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Posted 03 April, 2024

Endeavor Group Holdings, Inc. appointed Mr. Emanuel as new CEO

NYSE:EDR appointed new Chief Executive Officer Mr. Emanuel in a 8-K filed on 03 April, 2024.


  At the Effective Time, Mr. Emanuel will be appointed as the Chief Executive Officer of the Company, a member of the board of directors of the Company and Founder and Executive Chairman of WME.  

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Overview of Endeavor Group Holdings, Inc.
Business/Consumer Services • Employment/Training Services
Endeavor Group Holdings, Inc. operates as an intellectual property, content, events, and experiences company. The firm operates through the Owned Sports Properties, Events, Experiences & Rights, and Representation segments. The Owned Sports Properties segment consists of a unique portfolio of scarce sports properties, including UFC, PBR and Euroleague, that generate significant growth through innovative rights deals and exclusive live events. The Events, Experiences & Rights segment owns and operates many events, including the Miami Open, HSBC Champions, Frieze Art Fair, New York Fashion Week, and Hyde Park Winter Wonderland. The Representation segment provides services to talent and corporate clients and includes the content division, Endeavor Content. The company was founded in 1995 and is headquartered in Beverly Hills, CA.
Market Cap
$17.0B
View Company Details
Relevant filing section
Item 5.02 
Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers 


Rollover Documents 

Ariel Emanuel Letter Agreement. 

The Company, OpCo, William Morris Endeavor Entertainment, LLC ("WME"), Holdco Parent and OpCo Parent entered into a letter agreement with Mr. Emanuel (the "Emanuel Letter Agreement"), which provides for, among other things, the following. 


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Mr. Emanuel's current employment agreement with the Company and OpCo will terminate at the Effective Time and Mr. Emanuel will not be entitled to any additional compensation or benefits under such employment agreement (other than accrued compensation and reimbursement of any unreimbursed business expenses). 


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At the Effective Time, Mr. Emanuel will be appointed as the Chief Executive Officer of the Company, a member of the board of directors of the Company and Founder and Executive Chairman of WME. He will be eligible to serve in such positions until the earlier of his death, incapacitation or resignation, except that Mr. Emanuel's employment as Chief Executive Officer of the Company will terminate upon payment of the Asset Sale Bonus (as described below). 


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Mr. Emanuel will be reimbursed for travel, entertainment and other expenses reasonably incurred in the performance of his duties and responsibilities in accordance with applicable policy and, while employed as Chief Executive Officer of the Company, Mr. Emanuel may participate in all health, welfare, retirement and other benefit plans (excluding any severance plans) that are made available to other the Company employees. 


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Following an initial public offering of or pertaining to the Company or WME, such company will take all actions necessary to appoint or nominate Mr. Emanuel to comparable positions either with such company or with the applicable public company successor to the Company. 


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Mr. Emanuel will receive new equity awards in the Company or OpCo following the Mergers representing 2.5% (the "Initial Award") and 0.50% (the "Supplemental Award") of the equity interests, in each case calculated on a fully-diluted basis. One third of the Initial Award will be options (or economically-equivalent equity interests in OpCo) and two thirds of the Initial Award will be restricted stock units. All of the Supplemental Award will be catch-up profits interests. The awards will be subject to vesting and other terms to be mutually agreed by the parties. 


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Mr. Emanuel will receive a $25,000,000 asset sale transaction bonus (the "Asset Sale Bonus") following the sale or disposition (in one or a series of transactions) of all of, or all except a de minimis portion of, the certain specified assets of the Company and OpCo (the "Asset Sale"), subject to certain exceptions. 


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Upon payment of the Asset Sale Bonus, Mr. Emanuel's employment as Chief Executive Officer of the Company will terminate but such payment will not affect his position as Founder and Executive Chairman of WME or as a member of the board of directors of the Company. 


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From and after the effective time of the Mergers, Mr. Emanuel will be entitled to receive quarterly royalty payments from WME equal to 2.5% of the quarterly net cash profits (as defined in the Emanuel Letter Agreement) of the agency representation business of WME and its affiliates (the "WME Agency Business" and such payments, the "Emanuel Royalty Payments"). 


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Mr. Emanuel's right to Emanuel Royalty Payments will terminate upon the occurrence of certain qualifying sale transactions involving WME. 


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From and after the second anniversary of the effective date of the Mergers, Mr. Emanuel will have a one-time right to require the Company (a) to repurchase all or a portion of his Company equity interests or (b) to purchase all or a portion of his OpCo equity interests, or any combination of (a) and (b). The put price per equity interest shall be (x) if within five and a half years of the effective date of the Mergers, the price paid in the Merger plus interest equal to the 10-year United States Treasury Rate, and (y) thereafter, the most recent valuation of a share of the Company adjusted for various items such as exercise price, strike price or distribution threshold, required withholding, adjustment for stock splits, reverse splits, stock dividends or similar events. 


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Following the effective date of the Mergers, ownership and operation of one of the private planes owned by the Company and its Subsidiaries (other than TKO Group Holdings, Inc. and its Subsidiaries) (collectively, the "Employer Group") will transfer to Mr. Emanuel. The Employer Group will pay or reimburse him for reasonable costs and expenses related to the use of the plane for business purposes of the Employer Group. 


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The Company, Holdco Parent, OpCo and OpCo Holdco will reimburse Mr. Emanuel for his expenses (including reasonable and documented out-of-pocket legal fees and costs) incurred in anticipation of and/or in connection with the transactions, including the drafting, negotiation and execution of the Emanuel Letter Agreement and rollover agreement. 


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The Company, OpCo, Holdco Parent and OpCo Parent will indemnify and hold harmless, and advance expenses to, Mr. Emanuel if he is made or is threatened to be made a party or is otherwise involved in any transaction litigation in any capacity. 


Certain information regarding Mr. Emanuel has been described under the section entitled "Class III Directors Whose Terms Expire at the 2024 Annual Meeting of Stockholders" and certain existing arrangements with Mr. Emanuel have been described under the section entitled "Certain Transactions with Related Persons" in the definitive proxy statement with respect to the Company's 2023 annual meeting of stockholders filed on April 28, 2023. 

The foregoing description of the Emanuel Letter Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Emanuel Letter Agreement, a copy of which is attached hereto as Exhibit 10.1 and incorporated herein by reference. 

Patrick Whitesell Letter Agreement 

The Company, OpCo, WME, Holdco Parent and OpCo Parent entered into a letter agreement with Mr. Whitesell (the "Whitesell Letter Agreement"), which provides for, among other things, the following. 


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Mr. Whitesell's current employment agreement and restrictive covenant agreement with the Company and OpCo will terminate at the earlier of the Effective Time or Mr. Whitesell's resignation without good reason (as defined in this current employment agreement) (the "Trigger Date"). After such termination, Mr. Whitesell will be eligible to receive accrued and unpaid base salary, reimbursement of any unreimbursed business expenses, and, subject to Mr. Whitesell's execution, delivery and non-revocation of a general release of claims, a prorated amount equal to Mr. Whitesell's annual bonus earned in respect of 2023, with such proration based on the number of days employed during the year in which the termination occurs. 


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At the Effective Time, Mr. Whitesell will be appointed as a member of the board of directors of the Company and, if requested by the Company or a Silver Lake affiliate and agreed to by Mr. Whitesell, will also be appointed as Chairman of the governing body of WME. 


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Mr. Whitesell will not be entitled to any additional compensation for his services, except that if Mr. Whitesell is not actively involved in the management of WME and being compensated for such management services, he will receive compensation for being a member of the board of directors of the Company and/or WME that is consistent with other investing, non-Silver Lake affiliated directors. Mr. Whitesell will be eligible to serve in such positions until the earlier of his death, incapacitation or resignation, except in certain limited circumstances which may result in Mr. Whitesell leaving those positions earlier. Mr. Whitesell will be entitled to be reimbursed for travel, entertainment and other expenses reasonably incurred in the performance of his duties and responsibilities in accordance with applicable policy and will be entitled to the same rights of exculpation, indemnification and advancement of expenses as are provided to the other members of the board of directors of the Company and the governing body of WME. 


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Following an initial public offering of the Company or WME, if requested by Mr. Whitesell, such company will take all actions reasonably necessary to nominate Mr. Whitesell for election to the board of directors of the applicable public company, and if elected, he agrees to serve until the earlier of his death, incapacitation, resignation or removal. 


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Silver Lake affiliates will invest $250,000,000 of seed equity into a new business to be founded, managed and controlled by Mr. Whitesell, which business will include (a) investing in and providing services to companies in the entertainment, media and sports industries, (b) developing, producing, financing and exploiting film, television and digital audio visual content, (c) talent management and (d) consulting with other entertainment companies. 


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If Mr. Whitesell is appointed as Chairman of WME at the Effective Time, then he will be entitled to receive quarterly royalty payments from WME equal to 2.5% of the quarterly net cash profits (as defined in the Whitesell Letter Agreement) of the agency representation business of WME (the "WME Agency Business" and such payments, the "Whitesell Royalty Payments"). If Mr. Whitesell is not appointed as Chairman of WME at the Effective Time, or if he is appointed Chairman of WME but declines such appointment, then he will receive a lump sum payment of $60,000,000 and will not be entitled to Whitesell Royalty Payments or Whitesell Commission Payments (as described and defined below). 


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Mr. Whitesell's right to Whitesell Royalty Payments will terminate upon the occurrence of certain qualifying sale transactions involving WME. Mr. Whitesell may also elect to unilaterally terminate his right to receive the Whitesell Royalty Payments and to begin receiving the Whitesell Commission Payments. 


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If Mr. Whitesell is appointed as Chairman of WME at the Effective Time and becomes entitled to Whitesell Royalty Payments, Mr. Whitesell may thereafter elect, at any time, to terminate the Whitesell Royalty Payments and begin receiving certain commissions with respect to common clients of Mr. Whitesell and WME (the "Whitesell Commission Payments"). Mr. Whitesell's right to any Whitesell Commission Payments will also terminate upon certain qualifying sale transactions involving WME. 


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From and after the first anniversary of the effective date of the Mergers, Mr. Whitesell will have the right to require the Company to repurchase his the Company equity interests and/or OpCo equity interests. The put price per equity interest shall be (a) if within five and a half years of the effective date of the Mergers, the price in the Mergers plus interest equal to the 10-year United States Treasury Rate and (b) thereafter, the most recent valuation of a share of the Company adjusted for various items such as exercise price, strike price or distribution threshold, required withholding, adjustment for stock splits, reverse splits, stock dividends or similar events. 


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The Company will also have the right to call Mr. Whitesell's equity interests under certain circumstances at the same prices that apply to Mr. Whitesell's put right. 


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Following the Effective Time, ownership and operation of one of the Employer Group's private planes will transfer to Mr. Whitesell. The Employer Group will pay or reimburse him for reasonable costs and expenses related to the use of the plane for the Company and WME business purposes. 


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The Company, the Company Holdco, OpCo and OpCo Holdco will reimburse Mr. Whitesell for his expenses (including reasonable and documented out-of-pocket legal fees and costs) incurred in anticipation of and/or in connection with the transactions, including the drafting, negotiation and execution of the Whitesell Letter Agreement and rollover agreement. 


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The Company, OpCo, Holdco Parent and OpCo Parent will indemnify and hold harmless, and advance expenses to, Mr. Whitesell if he is made or is threatened to be made a party or is otherwise involved in any transaction litigation in any capacity. 


Certain information regarding certain existing arrangements with Mr. Whitesell have been described under the section entitled "Certain Transactions with Related Persons" in the definitive proxy statement with respect to the Company's 2023 annual meeting of stockholders filed on April 28, 2023. 

The foregoing description of the Whitesell Letter Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Whitesell Letter Agreement, a copy of which is attached hereto as Exhibit 10.2 and incorporated herein by reference 

Mark Shapiro Employment Agreement Amendment 

The Company and OpCo entered into an employment agreement amendment with Mr. Shapiro (the "Shapiro Employment Agreement Amendment"), which amended certain terms of his previously disclosed Employment Agreement, dated as of April 19, 2021, and amended as of February 26, 2024 (as amended, the "Existing Shapiro Employment Agreement"). The Shapiro Employment Agreement Amendment provides for, among other things, the following (effective as of April 2, 2024). 


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Mr. Shapiro's base salary was increased to $7,000,000. 


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Mr Shapiro will receive a guaranteed annual bonus equal to $15,000,000 for each year during his employment with OpCo (in lieu of his target annual bonus opportunity provided for under the Existing Shapiro Employment Agreement prior to such amendment). 


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Mr. Shapiro is eligible to receive a cash bonus upon the completion of certain qualifying asset sales (an "Asset Sale Bonus"). A qualifying asset sale is a sale of certain specified assets of the Company and OpCo (an "Asset Sale"). The aggregate maximum amount of Asset Sale Bonuses Mr. Shapiro may earn under the Shapiro Employment Agreement is $100,000,000. Mr. Shapiro will earn an Asset Sale Bonus equal to $20,000,000 upon each of the first three Asset Sales where the cumulative consideration received for the specified assets sold (including consideration for assets sold in connection with any prior Asset Sale) equals or exceeds $1,000,000,000, $2,000,000,000 and $3,000,000,000 (respectively). However, in the event all (but not less than all) of the specified assets are sold (either in one or a series of Assets Sales) (a "Final Asset Sale"), Mr. Shapiro will be entitled to an Asset Sale Bonus equal to $100,000,000 (less the amount of any Asset Sale Bonuses Mr. Shapiro previously received (if any)). Any earned Asset Sale Bonuses are generally payable within 75 days following the applicable Asset Sale. If Mr. Shapiro resigns or gives notice of his resignation without good reason prior to an Asset Sale, he will not receive an Asset Sale Bonus with respect to such Asset Sale, unless (a) a transaction that would constitute an Asset Sale, if consummated, is in process at the time of Mr. Shapiro's resignation, or (b) following such resignation, Mr. Shapiro is otherwise engaged in the Asset Sale process in a manner agreed to between Mr. Shapiro and the Company. If Mr. Shapiro's employment is terminated by OpCo without "cause" (as defined in the Employment Agreement Amendment) or if Mr. Shapiro resigns for "good reason" (as defined in the Existing Shapiro Employment Agreement) prior to the payment of the full Asset Sale Bonus, Mr. Shapiro will be entilted to compensation in the amount of the foregone Asset Sale Bonus. Payment of the Asset Sale Bonus is subject to Mr. Shapiro's execution and non-revocation of a mutual release of claims. 


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OpCo will reimburse Mr. Shapiro for his reasonable and documented out-of-pocket legal fees and costs incurred in anticipation of and/or in connection with the drafting, negotiation and execution of the Shapiro Employment Agreement Amendment and the Merger Agreement. 


The foregoing description of the Shapiro Employment Agreement Amendment does not purport to be complete and is qualified in its entirety by reference to the full text of the Shapiro Employment Agreement Amendment, a copy of which is attached hereto as Exhibit 10.3 and incorporated herein by reference. 

Mark Shapiro's Employment Agreement 

In addition to the Shapiro Employment Agreement Amendment, Mr. Shapiro also entered into an amended and restated employment agreement (the "Shapiro A&R Employment Agreement"). The Existing Shapiro Employment Agreement, as amended by the Shapiro Employment Agreement Amendment, will remain in effect until immediately prior to the Effective Time. At the Effective Time, the Shapiro A&R Employment Agreement will be effective and will supersede the Existing Shapiro Employment Agreement in its entirety. The Shapiro A&R Employment Agreement provides for, among other things, the following. 


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Mr. Shapiro will be employed as President of the Company and its direct and indirect subsidiaries (excluding TKO Group Holdings, Inc. and its subsidiaries, which will be subject to a separate arrangement with Mr. Shapiro) (the "Employer Group") and will report directly to Ariel Emanuel as Chief Executive Officer of the Employer Group. The term of such employment will expire on the fourth anniversary of the effective date of the Mergers. 


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To the extent not inconsistent with the business practices and policies of OpCo, and if such activities do not interfere in any material respect with his duties and responsibilities, Mr. Shapiro is permitted to serve as a member of the board of directors of any charitable, educational, religious, public interest or public service organization and any "for profit" entity approved by OpCo. 


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Mr. Shapiro's principal place of employment will be New York, New York. 


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Mr. Shapiro will receive an annual base salary of $7,000,000 and a guaranteed annual bonus of $15,000,000 for each year during his employment term. 


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Mr. Shapiro will receive a one-time $15,000,000 transaction bonus in connecton with the consummation of the Mergers (subject to his continued employment through the Effective Time), but reduced by the amount of any guaranteed bonus paid to Mr. Shapiro in respect of the year in which the effective date of the Mergers occurs. 


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Mr. Shapiro will remain entitled to receive the Asset Sale Bonus (on the same terms and conditions as described above in the section titled "Mark Shapiro Employment Agreement Amendment"). 


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Mr. Shapiro will receive a new equity award in connection with the Mergers representing 1% of the issued and outstanding equity interests of the Company, calculated on a fully-diluted basis. The award will consist of options (or economically-equivalent equity interests in OpCo) and restricted stock units. The award will be subject to vesting and other terms to be mutually agreed by the parties. WME is expected to implement a new management equity plan with an annual liquidity program and Mr. Shapiro will be entitled to participate in such plan with respect to his interests in the Employer Group. 


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For business travel, Mr. Shapiro will have reasonable access to the private aircraft available to the Company (when available) and when not using such private aircraft, will be reimbursed for first class or charter aircraft travel. He will also be entitled to reimbursement for his commuting expenses, all business-related travel, and entertainment and other expenses reasonably incurred in the performance of his duties. 


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While employed as President of the Employer Group, Mr. Shapiro may participate in all health, welfare, retirement and other benefit plans (excluding any severance plans) that are made available to other senior executives of the Employer Group. 


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If Mr. Shapiro's employment is terminated without "cause" or due to a resignation for "good reason" (as such terms are defined in the Shapiro A&R Employment Agreement), in other than in connection with a Asset Sale Termination (defined below), he will receive (a) continued payment of his base salary commencing on the date of termination and ending on the later of (i) the end of his employment term and (ii) the second anniversary of the termination date (such period, the "Shapiro Severance Period"), (b) payment of his guaranteed bonus for each calendar year during the Shapiro Severance Period (prorated for any partial year). 


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If Mr. Shapiro's employment is terminated due to an employer non-renewal of the employment term (as defined in Shapiro A&R Employment Agreement), he will receive (a) continued payment of his base salary until the second anniversary of the termination date and (the "Post-Termination Continuation Period") and (b) payment of his guaranteed bonus for each calendar year during the Post-Termination Continuation Period (prorated for any partial year). 


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If Mr. Shapiro's employment is terminated due to death or disability, he will receive a pro rated guaranteed bonus. 


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Upon payment of the Asset Sale Bonus that results to a Final Asset Sale, Mr. Shapiro's employment with the Employer Group will automatically terminate (an "Asset Sale Termination"), and Mr. Shapiro will be appointed as managing partner and sole president of WME (unless otherwise agreed upon by WME and Mr. Shapiro). He will be entitled to a pro-rated guaranteeed annual bonus in connection with the Asset Sale Termination. With respect to Mr. Shapiro's WME role, he will recieve a base salary of $5,000,000 and a target annual bonus of $5,000,000 ($2,000,000 of which will be guaranteed). If terminated by WME without "cause" or Mr. Shapiro resigns from his WME role for "good reason", Mr. Shapiro will be entitled to an amount equal to his base salary and target annual bonus, payable over 12 months. 


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Mr Shapiro will remain subject to confidentiality and assignment of intellectual property covenants, and his certain restrictive covenants in effect as of the date hereof under a certain equity award agreement. 


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The Company, OpCo, WME, Holdco Parent and OpCo Parent will reimburse Mr. Shapiro for his expenses (including reasonable and documented out-of-pocket legal fees and costs) incurred in anticipation of and/or in connection with the transactions, including the drafting, negotiation and execution of the Shapiro A&R Employment Agreement. 


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The Company, OpCo, Holdco Parent and OpCo Parent will indemnify and hold harmless, and advance expenses to, Mr. Shapiro if he is made or is threatened to be made a party or is otherwise involved in any transaction litigation in any capacity. 


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As previously disclosed, Mr. Shapiro was issued a retention bonus pursuant to Existing Shapiro Employment Agreement. This retention bonus remains subject to the clawback provisions included in the Existing Shapiro Employment Agreement. 


Certain existing arrangements with Mr. Shapiro have been described under the section entitled "Certain Transactions with Related Persons" in the definitive proxy statement with respect to the Company's 2023 annual meeting of stockholders filed on April 28, 2023. 


The foregoing description of the A&R Shapiro Employment Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the A&R Shapiro Employment Agreement, a copy of which is attached hereto as Exhibit 10.4 and incorporated herein by reference.