Exhibit 1.1

 

[ · ] Shares

 

EUROPEAN WAX CENTER, INC.

 

CLASS A COMMON STOCK, PAR VALUE $0.00001 PER SHARE

 

 

UNDERWRITING AGREEMENT

 

[ · ], 2022

 

 

[ · ], 2022

 

BofA Securities, Inc.

Morgan Stanley & Co. LLC

Jefferies LLC

 

c/o BofA Securities, Inc.

One Bryant Park

New York, New York 10036

 

c/o Morgan Stanley & Co. LLC

1585 Broadway

New York, New York 10036

 

c/o Jefferies LLC
520 Madison Avenue

New York, New York 10022

 

As representatives of the several Underwriters named in Schedule II hereto

 

Ladies and Gentlemen:

 

Certain shareholders of European Wax Center, Inc., a Delaware corporation (the “Company”) named in Schedule I hereto (the “Selling Shareholders”), severally propose to sell to the several Underwriters named in Schedule II hereto (the “Underwriters”), for whom BofA Securities, Inc. (“BofA”), Morgan Stanley & Co. LLC (“Morgan Stanley”) and Jefferies LLC (“Jefferies”) are acting as representatives (the “Representatives”), an aggregate of [ · ] shares of the Company’s Class A common stock, par value $0.00001 per share (the “Firm Shares”), of which each Selling Shareholder proposes to sell the amount set forth opposite such Selling Shareholder’s name in Schedule I hereto.

 

The Selling Shareholders also propose to sell to the several Underwriters not more than an additional [ · ] shares of the Company’s Class A common stock, par value $0.00001 per share, of the Company (the “Additional Shares”) if and to the extent that the Representatives shall have determined to exercise, on behalf of the Underwriters, the right to purchase such Additional Shares granted to the Underwriters in Section 3 hereof. The Firm Shares and the Additional Shares are hereinafter collectively referred to as the “Shares.” The shares of Class A common stock, par value $0.00001 per share, of the Company to be outstanding after giving effect to the sales contemplated hereby are hereinafter referred to as the “Common Stock.” Certain of the Shares that will be sold by Selling Shareholders are Shares which exist as of the date hereof (the “Existing Shares”), and certain of the Shares that will be sold by Selling Shareholders are Shares that will be issued prior to the Closing in exchange for Class B common stock of the Company and units of EWC Ventures, LLC (the “Exchange Shares”).

 

 

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

 

For purposes of this Agreement, “free writing prospectus” has the meaning set forth in Rule 405 under the Securities Act, “preliminary prospectus” shall mean each prospectus used prior to the effectiveness of the Registration Statement, and each prospectus that omitted information pursuant to Rule 430A under the Securities Act that was used after such effectiveness and prior to the execution and delivery of this Agreement, “Time of Sale Prospectus” means the preliminary prospectus contained in the Registration Statement at the time of its effectiveness together with the documents and pricing information set forth in Schedule III hereto, and “broadly available road show” means a “bona fide electronic road show” as defined in Rule 433(h)(5) under the Securities Act that has been made available without restriction to any person. As used herein, the terms “Registration Statement,” “preliminary prospectus,” “Time of Sale Prospectus” and “Prospectus” shall include the documents, if any, incorporated by reference therein as of the date hereof.

 

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

 

(a)            The Registration Statement has become effective; no stop order suspending the effectiveness of the Registration Statement is in effect, and no proceedings for such purpose or pursuant to Section 8A under the Securities Act are pending before or, to the Company’s knowledge, threatened by the Commission.

 

 

(b)            (i) The Registration Statement, when it became effective, did not contain and, as amended or supplemented, if applicable, as of the date of such amendment or supplement, will not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading, (ii) the Registration Statement and the Prospectus comply and, as amended or supplemented, if applicable, as of the date of such amendment or supplement, will comply in all material respects with the Securities Act and the applicable rules and regulations of the Commission thereunder, (iii) the Time of Sale Prospectus does not, and at the time of each sale of Shares in connection with the offering when the Prospectus is not yet available to prospective purchasers and at the Closing Date and any Option Closing Date (as defined in Section 5 and Section 3, respectively), the Time of Sale Prospectus, as then amended or supplemented by the Company, if applicable, as of the date of such amendment or supplement, will not, contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, (iv) each broadly available road show, if any, when considered together with the Time of Sale Prospectus, does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading and (v) the Prospectus, as of its date, does not contain and, as amended or supplemented, if applicable, as of the date of such amendment or supplement, will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, except that the representations and warranties set forth in this paragraph do not apply to statements or omissions in the Registration Statement, the Time of Sale Prospectus or the Prospectus based upon information relating to any Underwriter furnished to the Company in writing by or on behalf of such Underwriter through the Representatives expressly for use therein, it being understood and agreed that the only such information furnished by any Underwriter consists of the Underwriter Information (as defined in Section 11(b) of this Agreement).

 

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

 

 

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

 

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

 

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

 

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

 

(h)            The Existing Shares have been duly authorized and are validly issued, fully paid and non-assessable.

 

(i)             The Exchange Shares have been duly authorized and, when issued and delivered upon exchange of Class B common stock of the Company and units of EWC Ventures, LLC in accordance with the exchange agreement to which such holders and the Company are party, as described in the Registration Statement, the Time of Sale Prospectus, and the Prospectus, will be validly issued, fully paid and non-assessable, and the issuance of the Shares will not be subject to any preemptive or similar rights.

 

 

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

 

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

 

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

 

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

 

 

(n)            The Company is not required to register as an “investment company” as such term is defined in the Investment Company Act of 1940, as amended.

 

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

 

(p)            There are no costs or liabilities associated with Environmental Laws (including, without limitation, any capital or operating expenditures required for clean-up, closure of properties or compliance with Environmental Laws or any permit, license or approval, any related constraints on operating activities and any potential liabilities to third parties) which would, singly or in the aggregate, have a material adverse effect on the Company and its subsidiaries, taken as a whole.

 

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

 

(r)             (i) None of the Company or any of its subsidiaries or any director or officer, or to the knowledge of the Company, any employee, affiliate, agent or representative of the Company or of any of its subsidiaries or affiliates, has taken or will take any action in furtherance of an offer, payment, promise to pay, or authorization or approval of the payment, giving or receipt of money, property, gifts or anything else of value, directly or indirectly, to any government official (including any officer or employee of a government or government-owned or controlled entity or of a public international organization, or any person acting in an official capacity for or on behalf of any of the foregoing, or any political party or party official or candidate for political office) (“Government Official”) in order to influence official action, or to any person in violation of any applicable anti-corruption laws; and (ii) the Company and each of its subsidiaries and affiliates have conducted their businesses in compliance with applicable anti-corruption laws and have instituted and maintained and will continue to maintain policies and procedures reasonably designed to promote and achieve compliance with such laws and with the representations and warranties contained herein.

 

 

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

 

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

 

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

 

(B)             located, organized or resident in a country or territory that is the subject of Sanctions (including, without limitation, the Crimea Region of Ukraine, the so-called Donetsk People’s Republic, the so-called Luhansk People’s Republic, Cuba, Iran, North Korea and Syria).

 

(ii)            For the past five years (or if the Company has owned a subsidiary for a shorter period, for the duration of such ownership), the Company and each of its subsidiaries have not knowingly engaged in, are not now knowingly engaged in, and will not knowingly engage in, any dealings or transactions with any Person, or in any country or territory, that at the time of the dealing or transaction is or was the subject of Sanctions.

 

 

(u)            Subsequent to the respective dates as of which information is given in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus, (i) the Company and its subsidiaries, taken as a whole, have not incurred any material liability or obligation, direct or contingent, nor entered into any material transaction; (ii) the Company has not purchased any of its outstanding capital stock, nor declared, paid or otherwise made any dividend or distribution of any kind on its capital stock other than ordinary and customary dividends; and (iii) there has not been any material change in the capital stock (other than the exercise or settlement of equity awards or warrants or grants of equity awards or forfeiture of equity awards outstanding as of such respective dates as of which information is given in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus, in each case granted pursuant to the equity compensation plan described in the Time of Sale Prospectus and the Prospectus), short-term debt or long-term debt of the Company and its subsidiaries, taken as a whole, except in each case as described in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus, respectively.

 

(v)            The Company and each of its subsidiaries have good and marketable title in fee simple to all real property (other than intellectual property, which is addressed exclusively in Section 1(w) below) and good and marketable title to all personal property owned by them which is material to the business of the Company and its subsidiaries, in each case free and clear of all liens, encumbrances and defects except such as are described in the Time of Sale Prospectus or such as would not reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole, and any real property and buildings held under lease by the Company and its subsidiaries are held by them under valid, subsisting and enforceable leases with such exceptions as would not reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole.

 

(w)           (i) The Company and its subsidiaries own or otherwise have the right to use all intellectual property rights, including patents, copyrights, trademarks, service marks and trade names, trade secrets and other intellectual property rights in know-how and proprietary or confidential information, systems or procedures (collectively, “Intellectual Property Rights”) used in or reasonably necessary to the conduct of their businesses, except where the failure to own or have the right to use any of the foregoing, individually or in the aggregate, would not reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole; (ii) except as would not reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole, the Intellectual Property Rights owned by the Company and its subsidiaries and, to the Company’s knowledge, the Intellectual Property Rights licensed to the Company and its subsidiaries, are valid, subsisting and enforceable; (iii) there is no pending or, to the Company’s knowledge, threatened action, suit, proceeding or claim by others challenging the validity, scope or enforceability of any such Intellectual Property Rights, except as would not reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole; (iv) neither the Company nor any of its subsidiaries has received any notice alleging any infringement, misappropriation, dilution or other violation of third-party Intellectual Property Rights which, singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole; (v) to the Company’s knowledge, no third party is infringing, misappropriating or otherwise violating, or has infringed, misappropriated or otherwise violated, the Company’s or its subsidiaries’ Intellectual Property Rights in such a way which would reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole; and (vi) to the Company’s knowledge, the Company’s and its subsidiaries’ conduct of their business does not infringe, misappropriate or otherwise violate, and the Company and its subsidiaries have not infringed, misappropriated, or otherwise violated any third-party Intellectual Property.

 

 

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

 

(y)            (i) Except as would not reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole, (i) the Company and each of its subsidiaries have complied and are presently in compliance with the Company’s and its subsidiaries’ internal and external privacy policies, contractual obligations, applicable laws, statutes, judgments, orders, rules and regulations of any court or arbitrator or other governmental or regulatory authority, in each case, relating to the collection, use, transfer, import, export, storage, protection, disposal and disclosure by the Company or any of its subsidiaries of personal, personally identifiable, sensitive, confidential or regulated data (“Data Security Obligations”, and such data, “Data”); (ii) the Company has not received any written notification of or complaint regarding, and is unaware of any other, facts that, individually or in the aggregate, would reasonably indicate non-compliance with any Data Security Obligation; and (iii) there is no action, suit or proceeding by or before any court or governmental agency, authority or body pending or threatened alleging non-compliance with any Data Security Obligation.

 

 

(z)            The Company and its subsidiaries have used commercially reasonable efforts to establish and maintain, and have established, maintained, implemented and complied with, reasonable information technology, information security, cyber security and data protection controls, policies and procedures, including oversight, access controls, encryption, technological and physical safeguards and business continuity/disaster recovery and security plans. Except as would not reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole, there has been no breach, destruction, loss, unauthorized distribution, use, access, disablement, misappropriation or modification, or other compromise or misuse of or relating to any information technology system or Data used in connection with the operation of the Company’s and its subsidiaries’ businesses (“Breach”) and the Company and its subsidiaries have not been notified of and have no knowledge of any event or condition that would reasonably be expected to result in, any such Breach.

 

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

 

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

 

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

 

 

(dd)         The financial statements included or incorporated by reference in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus, together with the related schedules and notes thereto, comply as to form in all material respects with the applicable accounting requirements of the Securities Act and present fairly in all material respects the consolidated financial position of the Company and its subsidiaries as of the dates shown and its results of operations and cash flows for the periods shown, and such financial statements have been prepared in conformity with generally accepted accounting principles in the United States (“U.S. GAAP”) applied on a consistent basis throughout the periods covered thereby except for any normal year-end adjustments in the Company’s quarterly financial statements. The other financial information included or incorporated by reference in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus has been derived from the accounting records of the Company and its consolidated subsidiaries and presents fairly in all material respects the information shown thereby. The statistical, industry-related and market-related data included or incorporated by reference in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus are based on or derived from sources which the Company reasonably and in good faith believes are reliable and accurate and such data is consistent with the sources from which they are derived, in each case in all material respects.

 

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

 

(ff)           The Company and each of its subsidiaries maintain a system of internal accounting controls sufficient to provide reasonable assurance that (i) transactions are executed in accordance with management’s general or specific authorizations; (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with U.S. GAAP and to maintain asset accountability; (iii) access to assets is permitted only in accordance with management’s general or specific authorization; (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences and (v) interactive data in eXtensible Business Reporting Language included or incorporated by reference in the Registration Statement, the Time of Sale Prospectus and the Prospectus fairly presents the information called for in all material respects and is prepared in accordance with the Commission’s rules and guidelines applicable thereto. Since the end of the Company’s most recent audited fiscal year, there has been (i) no material weakness in the Company’s internal control over financial reporting (whether or not remediated) and (ii) no change in the Company’s internal control over financial reporting that has materially and adversely affected, or is reasonably likely to materially and adversely affect, the Company’s internal control over financial reporting.

 

 

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

 

(hh)         [Reserved].

 

(ii)            [Reserved].

 

(jj)            [Reserved].

 

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

 

 

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

 

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

 

(nn)         As of the time of each sale of the Shares in connection with the offering when the Prospectus is not yet available to prospective purchasers, none of (A) the Time of Sale Prospectus, (B) any free writing prospectus, when considered together with the Time of Sale Prospectus, and (C) any individual Written Testing-the-Waters Communication, when considered together with the Time of Sale Prospectus, included, includes or will include an untrue statement of a material fact or omitted, omits or will omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.

 

(oo)          The documents incorporated by reference in the Registration Statement, the Time of Sale Prospectus and the Prospectus, when they were filed with the Commission conformed in all material respects to the requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and none of such documents contained any untrue statement of a material fact or omitted to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.

 

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

 

 

(qq)          The interactive data in eXtensible Business Reporting Language included or incorporated by reference in the Registration Statement fairly presents the information called for in all material respects and has been prepared in accordance with the Commission’s rules and guidelines applicable thereto.

 

(rr)            The Company maintains disclosure controls and procedures (as such term is defined in Rule 13a-15(e) under the Exchange Act); such disclosure controls and procedures have been designed to ensure that material information relating to the Company is made known to the Company’s principal executive officer and principal financial officer by others within the Company; such disclosure controls and procedures are effective at the reasonable assurance level; and the Company has carried out evaluations of the effectiveness of its disclosure controls and procedures as required by Rule 13a-15 of the Exchange Act through March 26, 2022.

 

2.            Representations and Warranties of the Selling Shareholders. Each Selling Shareholder, severally and not jointly, represents and warrants to and agrees with each of the Underwriters that:

 

(a)            This Agreement has been duly authorized, executed and delivered by or on behalf of such Selling Shareholder.

 

(b)            The execution and delivery by such Selling Shareholder of, and the performance by such Selling Shareholder of its obligations under, this Agreement and, if applicable, the Custody Agreement signed by such Selling Shareholder and Computershare Inc., as Custodian, relating to the deposit of the Shares to be sold by such Selling Shareholder (the “Custody Agreement”) and the Power of Attorney appointing certain individuals as such Selling Shareholder’s attorneys in fact to the extent set forth therein, relating to the transactions contemplated hereby and by the Registration Statement (the “Power of Attorney”), will not contravene (i) any provision of applicable law, or (ii) the certificate of incorporation or by-laws of such Selling Shareholder (if such Selling Shareholder is a corporation), or (iii) any agreement or other instrument binding upon such Selling Shareholder or (iv) any judgment, order or decree of any governmental body, agency or court having jurisdiction over such Selling Shareholder, except in the case of clauses (i), (iii) and (iv) as would not, individually or in the aggregate, reasonably be expected to have a material adverse effect on the Selling Shareholders and no consent, approval, authorization or order of, or qualification with, any governmental body, agency or court is required for the performance by such Selling Shareholder of its obligations under this Agreement or, if applicable, the Custody Agreement or Power of Attorney of such Selling Shareholder, except such as have been obtained or waived or as may be required by the securities or Blue Sky laws of the various states in connection with the offer and sale of the Shares.

 

 

(c)            Such Selling Shareholder has, and on the Closing Date will have, valid title to, or a valid “security entitlement” within the meaning of Section 8-501 of the New York Uniform Commercial Code in respect of, the Shares to be sold by such Selling Shareholder free and clear of all security interests, claims, liens, equities or other encumbrances and the legal right and power, and all authorization and approval required by law, to enter into this Agreement and, if applicable, the Custody Agreement and the Power of Attorney, and to sell, transfer and deliver the Shares to be sold by such Selling Shareholder or a security entitlement in respect of such Shares.

 

(d)            If applicable to such Selling Shareholder, the Custody Agreement and the Power of Attorney have been duly authorized, executed and delivered by such Selling Shareholder and are valid and binding agreements of such Selling Shareholder.

 

(e)            Upon payment for the Shares to be sold by such Selling Shareholder pursuant to this Agreement, delivery of such Shares, as directed by the Underwriters, to Cede & Co. (“Cede”) or such other nominee as may be designated by the Depository Trust Company (“DTC”), registration of such Shares in the name of Cede or such other nominee and the crediting of such Shares on the books of DTC to securities accounts of the Underwriters (assuming that neither DTC nor any such Underwriter has notice of any adverse claim (within the meaning of Section 8-105 of the New York Uniform Commercial Code (the “UCC”)) to such Shares), (A) DTC shall be a “protected purchaser” of such Shares within the meaning of Section 8-303 of the UCC, (B) under Section 8-501 of the UCC, the Underwriters will acquire a valid security entitlement in respect of such Shares and (C) no action based on any “adverse claim”, within the meaning of Section 8-102 of the UCC, to such Shares may be asserted against the Underwriters with respect to such security entitlement; for purposes of this representation, such Selling Shareholder may assume that when such payment, delivery and crediting occur, (x) such Shares will have been registered in the name of Cede or another nominee designated by DTC, in each case on the Company’s share registry in accordance with its certificate of incorporation, bylaws and applicable law, (y) DTC will be registered as a “clearing corporation” within the meaning of Section 8-102 of the UCC and (z) appropriate entries to the accounts of the several Underwriters on the records of DTC will have been made pursuant to the UCC.

 

(f)             Each such Selling Shareholder has delivered to the Representatives an executed lock-up agreement in substantially the form attached hereto as Exhibit A (the “Lock-up Agreement”).

 

(g)            Such Selling Shareholder is not prompted by any information concerning the Company or its subsidiaries which is not set forth in the Registration Statement , the Time of Sale Prospectus or the Prospectus to sell its Shares pursuant to this Agreement.

 

 

(h)            (i) The Registration Statement, when it became effective, did not contain and, as amended or supplemented, if applicable, will not, as of the date of such amendment or supplement, contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading, (ii) the Registration Statement and the Prospectus comply and, as amended or supplemented, if applicable, will, as of the date of such amendment or supplement, comply in all material respects with the Securities Act and the applicable rules and regulations of the Commission thereunder, (iii) the Time of Sale Prospectus does not, and at the time of each sale of Shares in connection with the offering when the Prospectus is not yet available to prospective purchasers and at the Closing Date and any Option Closing Date, the Time of Sale Prospectus, as then amended or supplemented by the Company, if applicable, will not, contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, (iv) each broadly available road show, if any, when considered together with the Time of Sale Prospectus, does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading and (v) the Prospectus as of its date does not contain and, as amended or supplemented, if applicable, will not, as of the date of such amendment or supplement, contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided, in each case, that the representations and warranties set forth in this paragraph shall only apply to any untrue statement of a material fact or omission to state a material fact made in reliance upon and in conformity with any information relating to such Selling Shareholder furnished to the Company in writing by or on behalf of such Selling Shareholder expressly for use in such documents, it being understood and agreed that the only information furnished by such Selling Shareholder to the Company consists of (i) the legal name of such Selling Shareholder and (ii) the number of shares of Common Stock beneficially owned prior to the offering by such Selling Shareholder and the information contained in the respective footnote related to such Selling Shareholder set forth in the beneficial ownership table, which appears in the Registration Statement, the Prospectus, and the Time of Sale Prospectus in the table (and corresponding footnotes) under the caption “Principal and Selling Stockholders” (the “Selling Shareholder Information”).

 

 

(i)            (i) None of such Selling Shareholder or any of its subsidiaries, or, to the knowledge of such Selling Shareholder, any director, officer, employee, agent, representative, or affiliate thereof, is a Person that is, or is owned or controlled by one or more Persons that are:

 

(A)            the subject of any Sanctions, or

 

(B)            located, organized or resident in a country or territory that is the subject of Sanctions (including, without limitation, the Crimea Region of Ukraine, the so-called Donetsk People’s Republic, the so-called Luhansk People’s Republic, Cuba, Iran, North Korea and Syria).

 

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

 

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

 

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

 

(iii)           For the past five years, such Selling Shareholder has not knowingly engaged in, is not now knowingly engaged in, and will not knowingly engage in, any dealings or transactions with any Person, or in any country or territory, that at the time of the dealing or transaction is or was the subject of Sanctions.

 

(iv)           (a) None of such Selling Shareholder or any of its subsidiaries, or, to the knowledge of such Selling Shareholder, any director, officer, employee, agent, representative, or affiliate thereof has taken or will take any action in furtherance of an offer, payment, promise to pay, or authorization or approval of the payment giving or receipt of money, property, gifts or anything else of value, directly or indirectly, to any Government Official in order to influence official action, or to any person in violation of any applicable anti-corruption laws; (b) such Selling Shareholder and each of its subsidiaries have conducted their businesses in compliance with applicable anti-corruption laws and have instituted and maintained and will continue to maintain policies and procedures reasonably designed to promote and achieve compliance with such laws and with the representations and warranties contained herein; and (c) neither the Selling Shareholder nor any of its subsidiaries will use, directly or indirectly, the proceeds of the offering in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, to any person in violation of any applicable anti-corruption laws.

 

 

(v)            The operations of such Selling Shareholder and each of its subsidiaries are and have been conducted at all times in material compliance with all applicable Anti-Money Laundering Laws, and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving such Selling Shareholder or any of its subsidiaries with respect to the Anti-Money Laundering Laws is pending or, to the knowledge of the Selling Shareholder, threatened.

 

(j)            Such Selling Shareholder represents and warrants that it is not (i) an employee benefit plan subject to Title I of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), (ii) a plan or account subject to Section 4975 of the Internal Revenue Code of 1986, as amended or (iii) an entity deemed to hold “plan assets” of any such plan or account under Section 3(42) of ERISA, 29 C.F.R. 2510.3-101, or otherwise.

 

3.            Agreements to Sell and Purchase. Each Selling Shareholder, severally and not jointly, hereby agrees to sell to the several Underwriters the number of Firm Shares set forth in Schedule I hereto opposite the name of such Selling Shareholder, and each Underwriter, upon the basis of the representations and warranties herein contained, but subject to the terms and conditions hereinafter stated, agrees, severally and not jointly, to purchase from such Selling Shareholder at $[ · ] a share (the “Purchase Price”) the number of Firm Shares (subject to such adjustments to eliminate fractional shares as the Representatives may determine) that bears the same proportion to the number of Firm Shares to be sold by such Selling Shareholder as the number of Firm Shares set forth in Schedule II hereto opposite the name of such Underwriter bears to the total number of Firm Shares.

 

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

 

 

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

 

5.            Payment and Delivery. Payment for the Firm Shares to be sold by each Selling Shareholder shall be made to such Selling Shareholder in immediately available funds in New York City against delivery of such Firm Shares for the respective accounts of the several Underwriters at 10:00 a.m., New York City time, on [ · ], 2022, or at such other time on the same or such other date, not later than [ · ], 2022, as shall be designated in writing by the Representatives. The time and date of such payment are hereinafter referred to as the “Closing Date.”

 

Payment for any Additional Shares shall be made to such Selling Shareholder in Federal or other funds immediately available in New York City against delivery of such Additional Shares for the respective accounts of the several Underwriters at 10:00 a.m., New York City time, on the date specified in the corresponding notice described in Section 3 or at such other time on the same or on such other date, in any event not later than [ · ], 2022, as shall be designated in writing by the Representatives.

 

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

 

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

 

 

 

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

 

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

 

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

 

(ii)            there shall not have occurred any downgrading, nor shall any notice have been given of any intended or potential downgrading or of any review for a possible change that does not indicate the direction of the possible change, in the rating accorded any of the securities of the Company or any of its subsidiaries by any “nationally recognized statistical rating organization,” as such term is defined in the Exchange Act; and

 

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

 

(b)           The Underwriters shall have received on the Closing Date a certificate, dated the Closing Date and signed by an executive officer of the Company, to the effect set forth in Sections 6(a)(i) and 6(a)(ii) above and to the effect that the representations and warranties of the Company contained in this Agreement are true and correct as of the Closing Date and that the Company has complied with all of the agreements and satisfied all of the conditions on its part to be performed or satisfied hereunder on or before the Closing Date.

 

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

 

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

 

 

(d)           The Underwriters shall have received on the Closing Date an opinion of each of Ropes & Gray LLP and Paul, Weiss, Rifkind, Wharton & Garrison, LLP, each acting as counsel for certain of the Selling Shareholders (each, “Selling Shareholder Counsel”), dated the Closing Date, in form and substance reasonably satisfactory to the Representatives.

 

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

 

With respect to the negative assurance letters to be delivered pursuant to Sections 6(c) and 6(e) above, Ropes & Gray LLP and Latham & Watkins LLP may state that their opinions and beliefs are based upon their participation in the preparation of the Registration Statement, the Time of Sale Prospectus and the Prospectus and any amendments or supplements thereto and review and discussion of the contents thereof, but are without independent check or verification, except as specified.

 

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

 

(g)           The Underwriters shall have received, on each of the date hereof and the Closing Date, a certificate signed by the Chief Financial Officer of the Company, dated respectively as of the date hereof or as of the Closing Date, substantially in the form agreed with the Representatives.

 

(h)           The Firm Shares and Additional Shares, if any, shall have been approved for listing upon notice of issuance on the Nasdaq Global Select Market.

 

(i)            The Lock-up Agreements, each substantially in the form of Exhibit A hereto, between the Representatives and certain shareholders, officers and directors of the Company shall be in full force and effect on the Closing Date.

 

(j)            The Underwriters shall have received on the Closing Date a certificate of each of the Selling Shareholders, in form and substance satisfactory to the Representatives, confirming that the representations of such Selling Shareholder are true and correct and that such Selling Shareholder has complied with all agreements and satisfied all conditions on their part to be performed or satisfied hereunder at or prior to the Closing Date.

 

 

(k)           Such other documents as the Representatives may reasonably request with respect to the good standing of the Company, the due authorization and issuance of the Shares to be sold on such Closing Date and other matters related to the issuance of such Shares.

 

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

 

(i)             a certificate, dated the Option Closing Date and signed by an executive officer of the Company, confirming that the certificate delivered on the Closing Date pursuant to Section 6(b) hereof remains true and correct as of such Option Closing Date;

 

(ii)            an opinion and negative assurance letter of Ropes & Gray LLP, outside counsel for the Company, dated the Option Closing Date, relating to the Additional Shares to be purchased on such Option Closing Date and otherwise to the same effect as the opinion required by Section 6(c) hereof;

 

(iii)           an opinion of each Selling Shareholder Counsel, dated the Option Closing Date, relating to the Additional Shares to be purchased on such Option Closing Date and otherwise to the same effect as the opinion required by Section 6(d) hereof;

 

(iv)           an opinion and negative assurance letter of Latham & Watkins LLP, counsel for the Underwriters, dated the Option Closing Date, relating to the Additional Shares to be purchased on such Option Closing Date and otherwise to the same effect as the opinion required by Section 6(e) hereof;

 

(v)            a letter dated the Option Closing Date, in form and substance reasonably satisfactory to the Underwriters, from Deloitte & Touche LLP, independent public accountants, substantially in the same form and substance as the letter furnished to the Underwriters pursuant to Section 6(f) hereof; provided that the letter delivered on the Option Closing Date shall use a “cut-off date” not earlier than two business days prior to such Option Closing Date;

 

(vi)           a certificate signed by the Chief Financial Officer of the Company, dated the Option Closing Date, substantially in the form agreed with the Representatives; and

 

 

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

 

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

 

(a)            To furnish to the Representatives, upon request and without charge, as many copies of the Registration Statement as the representatives may reasonably request (including exhibits thereto) and to furnish to the Representatives in New York City, without charge, prior to 10:00 a.m. New York City time on the business day next succeeding the date of this Agreement and during the period mentioned in Section 7(e) or 7(f) below, as many copies of the Time of Sale Prospectus, the Prospectus and any supplements and amendments thereto or to the Registration Statement as the Representatives may reasonably request.

 

(b)            Before amending or supplementing the Registration Statement, the Time of Sale Prospectus or the Prospectus, to furnish to the Representatives a copy of each such proposed amendment or supplement and not to file any such proposed amendment or supplement to which the Representatives reasonably object in a timely manner, and to file with the Commission within the applicable period specified in Rule 424(b) under the Securities Act any prospectus required to be filed pursuant to such Rule.

 

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

 

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

 

(e)            If the Time of Sale Prospectus is being used to solicit offers to buy the Shares at a time when the Prospectus is not yet available to prospective purchasers and any event shall occur or condition exist as a result of which it is necessary to amend or supplement the Time of Sale Prospectus in order to make the statements therein, in the light of the circumstances, not misleading, or if any event shall occur or condition exist as a result of which the Time of Sale Prospectus conflicts with the information contained in the Registration Statement then on file, or if, in the opinion of counsel for the Underwriters, it is necessary to amend or supplement the Time of Sale Prospectus to comply with applicable law, forthwith subject to Section 7(b) above, to prepare, file with the Commission and furnish, at its own expense, to the Underwriters and to any dealer upon request, either amendments or supplements to the Time of Sale Prospectus so that the statements in the Time of Sale Prospectus as so amended or supplemented will not, in the light of the circumstances when the Time of Sale Prospectus is delivered to a prospective purchaser, be misleading or so that the Time of Sale Prospectus, as amended or supplemented, will no longer conflict with the Registration Statement, or so that the Time of Sale Prospectus, as amended or supplemented, will comply with applicable law.

 

 

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

 

(g)            To endeavor to qualify the Shares for offer and sale under the securities or Blue Sky laws of such jurisdictions as the Representatives shall reasonably request; provided that the Company shall not be required to (i) qualify as a foreign corporation or other entity or as a dealer in securities in any jurisdiction where it is not now so qualified, (ii) file any general consent to service of process in any such jurisdiction or (iii) subject itself to taxation in any such jurisdiction in which it is not otherwise subject.

 

(h)            To make generally available (which may be satisfied by filing with the Commission on its Electronic Data Gathering, Analysis and Retrieval System) to the Company’s security holders and to the Representatives as soon as practicable an earnings statement covering a period of at least twelve months beginning with the first fiscal quarter of the Company occurring after the date of this Agreement which shall satisfy the provisions of Section 11(a) of the Securities Act and the rules and regulations of the Commission thereunder.

 

 

(i)            [Reserved].

 

(j)            The Company will promptly notify the Representatives if the Company ceases to be an Emerging Growth Company at any time prior to the later of (i) completion of the distribution of the Shares within the meaning of the Securities Act and (ii) completion of the Restricted Period referred to in Section 7.

 

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

 

The Company also covenants with each Underwriter that, without the prior written consent of the Representatives on behalf of the Underwriters, it will not, and will not publicly disclose an intention to, during the period ending 60 days after the date of the Prospectus (the “Restricted Period”), (1) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock or (2) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the Common Stock, whether any such transaction described in clause (1) or (2) above is to be settled by delivery of Common Stock or such other securities, in cash or otherwise or (3) publicly file or confidentially submit any registration statement with the Commission relating to the offering of any shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock; provided that confidential or non-public submissions to the Commission of any registration statements under the Securities Act may be made if and only if (x) no public announcement of such confidential or non-public submission shall be made during the Restricted Period and (y) the Company shall have provided the Representatives prior written notice of its intention to confidentially submit a draft registration statement with the Commission at least two business days prior to such confidential or non-public submission.

 

 

The restrictions contained in the preceding paragraph shall not apply to (A) the Shares to be sold hereunder, (B) the issuance by the Company of shares of Common Stock upon the exercise of an option or warrant or the conversion or exchange of convertible or exchangeable securities outstanding on the date hereof as described in each of the Time of Sale Prospectus and Prospectus, (C) grants of options, restricted stock or other equity awards and the issuance of Common Stock or securities convertible into or exercisable for Common Stock (whether upon the exercise of stock options or otherwise) to employees, officers, directors, advisors, or consultants of the Company pursuant to the terms of an employee benefit plan, qualified stock option plan or other employee compensation plan in effect on the date hereof and described in the Time of Sale Prospectus and the Prospectus; (D) the filing of a registration statement on Form S-8 to register Common Stock issuable pursuant to any plans referred to in clause (C) above, or (E) the issuance of Common Stock or any securities convertible into, or exercisable or exchangeable for, Common Stock, or the entrance into an agreement to issue Common Stock or any securities convertible into, or exercisable or exchangeable for, Common Stock, in connection with any merger, joint venture, strategic alliances, commercial or other collaborative transaction or the acquisition or license of the business, property, technology or other assets of another individual or entity or the assumption of an employee benefit plan in connection with a merger or acquisition; provided that the aggregate number of shares of Common Stock or any securities convertible into, or exercisable or exchangeable for, Common Stock that the Company may issue or agree to issue pursuant to this clause (E) shall not exceed 10% of the total outstanding share capital of the Company immediately following the issuance of the Shares; and provided further that the recipients thereof provide to the Representatives a signed lock-up letter substantially in the form of the lock-up letter described in Section 6(i).

 

8.             Covenants of the Selling Shareholders. Each Selling Shareholder, severally and not jointly, covenants with each Underwriter as follows:

 

(a)            Each Selling Shareholder will deliver to each Underwriter (or its agent), prior to or at the Closing Date, a properly completed and executed Internal Revenue Service (“IRS”) Form W-9 or an IRS Form W-8, as appropriate, together with all required attachments to such form.

 

(b)            Each Selling Shareholder that is a “legal entity customer” (as defined in 31 C.F.R. §1010.230(e)) will deliver to each Underwriter (or its agent), on the date of execution of this Agreement, a properly completed and executed Certification Regarding Beneficial Owners of Legal Entity Customers, together with copies of identifying documentation, and each Selling Shareholder undertakes to provide such additional supporting documentation as each Underwriter may reasonably request in connection with the verification of the foregoing Certification.

 

 

9.             Expenses. Whether or not the transactions contemplated in this Agreement are consummated or this Agreement is terminated, the Company agrees with the Underwriters that it shall pay or cause to be paid all expenses incident to the performance of their obligations and those of the Selling Shareholders under this Agreement, including: (i) the fees, disbursements and expenses of the Company’s counsel, the Company’s accountants and counsel for the Selling Shareholders in connection with the registration and delivery of the Shares under the Securities Act and all other fees or expenses in connection with the preparation and filing of the Registration Statement, any preliminary prospectus, the Time of Sale Prospectus, the Prospectus, any free writing prospectus prepared by or on behalf of, used by, or referred to by the Company and amendments and supplements to any of the foregoing, including all printing costs associated therewith, and the mailing and delivering of copies thereof to the Underwriters and dealers, in the quantities hereinabove specified, (ii) all costs and expenses related to the transfer and delivery of the Shares to the Underwriters, including any transfer or other taxes payable thereon to the extent not borne by the Selling Shareholders under Section 5, (iii) the cost of printing or producing any Blue Sky or Legal Investment memorandum in connection with the offer and sale of the Shares under state securities laws and all expenses in connection with the qualification of the Shares for offer and sale under state securities laws as provided in Section 7(g) hereof, including filing fees and the reasonable fees and disbursements of counsel for the Underwriters in connection with such qualification and in connection with the Blue Sky or Legal Investment memorandum, (iv) all filing fees and the reasonable fees and disbursements of counsel to the Underwriters incurred in connection with the review and qualification of the offering of the Shares by FINRA (provided that such fees and expenses of counsel to be reimbursed pursuant to clauses (iii) and (iv) shall not to exceed $40,000), (v) the cost of printing certificates representing the Shares, (vi) the costs and charges of any transfer agent, registrar or depositary, (vii) the costs and expenses of the Company relating to investor presentations on any “road show” undertaken in connection with the marketing of the offering of the Shares, including, without limitation, expenses associated with the preparation or dissemination of any electronic road show, expenses associated with the production of road show slides and graphics, fees and expenses of any consultants engaged in connection with the road show presentations with the prior approval of the Company, travel and lodging expenses of the representatives and officers of the Company and any such consultants, and 50% of the cost of any aircraft chartered in connection with the road show with the remaining 50% of the cost of such aircraft to be paid by the Underwriters, (viii) the document production charges and expenses associated with printing this Agreement, and (ix) all other costs and expenses incident to the performance of the obligations of the Company hereunder for which provision is not otherwise made in this Section. It is understood, however, that except as provided in this Section, Section 11 entitled “Indemnity and Contribution” and the last paragraph of Section 14 below, the Underwriters will pay all of their costs and expenses, including fees and disbursements of their counsel, stock transfer taxes payable on resale of any of the Shares by them and any advertising expenses connected with any offers they may make and all travel and other expenses of the Underwriters or any of their employees incurred by them in connection with the participation in investor presentations on any “road show” undertaken in connection with the marketing of the offering of the Shares; provided that this clause (ix) does not include the cost of any chartered aircraft, which shall be paid 50% by the Company as described in clause (vii).

 

 

The provisions of this Section shall not supersede or otherwise affect any agreement that the Company and the Selling Shareholders may otherwise have for the allocation of such expenses among themselves.

 

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

 

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

 

 

(b)           Each Selling Shareholder agrees, severally and not jointly, to indemnify and hold harmless each Underwriter, each person, if any, who controls any Underwriter within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act, and each affiliate of any Underwriter within the meaning of Rule 405 under the Securities Act from and against any and all losses, claims, damages and liabilities (including, without limitation, any legal or other expenses reasonably incurred in connection with defending or investigating any such action or claim) that arise out of, or are based upon, any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement or any amendment thereof, any preliminary prospectus, the Time of Sale Prospectus or any amendment or supplement thereto, any issuer free writing prospectus as defined in Rule 433(h) under the Securities Act, any road show, the Prospectus or any amendment or supplement thereto, or any Testing-the-Waters Communication or arise out of, or are based upon, any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, in each case to the extent, but only to the extent, that such untrue statement or alleged untrue statement or omission or alleged omission was made in the Registration Statement or any amendment thereof, any preliminary prospectus, the Time of Sale Prospectus or any amendment or supplement thereto, any issuer free writing prospectus as defined in Rule 433(h) under the Securities Act, any road show, the Prospectus or any amendment or supplement thereto, or any Testing-the-Waters Communication in reliance upon and in conformity with written information furnished to the Company by such Selling Shareholder that constitutes Selling Shareholder Information. The liability of each Selling Shareholder under this paragraph shall be limited to an amount equal to the aggregate net proceeds (after underwriting commission and discounts but before expenses) from the sale of the Shares sold by such Selling Shareholder under this Agreement.

 

(c)           Each Underwriter agrees, severally and not jointly, to indemnify and hold harmless the Company, the Selling Shareholders, the directors of the Company, the officers of the Company who sign the Registration Statement and each person, if any, who controls the Company or any Selling Shareholder within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act from and against any and all losses, claims, damages and liabilities (including, without limitation, any legal or other expenses reasonably incurred in connection with defending or investigating any such action or claim) that arise out of, or are based upon, any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement or any amendment thereof, any preliminary prospectus, the Time of Sale Prospectus or any amendment or supplement thereto, any issuer free writing prospectus as defined in Rule 433(h) under the Securities Act, any Company information that the Company has filed, or is required to file, pursuant to Rule 433(d) under the Securities Act, any road show, the Prospectus or any amendment or supplement thereto, or any Testing-the-Waters Communication or arise out of, or are based upon, any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, but only with reference to information relating to such Underwriter furnished to the Company in writing by or on behalf of such Underwriter through the Representatives expressly for use in the Registration Statement, any preliminary prospectus, the Time of Sale Prospectus, any issuer free writing prospectus, road show, or the Prospectus or any amendment or supplement thereto, it being understood and agreed that the only information furnished by any such Underwriter consists of the following information in the Prospectus furnished on behalf of each Underwriter: the selling concession amount appearing in the third paragraph under the caption “Underwriting”, [the information concerning stabilization and the over-allotment option in the first, second, fifth, ninth and eleventh sentences of the twelfth paragraph under the caption “Underwriting,” the information concerning internet distributions in the fourteenth paragraph under the caption “Underwriting” and the information concerning sales to discretionary accounts appearing in the sixteenth paragraph under the caption “Underwriting” (the “Underwriter Information”)].

 

 

(d)           In case any proceeding (including any governmental investigation) shall be instituted involving any person in respect of which indemnity may be sought pursuant to Section 11 (a), 11(b) or 11(c), such person (the “indemnified party”) shall promptly notify the person against whom such indemnity may be sought (the “indemnifying party”) in writing; provided that the failure to notify the indemnifying party shall not relieve such indemnifying party from any liability that it may have under the preceding paragraphs of this Section 11, except to the extent that it has been materially prejudiced (through the forfeiture of substantive rights or defenses) by such failure; and provided further that the failure to notify the indemnifying party shall not relieve it from any liability that it may have to an indemnified party otherwise than under the preceding paragraphs of this Section 11. If any such proceeding shall be brought against any indemnified party and it shall notify the indemnifying party of the commencement thereof: (1) in the case of a civil proceeding (excluding, for the avoidance of doubt, any governmental, regulatory or non-civil proceeding), the indemnifying party shall be entitled to participate in such civil proceeding and, to the extent that it shall wish, jointly with any other indemnifying party similarly notified, to assume the defense thereof, with counsel reasonably satisfactory to such indemnified party and shall pay the fees and expenses of such counsel related to such civil proceeding, and, after notice from the indemnifying party to such indemnified party of its election to assume the defense of such civil proceeding, the indemnifying party shall not be liable to such indemnified party under such subsection for any legal expenses of other counsel or any other expenses, in each case, subsequently incurred by such indemnified party in connection with the defense thereof, other than reasonable costs of investigation; and (2) in case any governmental, regulatory or non-civil proceeding, upon request of the indemnified party, the indemnifying party shall retain counsel reasonably satisfactory to the indemnified party to represent the indemnified party and any others the indemnifying party may designate in such governmental, regulatory or non-civil proceeding and shall pay the fees and disbursements of such counsel related to such governmental, regulatory or non-civil proceeding. In any one or more of any foregoing proceeding, any indemnified party shall have the right to retain its own counsel, but the fees and expenses of such counsel shall be at the expense of such indemnified party unless (i) the indemnifying party and the indemnified party shall have mutually agreed in writing to the retention of such counsel or (ii) the named parties to any such proceeding (including any impleaded parties) include both the indemnifying party and the indemnified party and representation of both parties by the same counsel would be inappropriate due to actual or potential differing interests between them. It is understood that the indemnifying party shall not, in respect of the legal expenses of any indemnified party in connection with any proceeding or related proceedings in the same jurisdiction, be liable for (i) the reasonably incurred fees and expenses of more than one separate firm (in addition to any local counsel) for all Underwriters and all persons, if any, who control any Underwriter within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act or who are affiliates of any Underwriter within the meaning of Rule 405 under the Securities Act, (ii) the reasonably incurred fees and expenses of more than one separate firm (in addition to any local counsel) for the Company, its directors, its officers who sign the Registration Statement and each person, if any, who controls the Company within the meaning of either such Section and (iii) the reasonably incurred fees and expenses of more than one separate firm (in addition to any local counsel) for all Selling Shareholders and all persons, if any, who control any Selling Shareholder within the meaning of either such Section, and that all such fees and expenses shall be reimbursed as they are incurred. In the case of any such separate firm for the Underwriters and such control persons and affiliates of any Underwriters, such firm shall be designated in writing by the Representatives. In the case of any such separate firm for the Company, and such directors, officers and control persons of the Company, such firm shall be designated in writing by the Company. In the case of any such separate firm for the Selling Shareholders and such control persons of any Selling Shareholders, such firm shall be designated in writing by the persons named as attorneys-in-fact for the Selling Shareholders under the Powers of Attorney, if applicable, and otherwise by the applicable Selling Shareholders. The indemnifying party shall not be liable for any settlement of any proceeding effected without its written consent, but if settled with such consent or if there be a final judgment for the plaintiff, the indemnifying party agrees to indemnify the indemnified party from and against any loss or liability by reason of such settlement or judgment. No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement of any pending or threatened proceeding in respect of which any indemnified party is or could have been a party and indemnity could have been sought hereunder by such indemnified party, unless such settlement includes an unconditional release of such indemnified party from all liability on claims that are the subject matter of such proceeding.

 

 

(e)           To the extent the indemnification provided for in Section 11(a), 11(b) or 11(c) is unavailable to an indemnified party or insufficient in respect of any losses, claims, damages or liabilities referred to therein, then each indemnifying party under such paragraph, in lieu of indemnifying such indemnified party thereunder, shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages or liabilities (i) in such proportion as is appropriate to reflect the relative benefits received by the indemnifying party or parties on the one hand and the indemnified party or parties on the other hand from the offering of the Shares or (ii) if the allocation provided by clause 11(e)(i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause 11(e)(i) above but also the relative fault of the indemnifying party or parties on the one hand and of the indemnified party or parties on the other hand in connection with the statements or omissions that resulted in such losses, claims, damages or liabilities, as well as any other relevant equitable considerations. The relative benefits received by the Company and the Selling Shareholders on the one hand and the Underwriters on the other hand in connection with the offering of the Shares shall be deemed to be in the same respective proportions as the net proceeds from the offering of the Shares (before deducting expenses) received by each Selling Shareholder and the total underwriting discounts and commissions received by the Underwriters, in each case as set forth in the table on the cover of the Prospectus, bear to the aggregate Public Offering Price of the Shares. The relative fault of the Company and the Selling Shareholders on the one hand and the Underwriters on the other hand shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company and the Selling Shareholders or by the Underwriters and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The Underwriters’ respective obligations to contribute pursuant to this Section 11 are several in proportion to the respective number of Shares they have purchased hereunder, and not joint. The liability of each Selling Shareholder under this paragraph shall be limited to an amount equal to the aggregate net proceeds (after underwriting commission and discounts but before expenses) from the sale of the Shares sold by such Selling Shareholder under this Agreement.

 

 

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

 

 

(g)           The indemnity and contribution provisions contained in this Section 11 and the representations, warranties and other statements of the Company and the Selling Shareholders contained in this Agreement shall remain operative and in full force and effect regardless of (i) any termination of this Agreement, (ii) any investigation made by or on behalf of any Underwriter, any person controlling any Underwriter or any affiliate of any Underwriter, by or on behalf of any Selling Shareholder or any person controlling any Selling Shareholder, or by or on behalf of the Company, its officers or directors or any person controlling the Company and (iii) acceptance of and payment for any of the Shares.

 

12.            [Reserved].

 

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

 

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

 

 

If, on the Closing Date or an Option Closing Date, as the case may be, any one or more of the Underwriters shall fail or refuse to purchase Shares that it has or they have agreed to purchase hereunder on such date, and the aggregate number of Shares which such defaulting Underwriter or Underwriters agreed but failed or refused to purchase is not more than one-tenth of the aggregate number of the Shares to be purchased on such date, the other Underwriters shall be obligated severally in the proportions that the number of Firm Shares set forth opposite their respective names in Schedule II bears to the aggregate number of Firm Shares set forth opposite the names of all such non-defaulting Underwriters, or in such other proportions as the Representatives may specify, to purchase the Shares which such defaulting Underwriter or Underwriters agreed but failed or refused to purchase on such date; provided that in no event shall the number of Shares that any Underwriter has agreed to purchase pursuant to this Agreement be increased pursuant to this Section 14 by an amount in excess of one-ninth of such number of Shares without the written consent of such Underwriter. If, on the Closing Date, any Underwriter or Underwriters shall fail or refuse to purchase Firm Shares and the aggregate number of Firm Shares with respect to which such default occurs is more than one-tenth of the aggregate number of Firm Shares to be purchased on such date, and arrangements satisfactory to the Representatives, the Company and the Selling Shareholders for the purchase of such Firm Shares are not made within 36 hours after such default, this Agreement shall terminate without liability on the part of any non-defaulting Underwriter, the Company or the Selling Shareholders. In any such case either the Representatives or the relevant Selling Shareholder shall have the right to postpone the Closing Date, but in no event for longer than seven days, in order that the required changes, if any, in the Registration Statement, in the Time of Sale Prospectus, in the Prospectus or in any other documents or arrangements may be effected. If, on an Option Closing Date, any Underwriter or Underwriters shall fail or refuse to purchase Additional Shares and the aggregate number of Additional Shares with respect to which such default occurs is more than one-tenth of the aggregate number of Additional Shares to be purchased on such Option Closing Date, the non-defaulting Underwriters shall have the option to (i) terminate their obligation hereunder to purchase the Additional Shares to be sold on such Option Closing Date or (ii) purchase not less than the number of Additional Shares that such non-defaulting Underwriters would have been obligated to purchase in the absence of such default. Any action taken under this paragraph shall not relieve any defaulting Underwriter from liability in respect of any default of such Underwriter under this Agreement.

  

If this Agreement shall be terminated by the Underwriters, or any of them, because of any failure or refusal on the part of any Selling Shareholder to comply with the terms or to fulfill any of the conditions of this Agreement, or if for any reason any Selling Shareholder shall be unable to perform its obligations under this Agreement (other than, with respect to a defaulting Underwriter, by reason of default by such Underwriter), the Company will reimburse the Underwriters or such Underwriters as have so terminated this Agreement with respect to themselves, severally, for all accountable out-of-pocket expenses (including the fees and disbursements of their counsel) actually incurred by such Underwriters in connection with this Agreement or the offering contemplated hereunder. The provisions of this Section 14 will not supersede or otherwise affect any agreement that the Company and the Selling Shareholders may otherwise have for allocation of expenses among themselves.

 

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

 

 

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

 

(c)            Each Selling Shareholder further acknowledges and agrees that, although the Underwriters may provide certain Selling Shareholders with certain Regulation Best Interest and Form CRS disclosures or other related documentation in connection with the offering, the Underwriters are not making a recommendation to any Selling Shareholder to participate in the offering or sell any Shares at the Purchase Price, and nothing set forth in such disclosures or documentation is intended to suggest that any Underwriter is making such a recommendation.

 

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

 

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

 

 

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

 

17.            Counterparts. This Agreement may be signed in two or more counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. Electronic signatures complying with the New York Electronic Signatures and Records Act (N.Y. State Tech. §§ 301-309), as amended from time to time, or other applicable law will be deemed original signatures for purposes of this Agreement. Transmission by telecopy, electronic mail or other transmission method of an executed counterpart of this Agreement will constitute due and sufficient delivery of such counterpart.

 

18.            Applicable Law. This Agreement shall be governed by and construed in accordance with the internal laws of the State of New York.

 

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

 

20.            Notices. All communications hereunder shall be in writing and effective only upon receipt and if to the Underwriters shall be delivered, mailed or sent to the Representatives at (i) in care of BofA Securities, Inc., One Bryant Park, New York, New York 10036, Email: dg.ecm_execution_services@bofa.com, Attention: Syndicate Department, with a copy to Email: dg.ecm_legal@bofa.com, Attention: ECM Legal, (ii) in care of Morgan Stanley & Co. LLC, 1585 Broadway, New York, New York 10036, Attention: Equity Syndicate Desk, with a copy to the Legal Department and (iii) in care of Jefferies LLC, 520 Madison Avenue, New York, New York 10022; if to the Company shall be delivered, mailed or sent to 5830 Granite Parkway, 3^rd Floor, Plano, Texas 75024, Attention: Chief Legal Officer and Corporate Secretary; if to the Company shall be delivered, mailed or sent to 5830 Granite Parkway, 3^rd Floor, Plano, Texas 75024, Attention: Chief Legal Officer and Corporate Secretary and if to a Selling Shareholder shall be delivered, mailed or sent to such Selling Shareholder in care of its attorneys-in-fact as set forth in the Power of Attorney, if applicable, and otherwise in care of General Atlantic Service Company, L.P., 55 East 52nd Street, 33rd Floor, New York, New York 10055, Attention: Gordon Cruess.

 

 

 

	Very truly yours,
	EUROPEAN WAX CENTER, INC.
	By:
		Name:
		Title:

 

 

	GAPCO AIV Interholdco (EW), L.P.
	By:
		Name:
		Title:

 

 

	GA AIV-1 B Interholdco (EW), L.P.
	By:
		Name:
		Title:

 

 

	General Atlantic Partners AIV (EW), L.P.
	By:
		Name:
		Title:

 

 

	David Berg
	By:
		Name: Gavin O’Connor, Attorney-in-fact
		Title: Chief Legal Officer, Chief Human Resources Officer and Corporate Secretary

 

 

	David Willis
	By:
		Name: Gavin O’Connor, Attorney-in-fact
		Title: Chief Legal Officer, Chief Human Resources Officer and Corporate Secretary

 

 

	Gavin O’Connor
	By:
		Name: Gavin O’Connor
		Title: Chief Legal Officer, Chief Human Resources Officer and Corporate Secretary

 

 

	Jyoti Lynch
	By:
		Name: Gavin O’Connor, Attorney-in-fact
		Title: Chief Legal Officer, Chief Human Resources Officer and Corporate Secretary

 

 

	Christopher Kobus
	By:
		Name: Gavin O’Connor, Attorney-in-fact
		Title: Chief Legal Officer, Chief Human Resources Officer and Corporate Secretary

 

 

Accepted as of the date hereof
BofA Securities, Inc.
Morgan Stanley & Co. LLC
Jefferies LLC
Acting severally on behalf of themselves and the several Underwriters named in Schedule II hereto
By:	BofA Securities, Inc.
By:
	Name:
	Title:
By:	Morgan Stanley & Co. LLC
By:
	Name:
	Title:
By:	Jefferies LLC
By:
	Name:
	Title:

 

 

Schedule I

 

Selling Shareholder		Number of Firm Shares To Be Sold		Maximum Number of Additional Shares to Be Sold
GAPCO AIV Interholdco (EW), L.P.		[ l ]		[ l ]
GA AIV-1 B Interholdco (EW), L.P.		[ l ]		[ l ]
General Atlantic Partners AIV (EW), L.P.		[ l ]		[ l ]
David Berg		[ l ]		[ l ]
David Willis		[ l ]		[ l ]
Gavin O’Connor		[ l ]		[ l ]
Chris Kobus		[ l ]		[ l ]
Jyoti Lynch		[ l ]		[ l ]
Total:		[ l ]		[ l ]

 

 

Schedule II

 

Underwriter		Number of Firm Shares To Be Purchased
BofA Securities, Inc.		[ l ]
Morgan Stanley & Co. LLC		[ l ]
Jefferies LLC		[ l ]
[ l ]		[ l ]
Total:		[ l ]

 

 

SCHEDULE III

 

Time of Sale Prospectus

 

1.

Preliminary Prospectus issued [ l ], 2022.

 

2.

The Public Offering Price per share for the Shares is $[ l ]. The number of Firm Shares is [ l ]. The number of Additional Shares is [ l ].

 

 

EXHIBIT A

 

LOCK-UP AGREEMENT

 

[ l ], 2022

 

BofA Securities, Inc.

Morgan Stanley & Co. LLC

Jefferies LLC

 

c/o BofA Securities, Inc.

One Bryant Park

New York, New York 10036

 

c/o Morgan Stanley & Co. LLC

1585 Broadway

New York, New York 10036

 

c/o Jefferies LLC

520 Madison Avenue

New York, New York 10036

 

Ladies and Gentlemen:

 

The undersigned understands that BofA Securities, Inc. (“BofA”), Morgan Stanley & Co. LLC (“Morgan Stanley”) and Jefferies LLC (“Jefferies”) (the “Representatives”) propose to enter into an Underwriting Agreement (the “Underwriting Agreement”) with European Wax Center, Inc., a Delaware corporation (the “Company”) and the Selling Shareholders listed on Schedule I to the Underwriting Agreement, providing for the public offering (the “Public Offering”) by the several Underwriters, including the Representatives (the “Underwriters”), of shares (the “Shares”) of the Class A common stock, par value $0.00001 per share, of the Company (the “Common Stock”).

 

 

To induce the Underwriters that may participate in the Public Offering to continue their efforts in connection with the Public Offering, the undersigned hereby agrees that, without the prior written consent of the Representatives on behalf of the Underwriters, it will not, and will not publicly disclose an intention to, during the period commencing on the date hereof and ending 60 days after the date of the final prospectus (the “Restricted Period”) relating to the Public Offering (the “Prospectus”), (1) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any shares of Common Stock beneficially owned (as such term is used in Rule 13d-3 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), by the undersigned or any other securities so owned convertible into or exercisable or exchangeable for Common Stock or (2) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the Common Stock, whether any such transaction described in clause (1) or (2) above is to be settled by delivery of Common Stock or such other securities, in cash or otherwise. The undersigned acknowledges and agrees that the foregoing precludes the undersigned from engaging in any hedging or other transaction designed or intended, or which could reasonably be expected to lead to or result in, a sale or disposition of any shares of Common Stock, or any securities convertible into or exercisable or exchangeable for Common Stock, even if any such sale or disposition transaction or transactions would be made or executed by or on behalf of someone other than the undersigned.

 

The foregoing restrictions shall not apply to:

 

(a) transactions relating to shares of Common Stock or any other securities convertible into or exercisable or exchangeable for Common Stock acquired in open market transactions after the completion of the Public Offering or, if the undersigned is not an officer or director of the Company, acquired by the undersigned from the Underwriters in any public offering;

 

(b) transfers of shares of Common Stock or any other securities so owned convertible into or exercisable or exchangeable for Common Stock as a bona fide gift or, if the undersigned is an individual, to a trust the beneficiaries of which are exclusively the undersigned or immediate family members of the undersigned; provided that any such transfer shall not involve a disposition for value;

 

(c) if the undersigned is a corporation, partnership, limited liability company or other business entity, distributions of shares of Common Stock or any other securities so owned convertible into or exercisable or exchangeable for Common Stock to controlled affiliates, limited or general partners, members, stockholders or other equity holders of the undersigned; provided that any such transfer shall not involve a disposition for value; and provided further that no voluntary filing under Section 16 of the Exchange Act will be made during the Restricted Period and any required filing under Section 16 of the Exchange Act during the Restricted Period shall clearly indicate in the footnotes thereto that the filing relates to the circumstances described in this clause (c);

 

(d) facilitating the establishment of a trading plan on behalf of a shareholder, officer or director of the Company pursuant to Rule 10b5-1 under the Exchange Act for the transfer of shares of Common Stock;

 

(e) transactions relating to shares of Common Stock or any other securities so owned convertible into or exercisable or exchangeable for Common Stock by operation of law pursuant to a qualified domestic order or in connection with a divorce settlement;

 

 

(f) if the undersigned is an individual, transfers of shares of Common Stock or any other securities so owned convertible into or exercisable or exchangeable for Common Stock by will or intestacy; provided that any such transfer shall not involve a disposition for value;

 

(g) transfers to the Company, as permitted or required under any equity incentive plan or other equity award or benefit plan described in the registration statement relating to the Public Offering (the “Registration Statement”) and the Prospectus (each, an “Equity Plan”), any agreement pursuant to which such shares of Common Stock were issued, as in effect as of the date of, and which such agreement is described in the Registration Statement and the Prospectus in all material respects, or the Company’s certificate of incorporation or bylaws in connection with the repurchase or forfeiture of shares of Common Stock or any other securities so owned convertible into or exercisable or exchangeable for Common Stock;

 

(h) the exercise of options, stock appreciation rights or warrants to purchase shares of Common Stock pursuant to an Equity Plan;

 

(i) transfers of shares of Common Stock or any securities convertible into Common Stock to the Company upon a vesting or settlement event of the Company’s securities or upon the exercise of outstanding equity awards, which securities or equity awards have been issued pursuant to an Equity Plan, on a “cashless” or “net” basis only in an amount necessary to cover tax withholding obligations or the exercise price of options of the undersigned in connection with such vesting or exercise;

 

(j) transfers, sales, tenders or other dispositions of Common Stock to a bona fide third party pursuant to a tender offer for securities of the Company or any merger, consolidation or other business combination involving a Change of Control (as defined below) of the Company that, in each case, has been approved by the Board of Directors of the Company (including, without limitation, entering into any lock-up, voting or similar agreement pursuant to which the undersigned may agree to transfer, sell, tender or otherwise dispose of stock in connection with any such transaction, or vote any stock in favor of any such transaction); provided that all shares of Common Stock subject to this agreement that are not so transferred, sold, tendered or otherwise disposed of remain subject to this agreement; and provided, further, that it shall be a condition of transfer, sale, tender or other disposition that if such tender offer or other transaction is not completed, any Common Stock subject to this agreement shall remain subject to the restrictions herein;

 

(k) the shares to be sold to the Underwriters by the undersigned pursuant to the Underwriting Agreement, if applicable; or

 

(l) any exchange of membership interests of EWC Ventures, LLC and a corresponding number of shares of our Class B common stock for shares of the Class A common stock in accordance with the Exchange Agreement;

 

 

provided that (A) in the case of any transfer or distribution pursuant to clauses (b), (c), (e) and (f) above, each donee, transferee, pledgee or distributee shall sign and deliver a lock-up agreement substantially in the form of this agreement, (B) in the case of any transfer or distribution pursuant to clauses (a), (b) and (h) no filing under Section 16(a) of the Exchange Act, reporting a reduction in beneficial ownership of shares of Common Stock, shall be required or shall be voluntarily made during the Restricted Period, (C) in the case of clauses (h), (i) and (l) above, that any shares of Common Stock received upon such exercise, vesting, conversion, exchange or settlement shall be subject to all of the restrictions set forth in this agreement, (D) in the case of clause (d) above (i) such plan does not provide for the transfer of Common Stock during the Restricted Period and (ii) to the extent a public announcement or filing under the Exchange Act, if any, is required of or voluntarily made by or on behalf of the undersigned or the Company regarding the establishment of such plan, such announcement or filing shall include a statement to the effect that no transfer of Common Stock may be made under such plan during the Restricted Period and (E) any filing or announcement by the Company or the undersigned relating to a transfer or distribution under clauses (e), (f), (g), (i), (j) and (l) above shall note the applicable circumstances that cause such clause to apply and explain that the filing or announcement relates solely to transfers or distributions falling within the category described in the relevant clause. For the purpose of clause (j), “Change of Control” shall mean the transfer (whether by tender offer, merger, consolidation or other similar transaction), in one transaction or a series of related transactions, to a person or group of affiliated persons (other than an Underwriter pursuant to the Public Offering), of the Company’s voting securities if, after such transfer, such person or group of affiliated persons would hold more than 50% of the outstanding voting securities of the Company (or the surviving entity). [In addition, the undersigned agrees that, without the prior written consent of the Representatives on behalf of the Underwriters, it will not, during the Restricted Period, make any demand for or exercise any right with respect to, the registration of any shares of Common Stock or any security convertible into or exercisable or exchangeable for Common Stock.] The undersigned also agrees and consents to the entry of stop transfer instructions with the Company’s transfer agent and registrar against the transfer of the undersigned’s shares of Common Stock except in compliance with the foregoing restrictions.

 

[Notwithstanding anything to the contrary herein, the undersigned shall be permitted to make one or more demands for or otherwise exercise any rights the undersigned holds pursuant to an agreement with the Company described in the Registration Statement and Prospectus with respect to any confidential or non-public submission for registration (or, with respect to any securities automatically released pursuant to the immediately preceding paragraph, public filing for registration) of any shares of Common Stock or securities convertible, exercisable or exchangeable into Common Stock (provided that, in the case of any such confidential or non-public submission, (i) no public announcement of such demand or exercise of rights shall be made, (ii) no public announcement of such confidential or non-public submission shall be made and (iii) no such confidential or non-public submission shall become a publicly available registration statement during the Restricted Period).]

 

 

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

 

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

 

Notwithstanding anything herein to the contrary, this agreement shall be of no further force or effect and the undersigned shall be released from all obligations under this agreement upon the earlier to occur, if any, of (i) June 30, 2022, in the event the Underwriting Agreement has not been executed by that date, (ii) prior to the execution of the Underwriting Agreement by the parties thereto, the date the Company files an application to withdraw the Registration Statement related to the Public Offering, (iii) prior to the execution of the Underwriting Agreement by the parties thereto, the date either the Representatives, on the one hand, or the Company, on the other hand, notifies the other(s) in writing that it does not intend to proceed with the Public Offering, or (iv) the date of termination of the Underwriting Agreement (other than the provisions thereof which survive termination) prior to payment for and delivery of the shares of Common Stock to be sold thereunder.

 

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

 

 

This agreement shall be governed by and construed in accordance with the laws of the State of New York without regard to its conflict of law provisions.

 

	Very truly yours,
	(Name)
	(Address)

 

 

 

Exhibit 5.1

 

ROPES & GRAY LLP PRUDENTIAL TOWER 800 BOYLSTON STREET BOSTON, MA 02199-3600 WWW.ROPESGRAY.COM

 

May 17, 2022

 

European Wax Center, Inc.

5380 Granite Parkway, 3^rd Floor

Plano, Texas 75024

 

Re: Registration Statement on Form S-1 filed on May 17, 2022

 

Ladies and Gentlemen:

 

We have acted as counsel to European Wax Center, Inc., a Delaware corporation (the “Company”), in connection with the Registration Statement on Form S-1 filed as of the date hereof (the “Registration Statement”) filed by the Company with the Securities and Exchange Commission (the “Commission”) under the Securities Act of 1933, as amended (the “Securities Act”), for the registration of up to 5,175,000 shares (the “Shares”) of the Class A common stock, $0.00001 par value per share (“Common Stock”), of the Company, including 675,000 shares of Common Stock that may be purchased at the option of BofA Securities, Inc., Morgan Stanley & Co. LLC and Jefferies LLC (the “Underwriters”), in their capacity as representatives of the underwriters named in the Underwriting Agreement (as defined below). The Shares are being offered by the selling stockholders named in the Registration Statement (the “Selling Stockholders”) and consist of (i) 2,771,772 issued and outstanding Shares directly held by certain Selling Stockholders (the “Direct Selling Stockholders”) and (ii) 2,403,228 Shares that are issuable upon exchange of common units (“EWC Ventures Units”) of EWC Ventures, LLC, together with a corresponding number of shares of Class B common stock (the “Class B Stock”) of the Company, held by certain Selling Stockholders that are equity owners of EWC Ventures, LLC and EWC Management Holdco, LLC (the “LLC Owner Selling Stockholders”), in each case as set forth in the Registration Statement. The Shares are proposed to be sold pursuant to an underwriting agreement (the “Underwriting Agreement”) to be entered into among the Company, the Selling Stockholders and the underwriters named therein.

 

In connection with this opinion letter, we have examined such certificates, documents and records and have made such investigation of fact and such examination of law as we have deemed appropriate in order to enable us to render the opinions set forth herein. In conducting such investigation, we have relied, without independent verification, upon certificates of officers of the Company, public officials and other appropriate persons.

 

The opinions expressed below are limited to the Delaware General Corporation Law.

 

 

Based upon and subject to the foregoing, we are of the opinion that (i) the Shares being offered by the Direct Selling Stockholders have been duly authorized and are validly issued, fully paid and non-assessable and (ii) the Shares being offered by the LLC Owner Selling Stockholders, when issued and delivered upon exchange of EWC Ventures Units and a corresponding number of shares of Class B Stock as described in the Prospectus, will be validly issued, fully paid and non-assessable.

 

We hereby consent to your filing this opinion as an exhibit to the Registration Statement and to the use of our name therein and in the related prospectus under the caption “Legal Matters.” In giving such consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations of the Commission thereunder.

 

	Very truly yours,
	/s/ Ropes & Gray LLP
	Ropes & Gray LLP

 

 

 

Exhibit 10.13

 

EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT (the “Agreement”) is made and entered into effective as of July 1, 2016 (the “Effective Date”), by and between EWC Ventures, LLC, a Delaware limited liability company (“Company”), and David Willis (“Willis”).

 

RECITALS:

 

A.           Company, Willis and Crestbrook Capital LLC were parties to that certain Consulting Agreement, dated July 9, 2014 (the “Consulting Agreement”), pursuant to which Crestbrook Capital LLC and Willis, as its sole owner and authorized agent, performed certain financial and operational consulting services for the benefit of Company and other applicable Company Entities (as defined below).

 

B.            Company, for the benefit of itself and the other applicable Company Entities, effectively terminated the Consulting Agreement as of the Effective Date in order to employ Willis as its Chief Financial Officer, and Willis consented to the termination of the Consulting Agreement as of the Effective Date in order to accept the offer of employment from Company as Company’s Chief Financial Officer.

 

C.            Company and Willis agreed upon the terms and conditions, and the consideration, of Willis’ employment by Company, and Willis and Company desire to express such terms and conditions in this Agreement.

 

NOW, THEREFORE, in consideration of the premises and the mutual covenants and agreements contained herein, the sufficiency of which is hereby acknowledged, Company and Willis agree as follows:

 

AGREEMENTS:

 

1.            Employment Period. Subject to Section 3 and Section 5, Company hereby agrees to employ Willis, and Willis hereby agrees to be employed by Company, in accordance with the terms and provisions of this Agreement, for the period commencing effective as of the Effective Date and ending on the three-year anniversary of the Effective Date (the “Initial Term” and as extended or shortened in accordance with the terms of this Agreement, the “Employment Period”).

 

2.            Terms of Employment.

 

(a)            Position and Duties.

 

(i)            Chief Financial Officer. During the Employment Period, subject to Section 2(a)(ii) below, Willis shall serve as the Chief Financial Officer of Company, for the benefit of Company and each of the other Company Entities. Willis will perform such duties, functions and responsibilities as are associated with, and incident to, such position and as the Chief Executive Officer or Company’s Board of Managers/Directors (the “Board”) may from time to time reasonably require of Willis; provided, however, that such duties, functions and responsibilities are commensurate with the duties, functions and responsibilities generally performed by chief financial officers of companies which are similar in size, nature and complexity to the Company Entities. Company, and each of its direct and indirect subsidiaries, are hereinafter collectively referred to as the “Company Entities”, and individually as a “Company Entity”. With Willis’ consent, which shall not be unreasonably withheld, Company may cause Willis to serve as an executive officer of any Company Entity for no additional consideration.

 

 

(ii)            Operational Functions. In addition to, and without limiting, the duties, functions and responsibilities associated with the position of Chief Financial Officer, taking into account Willis’ background and experience, Company and Willis each desire that Willis oversee and support operational functions within the Company Entities, including functions such as (A) providing strategic leadership, management and vision necessary to support growth and operational success and efficiencies and (B) overseeing general corporate and franchise operations, with direct supervisor responsibility over the VP of Franchise Performance as well as the supply chain, site development and compliance services. Accordingly, Willis and Company each agree to work together in good faith on a transition plan pursuant to which Willis will begin to assume such operational functions and reports as soon as reasonably practicable (and pursuant to which Willis and Company will address any additional title(s) that may be commensurate with any such operational functions); provided, however, that for the avoidance of any doubt, such operational functions, responsibilities and title(s) shall be incidental to Willis’ primary role as Chief Financial Officer; and, will not, in and of itself, increase any aspects of the compensation package provided to Willis in this Agreement.

 

(iii)            Time and Effort. During the Employment Period, and excluding any periods of vacation and sick leave to which Willis is entitled, Willis shall (A) devote substantially all of Willis’ time, during normal working hours and at such other times as Willis’ duties may require, to the business and affairs of the Company Entities, with continued focus on the role of Chief Financial Officer; (B) discharge the responsibilities assigned to Willis hereunder; and (C) use Willis’ reasonable best efforts to perform faithfully, effectively and efficiently such responsibilities. During the Employment Period, it shall not be a violation of this Agreement for Willis to (I) serve on corporate, civic or charitable boards or committees, so long as Willis has the prior approval of the Board, which approval will not be unreasonably withheld, conditioned or delayed; (II) deliver lectures or fulfill speaking engagements, so long as Willis hm, the prior approval of the Board, which approval will not be unreasonably withheld, conditioned or delayed; and (III) manage personal investments, so long as such activities do not materially interfere with the performance of Willis’ responsibilities in accordance with this Agreement. Willis acknowledges that in the course of employment, Willis will be required, from time to time, to travel on behalf of the Company Entities, including to Company’s satellite offices (currently in New York City), as well as throughout the franchise network meeting with area representatives and franchisees.

 

(iv)            No Relocation. Company acknowledges Willis’ desire to not relocate from his current residence in Dallas, Texas and the parties further anticipate a certain amount of travel throughout the franchise network may be required to fulfill his duties and responsibilities. Accordingly, Company will not require Willis to relocate to South Florida where Company’s current principal headquarters are located; however, Willis acknowledges that his position(s) will require him to maintain a regular presence at Company’s principal offices, as required by Company in its reasonable discretion. Accordingly, Company will agree to reimburse Willis for actual and documented reasonable travel expenses incurred by Willis in traveling between Dallas and South Florida during the Employment Period as more particularly described in Section 2(b)(v) and Exhibit A attached hereto.

 

 

(b)           Compensation.

 

(i)            Base Salary. During the Employment Period, Willis shall receive an annual base salary (the “Annual Base Salary”) payable by Company or another Company Entity as determined by Company (provided that if the designated Company Entity shall be unable for any reason to pay such Annual Base Salary, then Company shall bear such responsibility), as applicable. Willis’ Annual Base Salary (initially $400,000.00 as of the Effective Date, increased to $406,016.00 for 2017) may be reviewed periodically, and may be adjusted, subject to the terms and conditions of this Agreement, from time to time. Willis’ Annual Base Salary shall be paid in accordance with the regular payroll practices of the Company Entities, as may be in effect from time to time, but in no event less frequently than monthly.

 

(ii)            Annual Bonus. During the Employment Period, Willis will be eligible to receive, at the reasonable discretion of the Board, an annual target bonus equal to 50% of Willis’ then current Annual Base Salary (each such bonus, an “Annual Bonus”), of which it is anticipated that such Annual Bonus shall be based on one or more of the following criteria: (A) Company’s overall annual EBITDA performance; and (B) Willis’ personal performance, including performance in achieving certain goals and objectives that are determined by the Board or Company’s Chief Executive Officer, from time to time, and of which are consistent with Willis’ duties set forth in Section 2(a)(i) and, as applicable, Section 2(a)(ii). Any Annual Bonus shall be subject to the approval of the Board based on the recommendation of the Chief Executive Officer of Company and shall be paid in accordance with the Company Entities’, as applicable, normal payroll practices, subject to the terms of this Section 2(b)(ii). In order to be eligible to receive any Annual Bonus, Willis must be employed by Company or another Company Entity, as applicable, on the last day of the applicable calendar year for such Annual Bonus, and remain employed, if later, through the date such annual bonuses are declared and paid by Company or another Company Entity, as applicable, for the executive team; provided, that, if, Company terminates Willis’ employment without Cause or Willis resigns for Good Reason after the end of the applicable calendar year to which the Annual Bonus relates but prior to the date annual bonuses are declared and paid by Company or another Company Entity, as applicable, for the executive team, Willis will be entitled to his maximum target Annual Bonus for such completed calendar year. Company anticipates that annual bonuses will be declared and paid by March 31^st for each preceding calendar year. Notwithstanding anything to the contrary set forth in this Section 2(b)(ii), to the extent that Company shall modify the Annual Bonus program, Willis shall be eligible to participate in any modified short term incentive bonus plan consistent with similarly situated executives of Company. For the avoidance of doubt, Company agreed to pay Willis a minimum bonus of $100,000.00 for 2016.

 

(iii)            Equity Incentives. Upon the Effective Date, subject to all required approvals and consents, Willis shall be entitled to receive 1,300,000 restricted incentive units, which shall vest annually over four (4) years from the Effective Date, subject to acceleration on certain change of control transactions, pursuant to the terms of a Restricted Incentive Unit Agreement to be entered into between Company and Willis, and such units will be further governed by Company’s Limited Liability Company Operwating Agreement, as amended or restated from time to time.

 

 

(iv)            Benefit Plans. During the Employment Period, Willis or Willis’ family, as the case may be, shall be eligible to participate in Company’s employee benefit plans as in effect from time to time (collectively “Benefit Plans”) on a basis which is no less favorable than is provided to other similarly situated executives of the Company Entities, and to the extent consistent with applicable law and the terms of the applicable Benefit Plans. Company reserves the right to amend or cancel any Benefit Plan at any time in its sole discretion, subject to the terms of such Benefit Plan and applicable law. Company shall make available to Willis information about each applicable Benefit Plan upon Willis’ request in accordance with the Company Entities’ standard policies and procedures.

 

(v)            Expenses. During the Employment Period, Willis shall be entitled to receive reimbursement for all reasonable business expenses incurred by Willis in connection with Willis’ duties hereunder and in accordance with the policies, practices and procedures of the Company Entities. For the avoidance of doubt, Willis shall document said business expenses in the manner generally required by the Company Entities under their policies, practices and procedures, and in any event, in the manner required to meet applicable regulations of the Internal Revenue Service relating to the deductibility of such expenses. Any reimbursement under this Agreement that would constitute nonqualified deferred compensation subject to Section 409A (as defined below) shall be subject to the provisions set forth in Section 4(g) of this Agreement, and no reimbursement of any such expense shall affect Willis’ right to reimbursement of any such expense in any other taxable year.

 

(vi)            Vacation and Holidays. During the Employment Period, Willis shall initially be entitled to four (4) weeks paid vacation per full calendar year of employment (pro-rated for the initial year of employment, as applicable) and paid holidays in accordance with the policies of the Company Entities as of the Effective Date (and as such policies may be modified by the Company Entities from time to time after the Effective Date). The Company Entities’ current vacation policy is a use-it or lose-it policy, meaning that in the event that an associate fails to utilize all of the vacation days provided in any calendar year, the associate will not have the ability to utilize the unused vacation days at any time in subsequent years, nor will the associate be compensated for any unused vacation days. Willis’ granted vacation is intended to supplement the Company Entities’ standard PTO policies such that Willis will receive, in addition to such vacation, PTO for personal/sick days and the like in accordance with the Company Entities’ standard policies and procedures.

 

(vii)            Withholding of Applicable Taxes. The Company Entities may withhold from any amounts payable under this Agreement such federal, state or local taxes as shall be required to be withheld pursuant to any applicable law or regulation.

 

(viii)            Exclusivity of Employment Remuneration and Benefits. The remuneration and benefits set forth in this Agreement shall be the only compensation payable to Willis with respect to Willis’ employment hereunder, unless agreed to in writing by Company (or, as applicable, another Company Entity).

 

 

(ix)            Clawback Provisions. Notwithstanding any other prov1s10ns in this Agreement to the contrary, any incentive-based compensation, or any other compensation, paid to Willis pursuant to this Agreement or any other agreement or arrangement with the Company Entities which is subject to recovery under any law, government regulation or stock exchange listing requirement, will be subject to such deductions and clawback as may be required to be made pursuant to such law, government regulation or stock exchange listing requirement (or any policy adopted by the Company Entities pursuant to any such law, government regulation or stock exchange listing requirement).

 

(c)            Restricted Activities. Willis represents and warrants that Willis is neither restricted nor prohibited from entering into this Agreement or engaging in any activities contemplated hereunder pursuant to the terms of any agreement (including any restrictive or non-competitive covenant) with any former employer of Willis or any other person whatsoever.

 

(d)            Security and Access. Willis agrees and covenants (i) to comply with all applicable Company Entity security policies and procedures as in force from time to time, including those regarding, computer equipment, computer networks and document storage systems; (ii) not to access or use any Company Entity facilities and information technology resources except as authorized by the Company Entities; and (iii) not to access or use any Company Entity facilities and information technology resources in any manner after the termination or expiration of Willis’ employment, whether termination or expiration is voluntary or involuntary. Willis agrees to notify Company’s Chief Executive Officer promptly in the event Willis learns of any violation of the foregoing by others, or of any other misappropriation or unauthorized access, use, reproduction or reverse engineering of, or tampering with any Company Entity facilities and information technology resources or other Company Entity property or materials by others.

 

3.            Termination of Employment.

 

(a)            Death or Disability. Willis’ employment shall terminate automatically upon Willis’ death during the Employment Period. If the Disability (as defined below) of Willis occurs during the Employment Period, Company may give to Willis written notice in accordance with Section 14(b) of its intention to terminate Willis’ employment. In such event, Willis’ employment with the Company Entities shall terminate effective on the thirtieth (30^th) day after receipt of such notice by Willis (the “Disability Effective Date”). provided that, within the thirty (30) days after such receipt, Willis shall not have returned to full-time performance of Willis’ duties. “Disability” shall mean Willis is (i) by reason of any medically determinable physical or mental impairment, unable to perform the essential functions of Willis’ position for more than ninety (90) consecutive days or one hundred twenty (120) days within one year’s period (measured from the first day Willis is absent due to the Disability); or (ii) by reason of any medically determinable physical or mental impairment, which can be expected to last for more than ninety (90) consecutive days or one hundred twenty (120) days within one (1) year’s period (measured from the first day Willis is absent due to the Disability), receiving income replacement benefits for a period of not less than three (3) months under an accident and health plan which covers Willis. Subject to the provisions of Section 409A of the Internal Revenue Code of 1986, as amended and the Treasury Regulations issued thereunder (“Section 409A”), any determination of whether Willis has a Disability shall be reasonably determined by a physician selected by Company or its insurer and acceptable to Willis or Willis’ legal representative (such determination by Willis or Willis’ legal representative as to acceptability shall not be unreasonably withheld, conditioned or delayed). If a disagreement arises between Willis and Company as to whether Willis is Disabled, the determination as to the question of Willis’ Disability shall be made by three (3) physicians selected in the following manner: (A) one (1) physician designated by Willis (the “Willis Physician”); (B) one (I) physician designated by Company (the “Company Physician”); and (C) one(]) physician collectively designated by Willis Physician and the Company Physician, and determination of at least two (2) of the three (3) physicians shall be binding.

 

 

(b)            By Company for Cause or Without Cause. The Company Entities may terminate Willis’ employment during the Employment Period for Cause or without Cause. “Cause” shall mean (i) Willis is convicted of, pleads guilty to, or enters a plea of “nolo contendere” in a court of competent jurisdiction to any act or omission by Willis constituting fraud under the laws of any State or the United States of America or Willis misappropriating, stealing or embezzling funds or property of Company or any other Company Entity or securing or attempting to secure personally any profit in connection with a transaction entered into for Company or any other Company Entity; (ii) Willis is convicted of, pleads guilty to, or enters a plea of “nolo contendere” in a court of competent jurisdiction to any felony or to any crime involving moral turpitude; (iii) Willis’ misconduct, malfeasance, negligence or dishonesty, which, in the reasonable judgment of the Board, has resulted, or is likely to result, in material injury, directly or indirectly, to Company or any other Company Entity; (iv) Willis’ use or distribution of illegal substances; (v) any material breach by Willis of any of the terms of this Agreement that (to the extent subject to cure) is not remedied by Willis within ten (10) days after Willis has been given written notice thereof; provided if such breach is not reasonably susceptible to cure within such 10-day period, then such 10-day period shall be extended for a reasonable period of time so long as Willis makes diligent efforts to complete such cure, but in no event shall Willis have in excess of thirty (30) days after notice to complete such cure; provided, further, that if Company reasonably expects irreparable injury as a result of such cure period, Company may give Willis notice of such shorter cure period within which to cure as is reasonable under the circumstances; or (vi) Willis fails, after written notice and if reasonable, an opportunity to cure (provided such failure or issue is not recurring), to perform or persistently neglects (other than by reason of illness or temporary disability, or by reason of vacation or approved leave of absence) the specific and lawful direction from Company’s Chief Executive Officer or the Board, any applicable policies, procedures, or rules of the Company Entities or any material duties, functions or responsibilities under this Agreement. For purposes of this Agreement, “without Cause” shall mean a termination by the Company Entities of Willis’ employment during the Employment Period for any reason other than a termination based upon Cause, death or Disability; provided, however, “without Cause” does not include expiration of this Agreement and the termination of Willis’ employment as a result thereof, at the end of the Initial Term or Renewal Term (as defined below). In the event of a termination or expiration, Willis shall also be removed from any director, manager or other positions with any Company Entity.

 

(c)            By Willis for Good Reason. During the Employment Period, Willis’ employment hereunder may be terminated by Willis for Good Reason after the following conditions have been met: (x) Willis gives Company at least thirty (30) days prior written notice of Willis’ intent to terminate Willis’ employment for Good Reason, which notice shall specify the facts and circumstances constituting Good Reason; (y) the Company Entities have not remedied such facts and circumstances constituting Good Reason within the 30-day period within the notice; and (z) Willis’ Notice of Termination (as defined below) is given to Company within sixty (60) days of the expiration of such 30-day cure period. For purposes of this Agreement, “Good Reason” shall mean, without Willis’ consent:

 

 

(i)            any material reduction by the Company Entities of Willis’ Annual Base Salary without the express written consent of Willis;

 

(ii)            a material reduction in Willis’ title(s), or Willis’ authority or responsibilities, viewed as a whole without regard to isolated changes in duties or functions that Willis may perform from time to time (other than temporarily while Willis is physically or mentally incapacitated or as required by applicable law), taking into account the terms set forth in Section 2(a)(ii): or

 

(iii)          any failure by the Company Entities to comply with any material provision of Section 2(a)(ii), Section 2(a)(iv) or Section 2(b) of this Agreement.

 

The Employment Period and Willis’ employment hereunder may be terminated by Willis without Good Reason: provided that, unless otherwise provided herein, Willis shall be required to provide Company with a Notice of Termination (as defined below) at least thirty (30) days, but not more than sixty (60) days, in advance of any such termination of Willis’ employment.

 

(d)            Notice of Termination. Any termination by the Company Entities for Cause or without Cause or by Willis other than for death or Disability shall be communicated by Notice of Termination to the other party hereto given in accordance with Section 14(b). For purposes of this Agreement, a “Notice of Termination” means a written notice which (i) indicates the specific termination provision in this Agreement relied upon; (ii) to the extent the Company Entities are exercising their rights to terminate Willis for Cause, or Willis is exercising his rights to terminate this Agreement with Good Reason, sets forth in reasonable detail the facts and circumstance claimed to provide a basis for termination of Willis’ employment under the provision so indicated; and (iii) if the Date of Termination (as defined below) is other than the date of receipt of such notice, specifies the termination date (which date shall not be more than ninety (90) days after the giving of such notice by Company and not less than thirty (30) days, nor more than sixty (60) days, after the giving of such notice by Willis). The failure by the Company Entities to set forth in the Notice of Termination any fact or circumstance which contributes to a showing of Cause shall not waive any right of the Company Entities hereunder or preclude the Company Entities from asserting such fact or circumstance in enforcing the Company Entities’ rights hereunder. For the avoidance of doubt, upon receipt of any Notice of Termination by Company or any other Company Entity from Willis, the Company Entities may take any and all reasonable measures to protect their respective goodwill, businesses and Confidential Information (as defined below), including, termination of access to each Company Entity’s facilities, systems and networks and changing Willis’ authority or responsibilities. In addition, upon receipt of any such Notice of Termination, the Company Entities may accelerate the Date of Termination up to, and including the date of Company’s receipt of such Notice of Termination. Willis acknowledges and agrees that any such reasonable actions taken by the Company Entities after receipt of such Notice of Termination shall not, in and of themselves, constitute termination by any Company Entity without Cause or create Good Reason under this Agreement.

 

 

(e)            Date of Termination. “Date of Termination” means (i) if Willis’ employment is terminated by the Company Entities for Cause, the date of receipt of the Notice of Termination or any later date specified therein pursuant to Section 3(d), as the case may be; (ii) if Willis’ employment is terminated by the Company Entities without Cause, the date on which Company notifies Willis of such termination in the Notice of Termination or any later date specified therein pursuant to Section 3(d), as the case may be; (iii) if Willis’ employment is terminated by reason of death or Disability, the date of death of Willis or the Disability Effective Date, as the case may be; (iv) if Willis’ employment is terminated by reason of the expiration of the Employment Period, the date of such expiration; (v) if Willis resigns employment, for any reason other than Good Reason, the date provided by Willis in the Notice of Termination (which date shall not be less than thirty (30) days, nor more than sixty (60) days, after the giving of such notice by Willis): provided that upon receipt of such Notice of Termination, Company may set an earlier Date of Termination in accordance with Section 3(d); and (vi) if Willis resigns employment for Good Reason, subject to applicable notice and cure periods, the date of Company’s receipt of the Notice of Termination.

 

(f)            Termination Prior to the Effective Date. [Intentionally Deleted].

 

4.            Obligations of Company upon Termination.

 

(a)            In General. Upon termination or expiration of Willis’ employment or this Agreement for any reason, Company (either directly or in its discretion through another Company Entity) shall pay to Willis (or Willis’ estate): (i) in cash in accordance with the Company Entities’ standard payroll procedures for each of the applicable payroll periods (unless earlier payment is required by law), Willis’ earned but unpaid Annual Base Salary through the Date of Termination, if any; (ii) subject to the terms and conditions set forth in Section 2(b)(ii), within fourteen (14) days following the Date of Termination (unless earlier payment is required by law), any earned but unpaid Annual Bonus with respect to any completed calendar year preceding the Date of Termination; and (iii) any expenses due from the Company Entities but not previously reimbursed under Section 2(b)(v), no later than fourteen (14) days following the Date of Termination (unless earlier payment is required by law). Notwithstanding the foregoing, any amounts due to Willis under Sections 4(b) and (c) shall be in addition to and not in lieu of amounts due herein under this Section 4(a).

 

(b)            Without Cause or for Good Reason. If, during the Employment Period, Company terminates Willis’ employment without Cause or Willis resigns for Good Reason, subject to Section 4(f) below, Company shall pay to Willis in twelve (12) equal monthly installments payable on the last day of each calendar month, beginning on the first regular payroll date following the sixtieth (60th) day after Willis’ “Separation from Service” (within the meaning of Treasury Regulation Section l.409A-1(h)), an amount equal to the sum of (i) Willis’ Annual Base Salary on the Date of Termination (without regard to any reductions that may have resulted in Willis’ resignation for Good Reason), plus (ii) a pro-rated portion of Willis’ Annual Bonus for the year of separation. In calculating Willis’ pro-rated Annual Bonus for the year of separation, Willis’ Annual Base Salary on the Date of Termination (without regard to any reductions that may have resulted in Willis’ resignation for Good Reason) will be multiplied by Willis’ then-current target bonus percentage pursuant to Section 2(b)(ii) (i.e., 50% as of the Effective Date), and then multiplying the product by a fraction, the numerator of which being the total number of days from January 15th to, but not including, the Date of Termination, and the denominator being 365 days (or 366 days if a leap year).

 

 

(c)            Death or Disability. If Willis experiences a Separation from Service by reason of Willis’ death or Disability during the Employment Period, Company (either directly or in its discretion through another Company Entity) shall pay to Willis or Willis’ legal representatives, as the case may be, subject to Section 4(f) below: (A) an amount equal to three times (3*) the monthly pro-rata portion of Willis’ Annual Base Salary on the Date of Separation from Service, which such amounts shall be paid in six (6) equal bi-weekly installments (or at such other times as the Company Entities distribute their regular payroll, but in no event less frequently than monthly, with the amounts adjusted equitably to be paid equally in each installment) until fully paid, commencing on the first day of the first full calendar month following the sixtieth (60^th) day after Willis’ Separation from Service; and (B) such additional benefits as are consistent with the Company Entities’ policies then in effect or as determined by the Board at such time.

 

(d)            Cause. If Willis’ employment shall be terminated by the Company Entities for Cause during the Employment Period, the Company Entities shall have no further payment obligations to Willis other than for payment pursuant to Section 4(a) above and the continuance of benefits under the Benefit Plans lo the Date of Termination.

 

(e)            Other than for Good Reason, Death or Disability. If Willis terminates employment hereunder during the Employment Period for any reason other than for Good Reason, death or Disability, or if Willi ‘ employment is terminated by reason of the expiration of the Employment Period, the Company Entities shall have no further payment obligations to Willis other than for payment pursuant to Section 4(a) and Section 4(c) above (as applicable) and the continuance of benefits under the Benefit Plans to the Date of Termination.

 

(f)            Compliance with Legal Obligations Required. All rights of Willis to receive any portion whatsoever of the amounts due pursuant to Section 4, with the exception of the obligations in Section 4(a), shall be expressly conditioned upon (i) the execution of a full general release (to the fullest extent permitted by applicable law and to the extent Willis has the legal capacity to do so) delivered by Willis to Company within thirty (30) days of the Date of Termination, in such form prepared by and reasonably acceptable to Company or its counsel, releasing all claims, known or unknown, that Willis may have against the Company Entities or their respective members, managers, officers, directors, employees, agents, affiliates or other representatives, arising out of or in any way related to Willis’ employment or termination of employment with the Company Entities; and (ii) Willis’ continued compliance with the requirements of Sections 7, 8, 9, 11, 12, 13 and 14(c). The 30-day release period set forth above may be extended by Company in its sole discretion and with written notice to Willis to comply with applicable law.

 

(g)            409A Compliance. Notwithstanding any provisions to the contrary in Section 4, in the event Willis is a “specified employee” (as defined in Treasury Regulation Section I.409A-l(i)), any amounts payable to Willis by reason of Willis’ termination of employment pursuant to this Agreement that would be nonqualified deferred compensation and would (but for this provision) be payable within six (6) months following the Date of Termination, shall instead be paid, without interest, to Willis in a lump sum on the first day of the seventh (7^th) month following Willis’ Date of Termination or, if earlier, within fifteen (15) days after the appointment of the personal representative or executor of Willis’ estate following Willis’ death, except (i) to the extent of amounts that do not constitute a deferral of compensation within the meaning of Treasury Regulation Section l.409A-l (b), as determined by Company in its discretion; (ii) benefits which qualify as excepted welfare benefits pursuant to Treasury Regulation Section l.409A-l(a)(5); or (iii) other amounts or benefits that are not subject to the requirements of Section 409A. This Agreement shall be interpreted and administered in a manner consistent with Section 409A and other guidance promulgated thereunder. Additionally, Company intends that each right to payment made pursuant to this Agreement shall be treated as a “separate payment” for purposes of the application of Section 409A. Further, all expenses reimbursed to Willis under Section 2(b)(v) shall be reimbursed no less frequently than monthly, but in no event shall any reimbursement payment be paid to Willis following the last day of the calendar year following the calendar year in which the expense was incurred. The amount of expenses for which Willis is eligible to receive reimbursement or the amount of in-kind benefits Willis is eligible to receive during any calendar year shall not affect the amount of expenses for which Willis is eligible to receive reimbursement or the amount of in-kind benefits Willis is eligible to receive during any other calendar year. Any reimbursement or in-kind benefit payable in accordance with Section 2(b) will not be subject to liquidation or exchange for another benefit.

 

 

(h)           Determinations.

 

(i)            Cause. In all instances, Company shall determine in its good faith discretion whether Cause exists for purposes of this Agreement, and whether this Agreement or Willis’ employment was terminated for Cause. Any such determination must be approved by a majority of the Board.

 

(ii)            Later Determined Cause. Notwithstanding any other provision of this Agreement, if Willis’ employment with the Company Entities is terminated without Cause such that Willis is entitled to severance pursuant to this Agreement or otherwise and Company later determines that Cause exists or existed on, prior to, or after such termination, Willis shall not be entitled to any severance pursuant to this Agreement or otherwise, any and all severance payments and reimbursements from the Company Entities to Willis shall cease, and Willis shall be required to return to the Company Entities any and all severance payments (including withholdings paid by the Company Entities related thereto) and applicable reimbursements paid up to that date.

 

5.            Extension of Term. At the end of the Initial Term and each Renewal Term. this Agreement, and Willis’ employment hereunder, will be renewed and extended for a Renewal Term automatically and without the necessity of any further action on the part of the Company Entities or Willis unless Company or Willis delivers a written notice of non-renewal (a “Non-Renewal Notice”) to the other party at least ninety (90) days prior to the last day of the Initial Term or a Renewal Term, as the case may be. Each such extension, unless expressly agreed otherwise by Company and Willis, shall be for twelve (12) months (each extension, a “Renewal Term”) commencing on the expiration of the Initial Term or any Renewal Term. In the event that neither Company nor Willis delivers a Non-Renewal Notice to the other party at least ninety (90) days prior to the last day of the Initial Term or a Renewal Term, as the case may be; and, unless otherwise agreed to in writing by Company and Willis, this Agreement will remain in effect in accordance with its terms during each such Renewal Term. Any Renewal Term may be terminated as set forth in this Agreement, unless otherwise agreed upon in writing by Company and Willis.

 

 

6.            Full Settlement, Mitigation. In no event shall Willis be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to Willis under any of the provisions of this Agreement and such amounts shall not be reduced whether or not Willis obtains other employment.

 

7.            Confidential Information.

 

(a)            Disclosure of Confidential Information. The parties to this Agreement expressly acknowledge that any performance of Willis’ responsibilities hereunder may necessitate, and Company and the other Company Entities may provide, access to or the disclosure of Confidential Information (as defined below) to Willis and that Willis’ responsibilities shall include the development of goodwill of the Company Entities through Willis’ contacts with the Company Entities’ customers, suppliers, franchisees, area representatives, vendors, lenders and other third party relationships.

 

(b)            Confidential Information Defined. Willis acknowledges that the Company Entities have trade, business and financial secrets and other confidential and proprietary information (collectively, the “Confidential Information”) that are special and unique assets of the Company Entities, created or obtained by the Company Entities at time or expense, from which the Company Entities may or do derive independent economic value from the Confidential Information not being generally known to third parties. Willis further acknowledges and understands that this Confidential Information and the Company Entities’ ability to preserve it for the exclusive knowledge and use of the Company Entities is of great competitive importance and competitive value to the Company Entities, and that improper use of disclosure of the Confidential Information by Willis will cause irreparable harm to the Company Entities, for which remedies at law will not be adequate. As defined herein, the term Confidential Information includes, whether made available in writing, electronically or orally, whether made available before, on or after the Effective Date (including pursuant to the Consulting Agreement), and whether or not identified as confidential, Results (as defined below), internal communications, marketing data, agreements, personnel information and personnel strategies, business plans and strategies, new product or service offerings, product and service information, marketing information, marketing methods, unpublished financial information, pricing information and techniques, pending mergers and acquisition transactions, expansion plans, customer and supplier lists, customer and supplier information, strategies, methods, procedures, processes, contract terms, contract negotiations, compensation information, structures and plans, formulas, technology, documents, reports, analyses, data, studies, samples, copyright, trademark and patent applications, projections, software, trade secrets, know-how, and observations, and other disclosures pertaining to, based on, or containing, directly or indirectly, in whole or in part, any other Confidential Information, but shall not include (i) information that is in the public domain, other than as a result of an improper disclosure by Willis or any other party with restrictions on disclosure; or (ii) information that Willis can show by competent proof is generally known by Willis prior to any engagement or relationship with the Company Entities, including the trade knowledge, skill and expertise developed by Willis as a result of Willis’ prior experience.

 

 

(c)            Maintenance of Confidential Information. Willis agrees that during the Employment Period and at all times following the expiration or earlier termination of Willis’ employment with Company or the other Company Entities, for any reason, and consistent with Willis’ duties as an officer of the Company Entities, Willis will maintain all Confidential Information in strict confidence and will only disclose such Confidential Information during the Employment Period to employees of the Company Entities and other persons or entities to whom Willis reasonably believes that such disclosure of the Confidential Information is necessary and in the best interest of the Company Entities and then only to the extent that such employees of the Company Entities and other persons authorized by the Company Entities have a need to know such Confidential Information; provided, however, that Willis understands that Willis may disclose the Confidential Information as may be required by law or court process, subject to compliance with the terms and conditions of Section 7(g) of this Agreement. Willis understands that this Agreement does not, in any way, restrict or impede Willis from exercising protected rights to the extent such rights cannot be waived by this Agreement.

 

(d)            Compliance with Policies. Willis shall take all steps reasonably necessary or requested by any Company Entity to ensure that the Confidential Information is kept confidential pursuant to this Agreement. Willis shall comply with all applicable published and communicated policies, procedures and practices that any Company Entity ha,; established and may establish from time to time with regard to the Confidential Information. Willis shall not, directly or indirectly (i) access, use, copy, reproduce, reverse engineer or permit access, use, reproduction or reverse engineering of any part of the Confidential Information except as necessary within the authorized scope of Willis’ duties with the Company Entities; (ii) remove or permit removal from any Company Entity premises, any Confidential Information, except as necessary within the authorized scope of Willis’ duties with the Company Entities; or (iii) divulge, disclose, distribute or communicate to any person or organization outside of the Company Entities any of the Confidential Information without the prior written consent of the Company Entities (except as may otherwise be permitted pursuant to this Agreement), and then such disclosure will be made only within the limits and to the extent of such consent.

 

(e)            Ownership. As between the Company Entities and Willis, Willis acknowledges and agrees that the Confidential Information, and all copies and manifestations of the Confidential Information, are, and shall remain at all times, the exclusive property of the Company Entities.

 

(f)            Use of Confidential Information. Willis further agrees not to use any Confidential Information for the benefit of any person or entity other than the Company Entities.

 

(g)            Legal Compulsion; Whistleblower Immunity.

 

(i)            Legal Compulsion. In the event that Willis is requested or required by applicable law or court process to disclose any of the Confidential Information, Willis will provide Company with prompt notice of such request or requirement, and Willis shall cooperate with each Company Entity in seeking to legally avoid such disclosure. If, in the absence of a protective order, Willis is legally compelled, in the opinion of Willis’ counsel, to disclose any of the Confidential Information, the Company Entities shall either seek and obtain appropriate protective orders against such disclosure or shall be deemed to waive Willis’ compliance with the provisions of this Agreement to the least extent necessary to satisfy such request or requirement, in which event Willis shall use all reasonable efforts to assure confidential treatment of the disclosed information.

 

 

(ii)            Whistleblower. For the avoidance of doubt, Willis may disclose, in confidence, Confidential Information (A) to a federal, state, or local government official, either directly or indirectly, or to Willis’ legal counsel solely for the limited purpose of reporting or investigating a suspected violation of law; or (B) as part of a complaint or other legal document filed in a lawsuit or other proceeding: provided, that such filing is made under protective seal. In addition, if Willis files a lawsuit for retaliation by any Company Entity for reporting a suspected violation of law, Willis may disclose, in confidence, relevant trade secret information to his legal counsel representing him in such lawsuit, and use such trade secret information in the court proceedings; provided, that Willis (x) either directly or through his legal counsel, files any document containing any such trade secret under protective seal; and (y) does not disclose the trade secret information, except pursuant to court order or with the Company Entities’ prior written consent, which such consent may be withheld in the Company Entities’ sole discretion. Each Company Entity reserves the right to pursue all remedies available under federal, state, or local law for any disclosure of Confidential Information (including trade secret information) by Willis which does not comply with this Section 7(g)(ii).

 

(h)            Return of Confidential Information. Willis shall, immediately upon any Company Entity’s request, and promptly upon termination of Willis’ employment, regardless of the reason and who is the terminating party, return to the Company Entities: (i) all copies and manifestations of Confidential Information that Willis may have or have access to; (ii) all documents, other materials and equipment provided by any Company Entity or otherwise obtained by Willis during and in connection with Willis’ employment with the Company Entities and (iii) all documents and materials that Willis has prepared during Willis’ employment with the Company Entities.

 

(i)            No Use of Others’ Confidential Information. Willis represents and warrants to Company that Willis will not, at any time, improperly use or disclose any proprietary information or trade secrets of any former employer or other person or entity with which Willis has any agreement or duty to keep in confidence information acquired by Willis, if any. Willis shall not bring onto any Company Entity premises any unpublished document or proprietary information belonging to such employer, person or entity unless consented to in writing by Company’s Chief Executive Officer and such employer, person or entity.

 

8.            Surrender of Materials Upon Termination. Upon any termination of Willis’ employment, regardless of the reason and who is the terminating party, in addition to Willis’ obligations pursuant to Section 7(h), Willis shall promptly (and in any event within five (5) days) return to the Company Entities: (a) any other properties of the Company Entities which are in Willis’ possession, custody or control, including any applicable documents, other materials and equipment provided by any Company Entity, such as access cards, identification cards, employer credit cards, computers, cell/smart phones, manuals and removable information storage devices; and (b) all documents and materials that Willis has prepared in connection with Willis’ duties under this Agreement. Without limiting the foregoing, Willis shall delete or destroy, to the extent Willis possesses any files, data, or information relating in any way to any Company Entity or their respective businesses on any non-Company Entity devices, networks, personal computers, storage locations or media in Willis’ possession, custody or control that are not being returned to the Company Entities, each and every file, data, or information relating in any way to any Company Entity or their respective businesses (and will retain no copies in any form).

 

 

9.            Work Product.

 

(a)            Work Product. All the work product and other results of Willis’ employment with the Company Entities of any nature whatsoever that is created, prepared, produced, authored, edited, amended, conceived or reduced to practice by Willis individually or jointly with others during the Employment Period and made within the scope of Willis’ employment (regardless of when or where prepared or whose equipment or other resources are used in preparing the same), including all data, information, analyses, materials, documentation, reports, inventions, improvements, modifications or works of authorship, generated, created, conceived, derived or resulting from the performance of Willis’ duties and any works in progress, and all printed, physical and electronic copies, all improvements, rights and claims related to the foregoing, and other tangible embodiments thereof, whether or not now or hereafter known, existing, contemplated, recognized or developed (collectively, “Results”), as well as any and all rights in and to copyrights, trade secrets, trademarks (and related goodwill), mask works, patents and other intellectual property rights therein arising in any jurisdiction throughout the world and all related rights of priority under international conventions with respect thereto, including all pending and future applications and registrations therefor, and continuations, divisions, continuations-in-part, reissues, extensions and renewals thereof (collectively, “Intellectual Property Rights”), shall be, to the extent permitted by law and as applicable, deemed “works for hire” or “works made for hire,” within the meaning of the United States Copyright Act of 1976, for the benefit of the Company Entities. As between Willis and the Company Entities, the Company Entities shall be deemed the sole owners throughout the universe of any and all such Results and all Intellectual Property Rights related thereto, with the right to use the same in perpetuity in any manner the Company Entities, in their sole and absolute discretion, determine, without any further payment or compensation to Willis whatsoever.

 

(b)            Pre-Existing Intellectual Property Rights. Other than the trade knowledge, skill and expertise developed by Willis as a result of Willis’ prior experience Willis hereby represents, warrants and covenants that there are no original works of authorship, developments, concepts, improvements, designs, discoveries, ideas, trademarks, service marks, or trade secrets, or inventions which were made or acquired by Willis prior to his employment with the Company Entities, which are owned in whole or in part by Willis, which relate to the Company Entities’ business or proposed business, and which are not assigned to the Company Entities under this Agreement.

 

(c)            Assignment of Results and Other Rights. If, for any reason, any such Results shall not be legally deemed “works for hire” or “works made for hire,” or there are any rights which do not accrue to the Company Entities pursuant to this Section 9, then Willis hereby irrevocably assigns to the Company Entities any and all of Willis’ right, title and interest in such Results and the Intellectual Property Rights therein, and Company and the other Company Entities shall have the right to use the same in perpetuity throughout the universe in any manner they determine, in their sole and absolute discretion, without any further payment or compensation to Willis whatsoever. To the extent Willis has any rights in the Results or any other Intellectual Property Rights that cannot be assigned in the manner described above, Willis hereby unconditionally and irrevocably waives the enforcement of such rights. The rights provided in this Section 9 are in addition to, and shall not be deemed to limit, restrict, or constitute any waiver by Company or any other Company Entity of, any rights of ownership to which Company or any other Company Entity may be entitled by operation of Jaw.

 

 

(d)            Further Assurances. Willis shall, from time to time, as may be requested by the Company Entities, do any and all things which the Company Entities may deem useful, necessary or desirable lo establish or document the Company Entities’ exclusive owner hip of any and all rights in any Results or the Intellectual Property Rights therein. Willis hereby grants Company a power of attorney to do all such things on Willis’ behalf and in Willis’ name and to do all other lawfully permitted acts to establish or document the Company Entities’ exclusive ownership of any and all rights in any Results and Intellectual Property Rights therein, to the fullest extent permitted by law, if Willis does not promptly cooperate with the Company Entities’ request (without limiting the rights the Company Entities may have in such circumstances by operation of law). This power of attorney is coupled with an interest and shall not be affected by Willis’ subsequent incapacity.

 

(e)            No Implied Licenses. Willis understands that this Agreement does not, and shall not be construed to, grant Willis any license or right of any nature with respect to any Results or Intellectual Property Rights therein or any Confidential Information, materials, software or other tools made available to Willis by the Company Entities.

 

(f)            Moral Rights. To the extent any copyrights are assigned under this Agreement, Willis irrevocably waives, to the extent permitted by applicable law, any and all claims that Willis may now or hereafter have in any jurisdiction to all rights of paternity, integrity, disclosure and withdrawal and any other rights that may be known as “moral rights” with respect to all Results and all Intellectual Property Rights therein.

 

10.            Successors.

 

(a)            Personal to Willis. This Agreement is personal to Willis and without the prior written consent of Company shall not be assignable by Willis; provided, that this Agreement shall inure to the benefit of and be enforceable by Willis’ legal representatives.

 

(b)            Company May Assign. This Agreement shall inure to the benefit of and be binding upon the Company Entities and their successors and assigns. Willis agrees that, on or after the Effective Date, Company may assign, in whole or in part, this Agreement to a directly or indirectly owned subsidiary or a direct or indirect parent entity of Company that acts as a holding company for the Company Entities or to any acquirer of all or substantially all of the assets or equity of Company or of the Companies Entities and, in connection with such assignment, such subsidiary or parent entity or such acquirer(s) shall expressly assume this Agreement; provided, however, that except with respect to a sale of such assets or equity, no such assignment shall release Company from its obligations hereunder.

 

 

11.            Non-Competition.

 

(a)            Non-Competition Term. The term of “Non-Competition” (herein so called) shall commence on the Effective Date and shall continue until the 12-month anniversary of the Date of Termination.

 

(b)            Non-Competition Scope. During the term of Non-Competition, Willis will not (other than for the benefit of the Company Entities pursuant to this Agreement) (and will cause Willis’ family members not to) directly or indirectly, individually or as an officer, director, employee, shareholder, consultant, contractor, partner, joint venturer, agent, equity owner or in any capacity whatsoever, own or become employed by or otherwise provide consulting services to any business engaged or planning to become engaged in (i) the business of owning, managing or franchising waxing salon centers or other beauty or related salon businesses, or the manufacture, distribution, or licensure of retail or wholesale products which accompany or are related to beauty services, including the wax used in the Company Entities’ hair removal services, in-grown hair serums/lotions, exfoliates, body washes, lotions, polishes, brow products and eye creams, or (ii) any other business that may compete against the businesses of the Company Entities, as such businesses have been conducted, are proposed to be conducted or are being conducted, in each case, prior to the termination of the Employment Period (a “Competing Business”), in the United States of America or any foreign country in which the Company Entities are actively engaged in the Competing Business on the Date of Termination. Notwithstanding the foregoing, Company agrees that Willis may own less than one percent (1%) of the outstanding voting securities of any publicly traded company that is a Competing Business so Jong as Willis does not otherwise participate in such competing business in any way prohibited by the preceding clause.

 

(c)            Willis Shall Not Use Confidential Information for the Benefit of any Competing Business. During the term of Non-Competition, Willis will not use Willis’ access to, knowledge of, or application of Confidential Information to perform any duty for any Competing Business; it being understood and agreed to that this Section 11(c) shall be in addition to and not be construed as a limitation upon the covenants in Section 11(b) or Section 7, or described in Section 14(q), hereof.

 

(d)            Non-Interference. During the term of Non-Competition, Willis will not in any adverse way interfere in any way with any business relationship of the Company Entities.

 

(e)            Reasonableness of Restrictions. Willis acknowledges that the geographic boundaries, scope of prohibited activities and time duration of the preceding paragraphs are reasonable in nature, will not materially impact Willis’ ability to find other employment or provide for himself or his family, as applicable, and are no broader than are necessary to maintain the confidentiality and the goodwill of each Company Entity’s proprietary information, plans and services and to protect the other legitimate business interests of the Company Entities. Willis also acknowledges and agrees that Willis’ agreement to the restrictions set forth in this Section 11 is a material inducement to Company to enter into this Agreement; is in consideration for Company’s agreement hereunder to provide Confidential Information to Willis; and is in consideration for the compensation and other benefits payable hereunder to Willis.

 

 

(f)            Extension of Non-Competition Term: Clawback. Should Willis violate any of the terms of this Section 11, the obligation at issue will run from the first date on which Willis ceases to be in violation of such obligation. Notwithstanding any other provisions in this Agreement to the contrary, should Willis violate any of the terms of this Section 11 or Section 12, the Company Entities shall have the right to clawback all or any portion of the amounts previously paid to Willis pursuant to Section 4(b) of this Agreement.

 

(g)            Subsequent Employers. When Willis’ employment with the Company Entities terminates or expires, Willis agrees to notify any subsequent employer of the restrictive covenants section contained in this Agreement. In addition, Willis authorizes the Company Entities to provide a copy of the restrictive covenants sections of this Agreement to third parties, including Willis’ subsequent, anticipated or possible future employer(s).

 

12.            Non-Solicitation.

 

(a)            Non-Solicitation Term. The term of Non-Solicitation (herein so called) shall run concurrently with any initial or extended term of Non-Competition set forth in Section 11.

 

(b)            Non-Solicitation Scope; Employees. During the term of Non-Solicitation, Willis will not, on Willis’ own behalf or on behalf of any other person, encourage, induce or attempt to induce, any individual that is an employee of any of the Company Entities or any franchisee, area representative, vendor, supplier, distributor, investor, licensee, regional developer, financial resource or any other associated third party with whom Willis may have had contact in connection with Willis’ employment, to leave his employment with the Company Entities or any such other third party, and Willis will not otherwise (and will cause Willis’ family members not to) directly or indirectly hire or attempt to hire, or contact or solicit with respect to hiring any such employee; provided, however, that general solicitation of potential employees not specifically targeting such restricted employees (such as through the placing of a classified ad in a newspaper) shall not be a breach of the foregoing; provided, further, that notwithstanding anything to the contrary contained herein, Willis agrees that during the term of Non Solicitation, Willis shall not, on Willis’ own behalf or on behalf of any other person, hire any person that held an executive or management level or above position with any of the Company Entities on the Date of Termination. For the avoidance of doubt, after the Date of Termination, notwithstanding the foregoing, Willis may employ during the term of Non-Solicitation any such executive or management level or above personnel who contacts Willis on their own initiative without any direct or indirect solicitation or encouragement by Willis and whose employment with the Company Entities has terminated for at least six (6) months.

 

(c)            Non-Solicitation Scope: Business Relationships. During the term of Non- Solicitation. Willis will not (and will cause Willis’ family members not to) directly or indirectly. solicit or attempt to solicit any person who is or has been a customer, franchisee, area representative, vendor, supplier, distributor, investor, licensee, regional developer, financial resource, agent, contractor or any other associated third party with whom Willis may have had contact in connection with Willis’ employment to alter, limit or cease such person’s business relationship with the Company Entities.

 

 

13.          Standstill. Willis agrees that, from the date hereof through the one (1) year anniversary of a Sale Transaction (as defined in the Limited Liability Company Operating Agreement of Company, as amended), except (a) as may be required for (i) Willis to perform Willis’ responsibilities and obligations as a member of the Board (if, in fact, so designated) or (ii) an officer of Company or any of the Company Entities to perform Willis’ responsibilities and obligations as such an officer; (b) in connection with the exercise of options pursuant to an equity incentive plan of the Company Entities; or (c) the receipt of restricted incentive units provided by the Company Entities, Willis shall not, without the prior written consent of the Board, acquire, in any manner, directly or indirectly, or together with, on behalf of or for the benefit of any other party, by purchase or otherwise (or assist or consult with any party with respect to the foregoing), any (i) capital stock or other equity; (ii) any assets; or (iii) any indebtedness, in each case, of any of the Company Entities or their respective affiliates.

 

14.          Miscellaneous.

 

(a)            Interpretation; Amendments. The recitals set forth in this Agreement are true and correct and are hereby incorporated into this Agreement. The captions of the Agreement are not part of the provisions hereof and shall have no force or effect. In this Agreement, unless a clear contrary intention appears: (i) the singular number includes the plural number and vice versa; (ii) reference to any gender includes each other gender; (iii) reference to any agreement, document or instrument means such agreement, document or instrument as amended or modified and in effect from time to time in accordance with the terms thereof; (iv) reference to any law means such law as amended, modified, codified, replaced or reenacted, in whole or in part, and in effect from time to time, including rules and regulations promulgated thereunder, and reference to any section or other provision of any law means that provision of such law from time to time in effect and constituting the substantive amendment, modification, codification, replacement or reenactment of such section or other provision; (v) the terms “hereof’, “hereby”, “herein”, or words of similar import are used in this Agreement they shall be construed as referring to this Agreement in its entirety rather than to a particular section or provision, unless the context specifically indicates to the contrary; (vi) reference to a particular “Section” or “paragraph” shall be construed as referring to the indicated section or paragraph of this Agreement unless the context indicates to the contrary; (vii) the term “including” herein shall be construed as meaning “including without limitation”; (viii) “or” is used in the inclusive sense of “and/or”; (ix) with respect to the determination of any period of time, “from” means “from and including” and “to” means “to but excluding”; (x) references to documents, instruments or agreements shall be deemed to refer as well to all addenda, Exhibits, Schedules or amendments thereto; and (xi) all references to “Dollars” or “$” shall mean U.S. Dollars unless otherwise specified. This Agreement may not be amended or modified otherwise than by a written agreement executed by the parties hereto or their respective successors, permitted assigns and legal representatives. Each Company Entity is an intended third-party beneficiary of this Agreement.

 

 

(b)            Notices. All notices and other communications hereunder shall be in writing and shall be given by (i) hand delivery to the other party; (ii) by registered or certified mail, return receipt requested, postage prepaid; or (iii) by electronic mail or any other electronic means (e-mail or any other electronic means shall constitute a writing for purposes of this Agreement); provided that receipt of such notice sent by e-mail or any other electronic means is confirmed by the recipient and notice is also sent by registered or certified mail, return receipt requested, postage prepaid, in any case, as applicable, addressed as follows:

 

If to Willis:	David Willis, using his address and e-mail address then on file with the Company Entities
If to Company:	EWC Ventures, LLC The Village at Gulfstream Park 600 Silks Run Suite 2270 Hallandale Beach, FL 33009 Attention: David Coba E-Mail: david@waxcenter.com   And   EWC Ventures, LLC The Village at Gulfstream Park 600 Silks Run Suite 2270 Hallandale Beach, FL 33009 Attention: Legal E-Mail: legal@waxcenter.com

 

or to such other address as either party shall have furnished to the other in writing in accordance herewith. Notice and communications shall be effective when actually received by the addressee (or refusal of receipt of delivery). Submission of a copy of the notice to counsel shall not constitute notice to Willis or Company.

 

(c)            Non-Disparagement. Willis agrees and covenants that Willis will not, directly or indirectly through any other person or entity, at any time make, publish or communicate to any person or entity or in any public forum any defamatory or disparaging remarks, comments or statements concerning Company or any of Company’s affiliates (including any Company Entity) or their respective businesses, or any of their respective employees, managers, officers, agents, contractors, representatives or existing, prospective or former guests, customers, franchisees, area representatives, vendors, suppliers, distributors, investors, licensees, regional developers, financial resources or any other associated third party with European Wax Center. The previous sentence does not, in any way, restrict or impede Willis from exercising protected rights by speaking the truth to the extent that such rights cannot be waived by agreement or from complying with any applicable law or regulation or a valid order of a court of competent jurisdiction or an authorized government agency, provided that such compliance does not exceed that required by the law, regulation or order. Willis shall promptly provide written notice of any such order to an authorized officer of Company.

 

(d)            Severability. If any provision of this Agreement is held to be illegal, invalid or unenforceable under present or future laws effective during the term of this Agreement, such provision shall be fully severable; this Agreement shall be construed and enforced as if such illegal, invalid or unenforceable provision had never comprised a portion of this Agreement; and the remaining provisions of this Agreement shall remain in full force and effect and shall not be affected by the illegal, invalid or unenforceable provision or by its severance from this Agreement. Furthermore, in lieu of such illegal, invalid or unenforceable provision there shall be added automatically as part of this Agreement a provision as similar in terms to such illegal, invalid or unenforceable provision as may be possible and be legal, valid and enforceable.

 

 

(e)            No Implied Waivers. The failure of Willis or any Company Entity to insist upon strict compliance with any provision of this Agreement or to assert any right Willis or any Company Entity may have hereunder shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.

 

(f)            Equitable Remedies. Willis acknowledges that money damages would be both incalculable and an insufficient remedy for a breach of Sections 7, 8, 9, 11, 12, 13 or 14(c) by Willis and that any such breach would cause the Company Entities irreparable harm. Accordingly, the Company Entities, in addition lo any other remedies provided for in this Agreement, at law or in equity, shall be entitled, without the requirement of posting of bond or other security, to seek equitable relief, including injunctive relief and specific performance, in connection with a breach of Sections 7, 8, 9, 11, 12, 13 or 14(c) by Willis.

 

(g)            Licenses to Name. Likeness. Etc. Willis acknowledges that any Company Entity may utilize Willis’ name, likeness, voice, image, appearance, biographical information or other characteristics in, on or in connection with any pictures, photographs, audio and video recordings, digital images, websites, social media pages, television programs and advertising, other advertising and publicity, sales and marketing brochures, books, magazines, other publications, and all other printed and electronic forms and media throughout the world, at any time during or after the period of Willis’ employment with the Company Entities, for all legitimate commercial and business purposes of any Company Entity. Willis hereby consents to the use of such characteristics by the Company Entities and releases each Company Entity and their respective directors, officers, managers, employees, contractors, representatives and agents from any claims, actions, damages, losses, costs, expenses and liability of any kind, arising under any legal or equitable theory whatsoever at any time during or after the period of Willis’ employment by the Company Entities, in connection with any use permitted by this Agreement.

 

(h)            Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed to be an original, but all of which taken together shall constitute one and the same instrument. The exchange of copies of this Agreement and of signature pages by facsimile transmission or other electronic means shall constitute effective execution and delivery of this Agreement as to the parties and may be used in lieu of the original Agreement for all purposes.

 

(i)            Survival. Section 4 (as applicable) and Sections 6 through 14 of this Agreement shall survive the termination of Willis’ employment.

 

(j)            Mediation. Before initiating any legal action to resolve disputes arising in connection with this Agreement, other than equitable relief pursuant to Section 14(f) of this Agreement which may be pursued immediately, the parties shall comply with the dispute resolution process set out in this Section. Company and Willis shall attempt in good faith to resolve each applicable dispute that arises between them related to this Agreement within fifteen (15) days after their first meeting regarding such dispute (or such longer time as such parties may agree in writing). In the event Company and Willis are unable to resolve such dispute within fifteen (15) days after their first meeting regarding such dispute (or such longer time as such parties may agree in writing), the dispute shall be mediated within thirty (30) days from the date a written request for mediation is made by either party. The mediation shall take place in the county where Company’s principal offices are then located (currently Broward County, Florida). The mediation shall be conducted before a single mediator to be agreed upon by the parties. If the parties cannot agree on the mediator, each party shall select a mediator and such mediators sha11 together unanimously select a neutral mediator who will conduct the mediation. Each party shall bear the fees and expenses of its mediator and parties shall equally bear the fees and expenses of the final mediator. If the parties are unable to resolve their dispute through the mediation process, then the parties shall be free to initiate legal action to resolve the dispute.

 

 

(k)            Governing Law: Venue. This Agreement, for all purposes, shall be construed in accordance with the laws of Florida without regard to conflicts of law principles. Subject to Section 14(j) above, any action or proceeding by either of the parties to enforce this Agreement shall be brought only in a state or federal court located in the State of Florida, County of Broward. The parties, hereby irrevocably submit to the jurisdiction of such courts and waive the defense of inconvenient forum to the maintenance of any such action or proceeding in such venue.

 

(l)            Key-Man Insurance. The Company Entities shall have the option, but not the obligation, to obtain on the life of Willis, pay all premium amounts related to, and maintain, “key employee” insurance naming one or more Company Entities as beneficiary(ies). Selection of such insurance policy shall be in the sole and absolute discretion of the Company Entities. Willis shall cooperate fully with the Company Entities, and the insurer in applying for, obtaining and maintaining such life insurance, by executing and delivering such further and other documents as the Company Entities or the insurer may request from time to time, and doing all matters and things which may be convenient or necessary to obtain such insurance, including submitting to any physical examinations and providing any medical information required by the insurer.

 

(m)            Prevailing Party: Cumulative Remedies. If any claim is brought for the enforcement of or in connection with this Agreement, the successful or prevailing party or parties shall be entitled to recover reasonable attorneys’ fees, court costs and all expenses even if not taxable as court costs (including all such fees, costs and expenses incident to arbitration, appellate, bankruptcy and post judgment proceedings), incurred in that claim, in addition to any other relief to which such party or parties may be entitled. Each remedy provided to either party pursuant to this Agreement is intended not to be exclusive of any other remedy available to such party pursuant to this Agreement and shall be in addition to every other remedy available to such party. No single or partial exercise by either party of any right, power or remedy provided pursuant to this Agreement shall disallow or preclude any additional exercise of such right, power or remedy by such party.

 

(n)            Entire Agreement: Acknowledgment of Negotiated Terms. Subject to and without limiting Section 14(q), the provisions of this Agreement constitute the complete understanding and agreement between the parties with respect to the employment of Willis and supersede any other prior oral or written agreements between Willis and the Company Entities. For the avoidance of doubt, this Agreement shall not in any way supersede the terms of any applicable Restricted Incentive Unit Agreement. Willis acknowledges that this is a negotiated agreement, and that in no event shall the terms of this Agreement be construed against Company on the basis that Company, or its counsel, drafted this Agreement.

 

 

(o)            Waiver of Jury Trial. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY CIVIL ACTION, COUNTERCLAIM, OR PROCEEDING, WHETHER AT LAW OR IN EQUITY, WHICH ARISES OUT OF, CONCERNS, OR RELATES TO THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT, THE PERFORMANCE OF THIS AGREEMENT, OR THE RELATIONSHIP CREATED BY THIS AGREEMENT, WHETHER SOUNDING IN CONTRACT, TORT, STRICT LIABILITY, OR OTHERWISE. ANY PARTY MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS AGREEMENT WITH ANY COURT, AS WRITTEN EVIDENCE OF THE CONSENT OF THE PARTIES TO THIS AGREEMENT OF THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY. NEITHER PARTY HAS MADE OR RELIED UPON ANY ORAL REPRESENTATIONS TO OR BY ANY OTHER PARTY REGARDING THE ENFORCEABILITY OF THIS PROVISION. EACH PARTY HAS READ AND UNDERSTANDS THE EFFECT OF THIS JURY WAIVER PROVISION. EACH PARTY ACKNOWLEDGES THAT IT HAS BEEN ADVISED BY ITS OWN COUNSEL WITH RESPECT TO THE TRANSACTIONS AND RELATIONSHIP GOVERNED BY THIS AGREEMENT AND SPECIFICALLY WITH RESPECT TO THE TERMS OF THIS SECTION.

 

(p)            Termination of Consulting Agreement. For the avoidance of doubt, effective as of the Effective Date, pursuant to Section 4(a)(iii) of the Consulting Agreement, the Consulting Agreement shall be deemed terminated in accordance with its terms, it being understood that those provisions that are intended to survive such termination shall survive in accordance with the terms of the Consulting Agreement. Crestbrook Capital LLC joins in this Agreement for the sole limited purpose of agreeing lo the termination of the Consulting Agreement.

 

(q)            Other Obligations to the Company Entities. From time to time, Willis may, either before or after the Effective Date, become bound by other Company standard confidentiality or non interference obligations in connection with Willis’ employment, including, by way of example and not limitation, by acknowledging and agreeing to terms of Company Entity employment handbooks and confidentiality agreements executed pursuant thereto. These terms and conditions will not in any way replace or otherwise supersede any such other confidentiality or non-interference (non-solicitation) type agreement, arrangement or obligation, but instead these terms and conditions will supplement any such other applicable agreement, arrangement or obligation. Confidential Information shall be maintained in accordance with this Agreement and any such other confidentiality agreement, arrangement or obligation, as applicable, and in the event of any inconsistency or conflict, Willis shall be bound by the most restrictive obligation then applicable.

 

 

(r)            Willis Acknowledgment of Terms. WILLIS ACKNOWLEDGES AND AGREES THAT WILLIS HAS FULLY READ, UNDERSTANDS AND VOLUNTARILY ENTERS INTO THIS AGREEMENT. WILLIS ACKNOWLEDGES AND AGREES THAT WILLIS HAS HAD AN OPPORTUNITY TO ASK QUESTIONS AND CONSULT WITH AN ATTORNEY OF WILLIS’ CHOICE BEFORE SIGNING THIS AGREEMENT.

 

[Signatures on Following Page]

 

 

IN WITNESS WHEREOF, Willis and Company have executed this Agreement to be effective as of the Effective Date.

  

	WILLIS:
	/s/ David L. Willis
	David Willis
	COMPANY:
	EWC VENTURES, LLC
	By:	/s/ David Coba
	Name:	David Coba
	Title:	President & CEO

 

JOINDER:

 

Crestbrook Capital LLC joins in this Agreement for the sole limited purpose of confirming and ratifying the termination of the Consulting Agreement, effective as of the Effective Date, pursuant to Section 14(p) of this Agreement.

 

CRESTBROOK CAPITAL LLC
By:	/s/ David L. Willis
Name:	David L. Willis
Title:	Manager

 

 

EXHIBIT A

 

Willis Travel

 

This Exhibit A is made a part of Employment Agreement by and among EWC Ventures, LLC, and David Willis. This Exhibit A addresses certain terms and conditions related to Willis’ anticipated traveling from his residence in Dallas, Texas (such traveling or commuting, “Commute” or variation thereof) to Hallandale Beach, Florida during the Employment Period as contemplated in Section 2(a)(iv) of the Employment Agreement.

 

Company (either directly or in its discretion through another Company Entity) shall provide Willis the following:

 

1.            Company (either directly or in its discretion through another Company Entity) will reimburse Willis for his actual, but reasonable, costs incurred in (i) obtaining transient accommodations (i.e., apartment, hotel) in the Hallandale Beach, Florida area related to Willis’ employment with Company; and (ii) roundtrip airfare in accordance with Company’s travel policies for traveling between Dallas and South Florida no more than one-time per week. For the avoidance of doubt, the foregoing will not limit any other travel-related reimbursements that Willis may be entitled to from time to time in connection with Willis’ employment and in accordance with the Company Entities’ standard travel policies, subject to the terms and conditions of Section 2(b)(v) of the Employment Agreement.

 

2.            The Company Entities will gross-up for tax purposes any of the amounts disbursed to Willis for the Commute pursuant to this Exhibit A which may be deemed income to Willis, at his highest effective tax rate.

 

3.            All reimbursements under this Exhibit A shall be subject to any then-existing policies, practices and procedures of the Company Entities related to travel reimbursements and payments. Without limiting the foregoing, Willis shall document all such Commuting costs subject to reimbursement under this Exhibit A, and shall deliver to Company, written statements, in the manner generally required by the Company Entities under their policies, practices and procedures, setting forth any such requested reimbursements, together with supporting documents and other information as applicable or as reasonably requested by the Company Entities.

 

4.            Willis agrees to work in good faith with Company to achieve Company desired efficiencies with respect to both costs incurred, as well as with respect to productivity and other operational issues to ensure a smooth and efficient transition for Company and its business operations. Efficiencies with respect to costs may include the Company Entities’ direct sourcing of Commute support using their corporate accounts or preferred providers.

 

 

 

Exhibit 21.1

 

Subsidiaries of the Registrant

 

Entity		Jurisdiction of Organization
EWC Aventura, LLC		Florida
EWC Boca Central, LLC		Florida
EWC Boca West, LLC		Florida
EWC Co-Op Fund, LLC		Florida
EWC Corporate, LLC		Florida
EWC eCom Distribution US, LLC		Florida
EWC Fort Lauderdale		Florida
EWC Franchise Distribution, LLC		Florida
EWC Franchise, LLC		Florida
EWC Merrick I, LLC		New York
EWC MFund, LLC		Florida
EWC Paymaster, LLC		Florida
EWC Prosper, LLC		Texas
EWC P&T, LLC		Florida
EWC South Beach, LLC		Florida
EWC Ventures, LLC		Delaware
EWC Ventures Stores, LLC		Florida
EW Holdco, LLC		Delaware
EW Intermediate Holdco, LLC		Delaware
EW Super Holdco, LLC		Delaware
EW Holding Guarantor LLC		Delaware
EWC Master Issuer LLC		Delaware
EWC Franchisor LLC		Delaware
EWC Distributor LLC		Delaware

 

 

Exhibit 23.1

 

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

We consent to the incorporation by reference in this Registration Statement on Form S-1 of our report dated March 15, 2022 relating to the consolidated financial statements of European Wax Center, Inc. and its subsidiaries, appearing in the Form S-1 for the year ended December 25, 2021. We also consent to the reference to us under the heading “Experts” in such Registration Statement.

 

/s/ DELOITTE & TOUCHE LLP

 

Dallas, Texas

 

May 17, 2022

 

 

Exhibit 107

 

Calculation of Filing Fee Tables

 

FORM S-1

(Form Type)

 

European Wax Center, Inc.

(Exact Name of Registrant as Specified in its Charter)

 

Table 1: Newly Registered and Carry Forward Securities

 

Newly Registered Securities

Fees to Be Paid

Equity

Class A Common Stock, par value $0.00001 per share

Rule 457(c)

5,175,000(1)

$26.04(2)

$134,757,000(2)

0.0000927

$12,491.97(2)

Fees Previously Paid

N/A

N/A

N/A

N/A

N/A

N/A

N/A

N/A

Carry Forward Securities

Carry Forward Securities

N/A

N/A

N/A

N/A

N/A

N/A

N/A

N/A

N/A

Total Offering Amounts

N/A

N/A

Total Fees Previously Paid

N/A

Total Fee Offsets

N/A

Net Fee Due

N/A

 

(1)	Includes offering of any additional shares of Class A common stock that the underwriters have the option to purchase.
(2)	In accordance with Rule 457(c) of the Securities Act of 1933, as amended, the price per share and aggregate offering price are based on the average of the high and low prices of the Registrant’s Class A common stock on May 16 2022, as reported by the Nasdaq Global Select Market.