Exhibit 10.6
Atlas Energy Solutions Inc.
Management Change in Control Severance Plan
Purpose
This Atlas Energy Solutions Inc. Management Change in Control Severance Plan has been established by the Company on May 22, 2023 (the “Effective Date”) to provide Participants with the opportunity to receive severance protection in connection with a Change in Control of the Company. The purpose of the Plan is to attract and retain talent and to assure the present and future continuity, objectivity, and dedication of management in the event of any Change in Control to maximize the value of the Company on a Change in Control. The Plan is intended to be a top hat welfare benefit plan under ERISA.
Capitalized terms used but not otherwise defined herein have the meanings set forth in 1Article II.
Definitions
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The Company and the Participant agree that Good Reason does not exist unless and until the Participant provides the Company with written notice of the acts alleged to constitute Good Reason within ninety (90) days of the Participant’s knowledge of the occurrence of such event, and the Company fails to cure such acts within thirty (30) days of receipt of such notice. Participant must terminate employment within sixty (60) days following the expiration of such cure period for the termination to be on account of Good Reason.
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For purposes of clarity, a termination due to death or Disability shall not be deemed to be a Qualifying Termination pursuant to this Plan.
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Participation
Severance BENEFITS
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Conditions
Restrictive Covenants
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280G Matters
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Notwithstanding anything to the contrary in the Plan, if a Participant is a “disqualified individual” (as defined in Section 280G(c) of the Code), and the payments and benefits provided for in the Plan, together with any other payments and benefits which such Participant has the right to receive from the Company or any of its Affiliates, would constitute a “parachute payment” (as defined in Section 280G(b)(2) of the Code), then the payments and benefits provided for in the Plan shall be either:
whichever produces the better net after-tax position to such Participant (taking into account any applicable excise tax under Section 4999 of the Code and any other applicable taxes). The reduction of payments and benefits hereunder, if applicable, shall be made by reducing, first, payments or benefits to be paid in cash hereunder in the order in which such payment or benefit would be paid or provided (beginning with such payment or benefit that would be made last in time and continuing, to the extent necessary, through to such payment or benefit that would be made first in time) and, second, reducing any benefit to be provided in-kind hereunder in a similar order. The determination as to whether any such reduction in the amount of the payments and benefits provided hereunder is necessary shall be made by the Company in good faith. If a reduced payment or benefit is made or provided and through error or otherwise that payment or benefit, when aggregated with other payments and benefits from the Company used in determining if a “parachute payment” exists, exceeds one dollar ($1.00) less than three (3) times such Participant’s base amount, then such Participant shall be required to immediately repay such excess to the Company upon notification that an overpayment has been made. Nothing in this Article VII shall require the Company to be responsible for, or have any liability or obligation with respect to, such Participant’s excise tax liabilities under Section 4999 of the Code.
Claims Procedures
Atlas Energy Solutions
c/o Company Secretary
5918 W. Courtyard Dr., Suite 500
Austin, Texas 78730
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If the Participant’s claim is denied, in whole or in part, the Participant will be furnished with written notice of the denial within ninety (90) days after the Administrator’s receipt of the Participant’s written claim, unless special circumstances require an extension of time for processing the claim, in which case a period not to exceed 180 days will apply. If such an extension of time is required, then written notice of the extension will be furnished to the Participant before the termination of the initial ninety (90)-day period and will describe the special circumstances requiring the extension, and the date on which a decision is expected to be rendered. Written notice of the denial of the Participant’s claim will contain the following information:
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Administration, Amendment and Termination
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The decision of the Administrator on any disputes arising under the Plan, including (but not limited to) questions of construction, interpretation and administration shall be final, conclusive and binding on all persons having an interest in or under the Plan. Any determination made by the Administrator shall be given deference in the event the determination is subject to judicial review and shall be overturned by a court of law only if it is arbitrary and capricious.
General Provisions
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APPENDIX A
Eligible Employees
Name/Title or Position | Severance Multiplier | Change in Control Severance Multiplier |
Executive Chairman | 2X | 3X |
President and Chief Executive Officer | 2X | 3X |
Section 16 Officers | 1.5X | 2X |
Other Officers | 1X | 1.5X |
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APPENDIX B
The following Release is intended to be an example of the material terms of the
general form of Release that shall be used in connection with the
Atlas Energy Solutions Inc. Management Change in Control Severance Plan
FORM OF GENERAL RELEASE
This General Release (the “Release”) constitutes the Release referred to in that certain [Atlas Energy Solutions Inc.] Management Change in Control Severance Plan (as amended the “Plan”), by and among [●] (the “Employee”) and the Company.
(a) In exchange for and in consideration of the payments, benefits, and other commitments described above within the Plan that are conditioned upon the proper execution of a Release, Employee, individually, and for each of Employee’s heirs, executors, administrators, and assigns, hereby FULLY RELEASES, QUITS AND FOREVER DISCHARGES the Company and each of its respective predecessors, assigns, and Affiliates and its respective officers, managers, boards of directors, employees, attorneys and agents, past and present (collectively, the “Employer Released Parties”), of and from any and all claims, liabilities, causes of action, demands to any rights, damages, costs, attorneys’ fees, expenses, and compensation whatsoever, of whatever kind or nature, in law, equity or otherwise, whether known or unknown, vested or contingent, suspected or unsuspected, that Employee may now have, has ever had, or hereafter may have, relating directly or indirectly to Employee’s employment with any Employer Released Party or the termination of such employment or arising out of or relating to the Plan or any other agreement, plan, policy or program of the Company. Such claims may include, but are not limited to, claims for wages, back pay, front pay, commissions, bonuses, equity grants, profits interests, long term incentive plans, stock options, overrides, reimbursement, reinstatement, damages or benefits, Employee also releases any and all claims Employee may have that arose prior to the date of this Release, and hereby specifically waives and releases all claims under Title VII of the Civil Rights Act of 1964, as amended, the Civil Rights Act of 1991, the Equal Pay Act, the Americans With Disabilities Act, the Age Discrimination in Employment Act, as amended, the Consolidated Omnibus Budget Reconciliation Act (COBRA), the Family and Medical Leave Act, the Employment Retirement Income Security Act of 1974, as amended, the National Labor Relations Act, the Fair Labor Standards Act, and any and all state or local statutes, ordinances, or regulations, as well as all claims arising under federal, state or local law, involving any tort, employment contract claim whether express or implied, “wage and hour” or other claim, of any nature, for compensation or reimbursement claim of any type, including but not limited to, wrongful discharge, or any other claim. Employee covenants not to sue the Employer Released Parties for any claim released by this Release.
(b) By signing this Release, Employee does not hereby waive any rights or claims: (i) for unemployment or workers’ compensation; (ii ) that arise after Employee
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signs this Release; (iii) for which private waivers or releases are prohibited by applicable law; or (iv) to bring a lawsuit against the Company to enforce the Company’s obligations under this Release. This Release also does not prevent Employee from filing or participating in a charge of discrimination filed with the Equal Employment Opportunity Commission or any similar state or local agency, or a charge with the National Labor Relations Board or any other governmental agency.
Further, this Release does not limit Employee’s right or ability to: (i) disclose information required by law; (ii) report a possible violation of any law or regulation to any government agency or entity, or make disclosures that are protected under the whistleblower provisions of any law; (iii) initiate, provide information to, testify at, participate, or otherwise assist, any governmental, regulatory, law enforcement agency, legislative body, any self-regulatory organization, or the Company’s legal, compliance, or human resources officers in any investigation or proceeding brought by relating to an alleged violation of any federal, state, or municipal law; or (iv) respond to any inquiry from such authority, including an inquiry about the existence of this Release or its underlying facts. Employee also does not need to notify the Company or seek the Company’s prior authorization before making such disclosures or engaging in such communications.
(c) Employee represents and warrants that he or she does not presently have on file, and further agrees to the maximum extent allowed by law that he or she will not hereafter file, any lawsuits, claims, charges, grievances or complaints against the Company and/or the Employer Released Parties in or with any administrative, state, federal or governmental entity, agency, board or court, or before any other tribunal or panel of arbitrators, public or private, based upon any actions or omissions by the Company and/or the Employer Released Parties occurring prior to the date of your execution of this Release. Except to enforce the terms of this Release and subject to the exceptions and rights set forth above, Employee understands that if Employee breaks this promise, he or she agrees to pay all costs incurred by Employer Released Parties (or any of them), including reasonable attorney’s fees, in defending against such claim and return all but $500 of the Severance Benefits provided pursuant to the Plan, and that the Company may be entitled to additional monetary damages, including associated court costs and attorney fees, and that the Company may also seek injunctive relief to order specific performance of Employee’s obligations under this Release.
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Notwithstanding the initial effectiveness of this Release, Employee may revoke the delivery (and therefore the effectiveness) of this Release within the seven (7)-day period beginning on the date Employee delivers this Release to the Company (such seven (7)-day period being referred to herein as the “Release Revocation Period”). To be effective, such revocation must be in writing signed by Employee and must be delivered to [title] before 11:59 p.m., Central Time, on the last day of the Release Revocation Period. If an effective revocation is delivered in the foregoing manner and timeframe, this Release shall be of no force or effect and shall be null and void ab initio. No consideration pursuant to the Plan shall be paid if this Release is revoked by Employee in the foregoing manner.
Executed on this ___________ day of _____________, _______.
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