Exhibit 10.1
EMPLOYMENT AGREEMENT
This Agreement (the “Agreement”), dated as of May 20, 2024, is made and entered into by and between, on the one hand, Definitive Healthcare, LLC, a Massachusetts limited liability company (the “Company”) and its parent company, Definitive Healthcare Corp., a Delaware corporation (“Parent”, and together with the Company, the “Company Group”), and, on the other hand, Kevin Coop (the “Executive”).
Introduction
The Company Group desires to retain the services of the Executive pursuant to the terms and conditions set forth herein and the Executive wishes to be employed by the Company Group on such terms and conditions. The Executive will be a senior executive of the Company and Parent, with significant access to information concerning the Company Group and its business. The disclosure or misuse of such information or the engaging in competitive activities would cause substantial harm to the Company Group.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:
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Stock Price Hurdle | Value of Value Creation PSUs | Number of Value Creation PSUs | “Performance Period” |
$10.00 | $2,000,000 | 200,000 | 2 years from date of grant |
$15.00 | $4,000,000 | 266,667 | 4 years from date of grant |
$20.00 | $6,000,000 | 300,000 | |
$27.00 | $10,000,000 | 370,371 |
The average closing price of a share of Parent Common Stock (the “Average Closing Price”) will be measured at the end of each month beginning with the first full month following the date of grant of the Value Creation PSU Grant (each, a “Hurdle Measurement Date”). An applicable Stock Price Hurdle will be achieved if, at any time during
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the applicable Performance Period noted above, the Average Closing Price during a period of thirty (30) consecutive trading days equals or exceeds the applicable Stock Price Hurdle. The number of Value Creation PSUs set forth above with respect to a Stock Price Hurdle will vest on the date on which the Compensation Committee certifies that the Stock Price Hurdle was achieved (the “PSU Vesting Date”), subject to the Executive’s continued Service through the PSU Vesting Date; provided, that such certification by the Compensation Committee will occur no later than the earlier of (i) ninety (90) days following the applicable Hurdle Measurement Date as of which a Stock Price Hurdle has been achieved or (ii) March 15 of the calendar year following the year in which the applicable Hurdle Measurement Date occurs. The number of Value Creation PSUs subject to each Stock Price Hurdle set forth above is determined by dividing the dollar value set forth under “Value of Value Creation PSUs” by the dollar value set forth under “Stock Price Hurdle.” The shares underlying such Value Creation PSUs will be delivered as soon as reasonably practicable following the PSU Vesting Date, and in all events by the earlier of (i) thirty (30) calendar days following the PSU Vesting Date and (ii) March 15 of the calendar year following the year in which the applicable Hurdle Measurement Date occurs.
In the event of a Change in Control (as defined in the Inducement Plan) that occurs prior to the last day of the applicable Performance Period and subject to the Executive’s continued Service through the consummation of such Change in Control, (i) satisfaction of any Stock Price Hurdle will be determined by reference to the price per share of Parent Common Stock that is payable pursuant to definitive documentation concerning such Change in Control as determined in good faith by the Compensation Committee (the “Per-Share Transaction Price”), in lieu of the Average Closing Price and without regard to the thirty (30) consecutive trading day requirement set forth above, and (ii) if the Per-Share Transaction Price falls between any two Stock Price Hurdles, the number of the Value Creation PSUs that will vest shall be determined based on linear interpolation of the Per-Share Transaction Price between each of the two applicable Stock Price Hurdles.
Notwithstanding anything in this Agreement to the contrary, the Value Creation PSU Grant shall be governed in all respects by the terms and conditions set forth in the Inducement Plan and the applicable award agreement, which will be consistent with the foregoing.
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(i) Government Agencies. Nothing contained in this Agreement limits Executive’s ability to file a charge or complaint with the Equal Employment Opportunity Commission, the National Labor Relations Board, the Occupational Safety and Health Administration, the Securities and Exchange Commission or any other federal, state, or local governmental agency or commission (“Government Agencies”). Executive further understand that this Agreement does not limit Executive’s ability to communicate with any Government Agencies or otherwise participate in any investigation or proceeding that may be conducted by any Government Agencies, including providing documents or other information, without notice to the Company Group. This Agreement does not limit Executive’s right to receive an award from a whistleblower award program administered by any Government Agencies for providing information to any Government Agencies.
(ii) Immunity under Defend Trade Secrets Act. In accordance with the Defend Trade Secrets Act of 2016, no employee will be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that: (a) is made (i) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney; and (ii) solely for the purpose of reporting or investigating a suspected violation of the law; or (b) is made in a complaint or other document that is filed under seal in a lawsuit or other proceeding.
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“Cause” shall mean, with respect to the Executive, (i) commission of, or pleading guilty or no contest to, a felony, or any crime involving moral turpitude (other than minor traffic violations); (ii) any unlawful act which is materially injurious or materially detrimental to the reputation or financial interests of any of the Company Group or its affiliates; (iii) theft of property of any of the Company Group or its affiliates or willful falsification of documents of any of the Company Group or its affiliates or willful dishonesty in their preparation; (iv) material breach of any material provision of any agreement with any of the Company Group or its affiliates, or any breach of any non-competition, non-solicitation or confidentiality provisions, or any other similar restrictive covenants to which the Executive is or may become a party with any of the Company Group or its affiliates; or (v) refusal to perform, or repeated failure to undertake good faith efforts to perform, the duties or responsibilities reasonably assigned to Executive by the Board, which duties or responsibilities are consistent with the scope and nature of Executive’s position. To the extent any purported grounds set forth in this definition of Cause can be cured (including, without limitation, those set forth in clauses (iv) or (v)), Parent shall provide written notice to the Executive identifying such grounds and Executive shall have thirty (30) calendar days to cure such grounds. “Willful” for these purposes shall mean the Executive’s act or omission in bad faith or without the reasonable belief that such act or omission was in the best interests of the Company. Failure to attain performance goals or financial objectives shall not in and of itself constitute Cause.
“Change in Control” shall mean have the meaning ascribed to it in the Equity Plan.
“Change in Control Period” means the period beginning on the date three (3) months prior to, and ending on the date eighteen (18) months following, a Change in Control.
“Good Reason” means, without the Executive’s written consent, (a) a material diminution (of 10% or more in the aggregate) of the Executive’s highest (I) annual rate of Base Salary or (II) target Annual Bonus (i.e. the size of the target Annual Bonus that the Executive has the opportunity to earn); or (b) any material breach by the Company Group of any material written agreement between the Executive and the Company Group; (c) a relocation by the Company of
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the Executive’s principal place of employment that extends the Executive’s commute by more than thirty five (35) miles; or (d) a material diminution of the duties, titles, authority, roles, or responsibilities of the Executive (including any change in reporting that results in the Executive not reporting directly to the Board), provided that no condition set forth in the preceding (a), (b), (c) or (d) will be deemed Good Reason unless the Company Group fails to cure the condition(s) giving rise to Good Reason within 30 days from the date on which the Executive notifies the Chairman of the Board, in writing, of such condition(s) (the “Cure Period”) (which notice will be provided by the Executive within sixty (60) days following the initial existence of such condition), and Executive resigns from employment within thirty (30) days following the expiration of the Cure Period.
“Disability” means illness (mental or physical) or accident, which results in the Executive being unable to perform the Executive’s duties as an Executive of the Company or Parent (as applicable) as reasonably determined by a competent independent physician, for a period of 180 days, whether or not consecutive, in any 12-month period.
“Severance” means (i) continuation of regular payments of Base Salary (at the rate in effect on the date of termination prior to any reduction constituting Good Reason) to the Executive for a period of twelve (12) months from the date of termination of employment, payable in accordance with the Company’s regular payroll schedule and subject to withholding for all applicable taxes; (ii) a lump sum payment equal to (A) any unpaid amount of the Annual Bonus for the immediately preceding calendar year that the Executive would have earned in accordance with the Bonus Plan had the employment termination not occurred (“Prior Year’s Bonus”), plus (B) an amount equal to the target Annual Bonus for the calendar year in which the date of termination occurs prior to any reduction constituting Good Reason, payable within thirty (30) days following the date on which the Release (defined below) becomes effective and irrevocable and subject to withholding for all applicable taxes; (iii) acceleration of the vesting of all stock options, restricted stock shares and RSUs, profit interests, or other forms of equity, in each case, that vest based solely on the passage of time, awarded to the Executive by the Company Group at any time (the “Equity”) and that would otherwise have vested during the twelve (12) month period following the termination date had the Executive’s employment not terminated (provided, that notwithstanding the foregoing, the Initial RSU Grant shall vest in full); (iv) vesting of any portion of the Value Creation PSU Grant for which a Stock Price Hurdle had been achieved as of a Hurdle Measurement Date prior to the date of termination, but for which the PSU Vesting Date had not yet occurred; and (v) should Executive timely elect and be eligible to continue receiving group medical insurance pursuant to the Consolidated Omnibus Budget Reconciliation Act, payment the entire amount of the premiums for such coverage for a period of twelve (12) months following the date of termination, or if earlier, until the date the Executive is no longer eligible to receive COBRA continuation coverage or the date on which the Executive becomes eligible to receive substantially similar coverage from another employer. For the purposes of clarity, as defined above, “Equity” shall not include any equity or equity-based awards that vest based on performance (“Performance-Based Awards”) and the acceleration described in (iii) above shall not apply to any such Performance-Based Awards.
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The Severance available to the Executive under this Section 11 are the sole and exclusive severance, termination and post-termination payments and benefits to which the Executive may be entitled upon termination of the Executive’s employment (including equity compensation benefits). Notwithstanding the terms of any other plan or agreement (including any plan or agreement related to equity compensation), the Executive shall not be entitled to receive any other severance-related or termination-related payments or benefits (including equity compensation benefits) under any other plan or agreement which may from time to time be made available to other executives of the Company Group or any affiliate.
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(i) Release of Claims. The Company Group’s obligation to pay Severance shall be contingent upon the Executive signing a separation agreement in form and substance reasonably acceptable to Parent and Executive, to include, among other provisions, non-competition, non-solicitation (in each case, not to exceed twelve (12) months following the termination date), non-disclosure, and mutual non-disparagement provisions (but no other restrictive covenants, including cooperation, beyond the scope and length provided for above), and a general release of claims in the favor of the Company Group (the “Release”), with customary carveouts for rights (including, without limitation, equity rights) that survive termination (e.g., indemnity, D&O coverage, contribution, exculpation, vested employee benefits), and such Release becoming effective and irrevocable in accordance with its terms within sixty (60) days following Executive’s employment termination date (such period, the “Release Execution Period”).
(ii) Clawback and Recovery. All compensation provided to the Executive will be subject to recoupment in accordance with the Company Group’s clawback policies as maintained or adopted from time to time for similarly situated executives, to the extent provided therein.
(iii) Consequences of Breach. If the Executive breaches the Executive’s obligations under Sections 5, 6 or 7 of this Agreement during the period any of the Company Group is obligated to pay Severance, the Company may immediately cease payments of Severance and may recover all Severance paid to the Executive after the date of such breach. The cessation and recovery of these payments shall be in addition to, and not as an alternative to, any other remedies at law or in equity available to the Company Group including, without limitation, the right to seek specific performance or an injunction. To the extent any breach set forth in this paragraph can be cured, Parent shall provide written notice to the Executive identifying the breach and Executive shall have thirty (30) calendar days to cure the breach.
(iv) Affordable Care Act. If making payments of COBRA premiums under this Section 11 would violate the nondiscrimination rules applicable to non-grandfathered plans under the Affordable Care Act (the “ACA”), or result in the imposition of penalties under the ACA and the related regulations and guidance promulgated thereunder, the parties agree to reform this Section 11 in an economically equivalent manner as is necessary to comply with the ACA.
(v) Payment Timing. For purposes of Section 409A, each payment of Severance shall be considered a separate payment and not one of a series of payments. Any payment under this Section 11 that is not made during the period following the termination of the Executive’s employment because the Executive has not executed the Release shall be paid to the Executive in a single lump sum on the first payroll date following the date the Release becomes effective and irrevocable; provided, that the Executive executes and does not revoke the Release
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in accordance with the requirements hereof; and provided further, that if the Release Execution Period begins in one taxable year and ends in another taxable year, any payment under this Section 11 shall not be made until the beginning of the second taxable year to the extent required to comply with Section 409A.
For purposes of Section 409A of the Code, each payment made under this Agreement shall be treated as a separate payment. In no event may Executive, directly or indirectly, designate the calendar year of any payment. All reimbursements provided under this Agreement shall be made or provided in accordance with the requirements of Section 409A of the Code, including, where applicable, the requirement that (i) any reimbursement be for expenses incurred during Executive’s lifetime (or during a shorter period of time specified in this Agreement), (ii) the amount of expenses eligible for reimbursement during a calendar year may not affect the expenses eligible for reimbursement in any other calendar year, (iii) the reimbursement of an eligible expense will be made on or before the last day of the calendar year following the year in which the expense is incurred, and (iv) the right to reimbursement is not subject to liquidation or exchange for another benefit.
Notwithstanding anything to the contrary herein, if a payment or benefit under this Agreement is due to a “separation from service” for purposes of the rules under Treas. Reg. § 1.409A-3(i)(2) (payments to specified employees upon a separation from service) and Executive is determined to be a “specified employee” (as determined under Treas. Reg. § 1.409A-1(i)), such payment or benefit shall, to the extent necessary to comply with the requirements of Section 409A of the Code, be made or provided on the later of the date specified by the foregoing provisions of this Agreement or the date that is six months after the date of Executive’s separation from service (or, if earlier, the date of Executive’s death). Any installment payments that are delayed pursuant to this Section 13 shall be accumulated and paid in a lump sum on the first day of the seventh
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month following Executive’s separation from service, and the remaining installment payments shall begin on such date in accordance with the schedule provided in this Agreement.
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Definitive Healthcare Corp.
492 Old Connecticut Path, Suite 401
Framingham, MA 01701
Attn: Chief Legal Officer
Email: *******@definitivehc.com
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IN WITNESS WHEREOF, this Agreement has been executed and delivered as a sealed instrument as of the date first above written.
DEFINITIVE HEALTHCARE, LLC
By: /s/ Jason Krantz
Name: Jason Krantz
Title: Interim CEO
DEFINITIVE HEALTHCARE CORP.
By: /s/ Jason Krantz
Name: Jason Krantz
Title: Executive Chairman, Interim CEO
/s/ Kevin Coop
Executive: Kevin Coop
[Signature Page to Employment Agreement]