and continues to operate as a public company. |
| ● | Shares continue to trade on Nasdaq under the symbol PUSA. There was no change to the symbol in connection with completion. |
Rock Hill, S.C., October 1, 2026 (GLOBE NEWSWIRE) –Autonomous Power Corporation, dba Powerus (“Powerus”), and Aureus Greenway Holdings Inc. (Nasdaq: PUSA) (“AGH”) today announced that they have completed their previously announced merger, effective October 1, 2026.
Powerus merged with and into a newly formed subsidiary of AGH, with Powerus continuing as the surviving entity, and AGH has been renamed Powerus Corporation. Shares of the combined company continue to trade on the Nasdaq Capital Market under the symbol PUSA. AGH adopted that symbol earlier in anticipation of the combination, and there was no change to the symbol in connection with the completion.
“When we agreed to combine with Powerus, the case was simple: a U.S.-headquartered autonomous systems company that was already building and selling,” said Matthew Saker, CEO of AGH. “Today that company is public. That was the point of the transaction.”
“Completing this transaction puts Powerus in a position to build at the scale our customers are asking for,” said Andrew Fox, Chief Executive Officer of Powerus. “Our focus does not change on October 1. The work is the same work.”
“I spent most of my career as the person relying on this equipment in the field,” said Brett Velicovich, Co-Founder of Powerus. “That is the standard we build to, and it does not change because the company has a listing.”
Recent Powerus Milestones
The completion of the merger follows a series of previously announced Powerus developments:
| ● | A purchase order from a defense prime contractor for the U.S. Department of War, valued at approximately $2.5 million, according to Powerus, for 1,500 U.S.-manufactured FPV aircraft, together with pilot kits and spare parts kits. As previously disclosed, that order does not guarantee future orders, a continuing customer relationship, or program-of-record status. |
| ● | A competitively awarded U.S. Air Force indefinite-delivery/indefinite-quantity (IDIQ) contract for the Company’s Guardian-2 counter-drone interceptor, with a ceiling value of up to $90 million and a term running through mid-2028. An IDIQ contract establishes a maximum value; orders are placed at the government’s discretion and actual awards may be materially less than the ceiling. |
| ● | A limited procurement order from the U.S. Air Force for Guardian-2 Interceptor systems, placed following a successful demonstration. As previously disclosed, that order does not guarantee future orders, a continuing customer relationship, or program-of-record status. |
| ● | Advancement to Phase 3 of the U.S. Army’s xTech Adaptive Strike Competition, following a Phase 2 field evaluation. Participation in a prize competition does not constitute a procurement contract or a commitment to purchase. |
| ● | The launch of a Powerus agriculture division, together with a $60 million, according to Powerus, Australia-New Zealand distribution agreement, including an exclusive agency and distribution agreement with Aerospread Technologies Limited of Napier, New Zealand, and a U.S. partnership with Sprig Aerospace. Distribution agreements establish sales arrangements and do not represent firm purchase commitments. |
| ● | A $30 million, according to Powerus, strategic equity investment in Powerus by Unusual Machines, Inc. (NYSE American: UMAC), deepening the companies’ existing supply and manufacturing relationship. |
| ● | An order placed by Powerus with Unusual Machines valued at more than $5 million, according to Powerus, for U.S.-made, NDAA-compliant components for counter-UAS systems and related drone platforms. This is a purchase by Powerus and does not represent Powerus revenue. |
| ● | A memorandum of understanding with UAV software company Swarmer, Inc. (Nasdaq: SWMR) to explore the technical and operational feasibility of integrating Swarmer’s swarming and coordination software with the Powerus autonomous systems architecture. The collaboration is exploratory; a memorandum of understanding is not a definitive agreement and may not result in one. |
| ● | The establishment of a dedicated Guardian counter-UAS manufacturing facility in the United Arab Emirates, through a multi-year partnership with a regional defense manufacturer. The arrangement does not guarantee any particular level of production, sales, or continuing relationship with the regional partner. |
| ● | Designation by the U.S. Department of War as an industry participant supporting Falcon Peak 26.2, a U.S. Northern Command and Joint Interagency Task Force 401 counter-unmanned aircraft systems experiment at Yuma Proving Ground. Participation as an industry participant in an experiment does not constitute a procurement contract or a commitment to purchase. |
| ● | A limited procurement order from the Ministry of Defence of the Islamic Republic of Pakistan for unmanned aerial systems and associated support, and a strategic memorandum of understanding with senior Pakistani defense officials. No other terms of the order have been disclosed, and the memorandum of understanding is not a definitive agreement and may not result in one. |
About Powerus
Powerus (formerly Autonomous Power Corporation) builds and scales unified autonomous systems designed to move, protect, and sustain critical assets in high-risk environments, with capabilities spanning heavy-lift platforms, autonomous air systems, autonomous maritime systems, mission systems, training and support, and U.S.-based manufacturing. Powerus completed its previously announced merger with AGH on October 1, 2026. Learn more at power.us.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by terminology such as “may,” “will,” “should,” “targets,” “plans,” “intends,” “goal,” “anticipates,” “expects,” “believes,” “potential,” or “continue” or negatives of such terms or other comparable terminology. These statements are based on current expectations and assumptions and are subject to risks and uncertainties that could cause actual results to differ materially. All forward-looking statements are subject to risks, uncertainties and other factors that may cause actual results, performance or achievements to differ materially from any results expressed or implied by such forward-looking statements.
As to the business combination between Powerus and AGH, these statements include, without limitation, the anticipated benefits of the merger; future financial and operating results; the plans, objectives, expectations and intentions of either company or of the combined company following the merger; anticipated future results of either company or of the combined company following the merger; and the anticipated benefits and strategic and financial rationale of the merger and other statements that are not historical facts.
As to the previously announced developments described in this release, such factors include, among others: (1) that the U.S. Air Force IDIQ contract establishes a ceiling value only, that orders are placed at the government’s discretion, that actual orders may be materially less than the ceiling or may not be placed at all, and that the contract is subject to termination for convenience, funding contingencies and task-order variability; (2) that the previously disclosed limited procurement orders do not guarantee future orders, a continuing customer relationship, or program-of-record status; (3) that advancement in the xTech Adaptive Strike Competition does not constitute a procurement contract and may not result in any award or purchase; (4) that the Agriculture division distribution agreements with Aerospread Technologies Limited and Sprig Aerospace establish sales arrangements rather than firm purchase commitments, that stated values may not be realized in whole or in part, and that realization depends on end-customer demand, regulatory approvals and counterparty performance; (5) that required export licenses, authorizations or other governmental consents may be delayed, denied or made subject to conditions; (6) that the memorandum of understanding with Swarmer, and the memorandum of understanding with Pakistani defense officials, may not result in definitive agreements or produce any commercial benefit; (7) that the United Arab Emirates manufacturing arrangement does not guarantee any particular level of production, sales, or continuing relationship with the regional partner; (8) that designation as a Falcon Peak 26.2 industry participant does not constitute a procurement contract or a commitment to purchase; and (9) other Powerus-specific operational uncertainties, including risks related to production scale-up, subsidiary integration, and reliance on third-party suppliers and government customers.
No Offer or Solicitation
This document is for informational purposes only and is not intended to and shall not constitute an offer to buy or sell or the solicitation of an offer to buy or sell any securities, or a solicitation of any vote or approval, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities shall be made, except by means of a prospectus meeting the requirements of Section 10 of the U.S. Securities Act of 1933, as amended.
Important Information and Where to Find It
In connection with the transaction, AGH has filed a registration statement on Form S-4 with the SEC, which includes an information statement prospectus of AGH. Investors and security holders are urged to read the registration statement (and any other documents filed with the SEC in connection with the transaction or incorporated by reference into the registration statement) because such documents contain important information regarding the transaction and related matters. Investors and security holders may obtain free copies of these documents and other documents filed with the SEC by AGH through the website maintained by the SEC at http://www.sec.gov, at AGH’s website at https://www.aureusgreenway.com/secfilings , or at the Powerus Website at https://www.power.us/.
Contacts
Powerus Investor Relations
Jason Assad
678-570-6791
Powerus Press Contact
Escalate PR
pr@power.us
Exhibit 99.2
Powerus Corporation
Board of Director Biographies
Andrew Fox
Chief Executive Officer, Powerus
Andrew Fox has been Chief Executive Officer of Powerus since October 2025. Mr. Fox has more than three decades of experience founding, scaling, and leading companies across technology, infrastructure, media, consumer products, and business services. He is the Founder and Chief Executive Officer of Powerus, an autonomous systems and defense technology company focused on drones, robotics, and autonomous solutions for government and commercial markets. Mr. Fox previously founded Charge Enterprises, Inc., which he led from inception to a NASDAQ listing and approximately $700 million in annual revenue over four years, and where he served as Chief Executive Officer and Chairman until his resignation in August 2023. In March 2024, Charge Enterprises, Inc. filed a voluntary petition for reorganization under Chapter 11 of the United States Bankruptcy Code in the U.S. Bankruptcy Court for the District of Delaware. Mr. Fox is also Managing Partner of Alliance Building Services, a privately held facility services company; founder of All Things Good, a nonprofit media platform; and co-founder of Ready, Set, Food!, an early-childhood nutrition company.
Brett Velicovich
President, Powerus
Brett Velicovich is a Co-Founder of Powerus and has been its President since January 2026. A former U.S. Army Special Operations intelligence analyst from 2001-2010, Mr. Velicovich served six combat tours in Iraq, Afghanistan, and Somalia, where he was central to America’s covert drone program hunting high-value terrorist targets including Abu Bakr al-Baghdadi. He is the author of Drone Warrior: An Elite Soldier’s Inside Account of the Hunt for America’s Most Dangerous Enemies, co-written with Pulitzer Prize-winning journalist Christopher S. Stewart. A Fox News contributor, Mr. Velicovich has appeared on CNN, CBS, NBC, ABC, BBC, and NPR. He has used drone technology for humanitarian purposes, including wildlife conservation in Kenya and donating surveillance drones to Somali police. He earned an MBA in International Business from Duke University’s Fuqua School of Business.
Matt Britton
Founder & Chief Executive Officer, Suzy
Matt Britton is the Founder and Chief Executive Officer of Suzy, a real-time consumer intelligence software platform he launched in 2018. An entrepreneur with nearly three decades of experience at the intersection of marketing, consumer behavior, and technology, Mr. Britton previously co-founded Mr. Youth, a youth-marketing agency, in 2002, which was acquired by LBi in 2011 and subsequently rebranded as MRY, where he served as Chief Executive Officer within the Publicis Groupe network. He also founded Crowdtap, a social media marketing software platform. Mr. Britton is the author of YouthNation (2015), a bestseller on the influence of youth culture on the American economy, and Generation AI, which explores how artificial intelligence is reshaping consumer behavior and business. One of the most in-demand keynote speakers on AI and consumer trends, he has delivered more than 500 keynote presentations to Fortune 500 organizations and has advised leading brands including Netflix, Coca-Cola, Procter & Gamble, Nintendo, and Visa. Mr. Britton is a graduate of Boston University.
Vuk Jeremić
President, Center for International Relations and Sustainable Development (CIRSD)
Vuk Jeremić is the President of the Center for International Relations and Sustainable Development (CIRSD), a global public policy think-tank, and Editor-in-Chief of the quarterly magazine “Horizons - Journal of International Relations and Sustainable Development.” Since 2013, Mr. Jeremić has operated Vuk Jeremić Consulting Agency Belgrade. From November 2022 to September 2023, Mr. Jeremić served as a director of Onconetix, Inc. (Nasdaq: ONCO, previously named Blue Water Vaccines Inc.). From August 2019 to December 2021, Mr. Jeremić served on the board of managers of Atomic 47 LLC. In 2016, Mr. Jeremić participated in the official election for United Nations (UN) Secretary-General. After six rounds of voting in the UN Security Council, he finished in second place, behind Mr. Antonio Guterres. In June 2012, Mr. Jeremić was directly elected by the majority of the world’s nations to be the President of the 67th session of the UN General Assembly. During his term in office, he played a leading role in steering the UN towards the establishment of the Sustainable Development Goals (SDGs). Mr. Jeremić served as Serbia’s Minister of Foreign Affairs from 2007 to 2012. In 2007, he chaired the Council of Europe’s Committee of Ministers. Mr. Jeremić has lectured at major universities, think-tanks, and institutes around the world, as well as published opinion pieces in leading outlets including The New York Times, The Washington Post, The Wall Street Journal, The Financial Times and Le Monde. Mr. Jeremić was named a Young Global Leader by the World Economic Forum in 2013 and appointed to the Leadership Council of the UN Sustainable Development Solutions Network (UN SDSN) in 2014. Mr. Jeremić served as the President of the Serbian Tennis Federation from 2011 to 2015.
Mr. Jeremić holds a bachelor’s degree in theoretical physics from Cambridge University (1998) and a master’s degree in public administration in international development from Harvard University’s John F. Kennedy School of Government (2003).
Jason Finger
Co-Founder & Chairman, Upper90
Jason Finger is the Co-Founder and Chairman of Upper90, a hybrid investment firm providing credit and equity capital to growing companies across e-commerce, enterprise software, and fintech, which has deployed more than $1.5 billion of capital globally and was among the first investors in Thrasio and Clearco (formerly Clearbanc). Mr. Finger is best known as the Co-Founder and former Chief Executive Officer of Seamless (originally SeamlessWeb), the pioneering online food-ordering platform he launched in 1999, which later combined with Grubhub to form GrubHub Seamless. He has served as an Entrepreneur in Residence at Bessemer Venture Partners and has been an active early-stage investor and advisor, with investments including ZocDoc, Betterment, Blue Apron, Skillshare, Conductor, and Clio. Mr. Finger holds a Bachelor of Science from the University of Maryland and JD and MBA degrees from New York University.
Richard Allorto
Chief Financial Officer, PennantPark Investment Advisors
Richard T. Allorto, Jr. has served as Chief Financial Officer of PennantPark Investment Advisers since June 2022. Mr. Allorto has more than 30 years of experience in accounting, audit, financial reporting, investment management, and public-company governance. At PennantPark, he serves as Chief Financial Officer of PennantPark Floating Rate Capital Ltd. (NYSE: PFLT) and PennantPark Investment Corporation (NYSE: PNNT). He leads the finance, operations, and liability management functions of PennantPark Investment Advisers, an SEC-registered investment adviser with more than $10 billion in assets under management.
Prior to joining PennantPark, Mr. Allorto served as Chief Financial Officer of Medley Management Inc. from 2010 to 2022. During his tenure at Medley, he also served as Chief Financial Officer, Treasurer and Secretary of Sierra Income Corporation from 2012 to 2022 and Medley Capital Corporation (NYSE: MCC) from 2011 to 2020. Earlier in his career, Mr. Allorto served at GSC Group, Inc., including as Chief Financial Officer of GSC Investment Corp. (NYSE: GNV) from 2008 to 2010. He began his career in public accounting at Arthur Andersen LLP and subsequently served as an Audit Supervisor at Schering-Plough Corporation.
Mr. Allorto has extensive experience working with public-company boards and audit committees on financial reporting, valuation, internal controls, audit, regulatory compliance, and governance matters. He led the accounting, tax, and financial statement workstreams for four initial public offerings, including Medley Management Inc., Sierra Income Corporation, Medley Capital Corporation, and GSC Investment Corp. He has also served on the Board of Trustees and as Treasurer of the Shannon Daley Memorial Fund since 2019.
Mr. Allorto earned a Bachelor of Science in Business Administration with a concentration in Accounting from Seton Hall University and is a Certified Public Accountant in New Jersey (inactive status).