Vertical Aerospace (NYSE: EVTL) adds $35M Mudrick convertible note facility
Vertical Aerospace Ltd. arranged additional financing with Mudrick Capital and aligned key financing documents with Yorkville. On August 12, 2026 the company executed a Fourth Supplemental Indenture that, among other changes, sets a fixed conversion price of US$1.30 per ordinary share for its outstanding and future convertible notes.
On the same date Vertical entered into an Amended and Restated Convertible Note Purchase Agreement giving Mudrick a committed facility to purchase up to US$35,000,000 in additional 10.00%/12.00% Convertible Senior Secured PIK Toggle Notes due 2030, with a draw (the Mudrick Facility Draw) expected around August 13, 2026. Net proceeds are intended for aircraft research and development, and expansion of testing, manufacturing and certification capabilities, as well as general working capital. The company also obtained a contractual right to repurchase specified notes from Mudrick at 112% of principal plus accrued cash interest within one year, and granted Mudrick and Yorkville registration rights for the ordinary shares issuable on note and preferred share conversion.
Positive
- None.
Negative
- None.
Filing Explained
The new notes remain conditional pending a minimum $50 million liquidity test, while their $1.30 conversion price preserves potential dilution for existing holders.
This Form 6-K reports signed August 12 amendments for a
A key closing condition requires at least
The filing also sets a resale-registration timetable: the company must file within 15 days for previously unregistered shares issuable on the new and existing notes, and seek effectiveness after notice of no review.
Registration would provide a resale route but does not itself issue or sell shares; the filing may be delayed or suspended during specified disclosure or regulatory events.
Key Figures
Key Terms
Convertible Senior Secured PIK Toggle Notes financial
Indenture financial
Amended and Restated Convertible Note Purchase Agreement financial
Issuer Repurchase Right financial
Registration Statement regulatory
Liquidity financial
AI-generated analysis. How Rhea-AI works. Not financial advice.
FAQ
What new financing did Vertical Aerospace (EVTL) arrange with Mudrick Capital?
How will Vertical Aerospace (EVTL) use proceeds from the Mudrick Facility Draw?
What change was made to Vertical Aerospace (EVTL) note conversion terms?
What repurchase right does Vertical Aerospace (EVTL) have over Mudrick-held notes?
How many ordinary shares of Vertical Aerospace (EVTL) are currently outstanding?
What registration rights do Mudrick and Yorkville receive from Vertical Aerospace (EVTL)?
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO SECTION 13A-16 OR 15D-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of August 2026
Commission File Number: 001-41169
Vertical Aerospace Ltd.
(Exact Name of Registrant as Specified in Its Charter)
Unit 1 Camwal Court, Chapel Street
Bristol BS2 0UW
United Kingdom
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F x Form 40-F ¨
INFORMATION CONTAINED IN THIS REPORT ON FORM 6-K
As previously announced, on August 5, 2026, Vertical Aerospace Ltd. (the “Company”) entered into an agreement in principle with Mudrick Capital Management, L.P. (“Mudrick Capital”) and a designee of Yorkville Advisors Global, LP (“Yorkville”) pursuant to a non-binding term sheet (the “Term Sheet”) providing for, among other things:
| (i) | an amendment to the indenture, dated December 16, 2021, entered into between the Company and U.S. Bank National Association, as trustee and collateral agent (the “Trustee”), which governs the Company’s 10.00% / 12.00% Convertible Senior Secured PIK Toggle Notes due 2030 (the “Convertible Senior Secured Notes”) issued to Mudrick Capital (as previously amended and supplemented, the “Indenture”), to provide for a change in the conversion price of all Convertible Senior Secured Notes issued under the Indenture from $3.50 to $1.30 (the “Indenture Amendment”); |
| (ii) | amendments to the convertible note purchase agreement, dated April 20, 2026 (the “Convertible Note Purchase Agreement”), between the Company and Mudrick Capital, which grants the Company the right, but not the obligation, to cause Mudrick Capital to purchase up to $50 million in aggregate original principal amount of additional Convertible Senior Secured Notes for a period of one year following the date of the Convertible Note Purchase Agreement, to accelerate the issuance of the remaining $35 million of additional Convertible Senior Secured Notes under the Convertible Note Purchase Agreement on or before August 12, 2026 (the “Mudrick Facility Draw”); and |
| (iii) | the implementation of a shareholder agreement with Mudrick Capital (the “Shareholder Agreement”) providing for certain director nomination rights, removal rights and consent rights for Mudrick Capital and other matters, including the submission of certain amendments to the Company’s Fifth Amended and Restated Memorandum and Articles of Association to a vote at a general meeting of the Company’s shareholders. |
On August 12, 2026, the Company entered into the Fourth Supplemental Indenture (the “Fourth Supplemental Indenture”) to the Indenture with the Trustee to implement, among other things, the Indenture Amendment. A copy of the Fourth Supplemental Indenture is furnished as Exhibit 4.1 to this Report on Form 6-K.
On August 12, 2026, the Company entered into an Amended and Restated Convertible Note Purchase Agreement with Mudrick Capital to permit the Mudrick Facility Draw (the “A&R Convertible Note Purchase Agreement”). A copy of the A&R Convertible Note Purchase Agreement is furnished as Exhibit 99.1 hereto.
The Mudrick Facility Draw is expected be consummated on or about August 13, 2026. The Company intends to use the net proceeds from the Mudrick Facility Draw to fund its research and development expenses as it continues to develop its aircraft and its expenditures in the expansion of its testing, manufacturing and certification capacities, as well as for general working capital and other general corporate purposes.
On August 12, 2026, the Company entered into the Shareholder Agreement with Mudrick Capital. A copy of the Shareholder Agreement is furnished as Exhibit 99.2 hereto.
On August 12, 2026, the Company and Yorkville entered into (i) an Amended and Restated Certificate of Designations (the “A&R Certificate of Designations”), amending and restating the Certificate of Designations of Series A Convertible Preferred Shares of the Company, dated April 20, 2026, and (ii) an Amended and Restated Securities Purchase Agreement (the “A&R Securities Purchase Agreement”), amending and restating the Securities Purchase Agreement, dated April 20, 2026, between the Company and Yorkville, in each case in order to align certain terms included in each of those documents with the Indenture Amendment.
A copy of the A&R Certificate of Designations is furnished as Exhibit 99.3 hereto.
A copy of the A&R Securities Purchase Agreement is furnished as Exhibit 99.4 hereto.
Forward-Looking Statements
This Report of Foreign Private Issuer on Form 6-K (the “Form 6-K”) contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any express or implied statements contained in this Form 6-K that are not statements of historical fact may be deemed to be forward-looking statements, including, without limitation, the timing for the consummation of the Mudrick Facility Draw, the Company’s anticipated use of proceeds, and statements that include the words "expect," "intend," "plan," "believe," "project," "forecast," "estimate," "may," "should," "anticipate," "will," "aim," "potential," "continue," "are likely to" and similar statements of a future or forward-looking nature. Forward-looking statements are neither promises nor guarantees, but involve known and unknown risks and uncertainties that could cause actual results to differ materially from those projected, including, without limitation: our limited operating history without manufactured non-prototype aircraft or completed eVTOL aircraft customer order; our potential inability to raise additional funds when we need or want them, or at all, to fund our operations; our potential inability to produce, certify or launch aircraft in the volumes or timelines projected; the potential inability to obtain the necessary certifications for production and operation within any projected timeline, or at all; our history of losses and the expectation to incur significant expenses and continuing losses for the foreseeable future; the market for eVTOL aircraft being in a relatively early stage; any accidents or incidents involving eVTOL aircraft could harm our business; our dependence on partners and suppliers for the components in our aircraft and for operational needs; and the other important factors discussed under the caption "Risk Factors" in our Annual Report on Form 20-F filed with the U.S. Securities and Exchange Commission ("SEC") on March 24, 2026, as such factors may be updated from time to time in our other filings with the SEC. Any forward-looking statements contained in this Form 6-K speak only as of the date hereof and accordingly undue reliance should not be placed on such statements. The Company disclaims any obligation or undertaking to update or revise any forward-looking statements contained in this Form 6-K, whether as a result of new information, future events or otherwise, other than to the extent required by applicable law.
INCORPORATION BY REFERENCE
The information included in this Report on Form 6-K (including Exhibits 4.1, 99.1, 99.2, 99.3 and 99.4) is hereby incorporated by reference into the Company’s Registration Statements on Form F-3 (File No. 333-270756, File No. 333-284763, File No. 333-287207, File No. 333-292448, File No. 333-295988 and File No. 333-297030) (including any prospectuses forming a part of such registration statements) and to be a part thereof from the date on which this Report on Form 6-K is filed, to the extent not superseded by documents or reports subsequently filed or furnished.
EXHIBIT INDEX
|
Exhibit No. |
Description | |
| 4.1 | Fourth Supplemental Indenture, dated August 12, 2026, between Vertical Aerospace Ltd. and U.S. Bank Trust Company, National Association. | |
| 99.1 | Amended and Restated Convertible Note Purchase Agreement, dated August 12, 2026, by and between Vertical Aerospace Ltd. and Mudrick Capital Management, L.P. on behalf of certain funds, investors, entities or accounts that are managed, sponsored or advised by Mudrick Capital Management, L.P. or its affiliates. | |
| 99.2 | Shareholder Agreement, dated August 12, 2026, between Vertical Aerospace Ltd. and Mudrick Capital Management, L.P. on behalf of certain funds, investors, entities or accounts that are managed, sponsored or advised by Mudrick Capital Management, L.P. or its affiliates. | |
| 99.3 | Amended and Restated Certificate of Designations of Series A Convertible Preferred Shares of Vertical Aerospace Ltd., dated August 12, 2026. | |
| 99.4 | Amended and Restated Securities Purchase Agreement, dated August 12, 2026, by and between Vertical Aerospace Ltd. and YA II PN, Ltd. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Vertical Aerospace Ltd. | ||
| Date: August 12, 2026 | By: | /s/ Stuart Simpson |
| Stuart Simpson | ||
| Chief Executive Officer | ||
Exhibit 99.1
AMENDED AND RESTATED CONVERTIBLE NOTE PURCHASE AGREEMENT
This AMENDED AND RESTATED CONVERTIBLE NOTE PURCHASE AGREEMENT (this “Agreement”) is entered into on August 12, 2026, which amends, restates and supersedes in its entirety (subject to Section 11(r)) the Convertible Note Purchase Agreement, dated as of April 20, 2026 (the “Closing Date”, and such prior agreement, the “Original Convertible Note Purchase Agreement”), by and between Vertical Aerospace Ltd., a Cayman Islands exempted company (the “Issuer”) and Mudrick Capital Management, L.P. on behalf of certain funds, investors, entities or accounts that are managed, sponsored or advised by Mudrick Capital Management, L.P. or its affiliates (the “Purchaser”). Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to such terms in the Indenture (as defined below).
WHEREAS, on December 16, 2021, the Issuer and U.S. Bank Trust Company, National Association, as successor in interest to U.S. Bank National Association, as trustee and collateral agent (the “Trustee”), entered into an indenture (the “Base Indenture”), under which the Issuer issued an original aggregate principal amount of US$200,000,000 7.00% / 9.00% Convertible Senior Secured PIK Toggle Notes due 2026 (the “Initial Notes”);
WHEREAS, on December 23, 2024, the Issuer and the Trustee entered into the first supplemental indenture to the Base Indenture (the “First Supplemental Indenture”), setting forth certain amendments to the Base Indenture, including: (i) increasing the interest rate applicable to the Initial Notes to 10.00% for cash interest and 12.00% for PIK interest; (ii) extending the maturity date of the Initial Notes to December 15, 2028; and (iii) providing for a fixed conversion price of US$2.75 per Issuer ordinary share for half of the nominal principal amount of the Initial Notes and US$3.50 per Issuer ordinary share for the other half;
WHEREAS, on December 23, 2024, the Issuer, Vertical Aerospace Group Ltd (a company incorporated in England and Wales with company number 1250994 and a subsidiary of the Issuer; the “Subsidiary Guarantor”) and the Trustee entered into the second supplemental indenture to the Base Indenture and the First Supplemental Indenture (the “Second Supplemental Indenture”), pursuant to which the Subsidiary Guarantor became a guarantor of the Notes under the Indenture;
WHEREAS, on April 20, 2026, the Issuer, the Subsidiary Guarantor and the Trustee entered into the third supplemental indenture to the Base Indenture, the First Supplemental Indenture and the Second Supplemental Indenture (the “Third Supplemental Indenture”), setting forth certain amendments to the Base Indenture, including: (i) extending the maturity date of the Initial Notes to December 15, 2030; and (ii) permitting the issuance of up to $250 million face amount of Series A Convertible Preferred Shares (the “Yorkville Preferred Shares”), to YA II PN, Ltd. (“Yorkville”), plus accrued and capitalized dividends thereon, pursuant to that certain Securities Purchase Agreement, dated April 20, 2026, between the Issuer and Yorkville (the “Original Yorkville Securities Purchase Agreement”);
WHEREAS, on May 20, 2026, June 26, 2026 and July 27, 2026, the Issuer issued to the Purchaser $3,417,940.00, $3,224,471.00 and $3,224,472.00, respectively, in aggregate principal amount of additional 10.00% / 12.00% Convertible Senior Secured PIK Toggle Notes due 2030 under the Indenture (collectively, the “Q2 2026 Notes”, and together with the Initial Notes, the “Existing Notes”);
WHEREAS, on August 12, 2026, the Issuer, the Subsidiary Guarantor and the Trustee entered into the fourth supplemental indenture to the Base Indenture, the First Supplemental Indenture, the Second Supplemental Indenture and the Third Supplemental Indenture (the “Fourth Supplemental Indenture” and, together with the Base Indenture, the First Supplemental Indenture, the Second Supplemental Indenture and the Third Supplemental Indenture, the “Indenture”), setting forth certain amendments to the Base Indenture, including providing for a fixed conversion price of US$1.30 per Issuer ordinary share for the Notes (as defined below);
WHEREAS, on August 12, 2026, the Issuer and Yorkville amended and restated in its entirety the Original Yorkville Securities Purchase Agreement (so amended and restated, the “Amended and Restated Yorkville Securities Purchase Agreement”);WHEREAS, Section 2.03(B) of the Indenture provides that the Issuer may, with the consent of the majority of the holders of the Existing Notes, issue additional notes under the Indenture with the same terms as the Existing Notes (except with respect to the date as of which interest begins to accrue on such additional notes and the first interest payment date of such additional notes);
WHEREAS, the Issuer desires from time to time to issue and sell, and Purchaser desires from time to time to purchase, additional 10.00% / 12.00% Convertible Senior Secured PIK Toggle Notes due 2030 to be issued under the Indenture (the “Additional Notes” and, together with the Existing Notes, the “Notes”) upon the terms and subject to the conditions set forth in this Agreement;
WHEREAS, as of the date of this Agreement (the “Amendment Date”), the Purchaser holds 100% of the Existing Notes and has given its consent to the Issuer and Trustee for the Issuer to issue the Additional Notes pursuant to that certain Consent Agreement, dated August 12, 2026, between the Purchaser, the Issuer, the Subsidiary Guarantor and Trustee; and
WHEREAS, on the Amendment Date, the Purchaser and the Issuer entered into that certain Shareholder Agreement with respect to the governance matters set forth therein (the “Shareholder Agreement”).
NOW, THEREFORE, in consideration of the foregoing and the mutual representations, warranties and covenants, and subject to the conditions, herein contained, and intending to be legally bound hereby, the parties hereto hereby agree as follows:
Section 1. Certain Definitions. For purposes of this Agreement:
“2026 Issuer Repurchase Right” shall have the meaning ascribed to such term in Section 3(a).
2
“Additional Notes” shall have the meaning ascribed to such term in the Recitals to this Agreement.
“Amended and Restated Yorkville Securities Purchase Agreement” shall have the meaning ascribed to such term in the Recitals to this Agreement.
“Base Indenture” shall have the meaning ascribed to such term in the Recitals to this Agreement.
“Board” shall have the meaning ascribed to such term in Section 8(b).
“Business Day” means any day other than a Saturday, Sunday or any other day on which commercial banks are required or authorized to close in the State of New York.
“Chosen Courts” shall have the meaning ascribed to such term in Section 11(h).
“Closing Date” shall have the meaning ascribed to such term in the Recitals to this Agreement.
“Code” shall have the meaning ascribed to such term in Section 5(n).
“Commission” means the United States Securities and Exchange Commission.
“Commitment Amount” shall have the meaning ascribed to such term in Section 2(a).
“Commitment Termination Date” means the earlier to occur of (a) the issuance of Additional Notes in an aggregate nominal principal amount (after giving effect to the pool factor under the Indenture in effect on the relevant Draw Date) equal to the Commitment Amount, (b) the obligation of the Purchaser to purchase Additional Notes having been terminated in accordance with the terms of this Agreement, and (c) the date falling on the one-year anniversary of the Closing Date.
“Deferral Period” shall have the meaning ascribed to such term in Section 8(b).
“Draw Amount” means, in respect of each Drawdown, an amount in U.S. dollars, as specified in a Draw Notice, to be paid by the Purchaser on a Draw Date in consideration for the issuance by the Issuer of a like nominal principal amount (after giving effect to the pool factor under the Indenture in effect on the relevant Draw Date) of Additional Notes.
“Draw Date” means, in respect of each Drawdown, the date specified in a Draw Notice for payment by the Purchaser of the Issue Price in consideration for Additional Notes to be issued by the Issuer.
“Draw Notice Date” means the date on which the Issuer delivers a Draw Notice to the Purchaser.
“Draw Notice” means a written notice to be delivered by the Issuer to the Purchaser specifying, in respect of any Drawdown: (i) the Draw Amount(s), (ii) the Draw Date(s), and (iii) wire instructions for delivery of the Issue Price in respect of the Draw Amount(s) to the Issuer.
“Drawdown” shall have the meaning ascribed to such term in Section 2(b).
3
“Effectiveness Deadline” shall have the meaning ascribed to such term in Section 8(a).
“ERISA” shall have the meaning ascribed to such term in Section 5(p).
“Exchange Act” means the Securities Exchange Act of 1934, as amended.
“Existing Notes” shall have the meaning ascribed to such term in the Recitals to this Agreement.
“First Supplemental Indenture” shall have the meaning ascribed to such term in the Recitals to this Agreement.
“Fourth Supplemental Indenture” shall have the meaning ascribed to such term in the Recitals to this Agreement.
“Indenture” shall have the meaning ascribed to such term in the Recitals to this Agreement.
“Initial Notes” shall have the meaning ascribed to such term in the Recitals to this Agreement.
“Issue Price” means 100% of the nominal principal amount (after giving effect to the pool factor under the Indenture in effect on the relevant Draw Date) of Additional Notes to be issued in relation to a Drawdown.
“Issuer” shall have the meaning ascribed to such term in the Recitals to this Agreement.
“Issuer Group” shall have the meaning ascribed to such term in Section 6(f).
“Issuer Material Adverse Effect” shall have the meaning ascribed to such term in Section 4(f).
“Issuer Representation Date” shall have the meaning ascribed to such term in Section 4.
“Interest Payment Date” shall have the meaning ascribed to such term in the Indenture.
“Liquidity” means, as of any date of determination, the aggregate amount of unrestricted and unencumbered cash held by the Issuer and its subsidiaries on deposit in bank accounts, free and clear of all Liens (except for any Liens granted pursuant to the Security Documents) and restrictions on use, and immediately available for general corporate purposes.
“Note Facility” shall have the meaning ascribed to such term in Section 2(a).
“Notes” shall have the meaning ascribed to such term in the Recitals to this Agreement.
“Ordinary Shares” means the ordinary shares of the Issuer, par value US$0.001 per share.
“Original Yorkville Securities Purchase Agreement” shall have the meaning ascribed to such term in the Recitals to this Agreement.
“Plan” shall have the meaning ascribed to such term in Section 5(p).
4
“Purchaser” shall have the meaning ascribed to such term in the Preamble to this Agreement.
“Purchaser Material Adverse Effect” shall have the meaning ascribed to such term in Section 5(c).
“Registration Period” shall have the meaning ascribed to such term in Section 8(a).
“Registration Statement” shall have the meaning ascribed to such term in Section 8(a).
“Repurchase Date” shall have the meaning ascribed to such term in Section 3(a).
“Repurchase Notice” shall have the meaning ascribed to such term in Section 3(a).
“Repurchase Price” shall have the meaning ascribed to such term in Section 3(b).
“Repurchase Standstill” shall have the meaning ascribed to such term in Section 3(c).
“Sanctions” shall have the meaning ascribed to such term in Section 4(r).
“Scheduled Trading Days” shall have the meaning ascribed to such term in the Indenture.
“SEC Reports” shall have the meaning ascribed to such term in Section 4(p).
“Second Supplemental Indenture” shall have the meaning ascribed to such term in the Recitals to this Agreement.
“Securities Act” means the United States Securities Act of 1933, as amended.
“Security Documents” shall have the meaning ascribed to such term in the Indenture.
“Shelf Registration Statement” shall have the meaning ascribed to such term in Section 8(a).
“Solvent” means with respect to a particular date, that on such date (i) the fair value (and present fair saleable value) of the assets of the Issuer Group is not less than the total amount required to pay its liability on its total existing debts and liabilities (including contingent liabilities, but excluding any Additional Notes contemplated by this Agreement that are not yet issued under the Indenture), as they mature and become due; (ii) the Issuer Group is able to realize upon its assets and pay its debts and other liabilities, contingent obligations and commitments as they mature and become due in the normal course of business; (iii) assuming consummation of the issuance and sale of the Additional Notes to be issued on the Draw Date with respect to which Section 6(g) is required to be satisfied, the Issuer Group does not have, intend to incur or believe that it will incur debts or liabilities beyond its ability to pay as such debts and liabilities mature; (iv) the Issuer Group is not engaged in any business or transaction, and does not propose to engage in any business or transaction, for which its property would constitute unreasonably small capital; and (v) the Issuer Group is not a defendant in any civil action that would result in a judgment that the Issuer Group is or would become unable to satisfy.
“Subsidiary Guarantor” shall have the meaning ascribed to such term in the Recitals to this Agreement.
5
“Suspension Event” shall have the meaning ascribed to such term in Section 8(b).
“Termination Event” shall have the meaning ascribed to such term in Section 10.
“Third Supplemental Indenture” shall have the meaning ascribed to such term in the Recitals to this Agreement.
“Transactions Parties” shall have the meaning ascribed to such term in Section 5(p).
“Trustee” shall have the meaning ascribed to such term in the Recitals to this Agreement.
“Underlying Shares” shall have the meaning ascribed to such term in Section 4(e).
“Yorkville” shall have the meaning ascribed to such term in the Recitals to this Agreement.
“Yorkville Preferred Shares” shall have the meaning ascribed to such term in the Recitals to this Agreement.
Section 2. Purchase and Sale.
(a) Subject to the terms and conditions of this Agreement, the Purchaser hereby agrees to purchase at the Issue Price, and the Issuer hereby agrees to issue and sell to the Purchaser, on the Amendment Date, Additional Notes (the “Note Facility”) for an aggregate nominal principal amount (after giving effect to the pool factor under the Indenture in effect on the relevant Draw Date) of US$35,000,000 (the “Commitment Amount”), together with, in respect of any Additional Notes issued on a date other than an Interest Payment Date, the Pre-Issuance Accrued Interest (as defined below) payable in cash in accordance with Section (e) below.
(b) The Issuer shall draw upon the Note Facility on the Amendment Date by delivery of a Draw Notice, substantially in the form attached hereto as Exhibit A, to the Purchaser on the Amendment Date (a “Drawdown”).
(c) For the avoidance of doubt, the Purchaser’s undrawn commitments to purchase Additional Notes under the Original Convertible Note Purchase Agreement are terminated and replaced with its commitments hereunder. After the purchase and sale of the Additional Notes on the Amendment Date in accordance with this Agreement, the Purchaser shall have no obligation to purchase additional Notes under this Agreement.
(d) Subject to the fulfillment or waiver of the conditions precedent set forth in Section 6 hereof, the Purchaser shall be obligated to purchase Additional Notes in a nominal principal amount (after giving effect to the pool factor under the Indenture in effect on the relevant Draw Date) equal to the Commitment Amount, and, to the extent such Additional Notes are issued on a date other than an Interest Payment Date, to pay the Pre-Issuance Accrued Interest in addition thereto in accordance with Section (e).
(e) Subject to the fulfillment or waiver of the conditions precedent set forth in Section 6 hereof, on the Amendment Date or within one Business Day thereafter, the Purchaser shall deliver the Issue Price for the Additional Notes to be issued in respect of the Commitment Amount by wire transfer of U.S. dollars in immediately available funds to the account specified by the Issuer in such Draw Notice, together with an amount in cash equal to the Pre-Issuance Accrued Interest (if any), and deliver to the Issuer such information as is reasonably requested in the Draw Notice in order for the Issuer to issue and deliver the Additional Notes. Substantially simultaneously with receipt of such Issue Price and the Pre-Issuance Accrued Interest, the Issuer shall deliver such Additional Notes to the Purchaser or its assignees pursuant to this Agreement. For the avoidance of doubt, each Additional Note shall be entitled to receive the full amount of interest payable for the Interest Period in which it is issued (whether paid in cash or in kind), determined in accordance with the Indenture.
6
For purposes herein, “Pre-Issuance Accrued Interest” means, with respect to any Additional Notes issued on a date other than an Interest Payment Date, an amount equal to the interest that would have accrued on the nominal principal amount (after giving effect to the pool factor under the Indenture in effect on the relevant Draw Date) of such Additional Notes from (and including) the most recent Interest Payment Date to (but excluding) the Draw Date, determined in accordance with the Indenture based on the form of interest (cash or payment-in-kind) applicable to the Interest Period commencing on such most recent Interest Payment Date (as elected or deemed elected by the Company thereon, including the corresponding interest rate), as if such Additional Notes had been issued on such most recent Interest Payment Date.
(f) Prior to a Draw Date, (i) the Purchaser shall deliver all such other information and shall take all such actions as is reasonably requested by the Issuer in order for the Issuer to deliver the Additional Notes to the Purchaser and (ii) the Issuer shall take all such actions as is reasonably requested by the Purchaser (including providing relevant instructions to the trustee and paying agent for the Additional Notes) in order to deliver the Additional Notes to the Purchaser. In particular, the Issuer shall use reasonable best efforts to procure the delivery of Additional Notes in the form of restricted global securities in registered form without interest coupons attached, which will be issued by the Issuer, authenticated by the trustee or an authenticating agent in accordance with the Indenture and deposited with, and registered in the name of a common depositary for Euroclear Bank SA/NV, as operator of the Euroclear System and Clearstream Banking, S.A. or their nominees for credit to the accounts notified in writing by the Purchaser to the Issuer at least two (2) Business Days prior to the Draw Date.
Section 3. Issuer Repurchase Right.
(a) The Issuer may from time to time, at any time following their issuance until the date falling on the one-year anniversary of the Closing Date, upon written notice to the Purchaser (a “Repurchase Notice”), repurchase any Notes held by the Purchaser, in an aggregate principal amount not to exceed the sum of (A) the aggregate principal amount of the Q2 2026 Notes issued by the Issuer on the dates set forth in the fifth WHEREAS clause above plus (B) the aggregate principal amount of Additional Notes issued by the Issuer on the Amendment Date (such sum, the “Specified Amount”), on a Business Day of the Issuer’s choosing that is no more than thirty five (35), nor less than ten (10), Business Days after the date of delivery of the Repurchase Notice (the “Repurchase Date”), irrespective of the issue date of such Q2 2026 Notes or Additional Notes (the “2026 Issuer Repurchase Right”).
(b) Any repurchase of Notes by the Issuer pursuant to the 2026 Issuer Repurchase Right shall be made at a price in cash equal to the nominal principal amount (after giving effect to the pool factor under the Indenture in effect on the relevant Repurchase Date) of such Notes being repurchased, multiplied by 112%, plus all accrued and unpaid Cash Interest thereon to, but excluding, the Repurchase Date (the “Repurchase Price”); provided however, that if such Repurchase Date is after a Regular Record Date and on or before the next Interest Payment Date, then (i) the Purchaser will be entitled, notwithstanding such repurchase, to receive on or, at the Issuer’s election, before such Interest Payment Date, the unpaid Cash Interest that would have accrued on such Notes to, but excluding, such Interest Payment Date (in the case of Global Notes, payable in accordance with the Applicable Procedures) (assuming, solely for these purposes, that such Notes remained outstanding through such Interest Payment Date, if such Repurchase Date is before such Interest Payment Date); and (ii) the Repurchase Price will not include accrued and unpaid Cash Interest on such Notes to, but excluding, such Repurchase Date.
7
(c) Upon the Issuer’s delivery of a Repurchase Notice, the Purchaser agrees that it shall not exercise its conversion rights pursuant to Section 5.01 of the Indenture to convert Notes in the principal amount that is subject to the Repurchase Notice (the “Repurchase Standstill”); provided that if the Issuer does not deliver the Repurchase Price by 5:00 p.m., New York City time on the Repurchase Date, then the Repurchase Standstill will no longer be in effect for the applicable Notes. For the avoidance of doubt, if a Repurchase Standstill lapses as a result of the Issuer’s failure to timely deliver the Repurchase Price, then upon Issuer’s delivery of a subsequent Repurchase Notice, the Notes subject to such new Repurchase Notice will be subject to the Repurchase Standstill.
(d) The Purchaser agrees to take all actions reasonably requested by the Issuer or the Trustee to give effect to the delivery and/or cancellation of the repurchased Notes against delivery to Purchaser of the Repurchase Price.
(e) The Issuer and Purchaser hereby acknowledge and agree that the 2026 Issuer Repurchase Right constitutes a “negotiated transaction” pursuant to Section 2.19 of the Indenture and that the Issuer is not exercising its rights under Section 4.03 of the Indenture in connection with its exercise of the 2026 Issuer Repurchase Right.
Section 4. Issuer Representations and Warranties. The Issuer represents and warrants to the Purchaser (for itself and in respect of other members of the Issuer Group, as applicable), as of the date of this Agreement, each Draw Notice Date and each Draw Date (each such date, an “Issuer Representation Date”), that:
(a) The Issuer is a company duly incorporated, validly existing and in good standing under the laws of the Cayman Islands, with corporate power and authority to own, lease and operate its properties and conduct its business as presently conducted and to enter into, deliver and perform its obligations under the Fourth Supplemental Indenture and related documents. The Subsidiary Guarantor is a limited liability corporation, duly incorporated and validly existing under the laws of England and Wales, and has the power to own its assets and carry on its business as it is being conducted, and has the power to enter into, perform and deliver, and has taken all necessary corporate action to authorize its entry into, performance and delivery of, the Fourth Supplemental Indenture, the Security Documents and related documents to which it is or will be party and the transactions contemplated thereby; and no limit on the Subsidiary Guarantor’s powers will be exceeded as a result of the grant of security or giving of guarantees or indemnities contemplated by the Fourth Supplemental Indenture, the Security Documents and related documents to which it is party.
8
(b) This Agreement has been duly authorized and validly executed and delivered by the Issuer and, assuming that this Agreement has been duly authorized, executed and delivered by the Purchaser, shall constitute the valid and binding obligation of the Issuer and is enforceable against the Issuer in accordance with its terms, except as may be limited or otherwise affected by (i) bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or other laws relating to or affecting the rights of creditors generally, and (ii) principles of equity, whether considered at law or equity (including concepts of materiality, reasonableness, good faith and fair dealing with respect to those jurisdictions that recognize such concepts) ((i) and (ii) together being the “Reserved Matters”).
(c) The issue of the Additional Notes has been or will be duly authorized and, when issued to the Purchaser against full payment for the Additional Notes in accordance with the terms of this Agreement, the Additional Notes will be valid and legally binding obligations of the Issuer, enforceable in accordance with their terms, except as may be limited or otherwise affected by the Reserved Matters.
(d) The Indenture constitutes a legal, valid and binding obligation of the Issuer and the guarantors thereunder (including the Subsidiary Guarantor), enforceable against the Issuer and the guarantors, respectively, in accordance with its terms, except as may be limited or otherwise affected by the Reserved Matters. Each Security Document has been duly authorized by the relevant security grantor and creates or confirms, as applicable, legal, valid and binding first-ranking security interests that each Security Document purports to create for the benefit of the secured parties named therein, in each case subject to the terms set forth in such Security Document. The obligations expressed to be assumed by the relevant security grantor (including the Subsidiary Guarantor) under each Security Document to which it is party are legal, valid, binding and enforceable obligations, except as may be limited or otherwise affected by the Reserved Matters. The relevant security grantor (including the Subsidiary Guarantor) under each Security Document owns the relevant Collateral (as defined in the Indenture) covered by such Security Document free and clear of any security interest, mortgage, pledge, lien, encumbrance or claim, other than as permitted under the Indenture. All filings and other actions necessary to perfect and protect each security interest in the Collateral created under the Security Documents have been duly made or taken and are in full force and effect and create a valid first-ranking security interest in the Collateral securing the obligations of the relevant security grantor (including the Subsidiary Guarantor), in favor of the collateral agent under the Indenture, in each case subject to the terms set forth in such Security Document.
(e) The Issuer’s Ordinary Shares issuable upon conversion of the Additional Notes (the “Underlying Shares”) have been duly authorized and, when issued upon conversion of the Additional Notes, will be validly issued, fully paid and non-assessable and will not have been issued in violation of any preemptive rights created under the Issuer’s constitutional documents (as adopted on or prior to such Issuer Representation Date), by any contract to which the Issuer is a party or by which it is bound, or under the laws of its jurisdiction of incorporation.
9
(f) The execution, delivery and, upon effectiveness of this Agreement and each of the Security Documents, performance by the Issuer and each of its subsidiaries (as applicable) party thereto of this Agreement and each of the Security Documents (including compliance by the Issuer and its relevant subsidiaries (as applicable) party thereto with all of the provisions in this Agreement and each of the Security Documents to which it is party), the issuance and sale of the Additional Notes and the issuance and delivery of Underlying Shares upon conversion of the Additional Notes in accordance with the terms of the Indenture do not and will not (i) conflict with, or result in a breach or violation of, any of the terms or provisions of, or constitute a default under, or result in the creation or imposition of any lien, charge or encumbrance upon, any of the property or assets of the Issuer or any of its subsidiaries, as applicable, pursuant to the terms of any indenture, mortgage, charge, deed of trust, loan agreement, lease, license or other agreement or instrument to which the Issuer or any of its subsidiaries, as applicable, is a party or by which the Issuer or any of its subsidiaries, as applicable, is bound or to which any of the property or assets of the Issuer or any of its subsidiaries, as applicable, is subject, (ii) result in any violation of the provisions of the organizational documents of the Issuer or any of its subsidiaries, as applicable, or (iii) result in any violation by the Issuer or any of its subsidiaries of any law, statute or any judgment, order, rule, regulation or other legally enforceable requirement of any court or governmental agency or body, domestic or foreign, having jurisdiction over the Issuer or any of its subsidiaries, as applicable, or any of its properties that, in the case of clauses (i) and (iii), would reasonably be expected, individually or in the aggregate, to have an Issuer Material Adverse Effect. For purposes of this Agreement, an “Issuer Material Adverse Effect” means an event, change, delay, development, occurrence, condition or effect with respect to the Issuer or the relevant subsidiary (as applicable) that has a material adverse effect on (x) the assets, business, prospects, shareholders’ equity, results of operation or financial operations of the Issuer and its subsidiaries, taken as a whole by reference to the position as at the date of this Agreement (y) the validity of the Additional Notes, or (z) the legal authority of the Issuer or the relevant subsidiary (as applicable) to enter into and timely perform its obligations under this Agreement and each of the Security Documents to which it is party; provided, however, that no Issuer Material Adverse Effect shall be deemed to have occurred if such event, change, delay, development, occurrence, condition or effect with respect to the Issuer or the relevant subsidiary (as applicable) (i) was known by the Purchaser as of the date of this Agreement to have already occurred or to be going to occur, (ii) was caused, directly or indirectly, by any delay or failure by the Purchaser to timely grant a consent pursuant to Section 7, or (iii) was caused, directly or indirectly, by any delay or failure by the Purchaser to timely pay to the Issuer the purchase price for the Additional Notes as contemplated hereby.
(g) As of the date of this Agreement, the authorized share capital of the Issuer is US$1,010,000 divided into 1,000,000,000 Ordinary Shares and 10,000,000 preferred shares of a par value of US$0.001 each. As of the date of this Agreement, (a) 171,723,641 Ordinary Shares are issued and outstanding, (b) 27,000 preferred shares are issued and outstanding, (c) 50,000,000 warrants, each exercisable to purchase 1/10th Ordinary Share at US$50.00 per full share, are issued and outstanding, (d) 2,625,000 warrants, each exercisable to purchase 1/10th Ordinary Share at US$100.00 per full share, are issued and outstanding, (e) 19,264,935 warrants, each exercisable to purchase 1/10th Ordinary Share at US$115.00 per full share, are issued and outstanding, (f) 7,500,000 Tranche A warrants, each exercisable to purchase one Ordinary Share at US$6.00 per share, are issued and outstanding, (g) 7,500,000 Tranche B warrants, each exercisable to purchase one Ordinary Share at US$7.50 per share, are issued and outstanding, (h) 33,333,334 Tranche C warrants, each exercisable to purchase one Ordinary Share at US$2.00 per share, are issued and outstanding, (i) an option to purchase 200,000 Ordinary Shares at an exercise price of US$115.00 per full share, is granted and outstanding, and (j) 18,842,343 Ordinary Shares were subject to issuance upon the grant or exercise of employee incentive plan awards. As of the date hereof, except with respect to the outstanding Existing Notes and as otherwise set forth in this Agreement, there are no outstanding options, warrants or other rights to subscribe for, purchase or acquire from the Issuer any Ordinary Shares or other equity interests in the Issuer or securities convertible into or exchangeable or exercisable for Ordinary Shares. Other than as publicly disclosed, there are no shareholder agreements, voting trusts or other agreements or understandings to which the Issuer is a party or by which it is bound relating to the voting of any equity interests of the Issuer. Other than as publicly disclosed, there are no securities or instruments issued by or to which the Issuer is a party containing anti-dilution or similar provisions that will be triggered by the issuance of the Additional Notes.
10
(h) Assuming the accuracy of the Purchaser’s representations and warranties set forth in Section 5 of this Agreement, no registration under the Securities Act is required for the offer and sale of the Additional Notes by the Issuer to the Purchaser.
(i) Neither the Issuer nor any person acting on its behalf has, directly or indirectly, made any offers or sales of any securities of the Issuer or solicited any offers to buy any securities of Issuer under circumstances that would adversely affect reliance by the Issuer on Section 4(a)(2) of the Securities Act for the exemption from registration for the transactions contemplated hereby or would require registration of the issuance of the Additional Notes under the Securities Act.
(j) The Issuer is not a “U.S. person” (as defined in Regulation S under the Securities Act); neither the Issuer, nor its affiliates (as defined in Rule 405 under the Securities Act), nor any person acting on its or their behalf, has engaged or will engage in any general solicitation or general advertising (within the meaning of Regulation D under the Securities Act), in connection with the offer or sale of any of the Additional Notes, and neither the Issuer, nor any person acting on its behalf has offered any of the Additional Notes in a manner involving a public offering under, or in a distribution in violation of, the Securities Act or any state securities laws.
(k) The Issuer and each security grantor (including the Subsidiary Guarantor) is not required to obtain any consent, waiver, authorization or order of, give any notice to, or make any filing or registration with, any court or other federal, state, local or other governmental authority, self-regulatory organization or other person in connection with the execution, delivery and performance by the Issuer and/or the relevant security grantor (as applicable) of this Agreement and each Security Document to which it is party (including, without limitation, the issuance of the Additional Notes), other than: (i) filings with the Securities and Exchange Commission of the Registration Statement pursuant to Section 8 of this Agreement, (ii) filings required by applicable state or federal securities laws, (iii) filings required by the NYSE, (iv) the consent of the majority of the holders of the Existing Notes, which consent has been given by the Purchaser in its capacity as the holder of 100% of the Existing Notes, (v) where the security grantor is incorporated in a jurisdiction within the United Kingdom, the registration of charge filed in respect of each Security Document to which such security grantor is party with the United Kingdom’s Registrar of Companies within the relevant period, together with prescribed particulars, in accordance with section 859A of the United Kingdom’s Companies Act 2006, and (vi) filings, the failure of which to obtain would not be reasonably expected to have, individually or in the aggregate, an Issuer Material Adverse Effect.
(l) No broker, finder or other financial consultant has acted on the Issuer’s behalf in connection with this Agreement or the transactions contemplated hereby.
11
(m) The Issuer and the Subsidiary Guarantor are in compliance with all applicable laws, except where such non-compliance would not have an Issuer Material Adverse Effect. The Issuer and the Subsidiary Guarantor have not received any written, or to its knowledge, other communication from a governmental entity that alleges that the Issuer or the Subsidiary Guarantor is not in compliance with or is in default or violation of any applicable law, except where such non-compliance, default or violation would not, individually or in the aggregate, have an Issuer Material Adverse Effect.
(n) Except for such matters as have not had and would not be reasonably likely to have, individually or in the aggregate, an Issuer Material Adverse Effect, there is no (i) action, suit, claim or other proceeding, in each case by or before any governmental authority pending against the Issuer or the Subsidiary Guarantor, or, to the knowledge of the Issuer, threatened against the Issuer or the Subsidiary Guarantor or (ii) judgment, decree, injunction, ruling or order of any governmental entity or arbitrator outstanding against the Issuer or the Subsidiary Guarantor.
(o) The Issuer is not, and immediately after receipt of payment for the Additional Notes will not be, an “investment company” within the meaning of the Investment Company Act of 1940, as amended.
(p) As of their respective dates, all reports required to be filed by the Issuer with the SEC (such reports, the “SEC Reports”) complied in all material respects with the applicable requirements of the Securities Act and the Exchange Act and the rules and regulations of the SEC promulgated thereunder, and none of the SEC Reports, when filed, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. The financial statements of the Issuer included in the SEC Reports were prepared in accordance with the International Financial Reporting Standards, consistently applied, comply in all material respects with the rules and regulations of the SEC with respect thereto as in effect at the time of filing and fairly present in all material respects the financial position of the Issuer Group as of and for the dates thereof and the results of operations and cash flows for the periods then ended, subject, in the case of unaudited statements, to normal, year-end audit adjustments and the absence of certain footnotes and other presentation items as is permissible under the International Financial Reporting Standards. The Issuer timely filed each report, statement, schedule, prospectus, and registration statement that the Issuer was required to file with the SEC since inception. A copy of each SEC Report is available to the Purchaser via the SEC’s EDGAR system. There are no outstanding or unresolved comments in comment letters received by the Issuer from the staff of the Division of Corporation Finance of the SEC with respect to any of the SEC Reports.
(q) There are no liabilities of the Issuer or any of its subsidiaries that would be required by International Financial Reporting Standards as issued by the International Accounting Standards Board to be reflected on the face of the consolidated balance sheet of the Issuer, except (i) liabilities reflected or reserved against in the financial statements or disclosed in the notes thereto contained in the SEC Reports since January 1, 2025, (ii) liabilities incurred since December 31, 2025 in the ordinary course of business and (iii) liabilities that would not, individually or in the aggregate, reasonably be expected to have an Issuer Material Adverse Effect.
12
(r) The Ordinary Shares of the Issuer are registered pursuant to Section 12(b) of the Exchange Act, and listed for trading on the NYSE under the symbol “EVTL”. There is no suit, action, proceeding or investigation pending or, to the knowledge of the Issuer, threatened against the Issuer by the NYSE or the SEC, respectively, to prohibit or terminate the listing of the Ordinary Shares on the NYSE or to deregister such shares under the Exchange Act. The Issuer has taken no action that is designed to terminate the registration of the Ordinary Shares under the Exchange Act. As soon as reasonably practicable following the filing of any Registration Statement pursuant to Section 8 hereof, the Issuer will file a supplemental listing application with the NYSE for the number of Underlying Shares registered for resale under such Registration Statement.
(s) Since its formation, neither the Issuer nor, to the Issuer’s knowledge, its subsidiaries, has (i) used any funds for unlawful contributions, gifts, entertainment or other unlawful expenses relating to political activity, (ii) made or offered to make any unlawful payment or provided or offered to provide anything of value to foreign or domestic government officials or employees, to foreign or domestic political parties or campaigns or violated any provision of the U.S. Foreign Corrupt Practices Act of 1977 or any other local or foreign anti-corruption or bribery law, or (iii) made any other unlawful payment. Since its formation, neither the Issuer nor, to the Issuer’s knowledge, its subsidiaries has directly or knowingly indirectly, given or agreed to give any unlawful gift or similar benefit in any material amount to any customer, supplier, governmental employee or other person who is or may be in a position to help or hinder the Issuer or its subsidiaries or assist the Issuer or its subsidiaries in connection with any actual or proposed transaction. Since its formation, the operations of each of the Issuer and, to the Issuer’s knowledge, its subsidiaries are and have been conducted at all times in compliance with money laundering statutes in all applicable jurisdictions, the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any governmental authority that has jurisdiction over the Issuer or its subsidiaries. Except as permitted by applicable law, neither the Issuer nor, to the Issuer’s knowledge, its subsidiaries or any director, officer, agent, or employee of the Issuer is a person that is, or is controlled or owned 50 percent or more, individually or in the aggregate, by one or more persons that are currently the subject of any sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury Department, the U.S. Department of Commerce, the U.S. Department of State, the United Nations Security Council, the European Union or His Majesty’s Treasury (collectively, “Sanctions”), nor is the Issuer or any of its subsidiaries located, organized, incorporated 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). Neither the Issuer nor, to the Issuer’s knowledge, any of its subsidiaries or any director, officer, agent, or employee of the Issuer has received notice of, or is otherwise aware of, any claim, action, suit, proceedings or investigation involving it with respect to Sanctions.
(t) As determined under U.S. federal income tax principles, (i) the Issuer does not have any accumulated “earnings and profits” and (ii) the Issuer, based on the facts and circumstances on the date of this Agreement, does not expect to have any “earnings and profits” for its taxable year ending on December 31, 2026, arising in the ordinary course.
13
Section 5. Purchaser Representations and Warranties. The Purchaser represents and warrants to the Issuer, as of the date of this Agreement and each Draw Date, that:
(a) The Purchaser has been duly formed or incorporated and is validly existing in good standing under the laws of its jurisdiction of incorporation or formation (if such concept exists in such jurisdiction), with power and authority to enter into, deliver and perform its obligations under this Agreement.
(b) This Agreement has been duly authorized, validly executed and delivered by the Purchaser and, assuming that this Agreement has been duly authorized, executed and delivered by the Issuer, shall constitute the valid and binding obligation of the Purchaser, and is enforceable against the Purchaser in accordance with its terms, except as may be limited or otherwise affected by the Reserved Matters.
(c) The execution, delivery and performance by the Purchaser of this Agreement (including compliance by the Purchaser with all of the provisions hereof), the purchase of the Additional Notes and the consummation of the transactions contemplated in this Agreement do not and will not (i) conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, or result in the creation or imposition of any lien, charge or encumbrance upon any of the property or assets of the Purchaser pursuant to the terms of any indenture, mortgage, charge, deed of trust, loan agreement, lease, license or other agreement or instrument to which the Purchaser is a party or by which the Purchaser is bound or to which any of the property or assets of the Purchaser is subject, (ii) result in any violation of the provisions of the organizational documents of the Purchaser or (iii) result in any violation by the Purchaser of any law, statute or any judgment, order, rule or regulation or any other legally enforceable requirement of any court or governmental agency or body, domestic or foreign, having jurisdiction over the Purchaser or any of its properties that, in the case of clauses (i) and (iii) would reasonably be expected to have a Purchaser Material Adverse Effect. For purposes of this Agreement, a “Purchaser Material Adverse Effect” means an event, change, delay, development, occurrence, condition or effect with respect to the Purchaser that has a material adverse effect on the ability of the Purchaser to enter into and timely perform its obligations under this Agreement.
(d) The Purchaser is not required to obtain any consent, waiver, authorization or order of, give any notice to, or make any filing or registration with, any court or other federal, state, local or other governmental authority, self-regulatory organization or other person in connection with the execution, delivery and performance of this Agreement.
(e) The Purchaser (i)(1) is a “qualified institutional buyer” (as defined in Rule 144A under the Securities Act) or (2) is an “accredited investor” (as defined in Rule 501(a) under the Securities Act), (ii) is acquiring the Additional Notes only for its own account and not for the account of others, or if the Purchaser is subscribing for the Additional Notes as a fiduciary or agent for one or more investor accounts, each owner of such account is a qualified institutional buyer or an accredited investor and the Purchaser has full investment discretion with respect to each such account, and the full power and authority to make the acknowledgements, representations and agreements herein on behalf of each owner of each such account, and (iii) is not acquiring the Additional Notes with a view to, or for offer or sale in connection with, any distribution thereof in violation of the Securities Act and has no present intention of selling, granting any participation in, or otherwise distributing the Additional Notes. The Purchaser is not an entity formed for the specific purpose of acquiring the Additional Notes.
14
(f) The Purchaser understands that the Additional Notes and the Underlying Shares are being offered in a transaction not involving any public offering within the meaning of the Securities Act, or any “offer of relevant securities to the public” within the meaning of the United Kingdom Public Offers and Admissions to Trading Regulations 2024 (SI 2024/105) (as amended), and that the Additional Notes and the Underlying Shares have not been registered under the Securities Act. The Purchaser understands that (i) the Additional Notes and the Underlying Shares may not be resold, transferred, pledged or otherwise disposed of by the Purchaser absent an effective registration statement under the Securities Act, except (1) to the Issuer or a subsidiary thereof, (2) to non-U.S. persons pursuant to offers and sales that occur solely in offshore transactions outside the United States within the meaning of Regulation S under the Securities Act or (3) pursuant to another applicable exemption from the registration requirements of the Securities Act, and in each of cases (2) and (3), in accordance with any applicable securities laws of the states and other jurisdictions of the United States, (ii) the Additional Notes and the Underlying Shares may be subject to transfer restrictions under applicable laws and (iii) any certificates or book entries representing the Additional Notes and the Underlying Shares shall contain a legend to such effect. The Purchaser acknowledges that the Additional Notes and the Underlying Shares may constitute “control” securities under applicable U.S. federal and state securities laws that may not be freely resold in the United States. The Purchaser understands and agrees that the Additional Notes and the Underlying Shares will be subject to the foregoing restrictions and, as a result of these restrictions, the Purchaser may not be able to readily resell the Additional Notes and the Underlying Shares, and may be required to bear the financial risk of an investment in the Additional Notes and the Underlying Shares for an indefinite period of time. The Purchaser acknowledges that it has been advised to consult legal counsel prior to making any offer, resale, pledge or transfer of any of the Additional Notes and the Underlying Shares.
(g) The Purchaser understands and agrees that it is purchasing the Additional Notes and the Underlying Shares directly from the Issuer. The Purchaser has received or has had full access to all the information the Purchaser considers necessary or appropriate to make an informed investment decision with respect to the Additional Notes. The Purchaser further has had an opportunity to ask questions and receive answers from the Issuer to obtain additional information necessary to verify any information furnished to the Purchaser or to which the Purchaser had access. In making its decision to acquire the Additional Notes, the Purchaser has relied solely upon independent investigation made by the Purchaser. Without limiting the generality of the foregoing, the Purchaser further acknowledges that (i) there have not been, and the Purchaser hereby agrees that it is not relying on, any representations, warranties, covenants or agreements made to the Purchaser by the Issuer, any of the Issuer’s affiliates, officers or directors, expressly or by implication, in connection with the Purchaser’s purchase of the Additional Notes and the Underlying Shares, other than those representations, warranties, covenants and agreements of the Issuer expressly set forth in this Agreement, and (ii) the Purchaser is not relying upon, and has not relied upon, any representations, warranties or covenants other than those expressly set forth in this Agreement in connection with its purchase of the Additional Notes and Underlying Shares.
15
(h) The Purchaser (i) is an institutional account as defined in FINRA Rule 4512(c), (ii) is a sophisticated investor, experienced in investing in equity transactions that are not registered under the Securities Act, and capable of evaluating investment risks independently, both in general and with regard to all transactions and investment strategies involving a security or securities and (iii) has exercised independent judgment in evaluating its participation in the purchase of the Notes and the Underlying Shares. Accordingly, the Purchaser understands that the offering meets (i) the exemptions from filing under FINRA Rule 5123(b)(1)(A) and (ii) the institutional customer exemption under FINRA Rule 2111(b).
(i) The Purchaser became aware of this offering of the Additional Notes and the Underlying Shares solely by means of direct contact between the Purchaser and the Issuer. The Purchaser has a pre-existing substantive relationship (as interpreted in guidance from the Commission under the Securities Act) with the Issuer, and the Additional Notes and the Underlying Shares were offered to the Purchaser solely by direct contact between the Purchaser and the Issuer. The Purchaser did not become aware of this offering of the Additional Notes and the Underlying Shares, nor were the Additional Notes and the Underlying Shares offered to the Purchaser, by any other means. The Purchaser acknowledges that the Additional Notes and the Underlying Shares (i) were not offered by any form of general solicitation or general advertising (within the meaning of Regulation D under the Securities Act), and (ii) to the Purchaser’s knowledge, are not being offered in a manner involving a public offering under, or in a distribution in violation of, the Securities Act, or any state securities laws.
(j) The Purchaser acknowledges that it is aware that there are substantial risks incident to the purchase and ownership of the Additional Notes and the Underlying Shares. The Purchaser is able to fend for itself in the transactions contemplated herein, has such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of an investment in the Additional Notes and the Underlying Shares. The Purchaser acknowledges that neither the Issuer nor any of its agents or affiliates have provided any tax advice or any other representation or guarantee, whether written or oral, regarding the tax consequences of its investment in the Additional Notes and the Underlying Shares.
(k) Alone, or together with any professional advisor(s), the Purchaser represents and acknowledges that the Purchaser has adequately analyzed and fully considered the risks of an investment in the Additional Notes and the Underlying Shares and determined that the Additional Notes and the Underlying Shares are a suitable investment for the Purchaser and that the Purchaser is able at this time and in the foreseeable future to bear the economic risk of a total loss of the Purchaser’s investment in the Issuer. The Purchaser acknowledges specifically that a possibility of total loss exists.
(l) The Purchaser understands and agrees that no federal or state agency has passed upon or endorsed the merits of the offering of the Additional Notes and the Underlying Shares, or made any findings or determination as to the fairness of an investment in the Additional Notes and Underlying Shares.
(m) Except as permitted by applicable law, neither the Purchaser nor, to the knowledge of the Purchaser, any director, officer, agent or employee of the Purchaser is a person that is, or is controlled or owned 50 percent or more, individually or in the aggregate, by one or more persons that are currently the subject of any Sanctions, nor is the Purchaser 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). Neither the Purchaser nor, to the knowledge of the Purchaser, any director, officer, agent or employee of the Purchaser has received notice of, or is otherwise aware of, any claim, action, suit, proceedings or investigation involving it with respect to Sanctions.
16
(n) If the Purchaser is an employee benefit plan that is subject to Title I of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), a plan, an individual retirement account or other arrangement that is subject to section 4975 of the Internal Revenue Code of 1986, as amended (the “Code”) or an employee benefit plan that is a governmental plan (as defined in section 3(32) of ERISA), a church plan (as defined in section 3(33) of ERISA), a non-U.S. plan (as described in section 4(b)(4) of ERISA) or other plan that is not subject to the foregoing but may be subject to provisions under any other federal, state, local, non-U.S. or other laws or regulations that are similar to such provisions of ERISA or the Code, or an entity whose underlying assets are considered to include “plan assets” of any such plan, account or arrangement (each, a “Plan”) subject to the fiduciary or prohibited transaction provisions of ERISA or section 4975 of the Code, the Purchaser represents and warrants that (i) it has not relied on the Issuer or any of its affiliates (the “Transactions Parties”) as the Plan’s fiduciary or for advice, with respect to its decision to acquire and hold the Notes and the Underlying Shares, and none of the Transactions Parties shall at any time be relied upon as the Plan’s fiduciary with respect to any decision to acquire, continue to hold or transfer the Notes and the Underlying Shares and (ii) none of the acquisition, holding and/or transfer or disposition of the Notes and the Underlying Shares will result in a non-exempt prohibited transaction under ERISA or Section 4975 of the Code or any similar law or regulation.
(o) The Purchaser has, and on each date the relevant Issue Price would be required to be funded to the Issuer pursuant to Section 2 will have, sufficient immediately available funds to pay the Issue Price pursuant to Section 2.
(p) No broker, finder, or other financial consultant has acted on behalf of or at the direction of the Purchaser in connection with this Agreement or the transactions contemplated hereby in such a way as to create any liability on the Issuer.
Section 6. Conditions Precedent. The Purchaser’s obligation to purchase the relevant Additional Notes pursuant to the terms included herein is subject to the fulfillment or (to the extent permitted by applicable law) written waiver by the Purchaser, on each Draw Date, of each of the following conditions:
(a) The representations and warranties made by the Issuer in Section 4 hereof shall be true and correct in all material respects as of such Draw Date (or, if such representation and warranties speak as of another date, as of such date) (other than representations and warranties that are qualified as to materiality or Issuer Material Adverse Effect, which representations and warranties shall be so true and correct in all respects as of such Draw Date (or, if such representation and warranties speak as of another date, as of such date)).
(b) The Issuer shall have performed, satisfied and complied in all material respects with the covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by the Issuer at or prior to such Draw Date.
17
(c) All required regulatory approvals, if any, in connection with the related Drawdown shall have been received.
(d) There shall not as of the Draw Date be any (i) Default or Event of Default under the Indenture or (ii) breach of the Issuer or its affiliate's obligations (or pending breach, giving effect to any applicable cure period) under the governing documents for the Yorkville Preferred Shares.
(e) There shall not be in force any order, judgment or injunction by or with any governmental authority in the United States enjoining or prohibiting the consummation of the related Drawdown.
(f) Since the date of this Agreement, as applicable, there shall not have occurred any Issuer Material Adverse Effect which is continuing as of the applicable Draw Date.
(g) On, immediately after, and, based on the Issuer's projected cash flows prepared on a reasonable basis, for the 120 days following such Draw Date, the Issuer together with its subsidiaries (the “Issuer Group”), on a consolidated basis (after giving effect to the issuance and sale of the Additional Notes on such Draw Date and the application of the proceeds therefrom) will be Solvent and no event has occurred or circumstance arisen that might (whether or not with the giving of notice and/or the passage of time and/or the fulfillment of any other requirement) result in a winding up, liquidation, dissolution, or insolvency proceeding of any member of the Issuer Group.
(h) The Issuer shall have at least US$50,000,000 in Liquidity as of such Draw Date, exclusive of any forecasted proceeds from any Drawdown.
(i) The Purchaser shall have received a certificate signed by the Issuer’s Principal Financial Officer substantially in the form attached hereto as Exhibit B certifying as to satisfaction of the conditions set forth in Sections 6(a), (d), (g) and (h) hereto.
(j) Subject to receipt by the Issuer’s counsel of executed representation letters or acknowledgments from the Purchaser’s broker in the form previously provided by the Issuer’s counsel to the Purchaser’s counsel or otherwise reasonably acceptable to the Issuer’s counsel (the “Prerequisite Letter”), the Issuer’s transfer agent shall have removed all restrictive legends from the Ordinary Shares currently owned by the Purchaser or its affiliates (the “Delegending Condition”), provided that the Delegending Condition shall not constitute a closing condition absent the availability of the Prerequisite Letter.
Section 7. Purchaser Consent Right to Yorkville Preferred
(a) The Issuer agrees, so long as the Purchaser beneficially owns at least 50% of the aggregate nominal principal amount of Notes then outstanding, calculated after giving effect to the pool factor under the Indenture then in effect, to not issue any “Additional Preferred Shares” (as defined in the Amended and Restated Yorkville Securities Purchase Agreement) to Yorkville without the Purchaser’s prior written consent (which consent may be given by email between counsel to the Parties). For the avoidance of doubt, the Purchaser provided its consent for the Issuer to issue (i) the “Initial Preferred Shares” (as defined in the Amended and Restated Yorkville Securities Purchase Agreement) to Yorkville on the Closing Date and (ii) 25,000 Additional Preferred Shares to Yorkville on August 12, 2026. The Issuer acknowledges and agrees that any future issuances of Additional Preferred Shares shall require the Purchaser’s prior written consent pursuant to this Section 7.
18
Section 8. Registration of Underlying Shares.
(a) The Issuer agrees that the Issuer will file with the Commission (at the Issuer’s sole cost and expense) a registration statement (the “Registration Statement”) registering the resale of (1) the Underlying Shares not previously registered for resale pursuant to an effective registration statement of the Company and (2) the Ordinary Shares issuable upon conversion of any Existing Notes not previously registered for resale pursuant to an effective registration statement of the Company (together with such Underlying Shares in limb (1) above, the “Registrable Shares”)no later than fifteen (15) days after the Amendment Date, and the Issuer shall use its commercially reasonable efforts to have the Registration Statement declared effective as soon as practicable after the filing thereof, but no later than the earlier of (i) in the event the Commission notifies the Issuer that it will “review” the Registration Statement, the forty-fifth (45th) calendar day following the filing thereof and (ii) the fifth (5th) Business Day after the date the Issuer is notified (orally or in writing, whichever is earlier) by the Commission that the Registration Statement will not be “reviewed” or will not be subject to further review ((i) and (ii) collectively, the “Effectiveness Deadline”); provided that if such day falls on a Saturday, Sunday or other day that the Commission is closed for business, the Effectiveness Deadline shall be extended to the next Business Day on which the Commission is open for business; provided further that if the Commission is closed for operations due to a government shutdown, the Effectiveness Deadline shall be extended by the same amount of days that the Commission remains closed for operations. The Issuer will provide a draft of the Registration Statement to the Purchaser for review at least two (2) Business Days in advance of filing the Registration Statement and shall incorporate any reasonable comments provided by the Purchaser; provided that, for the avoidance of doubt, in no event shall the Issuer be required to delay or postpone the filing of such Registration Statement as a result of or in connection with Purchaser’s review. In no event shall the Purchaser be identified as a statutory underwriter in the Registration Statement unless requested by the Commission or another regulatory agency; provided that if the Commission or another regulatory agency requests that the Purchaser be identified as a statutory underwriter in the Registration Statement, the Purchaser will have the opportunity to withdraw from the Registration Statement upon its written request to the Issuer. Notwithstanding the foregoing, if the Commission prevents the Issuer from including any or all of the shares proposed to be registered under the Registration Statement due to limitations on the use of Rule 415 of the Securities Act for the resale of the Registrable Shares by the applicable shareholders or otherwise, such Registration Statement shall register for resale such number of Registrable Shares which is equal to the maximum number of Registrable Shares as is permitted by the Commission. In such event, the number of Registrable Shares to be registered for each selling shareholder named in the Registration Statement shall be reduced pro rata among all such selling shareholders and as promptly as practicable after being permitted to register additional Registrable Shares under Rule 415 under the Securities Act, the Issuer shall amend the Registration Statement or file a new Registration Statement to register such Registrable Shares not included in the Registration Statement and cause such amendment or Registration Statement to become effective as promptly as practicable. The Issuer agrees that, except for such times as the Issuer is permitted hereunder to suspend the use of the prospectus forming part of a Registration Statement, at its expense, the Issuer will use its commercially reasonable efforts to cause such Registration Statement to remain continuously effective with respect to the Purchaser and to be supplemented and amended to the extent necessary to ensure that such Registration Statement is available or to file a “shelf” registration statement on Form F-3 once available (the “Shelf Registration Statement”) or, if not available, that another registration statement is available for the resale of the Registrable Shares and ensure that the applicable Registration Statement or any subsequent shelf registration statement is free of any material misstatements or omissions until the earlier of (i) three (3) years from the effective date of the Registration Statement and (ii) the date on which all of the Registrable Shares shall have been sold (such period, the “Registration Period”). Subject to receipt from the Purchaser by the Issuer’s and the Issuer’s transfer agent of customary representations and other documentation reasonably acceptable to the Issuer in connection therewith, the Purchaser may request that the Issuer remove any legend from the book entry position evidencing its Registrable Shares and the Issuer will, if required by the Issuer’s transfer agent, use its commercially reasonable efforts to cause an opinion of the Issuer’s counsel be provided, in a form reasonably acceptable to the Issuer’s transfer agent, to the effect that the removal of such restrictive legends in such circumstances may be effected under the Securities Act, following the earliest of such time as the Registrable Shares (1) are subject to or have been or may be sold or transferred pursuant to an effective registration statement, (2) have been or may be sold pursuant to Rule 144, or (3) are eligible for resale under Rule 144(b)(1) or any successor provision without the requirement for the Issuer to be in compliance with the current public information requirement under Rule 144 and without volume or manner-of-sale restrictions applicable to the sale or transfer of such Registrable Shares, or another exemption from registration. If restrictive legends are no longer required for the Registrable Shares pursuant to the foregoing, the Issuer shall, in accordance with the provisions of this Section 8 and within five (5) trading days of any request therefor from the Purchaser accompanied by such customary and reasonably acceptable representations and other documentation referred to above establishing that restrictive legends are no longer required, deliver to the Issuer’s transfer agent irrevocable instructions to make a new, unlegended entry in book-entry form or by electronic delivery through The Depository Trust Company for such Registrable Shares. The Issuer shall be responsible for the fees of its transfer agent, its legal counsel and all DTC fees associated with such issuance. From and after such time as the benefits of Rule 144 or any other similar rule or regulation of the Commission that may allow the Purchaser to sell securities of the Issuer to the public without registration are available to holders of the Ordinary Shares for so long as the Purchaser holds Registrable Shares, the Issuer shall, at its expense, make and keep public information available, as those terms are understood and defined in Rule 144; use commercially reasonable efforts to file with the Commission in a timely manner all reports and other documents required of the Issuer under the Securities Act and the Exchange Act so long as the Issuer remains subject to such requirements and the filing of such reports and other documents is required for the applicable provisions of Rule 144 to enable the Purchaser to sell the Registrable Shares under Rule 144 for so long as the Purchaser holds any Additional Notes; and furnish to the Purchaser, promptly upon the Purchaser’s reasonable request, (i) a written statement by the Issuer, if true, that it has complied with the reporting requirements of Rule 144, the Securities Act, and the Exchange Act, (ii) a copy of the most recent annual report of the Issuer and such other reports and documents so filed by the Issuer, and (iii) such other information as may be reasonably requested to permit the Purchaser to sell such securities pursuant to Rule 144 without registration. “Registrable Shares” shall be deemed to include, as of any date of determination, any equity security issued or issuable with respect to the Registrable Shares by way of share split, dividend, distribution, recapitalization, merger, exchange, replacement or similar event. “Holder” shall mean the Purchaser or any of its affiliates or any other person to whom the rights under this Section 8 shall have been assigned. The Issuer’s obligations to include the Registrable Shares in the Registration Statement are contingent upon the Purchaser furnishing in writing to the Issuer such information regarding the Purchaser, the securities of the Issuer held by the Purchaser and the intended method of disposition of the Registrable Shares as shall be reasonably requested by the Issuer to effect the registration of the Registrable Shares, and the Purchaser shall execute such documents in connection with such registration as the Issuer may reasonably request that are customary of a selling shareholder in similar situations, including providing that the Issuer shall be entitled to postpone and suspend the effectiveness or use of the Registration Statement as permitted hereunder; provided, however, that the Purchaser shall not in connection with the foregoing be required to execute any lock-up or similar agreement or otherwise be subject to any contractual restriction on the ability to transfer the Registrable Shares. In the case of the registration effected by the Issuer pursuant to this Agreement, the Issuer shall, upon reasonable request, inform the Purchaser as to the status of such registration.
19
(b) Notwithstanding anything to the contrary contained herein, the Issuer may delay or postpone filing of such Registration Statement, and from time to time require the Purchaser not to sell under the Registration Statement or suspend the use or effectiveness of any such Registration Statement if it determines that in order for the registration statement to not contain a material misstatement or omission, an amendment thereto would be needed, or if the negotiation or consummation of a transaction by the Issuer or its subsidiaries is pending or an event has occurred, which negotiation, consummation or such event the Issuer’s board of directors (“Board”) reasonably believes, upon the advice of outside legal counsel, would require additional disclosure by the Issuer in the Registration Statement of material information that the Issuer has a bona fide business purpose for keeping confidential and the non-disclosure of which in the Registration Statement would be expected, in the reasonable determination of the Issuer’s Board, upon the advice of outside legal counsel, to cause the Registration Statement to fail to comply with applicable disclosure requirements, or if the Commission issues any stop order suspending the effectiveness of any Registration Statement or indicates the intention to initiate any proceedings for such purpose (each such circumstance, a “Suspension Event”); provided that, (x) the Issuer shall not so delay filing or so suspend the use of the Registration Statement for a period (each such period, a “Deferral Period”) of more than (i) sixty (60) consecutive days or (ii) more than ninety (90) total calendar days, or more than two (2) Deferral Periods, in each case of this clause (ii), in any three hundred sixty (360) day period and (y) the Issuer shall use commercially reasonable efforts to make such registration statement available for the sale by the Purchaser of such securities as soon as practicable thereafter; provided that clause (i) of the definition of “Registration Period” shall be extended by the duration of any such Deferral Period.
(c) Upon receipt of any written notice from the Issuer (which notice shall not contain any material nonpublic information regarding the Issuer) of the occurrence of any Suspension Event during the period that the Registration Statement is effective or if as a result of a Suspension Event the Registration Statement or related prospectus contains any untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made (in the case of the prospectus) not misleading, the Purchaser agrees that (i) it will immediately discontinue offers and sales of the Registrable Shares under the Registration Statement (excluding, for the avoidance of doubt, sales conducted pursuant to Rule 144) until the Purchaser receives copies of a supplemental or amended prospectus (which the Issuer agrees to promptly prepare) that corrects the misstatement(s) or omission(s) referred to above and receives notice that any post-effective amendment has become effective or unless otherwise notified by the Issuer that it may resume such offers and sales, and (ii) it will maintain the confidentiality of any information included in such written notice delivered by the Issuer unless otherwise required by law, subpoena or regulatory request or requirement. If so directed by the Issuer, the Purchaser will deliver to the Issuer, or in the Purchaser’s sole discretion destroy, all copies of the prospectus covering the Registrable Shares in the Purchaser’s possession; provided, however, that this obligation to deliver or destroy all copies of the prospectus covering the Registrable Shares shall not apply (x) to the extent the Purchaser is required to retain a copy of such prospectus (A) in order to comply with applicable legal, regulatory, self-regulatory or professional requirements or (B) in accordance with a bona fide pre-existing document retention policy or (y) to copies stored electronically on archival servers as a result of automatic data back-up.
20
(d) The Issuer shall advise the Purchaser, as expeditiously as possible and in any event within five (5) Business Days:
| (i) | when a Registration Statement or any amendment thereto has been filed with the Commission and when any of the foregoing shall have been declared effective by the Commission, and any request by the Commission for an amendment or supplement thereto or to any prospectus included therein; |
| (ii) | of the issuance by the Commission of any stop order suspending the effectiveness of any Registration Statement or the initiation of any proceedings for such purpose; |
| (iii) | of the receipt by the Issuer of any notification with respect to the suspension of the qualification of the Registrable Shares included therein for sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose; and |
| (iv) | subject to the provisions in this Agreement, of the occurrence of any event that requires the making of any changes in any Registration Statement or prospectus so that, as of such date, the statements therein are not misleading and do not omit to state a material fact required to be stated therein or necessary to make the statements therein (in the case of a prospectus, in the light of the circumstances under which they were made) not misleading. |
Notwithstanding anything to the contrary set forth herein, the Issuer shall not, when so advising the Purchaser of such events, provide the Purchaser with any material, nonpublic information regarding the Issuer other than to the extent that providing notice to the Purchaser of the occurrence of the events listed in (i) through (iv) above may constitute material, nonpublic information regarding the Issuer.
21
(e) The Issuer shall use its commercially reasonable efforts to obtain the withdrawal of any order suspending the effectiveness of any Registration Statement as soon as reasonably practicable.
(f) Except for such times as the Issuer is permitted hereunder to suspend, and has suspended, the use of a prospectus forming part of a Registration Statement as contemplated by this Agreement, the Issuer shall use its commercially reasonable efforts to as soon as reasonably practicable prepare a post-effective amendment to such Registration Statement or a supplement to the related prospectus, or file any other required document so that, as thereafter delivered to holders of the Registrable Shares included therein, such prospectus will not include any untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.
(g) The Issuer shall cause all Registrable Shares (when issued) to be listed on each securities exchange or market, if any, on which the Ordinary Shares have been listed.
(h) The Issuer shall use its commercially reasonable efforts to take all other steps necessary to effect the registration of the Registrable Shares issuable upon conversion of the Additional Notes required hereby; and
(i) The Issuer shall otherwise, in good faith, cooperate reasonably with, and take such customary actions as may reasonably be requested by the Purchaser, consistent with the terms of this Agreement, in connection with the registration of the Registrable Shares.
Section 9. Indemnity.
(a) Subject to Section 10 below, the Issuer agrees to indemnify and hold harmless, to the extent permitted by law, the Purchaser, its directors, officers, employees and agents, and each person who controls the Purchaser (within the meaning of the Securities Act or the Exchange Act) and each affiliate of the Purchaser (within the meaning of Rule 405 under the Securities Act) from and against any and all losses, claims, damages, liabilities and expenses (including, without limitation, any reasonable external attorneys’ fees and expenses as reasonably incurred in connection with defending or investigating any such action or claim) caused by any untrue or alleged untrue statement of a material fact contained in any Registration Statement, prospectus included in any Registration Statement or preliminary prospectus or any amendment thereof or supplement thereto or any omission or alleged omission of a material fact required to be stated therein or necessary to make the statements therein not misleading, except insofar as the same are caused by or contained in any information furnished in writing to the Issuer by or on behalf of the Purchaser expressly for use therein or Purchaser has omitted a material fact from such information, provided, however, that the indemnification contained in this Section 9(a) shall not apply to amounts paid in settlement of any losses, claims, damages, liabilities and expenses if such settlement is effected without the consent of the Issuer (which consent shall not be unreasonably withheld, conditioned or delayed), nor shall the Issuer be liable for any losses, claims, damages, liabilities and expenses to the extent they arise out of or are based upon a violation which occurs (A) in connection with any failure of Purchaser to deliver or cause to be delivered a prospectus made available to Purchaser by the Issuer in a timely manner, (B) as a result of offers or sales effected by or on behalf of Purchaser by means of a freewriting prospectus (as defined in Rule 405) that was not authorized by the Issuer, or (C) in connection with any offers or sales effected by or on behalf of a Purchaser in violation of Section 8(b) of this Agreement. The Issuer shall notify Purchaser promptly of the institution, threat or assertion of any proceeding arising from or in connection with the transactions contemplated by this Section 9 of which the Issuer is aware. The indemnity set forth in this Section 9 shall remain in full force and effect regardless of any investigation made by or on behalf of an indemnified party and shall survive the transfer of the Additional Notes by the Purchaser.
22
(b) The Purchaser agrees to indemnify and hold harmless the Issuer, its directors, officers, employees and agents, and each person who controls the Issuer (within the meaning of the Securities Act or the Exchange Act) and each affiliate of the Issuer against any losses, claims, damages, liabilities and expenses (including, without limitation, reasonable external attorneys’ fees and expenses incurred in connection with defending or investigating any such action or claim) caused by any untrue or alleged untrue statement of a material fact contained in the Registration Statement, prospectus included in any Registration Statement or preliminary prospectus or any amendment thereof or supplement thereto or any omission or alleged omission of a material fact required to be stated therein or necessary to make the statements therein not misleading, but only to the extent that such untrue statement or omission is contained in any information or affidavit so furnished in writing by or on behalf of the Purchaser expressly for use therein; provided, however, that the indemnification contained in this Section 9(b) shall not apply to amounts paid in settlement of any losses, claims, damages, liabilities and expenses if such settlement is effected without the consent of the Purchaser (which consent shall not be unreasonably withheld, conditioned or delayed). In no event shall the liability of the Purchaser be greater in amount than the dollar amount of the net proceeds received by the Purchaser upon the sale of the Additional Notes purchased pursuant to this Agreement and the corresponding Underlying Shares giving rise to such indemnification obligation.
(c) Any person entitled to indemnification herein shall (i) give prompt written notice to the indemnifying party of any claim with respect to which it seeks indemnification (provided that the failure to give prompt notice shall not impair any person’s right to indemnification hereunder to the extent such failure has not prejudiced the indemnifying party) and (ii) unless in such indemnified party’s reasonable judgement a conflict of interest between such indemnified and indemnifying parties may exist with respect to such claim, permit such indemnifying party to assume the defense of such claim with counsel reasonably satisfactory to the indemnified party. If such defense is assumed, the indemnifying party shall not be subject to any liability for any settlement made by the indemnified party without its consent (not to be unreasonably withheld, conditioned or delayed). An indemnifying party who elects not to assume the defense of a claim shall not be obligated to pay the fees and expenses of more than one counsel for all parties indemnified by such indemnifying party with respect to such claim, unless in the reasonable judgment of legal counsel to any indemnified party a conflict of interest exists between such indemnified party and any other of such indemnified parties with respect to such claim. No indemnifying party shall, without the consent of the indemnified party, consent to the entry of any judgment or enter into any settlement which cannot be settled in all respects by the payment of money (and such money is so paid by the indemnifying party pursuant to the terms of such settlement) and any settlement pursuant hereto shall not include a statement or admission of fault or culpability on the part of such indemnified party and shall include as an unconditional term thereof the giving by the claimant or plaintiff to such indemnified party of a release from all liability in respect to such claim or litigation.
23
(d) The indemnification provided for under this Agreement shall remain in full force and effect regardless of any investigation made by or on behalf of the indemnified party or any officer, director, employee, agent, affiliate or controlling person of such indemnified party and shall survive the transfer of the Additional Notes purchased pursuant to this Agreement and the corresponding Underlying Shares.
(e) If the indemnification provided under this Section 9 from the indemnifying party is unavailable or insufficient to hold harmless an indemnified party in respect of any losses, claims, damages, liabilities and expenses referred to herein, then the indemnifying party, in lieu of indemnifying the indemnified party, subject to Section 10, shall contribute to the amount paid or payable by the indemnified party as a result of such losses, claims, damages, liabilities and expenses in such proportion as is appropriate to reflect the relative fault of the indemnifying party and the indemnified party, as well as any other relevant equitable considerations. The relative fault of the indemnifying party and indemnified party shall be determined by reference to, among other things, whether any action in question, including any untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact, was made by, or relates to information supplied by or on behalf of, such indemnifying party or indemnified party, and the indemnifying party’s and indemnified party’s relative intent, knowledge, access to information and opportunity to correct or prevent such action. The amount paid or payable by a party as a result of the losses or other liabilities referred to above shall be deemed to include, subject to the limitations set forth above, any legal or other fees, charges or expenses reasonably incurred by such party in connection with any investigation or proceeding. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution pursuant to this Section 9 from any person who was not guilty of such fraudulent misrepresentation. Any contribution pursuant to this Section 9(e) by any seller of the Additional Notes or Underlying Shares shall be limited in amount to the dollar amount of net proceeds received by such seller from the sale of such Additional Notes or Underlying Shares pursuant to the Registration Statement. Notwithstanding anything to the contrary herein, in no event will any party be liable for consequential, special, exemplary or punitive damages in connection with this Agreement.
(f) For purposes of this Section 9, (i) the “Purchaser” shall include any person to whom the rights under this Section 9 shall have been duly assigned in accordance with the terms of this Agreement and (ii) “Underlying Shares” shall mean, as of any date of determination, the Underlying Shares acquired by the Purchaser pursuant to this Agreement and any other equity security issued or issuable with respect to such Underlying Shares by way of share split, dividend, distribution, recapitalization, merger, exchange, replacement or similar event.
Section 10. Termination. Except for the provisions of Section 9, this Section 10 and Sections 11(a) to 11(j) (and 11(r), solely with respect to the same Sections of the Original Convertible Note Purchase Agreement), which shall survive any termination hereunder, this Agreement shall terminate and be void and of no further force and effect, and all rights and obligations of the parties hereunder shall terminate without any further liability on the part of any party in respect thereof upon the mutual written agreement of all parties hereto to terminate this Agreement (the “Termination Event”); provided that nothing herein will relieve any party from liability for any willful breach hereof prior to the time of termination or common law intentional fraud in the making of any representation or warranty hereunder, and each party will be entitled to any remedies at law or in equity to recover losses, liabilities or damages arising from such breach or fraud.
24
Section 11. Miscellaneous.
(a) Notices. Any notice or communication required or permitted hereunder shall be in writing and either delivered personally, emailed or sent by overnight mail via a reputable overnight carrier, or sent by certified or registered mail, postage prepaid, and shall be deemed to be given and received (i) when so delivered personally, (ii) when sent, with no mail undeliverable or other rejection notice, if sent by email, or (iii) three (3) Business Days after the date of mailing to the address below or to such other address or addresses as such person may hereafter designate by notice given hereunder:
|
If to the Issuer, to:
Vertical Aerospace Ltd. |
With a copy to (which shall not constitute notice):
Latham & Watkins (London) LLP
|
|
If to the Purchaser, to:
Mudrick Capital Management, L.P. New York, NY 10019 Attn: Adam Kaufman |
With a copy to (which shall not constitute notice):
Wachtell, Lipton, Rosen & Katz 51 W 52nd Street New York, New York 10019 Attention: Victor Goldfeld; Benjamin S. Arfa Email: VGoldfeld@wlrk.com; BSArfa@wlrk.com |
(b) Entire Agreement. Except as expressly contemplated herein, this Agreement constitutes the entire agreement, and supersedes all other prior agreements, communications, understandings, representations and warranties, both written and oral, between the parties, with respect to the subject matter hereof, including any term sheet or commitment letter entered into relating to the subject matter hereof.
(c) Modifications; Amendments; Waivers. This Agreement may not be amended, modified, supplemented or waived except by an instrument in writing, signed by each of the parties hereto. No failure or delay of any party in exercising any right or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such right or power, or any course of conduct, preclude any other or further exercise thereto or the exercise of any other right or power.
25
(d) Expenses. The Issuer shall reimburse the Purchaser from time to time for the reasonable and documented fees, expenses and disbursements of legal counsel incurred by the Purchaser in connection with the negotiation, preparation, and performance of this Agreement and the other agreements entered into on or about the Amendment Date (including the Shareholder Agreement) and the disclosure documents and transactions contemplated hereby and thereby (net of any amounts previously reimbursed by the Issuer for invoices as of August 4, 2026).
(e) Transfer Taxes. Any transfer, stamp, issue, recording or similar taxes (including any related penalties and interest) imposed upon the issuance of any Additional Notes to the Purchaser shall be paid by the Issuer.
(f) Tax Treatment. The parties intend that, for U.S. federal income tax purposes, (i) the Additional Notes be treated as debt instruments (and not equity) that are not “contingent payment debt instruments” within the meaning of Treasury Regulations Section 1.1275-4, (ii) the amendments implemented pursuant to the Fourth Supplemental Indenture be treated as (x) resulting in a “significant modification” of the Existing Notes within the meaning of Treasury Regulations Section 1.1001-3, with the deemed exchange of Existing Notes for “new notes” resulting from such significant modification qualifying as a tax-free “recapitalization” under Section 368(a) of the Code and (y) not resulting in a deemed distribution by the Issuer to the holders of the Existing Notes under Section 305 of Code except to the extent required pursuant to Section 305(b)(2) of the Code as a result of a payment by the Issuer of “cash or property” within the meaning of Treasury Regulations Section 1.305-3 with respect to its equity interests after the date hereof, and, to the extent required to be so treated, as a deemed distribution (in an amount and at such time as reasonably determined by the Purchaser in good faith) that is not treated as a dividend pursuant to Section 301(c)(1) of the Code provided that the Issuer does not have any “earnings and profits” for its taxable year ending December 31, 2026, and (iii) the Additional Notes be treated as fungible with the Existing Notes. The Issuer shall not take any position, on any tax return or otherwise, inconsistent with the foregoing tax treatment (including any reasonable determination made by the Purchaser pursuant to clause (y) above), except to the extent otherwise required by a change in applicable law after the date hereof or any final determination or other settlement on audit that is binding on the Issuer.
(g) Assignment. Neither this Agreement nor any rights, interests or obligations that may accrue to the parties hereunder may be transferred or assigned without the prior written consent of the parties hereto (other than the Additional Notes and Underlying Shares); provided that upon prior written notice to the Issuer, the Purchaser may assign its rights and obligations under this Agreement to one or more of their respective affiliates; provided, further, that no such assignment shall relieve the Purchaser of its obligations hereunder.
(h) No Third Party Rights. This Agreement shall not confer rights or remedies upon any person other than the parties hereto and their respective successors and assigns.
26
(i) Governing Law. This Agreement, and any claim or cause of action hereunder based upon, arising out of or related to this Agreement (whether based on law, in equity, in contract, in tort or any other theory) or the negotiation, execution, performance or enforcement of this Agreement, shall be governed by and construed in accordance with the Laws of the State of New York, including its statute of limitations, without giving effect to principles or rules of conflicts of law thereof, to the extent they would require or permit the application of laws or statute of limitations of another jurisdiction.
(j) Consent to Jurisdiction; Waiver of Jury Trial. Each of the parties irrevocably consents to the exclusive jurisdiction and venue of any state or federal court sitting in the Borough of Manhattan in the City and State of New York (the “Chosen Courts”), in connection with any matter based upon or arising out of this Agreement. Each party hereby waives, and shall not assert as a defense in any legal dispute, that (i) such person is not personally subject to the jurisdiction of the Chosen Courts for any reason, (ii) such legal proceeding may not be brought or is not maintainable in the Chosen Courts, (iii) such person’s property is exempt or immune from execution, (iv) such legal proceeding is brought in an inconvenient forum or (v) the venue of such legal proceeding is improper. Each party hereby consents to service of process in any such proceeding in any manner permitted by New York law, further consents to service of process by nationally recognized overnight courier service guaranteeing overnight delivery, or by registered or certified mail, return receipt requested, at its address specified pursuant to Section 11(a) and waives and covenants not to assert or plead any objection which they might otherwise have to such manner of service of process. Notwithstanding the foregoing in this Section 11(h), a party may commence any action, claim, cause of action or suit in a court other than the Chosen Courts solely for the purpose of enforcing an order or judgment issued by the Chosen Courts. TO THE EXTENT NOT PROHIBITED BY APPLICABLE LAW WHICH CANNOT BE WAIVED, EACH OF THE PARTIES WAIVES ANY RIGHT TO TRIAL BY JURY ON ANY CLAIMS OR COUNTERCLAIMS ASSERTED IN ANY LEGAL DISPUTE RELATING TO THIS AGREEMENT WHETHER NOW EXISTING OR HEREAFTER ARISING. IF THE SUBJECT MATTER OF ANY SUCH LEGAL DISPUTE IS ONE IN WHICH THE WAIVER OF JURY TRIAL IS PROHIBITED, NO PARTY SHALL ASSERT IN SUCH LEGAL DISPUTE A NONCOMPULSORY COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT. FURTHERMORE, NO PARTY SHALL SEEK TO CONSOLIDATE ANY SUCH LEGAL DISPUTE WITH A SEPARATE ACTION OR OTHER LEGAL PROCEEDING IN WHICH A JURY TRIAL CANNOT BE WAIVED.
(k) Severability. If any provision of this Agreement shall be invalid, illegal or unenforceable, the validity, legality or enforceability of the remaining provisions of this Agreement shall not in any way be affected or impaired thereby and shall continue in full force and effect.
(l) No Waiver of Rights, Powers and Remedies. No failure or delay by a party hereto in exercising any right, power or remedy under this Agreement, and no course of dealing between the parties hereto, shall operate as a waiver of any such right, power or remedy of such party. No single or partial exercise of any right, power or remedy under this Agreement by a party hereto, nor any abandonment or discontinuance of steps to enforce any such right, power or remedy, shall preclude such party from any other or further exercise thereof or the exercise of any other right, power or remedy hereunder. The election of any remedy by a party hereto shall not constitute a waiver of the right of such party to pursue other available remedies. No notice to or demand on a party not expressly required under this Agreement shall entitle the party receiving such notice or demand to any other or further notice or demand in similar or other circumstances or constitute a waiver of the rights of the party giving such notice or demand to any other or further action in any circumstances without such notice or demand.
27
(m) Remedies.
| (i) | The parties agree that irreparable damage would occur if this Agreement was not performed or any Drawdown is not consummated in accordance with its specific terms or was otherwise breached and that money damages or other legal remedies may not be an adequate remedy for any such damage. It is accordingly agreed that the parties hereto shall be entitled to seek equitable relief, including in the form of an injunction or injunctions, to prevent breaches or threatened breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement in an appropriate court of competent jurisdiction as set forth in Section 11(j), this being in addition to any other remedy to which any party is entitled at law or in equity, including money damages. The right to specific enforcement may include the right of the Issuer to cause the Purchaser and the right of the Purchaser to cause the Issuer to cause the transactions contemplated hereby to be consummated on the terms and subject to the conditions and limitations set forth in this Agreement (including, for the avoidance of doubt, the right to directly enforce each of the covenants and agreements of the Issuer and the Purchaser, as applicable, under this Agreement). The parties hereto further agree (i) to waive any requirement for the security or posting of any bond in connection with any such equitable remedy, (ii) not to assert that a remedy of specific enforcement pursuant to this Section 11(k) is unenforceable, invalid, contrary to applicable law or inequitable for any reason and (iii) to waive any defenses in any action for specific performance, including the defense that a remedy at law would be adequate. |
| (ii) | The parties acknowledge and agree that this Section 11(k) is an integral part of the transactions contemplated hereby and without that right, the parties hereto would not have entered into this Agreement. |
| (iii) | In any dispute arising out of or related to this Agreement, or any other agreement, document, instrument, or certificate contemplated hereby, or any transactions contemplated hereby or thereby, the applicable adjudicating body shall award to the prevailing party, if any, the reasonable and documented out-of-pocket costs and attorneys’ fees reasonably incurred by the prevailing party in connection with the dispute and the enforcement of its rights under this Agreement or any other agreement, document, instrument, or certificate contemplated hereby, and, if the adjudicating body determines a party to be the prevailing party under circumstances where the prevailing party won on some but not all of the claims and counterclaims, the adjudicating body may award the prevailing party an appropriate percentage of the costs and attorneys’ fees reasonably incurred by the prevailing party in connection with the adjudication and the enforcement of its rights under this Agreement or any other agreement, document, instrument, or certificate contemplated hereby or thereby. |
28
(n) Survival of Representations and Warranties. All representations and warranties made by the parties hereto in this Agreement shall survive the consummation of any Drawdown. All of the covenants and agreements made by each party hereto in this Agreement shall survive the consummation of any Drawdown until the applicable statute of limitations or in accordance with their respective terms, if a shorter period.
(o) Headings and Captions. The headings and captions of the various subdivisions of this Agreement are for convenience of reference only and shall in no way modify or affect the meaning or construction of any of the terms or provisions hereof.
(p) Counterparts. This Agreement may be executed in one or more counterparts (including by facsimile or electronic mail, in .pdf or any other form of electronic delivery (including any electronic signature complying with U.S. federal ESIGN Act of 2000)), all of which when taken together shall be considered one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other parties, it being understood that the parties need not sign the same counterpart. In the event that any signature is delivered by facsimile transmission, email or any other form of electronic delivery, such signature shall create a valid and binding obligation of the party executing (or on whose behalf such signature is executed) with the same force and effect as if such signature page were an original thereof.
(q) Mutual Drafting. This Agreement is the joint product of the parties hereto and each provision hereof has been subject to the mutual consultation, negotiation and agreement of the parties and shall not be construed for or against any party hereto.
(r) Amendment and Restatement. This Agreement amends, restates and supersedes in its entirety the Original Convertible Note Purchase Agreement, except that Sections 4, 5, 8, 9 and 11 of the Original Convertible Note Purchase Agreement shall remain in full force and effect solely with respect to the Q2 2026 Notes.
(s) Legend Removal. The Issuer shall use commercially reasonable efforts to facilitate the removal by the Issuer’s transfer agent of all restrictive legends from the Ordinary Shares currently owned by the Purchaser or its affiliates as promptly as possible after the Amendment Date.
Section 12. Cleansing Statement; Consent to Disclosure.
(a) The Issuer shall, prior to or following the date of this Agreement, promptly issue one (1) or more press releases or file with the Commission a Current Report on Form 6-K disclosing all material terms of the transactions contemplated hereby. From and after the publication of such Form 6-K, the Purchaser shall not be in possession of any material, non-public information received from the Issuer or any of its officers, directors, employees or agents in connection with the transactions contemplated by this Agreement.
29
(b) The Purchaser hereby consents to the publication and disclosure in (i) any press release or Current Report on Form 6-K issued or filed with the Commission by the Issuer in connection with the execution and delivery of this Agreement or any other filing with the Commission pursuant to applicable securities laws, in each case as and to the extent required by the federal securities laws or the Commission or any other securities authorities and (ii) any other documents or communications provided by the Issuer to any governmental authority or to securityholders of the Issuer, in each case, as and to the extent required by applicable law or the Commission or any other governmental authority, of the Purchaser’s name and identity and the nature of the Purchaser’s commitments, arrangements and understandings under and relating to this Agreement and, if deemed required or appropriate by the Issuer, a form (excluding details specific and personal to the Purchaser) of this Agreement; provided that, in the case of such disclosures by the Issuer, the Issuer shall provide the Purchaser with prior written notice (including by email) of such permitted disclosure, and shall reasonably consult with the Purchaser regarding such disclosure, in each case, to the extent such disclosure specifically names the Purchaser. The Purchaser will, to the extent reasonably practicable and legally permissible, promptly provide any information reasonably requested by the Issuer for any regulatory application or filing made or approval sought in connection with the transactions contemplated in this Agreement (including filings with the Commission).
[Signature Pages Follow]
30
IN WITNESS WHEREOF, each of the parties hereto has executed or caused this Agreement to be executed by its duly authorized representative as of the date set forth below.
| ISSUER: | ||
| VERTICAL AEROsPACE LTD. | ||
| By: | /s/ Stuart Simpson | |
| Name: | Stuart Simpson | |
| Title: | Chief Executive Officer | |
[Signature Page to Convertible Note Purchase Agreement]
| MUDRICK INVESTOR: | ||
| MUDRICK CAPITAL MANAGEMENT, L.P. | ||
| on behalf of the funds, investors, entities or accounts that are managed, sponsored or advised by it or its affiliates | ||
| By: | /s/ Jason Mudrick | |
| Name: | Jason Mudrick | |
| Title: | Authorized Signatory | |
[Signature Page to Convertible Note Purchase Agreement]
EXHIBIT A
FORM OF DRAW NOTICE
EXHIBIT B
FORM OF Officer CERTIFICATE
Exhibit 99.2
EXECUTION VERSION
SHAREHOLDER AGREEMENT
This shareholder agreement (this “Agreement”), dated August 12, 2026, is entered into by and between Vertical Aerospace Ltd. (the “Company”) and Mudrick Capital Management, L.P., on behalf of certain funds, investors, entities or accounts that are managed, sponsored or advised by Mudrick Capital Management, L.P. or its affiliates (“Mudrick Capital”). All capitalized terms used in this Agreement that are not defined in this Agreement shall have the meanings ascribed to such terms in the Company’s fifth amended and restated memorandum and articles of association adopted on January 20, 2026 (the “Articles”), and all references in this Agreement to any particular section of the Articles shall refer to the corresponding Article as set forth in the Articles.
WHEREAS, the board of directors of the Company (the “Board”) has considered and is of the opinion that it is in the best interests of the Company to enter into this Agreement and to conduct a Board refreshment exercise at this time.
WHEREAS, Mudrick Capital has dedicated significant resources in furtherance of the Board refreshment exercise in order to search for and nominate for appointment prospective members of the Board.
WHEREAS, without prejudice to any of Mudrick Capital’s rights under the Articles, it is the intent of the Company and Mudrick Capital that Mudrick Capital have the rights set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth in this Agreement, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties do hereby agree as follows:
| 1. | Promptly following execution of this Agreement, the Board will take all necessary corporate action to increase the number of seats on the Board from eight Directors to nine Directors in accordance with Article 30.1. Until such time as Mudrick Capital no longer Beneficially Owns (as defined below) at least 25% of the Ordinary Shares, the Board will not increase the number of seats on the Board beyond nine Directors without the prior written consent of Mudrick Capital. |
| 2. | For purposes of this Agreement, (a) “Specified Director” means any Director nominated by Mudrick Capital pursuant to this Agreement and appointed to the Board (and any replacement thereof), if any, and (b) “Beneficial Owner” means a person who is a beneficial owner, as determined under Rule 13d-3 under the Exchange Act (and “Beneficially Own” and “Beneficially Owned” shall have correlative meaning); and, for all purposes under this Agreement, a person’s “Beneficial Ownership” (or variations on such phrase) shall be determined and calculated in accordance with the provisions of Rule 13d-3, irrespective of whether or not such Rule is actually applicable in such circumstance. |
| 3. | Without prejudice to any of Mudrick Capital’s rights under the Articles: |
| a. | Until this Agreement is terminated in accordance with its terms, Mudrick Capital will have the right pursuant to this Agreement to nominate for election individuals to serve as Directors in respect of the number of Director positions that is equal to (X) the product, rounded to the nearest whole number, of (i) the percentage of Ordinary Shares Beneficially Owned by Mudrick Capital at the relevant time multiplied by (ii) the total number of Director positions on the Board (for the avoidance of doubt, including any vacancies) at the relevant time minus (Y) the number of Appointed Directors serving on the Board at such time; provided that there shall not be less than one Director on the Board that is either a Specified Director or an Appointed Director; |
| b. | If, due to a decrease in Mudrick Capital’s Beneficial Ownership of the Company’s Ordinary Shares, there is a decrease in the number of Director positions in respect of which Mudrick Capital is permitted to nominate for election individuals to serve as Directors pursuant to subparagraph 3(a) above, then Mudrick Capital may elect to re-designate the applicable number of Specified Director(s) as General Directors by delivering written notice to the Company. In the event that Mudrick Capital has not exercised this re-designation right within ten Business Days of such decrease, the Board shall re-designate the applicable number of Specified Director(s) as General Director(s). Specified Directors who are re-designated as General Directors may be removed from the Board in accordance with the Articles; |
| c. | In nominating Specified Directors under the terms of this Agreement, Mudrick Capital shall, in good faith, apply the criteria established by the Nominating and Corporate Governance Committee and may not nominate any person who on their appointment would cause the Board to not consist of a majority of Independent Directors. Mudrick Capital acknowledges that Specified Director nominees shall be required to comply with the terms of Article 23(f) in order to be eligible for appointment. The terms of engagement of each Specified Director shall be consistent with the terms applicable to Specified Directors set forth herein; |
| d. | Except as otherwise set forth herein, the terms that apply to Appointed Directors under the Articles shall apply to Specified Directors, mutatis mutandis. In furtherance (and not in limitation) of the foregoing, the Company and Mudrick Capital agree that, until this Agreement is terminated in accordance with its terms: |
| i. | The Nominating and Corporate Governance Committee shall review each candidate nominated by Mudrick Capital pursuant to this Agreement to be an Independent Director for fitness and, if deemed fit for service, the Nominating and Corporate Governance Committee will recommend the individuals for election by a majority vote of the Board. The Nominating and Corporate Governance Committee shall recommend for election by a majority vote of the Board each candidate deemed fit for service by Mudrick Capital and nominated by Mudrick Capital pursuant to this Agreement to be a Specified Director who is not an Independent Director. Notwithstanding the foregoing, the Nominating and Corporate Governance Committee may defer the appointment of any Director nominated by Mudrick Capital pursuant to this Agreement if and for such period as the appointment of such nominee would cause the Company not to qualify as a “foreign private issuer” as such term is defined in Rule 405 under the Securities Act, as if the date of such appointment were the last business day of the Company’s most recently completed second fiscal quarter; |
-2-
| ii. | If an individual nominated by Mudrick Capital pursuant to this Agreement is deemed unfit by the Nominating and Corporate Governance Committee pursuant to subparagraph 3(c)(i) above, Mudrick Capital shall have the right to nominate successive individuals until such Director position is filled; |
| iii. | Mudrick Capital will have the right under this Agreement to nominate a replacement in respect of a vacancy (whether as a result of death, resignation, removal or otherwise) in any Specified Director position; |
| iv. | Mudrick Capital may remove any Specified Director (whether or not the Specified Director is an Independent Director) at its discretion, with or without cause, by delivering notice to the Company; provided, in the case of removal of a Specified Director who is an Independent Director, that Mudrick Capital provides at least 30 days’ prior written notice to the Company and, following such removal (taking into account any appointment of another Director occurring substantially contemporaneous with or prior to such removal), the Board continues to consist of a majority of Independent Directors as required by Article 30.1; and |
| v. | So long as Mudrick Capital Beneficially Owns at least 10.0% of the Ordinary Shares and to the extent permitted by the Governance Requirements (as defined below), Mudrick Capital has the right to designate Specified Director(s) to serve on each of the Board’s committees in respect of the number of committee positions that is equal to (X) the product, rounded to the nearest whole number, of (i) the percentage of Ordinary Shares Beneficially Owned by Mudrick Capital at the relevant time multiplied by (ii) the total number of Director positions on the applicable committee (for the avoidance of doubt, including any vacancies) at the relevant time minus (Y) the number of Appointed Directors serving on each such committee at such time (provided that there shall not be less than one Director on each such committee that is either a Specified Director or an Appointed Director), and, to the extent such designation is made, such Specified Director shall be appointed to and serve on the relevant committee until such time as Mudrick Capital requests by notice in writing to the Company that they be removed from or replaced on the relevant committees or such Specified Director resigns from the relevant committee upon which Mudrick Capital shall have the right to designate their replacement; provided that if such removal shall cause the Company to be in noncompliance with the rules and regulations of the Designated Stock Exchange, the SEC, and/or any other competent regulatory authority or otherwise under Applicable Law (together, the “Governance Requirements”), the Company may defer such removal until the earlier of (a) such time as the Company shall have effected any changes in the composition of the relevant committee to permit compliance with the Governance Requirements upon such removal and (b) 60 days following the initial notification to the Company of such removal. If such designation is not permitted under the Governance Requirements, Mudrick Capital may appoint one observer to serve on each of the Board’s committees; and |
-3-
| e. | For the avoidance of doubt, the parties acknowledge that a Specified Director is not an Appointed Director and that the Articles do not dictate the treatment thereof. Rather, the foregoing provisions of this paragraph 3 reflect the agreement of the parties, as a commercial matter and for purposes of efficiency and except as otherwise set forth herein, to apply to Specified Directors the same terms that apply to Appointed Directors under the Articles, as set forth herein. |
| 4. | Mudrick Capital shall have the right at any time to deliver to the Company a written notice setting forth a rank-ordered list (the “Notified List”) of all Directors nominated by Mudrick Capital (together, the “Mudrick Nominated Directors”). If it is finally determined by a court of competent jurisdiction that any of the Directors nominated by Mudrick Capital were Specified Directors, then for all purposes under the Articles (including Article 30.5), the Mudrick Nominated Directors ranked lower on the Notified List shall be deemed not to be Appointed Directors before Mudrick Nominated Directors ranked higher on the Notified List, such that Mudrick Capital’s highest-ranked nominees on the Notified List shall retain their status as Appointed Directors to the maximum extent permitted under the Articles. For the avoidance of doubt, the ranking mechanism set forth in this paragraph shall not constitute an admission by Mudrick Capital as to the proper interpretation of the Articles or the number of Appointed Directors that Mudrick Capital is entitled to nominate thereunder. |
| 5. | This Agreement will terminate with immediate effect upon the earlier of (a) the adoption by the Company of the amendments to the Articles set forth in Exhibit A attached hereto (the “Articles Amendments”) and (b) such time as MC ceases to Beneficially Own at least 10% of the Ordinary Shares. |
| 6. | Each of the Company and Mudrick Capital reserve all rights and waive none with respect to the number of Appointed Directors that Mudrick Capital has the right to nominate in accordance with Article 30.2. This Agreement shall be without prejudice to any positions, arguments or contentions each of the Company and Mudrick Capital may make as to the proper interpretation of Article 30.2. |
-4-
| 7. | In addition, the Company shall take all necessary action to duly call, give notice of, convene and hold an Annual or Extraordinary General Meeting of the shareholders of the Company as promptly as possible following the Execution Date (as defined in that certain $100 Million Comprehensive Financing Term Sheet, among the Company, Mudrick Capital and YA II PN, Ltd., dated August 5, 2026 (the “Financing Term Sheet”)) (and in any event by September 15, 2026) to vote on the Articles Amendments, recommend that the shareholders of the Company vote in favor of the Articles Amendments and use commercially reasonable efforts to obtain shareholder approval thereof. In connection with the foregoing (and in connection with any subsequent shareholder meeting at which the Articles Amendments may be re-submitted as set forth below), the Company shall, in consultation with Mudrick Capital, set a record date for any such Annual or Extraordinary General Meeting and shall prepare, provide to shareholders in accordance with applicable law and furnish on a Report on Form 6-K a circular describing the Articles Amendments and any other matters to be voted on at such meeting (including any amendments to the Articles to remove provisions relating to SF’s governance rights and, if the Company so elects, the matters set forth in the “Management Option Pool” paragraph in the Financing Term Sheet), which other matters will be presented for a vote separate from the Articles Amendments, and neither the Articles Amendments nor such other matters will be cross-conditioned on the other (the “Circular”). Any Circular shall include the unanimous recommendation of the Board that shareholders vote to approve the Articles Amendments, and shall otherwise be in form reasonably acceptable to Mudrick Capital. The Company shall reflect in any Circular any reasonable comments in respect of the proposal with respect to the Articles Amendments proposed in good faith by Mudrick Capital. If the Articles Amendments are not approved at the Annual or Extraordinary General Meeting at which they are first submitted to shareholders, (i) the Company shall promptly consult with Mudrick Capital as to whether to make any amendments to the Articles Amendments, provided that any amendments to the Articles Amendments are reasonably satisfactory to each of the Company and Mudrick Capital, and (ii) the Company will take all necessary action to duly call, give notice of, convene and hold an Extraordinary General Meeting of the shareholders of the Company as promptly as possible following such consultation with Mudrick Capital (and in any event by January 31, 2027) to re-submit the Articles Amendments (as they may be revised in accordance with the foregoing clause (i)), recommend that the shareholders of the Company vote in favor of the Articles Amendments (as they may be revised in accordance with the foregoing clause (i)) and use commercially reasonable efforts to obtain shareholder approval thereof. The Company shall not cancel, adjourn or postpone any Annual or Extraordinary General Meeting at which the Articles Amendments (as they may be revised in accordance with the foregoing sentence) are submitted to shareholders for approval, except as required by law. |
| 8. | The Company shall use commercially reasonable efforts to, as promptly as practicable, obtain SF’s consent to remove provisions in the Articles relating to SF’s governance rights, and shall table a proposal at its next Annual General Meeting to vote on corresponding amendments to the Articles. In addition, the Company shall use commercially reasonable efforts to, as promptly as practicable, terminate that certain Shareholder Letter Agreement, dated December 23, 2024, by and among the Company, Mudrick Capital, Stephen Fitzpatrick and Imagination Aero Investments Limited, as to Stephen Fitzpatrick and Imagination Aero Investments Limited. |
| 9. | The Company shall reimburse Mudrick Capital from time to time for the reasonable and documented fees, expenses and disbursements of legal counsel incurred by Mudrick Capital in connection with the negotiation, preparation, and execution of this Agreement and the Transactions (as defined in the Financing Term Sheet). |
-5-
| 10. | This Agreement, together with the Articles, constitutes the entire agreement, and supersedes all other prior agreements, communications, understandings, representations and warranties, both written and oral, between the parties, with respect to the subject matter hereof. |
| 11. | This Agreement, and any claim or cause of action hereunder based upon, arising out of or related to this Agreement (whether based on law, in equity, in contract, in tort or any other theory) or the negotiation, execution, performance or enforcement of this Agreement, shall be governed by and construed in accordance with the laws of the State of Delaware, without giving effect to principles or rules of conflicts of law thereof, to the extent they would require or permit the application of laws of another jurisdiction. |
| 12. | Each of the parties irrevocably consents to the exclusive jurisdiction and venue of the Chancery Court of the State of Delaware (or, if the Chancery Court of the State of Delaware declines to accept jurisdiction over a particular matter, the United States federal district court for the District of Delaware) (the “Chosen Courts”), in connection with any matter based upon or arising out of this Agreement. Each party hereby waives, and shall not assert as a defense in any legal dispute, that (i) such person is not personally subject to the jurisdiction of the Chosen Courts for any reason, (ii) such legal proceeding may not be brought or is not maintainable in the Chosen Courts, (iii) such person’s property is exempt or immune from execution, (iv) such legal proceeding is brought in an inconvenient forum or (v) the venue of such legal proceeding is improper. Each party hereby consents to service of process in any such proceeding in any manner permitted by Delaware law, further consents to service of process by nationally recognized overnight courier service guaranteeing overnight delivery, or by registered or certified mail, return receipt requested, at its address specified on the signature page hereof and waives and covenants not to assert or plead any objection which they might otherwise have to such manner of service of process. Notwithstanding the foregoing in this paragraph 12, a party may commence any action, claim, cause of action or suit in a court other than the Chosen Courts solely for the purpose of enforcing an order or judgment issued by the Chosen Courts. TO THE EXTENT NOT PROHIBITED BY APPLICABLE LAW WHICH CANNOT BE WAIVED, EACH OF THE PARTIES WAIVES ANY RIGHT TO TRIAL BY JURY ON ANY CLAIMS OR COUNTERCLAIMS ASSERTED IN ANY LEGAL DISPUTE RELATING TO THIS AGREEMENT WHETHER NOW EXISTING OR HEREAFTER ARISING. IF THE SUBJECT MATTER OF ANY SUCH LEGAL DISPUTE IS ONE IN WHICH THE WAIVER OF JURY TRIAL IS PROHIBITED, NO PARTY SHALL ASSERT IN SUCH LEGAL DISPUTE A NONCOMPULSORY COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT. FURTHERMORE, NO PARTY SHALL SEEK TO CONSOLIDATE ANY SUCH LEGAL DISPUTE WITH A SEPARATE ACTION OR OTHER LEGAL PROCEEDING IN WHICH A JURY TRIAL CANNOT BE WAIVED. |
| 13. | No failure or delay by a party hereto in exercising any right, power or remedy under this Agreement, and no course of dealing between the parties hereto, shall operate as a waiver of any such right, power or remedy of such party. No single or partial exercise of any right, power or remedy under this Agreement by a party hereto, nor any abandonment or discontinuance of steps to enforce any such right, power or remedy, shall preclude such party from any other or further exercise thereof or the exercise of any other right, power or remedy hereunder. The election of any remedy by a party hereto shall not constitute a waiver of the right of such party to pursue other available remedies. No notice to or demand on a party not expressly required under this Agreement shall entitle the party receiving such notice or demand to any other or further notice or demand in similar or other circumstances or constitute a waiver of the rights of the party giving such notice or demand to any other or further action in any circumstances without such notice or demand. |
-6-
| 14. | The parties agree that irreparable damage would occur if this Agreement was not performed in accordance with its specific terms or was otherwise breached and that money damages or other legal remedies would not be an adequate remedy for any such damage. It is accordingly agreed that the parties hereto shall be entitled to equitable relief, including in the form of an injunction or injunctions, to prevent breaches or threatened breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement in an appropriate court of competent jurisdiction as set forth in paragraph 12, this being in addition to any other remedy to which any party is entitled at law or in equity, including money damages. The parties hereto further agree (i) to waive any requirement for the security or posting of any bond in connection with any such equitable remedy, (ii) not to assert that a remedy of specific enforcement pursuant to this paragraph 14 is unenforceable, invalid, contrary to applicable law or inequitable for any reason and (iii) to waive any defenses in any action for specific performance, including the defense that a remedy at law would be adequate. The parties acknowledge and agree that this paragraph 14 is an integral part of the transactions contemplated hereby and without that right, the parties hereto would not have entered into this Agreement. |
| 15. | The Company represents and warrants to Mudrick Capital as follows: (a) the Company has the power and authority to execute, deliver and carry out the terms and provisions of this Agreement and to consummate the transactions contemplated by this Agreement; (b) this Agreement has been duly and validly authorized, executed, and delivered by the Company, constitutes a valid and binding obligation and agreement of the Company and is enforceable against the Company in accordance with its terms; and (c) the execution, delivery and performance of this Agreement by the Company will not violate or breach the organizational documents of the Company or any of its subsidiaries or any law, statute, judgment, order, rule or regulation or any other legally enforceable requirement of any court or governmental agency or body. |
| 16. | Mudrick Capital represents and warrants to the Company as follows: (a) Mudrick Capital has the power and authority to execute, deliver and carry out the terms and provisions of this Agreement and to consummate the transactions contemplated by this Agreement; (b) this Agreement has been duly and validly authorized, executed, and delivered by Mudrick Capital, constitutes a valid and binding obligation and agreement of Mudrick Capital and is enforceable against Mudrick Capital in accordance with its terms; and (c) the execution, delivery and performance of this Agreement by Mudrick Capital will not violate or breach the organizational documents of Mudrick Capital or any law, statute, judgment, order, rule or regulation or any other legally enforceable requirement of any court or governmental agency or body. |
| 17. | This Agreement is the joint product of the parties hereto and each provision hereof has been subject to the mutual consultation, negotiation and agreement of the parties and shall not be construed for or against any party hereto. |
| 18. | This Agreement may be executed in any number of counterparts, each of which when executed and delivered shall constitute an original, and all of which together shall constitute one and the same instrument. |
[Signature Pages Follow]
-7-
IN WITNESS WHEREOF, each of the parties hereto has executed or caused this Agreement to be executed as a deed by its duly authorized representative on the date set forth above.
| COMPANY: | |||
| VERTICAL AEROsPACE LTD. | |||
| By: | /s/ Stuart Simpson | ||
| Name: | Stuart Simpson | ||
| Title: | Chief Executive Officer | ||
| Address: | Unit 1 Camwal Court, Chapel Street, Bristol BS2 0UW, United Kingdom | ||
| MUDRICK CAPITAL: | |||
| MUDRICK CAPITAL MANAGEMENT, L.P., on behalf of certain funds, investors, entities or accounts that are managed, sponsored or advised by it or its affiliates | |||
| By: | /s/ Jason Mudrick | ||
| Name: | Jason Mudrick | ||
| Title: | Authorized Signatory | ||
| Address: | 31 W. 52nd Street, 16th Floor New York, NY, 10019 | ||
[Signature Page to Letter Agreement]
EXHIBIT A
ARTICLES AMENDMENTS
THE COMPANIES ACT (AS REVISED)
OF THE CAYMAN ISLANDS
COMPANY LIMITED BY SHARES
SIXTH AMENDED AND RESTATED
MEMORANDUM AND ARTICLES OF ASSOCIATION
OF
VERTICAL AEROSPACE LTD.
(ADOPTED BY SPECIAL RESOLUTION DATED [•], 2026)
THE COMPANIES ACT (AS REVISED)
OF THE CAYMAN ISLANDS
COMPANY LIMITED BY SHARES
SIXTH AMENDED AND RESTATED
MEMORANDUM OF ASSOCIATION
OF
VERTICAL AEROSPACE LTD.
(ADOPTED BY SPECIAL RESOLUTION DATED [•], 2026)
| 1. | The name of the Company is Vertical Aerospace Ltd. |
| 2. | The Registered Office of the Company shall be at the offices of Walkers Corporate Limited, 190 Elgin Avenue, George Town, Grand Cayman, KY1-9008, Cayman Islands, or at such other place as the Directors may from time to time decide. |
| 3. | The objects for which the Company is established are unrestricted and the Company shall have full power and authority to carry out any object not prohibited by the laws of the Cayman Islands. |
| 4. | The liability of each Member is limited to the amount unpaid on such Member’s shares. |
| 5. | The authorised share capital of the Company is US$1,010,000 divided into 1,000,000,000 ordinary shares of a par value of US$0.001 each and 10,000,000 preferred shares of a par value of US$0.001 each. |
| 6. | The Company has the power to register by way of continuation as a body corporate limited by shares under the laws of any jurisdiction outside the Cayman Islands and to be deregistered in the Cayman Islands. |
| 7. | Capitalised terms that are not defined in this Sixth Amended and Restated Memorandum of Association bear the same meaning as those given in the Sixth Amended and Restated Articles of Association of the Company. |
THE COMPANIES ACT (AS REVISED)
OF THE CAYMAN ISLANDS
COMPANY LIMITED BY SHARES
SIXTH AMENDED AND RESTATED
ARTICLES OF ASSOCIATION
OF
VERTICAL AEROSPACE LTD.
(ADOPTED BY SPECIAL RESOLUTION DATED [•], 2026)
TABLE A
The Regulations contained or incorporated in Table ‘A’ in the First Schedule of the Statute shall not apply to the Company and the following Articles shall comprise the Articles of Association of the Company.
| 1 | Interpretation |
| 1.1 | In these Articles, unless otherwise defined, the defined terms shall have the meanings assigned to them as follows: |
| “Applicable Law” | means, with respect to any person, all provisions of laws, statutes, ordinances, rules, regulations, permits, certificates, judgments, decisions, decrees or orders of any governmental authority applicable to such person. | |
| “Appointed Director” | has the meaning given to it in Article 30.2. | |
| “Articles” | means these sixth amended and restated articles of association of the Company, as from time to time altered or added to in accordance with the Statute and these Articles. | |
| “Audit Committee” | means the audit committee of the Board established pursuant to the Articles, or any successor committee. | |
| “Auditor” | means the person for the time being performing the duties of auditor of the Company (if any). |
| “beneficial owner” | means a person who is a beneficial owner, as determined under Rule 13d-3 under the Exchange Act (and “beneficially own” and “beneficially owned” shall have correlative meaning); and, for all purposes under these Articles, a person’s “beneficial ownership” (or variations on such phrase) shall be determined and calculated in accordance with the provisions of Rule 13d-3, irrespective of whether or not such Rule is actually applicable in such circumstance. | |
| “Board” | means the board of directors of the Company. | |
| “Business Day” | means any day other than a Saturday, a Sunday or a legal holiday or a day on which banking institutions or trust companies are authorised or obligated by law to close in New York City. | |
| “Clearing House” | means a clearing house recognised by the laws of the jurisdiction in which the Shares (or depositary receipts therefor) are listed or quoted on a stock exchange or interdealer quotation system in such jurisdiction. | |
| “Company” | means the above named company. | |
| “Company’s Website” | means the website of the Company, the address or domain name of which has been notified to Members. | |
| “Compensation Committee” | means the compensation committee of the Board established pursuant to the Articles, or any successor committee. | |
| “Designated Stock Exchange” | means any United States national securities exchange on which the securities of the Company are listed for trading, including the New York Stock Exchange. | |
| “Directors” | means the directors for the time being of the Company. | |
| “Dividend” | means any dividend (whether interim or final) resolved to be paid on shares pursuant to these Articles. | |
| “electronic communication” | means a communication sent by electronic means, including electronic posting to the Company’s Website, transmission to any number, address or internet website (including the website of the SEC) or other electronic delivery methods as otherwise decided and approved by the Directors. |
| “electronic record” | has the same meaning as in the Electronic Transactions Act. | |
| “Electronic Transactions Act” | means the Electronic Transactions Act (As Revised) of the Cayman Islands. | |
| “Exchange Act” | means the United States Securities Exchange Act of 1934, as amended, and the rules and regulations of the SEC thereunder, all as the same shall be in effect at the time. | |
| “General Director” | has the meaning given to it in Article 30.4. | |
| “Indenture” | means the indenture, dated as of December 16, 2021, between, among others, the Company and U.S. Bank National Association as trustee and collateral agent, as amended and/or supplemented from time to time. | |
| “Independent Director” | has the same meaning set forth in the rules and regulations of the Designated Stock Exchange and, solely insofar as applicable to members of the Company’s Audit Committee, in Rule 10A-3 under the Exchange Act, as the case may be. | |
| “MC” | means Mudrick Capital Management, L.P. or any fund, investor, entity or account that is managed, sponsored or advised by Mudrick Capital Management, L.P. or its affiliates. | |
| “Member” | has the same meaning given to it in the Statute. | |
| “Memorandum of Association” | means the sixth amended and restated memorandum of association of the Company, as from time to time altered or added to in accordance with the Statute and these Articles. | |
| “Nominating and Corporate Governance Committee” | means the nominating and corporate governance committee of the Board established pursuant to the Articles, or any successor committee. | |
| “Officer” | means a person appointed to hold an office in the Company. |
| “Ordinary Resolution” | means (i) a resolution passed by a simple majority of votes cast by such Members as, being entitled to do so, vote in person or, in the case of any Member being an organisation, by its duly authorised representative or, where proxies are allowed, by proxy at a general meeting of the Company, or (ii) a unanimous written resolution. | |
| “Ordinary Share” | means an ordinary share in the share capital of the Company of US$0.001 nominal or par value designated as Ordinary Shares, and having the rights provided for in these Articles. | |
| “Preferred Share” | means a preferred share in the share capital of the Company of US$0.001 each nominal or par value designated as Preferred Shares, and having the rights provided for in these Articles. | |
| “Register of Members” | means the register of Members maintained in accordance with the Statute and includes (except where otherwise stated) any branch or duplicate register of Members. | |
| “Registered Office” | means the registered office for the time being of the Company. | |
| “Seal” | means the common seal of the Company including any facsimile thereof. | |
| “SEC” | means the United States Securities and Exchange Commission. | |
| “Securities Act” | means the Securities Act of 1933 of the United States of America, as amended, and the rules and regulations of the SEC thereunder, all as the same shall be in effect at the time. | |
| “SF” | means Stephen Fitzpatrick. | |
| “Share” | means any share in the capital of the Company, including the Ordinary Shares, Preferred Shares and shares of other classes. |
| “signed” | means a signature or representation of a signature affixed by mechanical means or an electronic symbol or process attached to or logically associated with an electronic communication and executed or adopted by a person with the intent to sign the electronic communication. | |
| “Special Resolution” | means (i) a resolution passed by not less than two-thirds of votes cast by such Members as, being entitled to do so, vote in person or, where proxies are allowed, by proxy at a general meeting of which notice specifying the intention to propose the resolution as a special resolution, has been duly given or (ii) a unanimous written resolution, provided that (1) any resolution to amend these Articles that would adversely affect the rights provided under Article 30.11 shall only be passed if the Shares beneficially owned by SF are voted in favor of such Special Resolution and (2) any resolution to amend these Articles that would adversely affect MC’s rights provided under Article 22(a), Article 23(a), Article 30, Article 32.3 or Article 32.10 shall be passed only if the Shares beneficially owned by MC are voted in favor of such Special Resolution. | |
| “Statute” | means the Companies Act (As Revised) of the Cayman Islands. | |
| “Treasury Share” | means a share held in the name of the Company as a treasury share in accordance with the Statute. |
| 1.2 | In these Articles, save where the context requires otherwise: |
| (a) | words importing the singular number include the plural number and vice versa; |
| (b) | words importing one gender include all other genders; |
| (c) | words importing persons include corporations as well as any other legal or natural person; |
| (d) | “written” and “in writing” include all modes of representing or reproducing words in visible form, including in the form of an Electronic Record; |
| (e) | “shall” shall be construed as imperative and “may” shall be construed as permissive; |
| (f) | references to provisions of any law or regulation shall be construed as references to those provisions as amended, modified, re-enacted or replaced; |
| (g) | any phrase introduced by the terms “including”, “include”, “in particular” or any similar expression shall be construed as illustrative and shall not limit the sense of the words preceding those terms; |
| (h) | the term “and/or” is used herein to mean both “and” as well as “or.” The use of “and/or” in certain contexts in no respects qualifies or modifies the use of the terms “and” or “or” in others. The term “or” shall not be interpreted to be exclusive and the term “and” shall not be interpreted to require the conjunctive (in each case, unless the context otherwise requires); |
| (i) | headings are inserted for reference only and shall be ignored in construing the Articles; |
| (j) | any requirements as to delivery under the Articles include delivery in the form of an Electronic Record; |
| (k) | any requirements as to execution or signature under the Articles including the execution of the Articles themselves can be satisfied in the form of an electronic signature as defined in the Electronic Transactions Act; |
| (l) | sections 8 and 19(3) of the Electronic Transactions Act shall not apply; |
| (m) | the term “clear days” in relation to the period of a notice means that period excluding the day when the notice is received or deemed to be received and the day for which it is given or on which it is to take effect; |
| (n) | the term “holder” in relation to a Share means a person whose name is entered in the Register of Members as the holder of such Share; and |
| (o) | references to “rules and regulations” shall be understood to give effect to any applicable exceptions or exemptions claimed by or available to the Company. |
| 2 | Commencement of Business |
| 2.1 | The business of the Company may be commenced as soon after incorporation of the Company as the Directors shall see fit. |
| 2.2 | The Directors may pay, out of the capital or any other monies of the Company, all expenses incurred in or about the formation and establishment of the Company, including the expenses of registration. |
| 3 | Issue of Shares and other Securities |
| 3.1 | Subject to the provisions, if any, in the Memorandum (and to any direction that may be given by the Company in general meeting) and, where applicable, the rules and regulations of the Designated Stock Exchange, the SEC and/or any other competent regulatory authority or otherwise under Applicable Law, and without prejudice to any rights attached to any existing Shares, the Directors may, in their absolute discretion and without approval of the holders of Ordinary Shares, allot, issue, grant options over or otherwise dispose of shares (including fractions of a share) with or without preferred, deferred or other rights or restrictions, whether in regard to Dividend or other distribution, voting, return of capital or otherwise, any or all of which may be greater than the powers and rights associated with the Ordinary Shares, to such persons, at such times and on such other terms as they think proper, which shall be conclusively evidenced by their approval of the terms thereof, and may also (subject to the Statute and these Articles) vary such rights. |
| 3.2 | The Company may issue rights, options, warrants or convertible securities or securities of similar nature conferring the right upon the holders thereof to subscribe for, purchase or receive any class of Shares or other securities in the Company on such terms as the Directors may from time to time determine and for such purposes the Directors may reserve an appropriate number of Shares for the time being unissued. |
| 3.3 | The Company shall not issue shares in bearer form and shall only issue shares as fully paid. |
| 4 | Ordinary Shares |
| 4.1 | The holders of the Ordinary Shares shall be: |
| (a) | entitled to dividends in accordance with the relevant provisions of these Articles; |
| (b) | entitled to and are subject to the provisions in relation to winding up of the Company provided for in these Articles; and |
| (c) | entitled to attend general meetings of the Company and shall be entitled to one vote for each Ordinary Share registered in his name in the Register of Members, both in accordance with the relevant provisions of these Articles. |
| 4.2 | All Ordinary Shares shall rank pari passu with each other in all respects. |
| 5 | Preferred Shares |
| 5.1 | Preferred Shares may be issued from time to time in one or more series, each of such series to have such voting powers (full or limited or without voting powers), designations, preferences and relative, participating, optional or other special rights and qualifications, limitations or restrictions thereof as are stated and expressed, or in any resolution or resolutions providing for the issue of such series adopted by the Directors as hereinafter provided. |
| 5.2 | Authority is hereby granted to the Directors, subject to the provisions of the Memorandum, these Articles and applicable law, to create one or more series of Preferred Shares and, with respect to each such series, to fix by resolution or resolutions, without any further vote or action by the Members of the Company providing for the issue of such series: |
| (a) | the number of Preferred Shares to constitute such series and the distinctive designation thereof; |
| (b) | the dividend rate on the Preferred Shares of such series, the dividend payment dates, the periods in respect of which dividends are payable (“Dividend Periods”), whether such dividends shall be cumulative and, if cumulative, the date or dates from which dividends shall accumulate; |
| (c) | whether the Preferred Shares of such series shall be convertible into, or exchangeable for, Shares of any other class or classes or any other series of the same or any other class or classes of Shares and the conversion price or prices or rate or rates, or the rate or rates at which such exchange may be made, with such adjustments, if any, as shall be stated and expressed or provided in such resolution or resolutions; |
| (d) | the preferences, if any, and the amounts thereof, which the Preferred Shares of such series shall be entitled to receive upon the winding up of the Company; |
| (e) | the voting power, if any, of the Preferred Shares of such series; |
| (f) | transfer restrictions and rights of first refusal with respect to the Preferred Shares of such series; and |
| (g) | such other terms, conditions, special rights and provisions as may seem advisable to the Directors. |
| 5.3 | Notwithstanding the fixing of the number of Preferred Shares constituting a particular series upon the issuance thereof, the Directors at any time thereafter may authorise the issuance of additional Preferred Shares of the same series subject always to the Statute and the Memorandum of Association. |
| 5.4 | No dividend shall be declared and set apart for payment on any series of Preferred Shares in respect of any Dividend Period unless there shall likewise be or have been paid, or declared and set apart for payment, on all Preferred Shares of each other series entitled to cumulative dividends at the time outstanding which rank senior or equally as to dividends with the series in question, dividends rateably in accordance with the sums which would be payable on the said Preferred Shares through the end of the last preceding Dividend Period if all dividends were declared and paid in full. |
| 5.5 | If, upon the winding up of the Company, the assets of the Company distributable among the holders of any one or more series of Preferred Shares which (a) are entitled to a preference over the holders of the Ordinary Shares upon such winding up; and (b) rank equally in connection with any such distribution, shall be insufficient to pay in full the preferential amount to which the holders of such Preferred Shares shall be entitled, then such assets, or the proceeds thereof, shall be distributed among the holders of each such series of the Preferred Shares rateably in accordance with the sums which would be payable on such distribution if all sums payable were discharged in full. |
| 6 | Register of Members |
| 6.1 | The Company shall maintain or cause to be maintained the Register of Members in accordance with the Statute, provided that for so long as the securities of the Company are listed for trading on the Designated Stock Exchange, title to such securities may be evidenced and transferred in accordance with the laws applicable to and the rules and regulations of the Designated Stock Exchange. |
| 6.2 | The Directors may determine that the Company shall maintain one or more branch registers of Members in accordance with the Statute. The Directors may also determine which register of Members shall constitute the principal register and which shall constitute the branch register or registers, and to vary such determination from time to time. |
| 7 | Closing Register of Members or Fixing Record Date |
| 7.1 | For the purpose of determining Members entitled to notice of, or to vote at any meeting of Members or any adjournment thereof, or Members entitled to receive payment of any Dividend or other distribution, or in order to make a determination of Members for any other purpose, the Directors may, after notice has been given by advertisement in an appointed newspaper or any other newspaper or by any other means in accordance with the rules and regulations of the Designated Stock Exchange, the SEC and/or any other competent regulatory authority or otherwise under Applicable Law, provide that the Register of Members shall be closed for transfers for a stated period which shall not in any case exceed forty days. |
| 7.2 | In lieu of, or apart from, closing the Register of Members, the Directors may fix in advance or arrears a date as the record date for any such determination of Members entitled to notice of, or to vote at any meeting of the Members or any adjournment thereof, or for the purpose of determining the Members entitled to receive payment of any Dividend or other distribution, or in order to make a determination of Members for any other purpose. |
| 7.3 | If the Register of Members is not so closed and no record date is fixed for the determination of Members entitled to notice of, or to vote at, a meeting of Members or Members entitled to receive payment of a Dividend or other distribution, the date on which notice of the meeting is sent or the date on which the resolution of the Directors resolving to pay such Dividend or other distribution is passed, as the case may be, shall be the record date for such determination of Members. When a determination of Members entitled to vote at any meeting of Members has been made as provided in this Article, such determination shall apply to any adjournment thereof. |
| 8 | Certificates for Shares |
| 8.1 | A Member shall only be entitled to a share certificate if the Directors resolve that share certificates shall be issued. Share certificates representing Shares, if any, shall be in such form as the Directors may determine. Share certificates shall be signed by one or more Directors or other person authorised by the Directors. The Directors may authorise certificates to be issued with the authorised signature(s) affixed by mechanical process. All certificates for Shares shall be consecutively numbered or otherwise identified and shall specify the Shares to which they relate. All certificates surrendered to the Company for transfer shall be cancelled and, subject to the Articles, no new certificate shall be issued until the former certificate representing a like number of relevant Shares shall have been surrendered and cancelled. |
| 8.2 | The Company shall not be bound to issue more than one certificate for Shares held jointly by more than one person and delivery of a certificate to one joint holder shall be a sufficient delivery to all of them. |
| 8.3 | If a share certificate is defaced, worn out, lost or destroyed, it may be renewed on such terms (if any) as to evidence and indemnity and on the payment of such expenses reasonably incurred by the Company in investigating evidence, as the Directors may prescribe, and (in the case of defacement or wearing out) upon delivery of the old certificate. |
| 8.4 | Every share certificate sent in accordance with the Articles will be sent at the risk of the Member or other person entitled to the certificate. The Company will not be responsible for any share certificate lost or delayed in the course of delivery. |
| 8.5 | Share certificates shall be issued within the relevant time limit as prescribed by the Statute, if applicable, or as the rules and regulations of the Designated Stock Exchange, the SEC and/or any other competent regulatory authority or otherwise under Applicable Law may from time to time determine, whichever is shorter, after the allotment or, except in the case of a Share transfer which the Company is for the time being entitled to refuse to register and does not register, after lodgement of a Share transfer with the Company. |
| 9 | Transfer of Shares |
| 9.1 | Subject to the terms of the Articles, any Member may transfer all or any of his Shares by an instrument of transfer provided that such transfer complies with the rules and regulations of the Designated Stock Exchange, the SEC and/or any other competent regulatory authority or otherwise under Applicable Law. If the Shares in question were issued in conjunction with rights, options or warrants issued pursuant to the Articles on terms that one cannot be transferred without the other, the Directors shall refuse to register the transfer of any such Share without evidence satisfactory to them (acting reasonably) of the like transfer of such option or warrant. |
| 9.2 | The instrument of transfer of any Share shall be in writing in the usual or common form or in a form prescribed by the rules and regulations of the Designated Stock Exchange, the SEC and/or any other competent regulatory authority or otherwise under Applicable Law or in any other form approved by the Directors and shall be executed by or on behalf of the transferor (and if the Directors so require, signed by or on behalf of the transferee) and may be under hand or, if the transferor or transferee is a Clearing House or its nominee(s), by hand or by machine imprinted signature or by such other manner of execution as the Directors may approve from time to time. The transferor shall be deemed to remain the holder of a Share until the name of the transferee is entered in the Register of Members. |
| 9.3 | The Directors may, in their absolute discretion, decline to register any transfer of Shares, subject to any applicable requirements imposed from time to time by the Commission and the Designated Stock Exchange. |
| 10 | Redemption, Purchase and Surrender of Shares, Treasury Shares |
| 10.1 | Subject to the provisions, if any, in these Articles, the Memorandum, applicable law, including the Statute, and the rules and regulations of the Designated Stock Exchange, the SEC and/or any other competent regulatory authority or otherwise under Applicable Law, the Company may: |
| (a) | issue shares on terms that they are to be redeemed or are liable to be redeemed at the option of the Company or the Member on such terms and in such manner as the Directors may, before the issue of such shares, determine; and |
| (b) | purchase its own shares (including any redeemable shares) in such manner and on such other terms as the Directors may agree with the relevant Member, provided that, the manner of purchase is in accordance with any applicable requirements imposed from time to time by the Designated Stock Exchange, the SEC and/or any other competent regulatory authority or otherwise under Applicable Law; |
| 10.2 | For the avoidance of doubt, redemptions, repurchases and surrenders of Shares in the circumstances described in the Article above shall not require further approval of the Members. |
| 10.3 | The Company may make a payment in respect of the redemption or purchase of its own shares in any manner permitted by the Statute, including out of capital. |
| 10.4 | The Directors may accept the surrender for no consideration of any fully paid share. |
| 10.5 | The Directors may, prior to the purchase, redemption or surrender of any Share, determine that such Share shall be held as a Treasury Share. |
| 10.6 | The Directors may determine to cancel a Treasury Share or transfer a Treasury Share on such terms as they think proper (including, without limitation, for nil consideration). |
| 11 | Variation of Rights Attaching to Shares |
| 11.1 | Subject to Article 3.1, if at any time the share capital of the Company is divided into different classes of shares, all or any of the rights attached to any class (unless otherwise provided by the terms of issue of the shares of that class) may, whether or not the Company is being wound up, be varied without the consent of the holders of the issued shares of that class where such variation is considered by the Directors not to have a material adverse effect upon such rights; otherwise, any such variation shall be made only with the consent in writing of the holders of not less than two thirds of the issued shares of that class, or with the sanction of a resolution passed by a majority of not less than two thirds of the votes cast at a separate meeting of the holders of the shares of that class. For the avoidance of doubt, the Directors reserve the right, notwithstanding that any such variation may not have a material adverse effect, to obtain consent from the holders of shares of the relevant class. To any such meeting all the provisions of these Articles relating to general meetings shall apply mutatis mutandis, except that the necessary quorum shall be one person holding or representing by proxy at least one third of the issued shares of the class and that any holder of shares of the class present in person or by proxy may demand a poll. |
| 11.2 | For the purposes of a separate class meeting, the Directors may treat two or more or all the classes of Shares as forming one class of shares if the Directors consider that such class of Shares would be affected in the same way by the proposals under consideration, but in any other case shall treat them as separate classes of shares. |
| 11.3 | The rights conferred upon the holders of the shares of any class issued with preferred or other rights shall not, unless otherwise expressly provided by the terms of issue of the shares of that class, be deemed to be varied by the creation or issue of further shares ranking in priority to or pari passu therewith. |
| 12 | Commission on Sale of Shares |
The Company may, in so far as the Statute permits, pay a commission to any person in consideration of his subscribing or agreeing to subscribe (whether absolutely or conditionally) or procuring or agreeing to procure subscriptions (whether absolutely or conditionally) for any shares. Such commissions may be satisfied by the payment of cash and/or the issue of fully or partly paid-up shares. The Company may also on any issue of shares pay such brokerage as may be lawful.
| 13 | Non-Recognition of Trusts |
The Company shall not be bound by or compelled to recognise in any way (even when notified) any equitable, contingent, future or partial interest in any share, or (except only as is otherwise provided by these Articles or the Statute) any other rights in respect of any share other than an absolute right to the entirety thereof in the holder.
| 14 | Lien on Shares |
| 14.1 | The Company shall have a first and paramount lien on all Shares (whether fully paid-up or not) registered in the name of a Member (whether solely or jointly with others) for all debts, liabilities or engagements to or with the Company (whether presently payable or not) by such Member or his estate, either alone or jointly with any other person, whether a Member or not, but the Directors may at any time declare any Share to be wholly or in part exempt from the provisions of this Article. The registration of a transfer of any such Share shall operate as a waiver of the Company’s lien thereon. The Company’s lien on a Share shall also extend to any amount payable in respect of that Share. |
| 14.2 | The Company may sell, in such manner as the Directors think fit, any Shares on which the Company has a lien, if a sum in respect of which the lien exists is presently payable, and is not paid within fourteen clear days after notice has been received or deemed to have been received by the holder of the Shares, or to the person entitled to it in consequence of the death or bankruptcy of the holder, demanding payment and stating that if the notice is not complied with the Shares may be sold. |
| 14.3 | To give effect to any such sale the Directors may authorise any person to execute an instrument of transfer of the Shares sold to, or in accordance with the directions of, the purchaser. The purchaser or his nominee shall be registered as the holder of the Shares comprised in any such transfer, and he shall not be bound to see to the application of the purchase money, nor shall his title to the Shares be affected by any irregularity or invalidity in the sale or the exercise of the Company’s power of sale under the Articles. |
| 14.4 | The net proceeds of such sale after payment of costs, shall be applied in payment of such part of the amount in respect of which the lien exists as is presently payable and any balance shall (subject to a like lien for sums not presently payable as existed upon the Shares before the sale) be paid to the person entitled to the Shares at the date of the sale. |
| 15 | Call on Shares |
| 15.1 | Subject to the terms of the allotment and issue of any Shares, the Directors may make calls upon the Members in respect of any monies unpaid on their Shares (whether in respect of par value or premium), and each Member shall (subject to receiving at least fourteen clear days’ notice specifying the time or times of payment) pay to the Company at the time or times so specified the amount called on the Shares. A call may be revoked or postponed, in whole or in part, as the Directors may determine. A call may be required to be paid by instalments. A person upon whom a call is made shall remain liable for calls made upon him notwithstanding the subsequent transfer of the Shares in respect of which the call was made. |
| 15.2 | A call shall be deemed to have been made at the time when the resolution of the Directors authorising such call was passed. |
| 15.3 | The joint holders of a Share shall be jointly and severally liable to pay all calls in respect thereof. |
| 15.4 | If a call remains unpaid after it has become due and payable, the person from whom it is due shall pay interest on the amount unpaid from the day it became due and payable until it is paid at such rate as the Directors may determine (and in addition all expenses that have been incurred by the Company by reason of such non-payment), but the Directors may waive payment of the interest or expenses wholly or in part. |
| 15.5 | An amount payable in respect of a Share on issue or allotment or at any fixed date, whether on account of the par value of the Share or premium or otherwise, shall be deemed to be a call and if it is not paid all the provisions of the Articles shall apply as if that amount had become due and payable by virtue of a call. |
| 15.6 | The Directors may issue Shares with different terms as to the amount and times of payment of calls, or the interest to be paid. |
| 15.7 | The Directors may, if they think fit, receive an amount from any Member willing to advance all or any part of the monies uncalled and unpaid upon any Shares held by him, and may (until the amount would otherwise become payable) pay interest at such rate as may be agreed upon between the Directors and the Member paying such amount in advance. |
| 15.8 | No such amount paid in advance of calls shall entitle the Member paying such amount to any portion of a Dividend or other distribution payable in respect of any period prior to the date upon which such amount would, but for such payment, become payable. |
| 16 | Forfeiture of Shares |
| 16.1 | If a call or instalment of a call remains unpaid after it has become due and payable the Directors may give to the person from whom it is due not less than fourteen clear days’ notice requiring payment of the amount unpaid together with any interest which may have accrued and any expenses incurred by the Company by reason of such non-payment. The notice shall specify where payment is to be made and shall state that if the notice is not complied with the Shares in respect of which the call was made will be liable to be forfeited. |
| 16.2 | If the notice is not complied with, any Share in respect of which it was given may, before the payment required by the notice has been made, be forfeited by a resolution of the Directors. Such forfeiture shall include all Dividends, other distributions or other monies payable in respect of the forfeited Share and not paid before the forfeiture. |
| 16.3 | A forfeited Share may be sold, re-allotted or otherwise disposed of on such terms and in such manner as the Directors think fit and at any time before a sale, re-allotment or disposition the forfeiture may be cancelled on such terms as the Directors think fit. Where for the purposes of its disposal a forfeited Share is to be transferred to any person the Directors may authorise some person to execute an instrument of transfer of the Share in favour of that person. |
| 16.4 | A person any of whose Shares have been forfeited shall cease to be a Member in respect of them and shall surrender to the Company for cancellation the certificate for the Shares forfeited and shall remain liable to pay to the Company all monies which at the date of forfeiture were payable by him to the Company in respect of those Shares together with interest at such rate as the Directors may determine, but his liability shall cease if and when the Company shall have received payment in full of all monies due and payable by him in respect of those Shares. |
| 16.5 | A certificate in writing under the hand of one Director or Officer that a Share has been forfeited on a specified date shall be conclusive evidence of the facts stated in it as against all persons claiming to be entitled to the Share. The certificate shall (subject to the execution of an instrument of transfer) constitute a good title to the Share and the person to whom the Share is sold or otherwise disposed of shall not be bound to see to the application of the purchase money, if any, nor shall his title to the Share be affected by any irregularity or invalidity in the proceedings in reference to the forfeiture, sale or disposal of the Share. |
| 16.6 | The provisions of the Articles as to forfeiture shall apply in the case of non payment of any sum which, by the terms of issue of a Share, becomes payable at a fixed time, whether on account of the par value of the Share or by way of premium as if it had been payable by virtue of a call duly made and notified. |
| 17 | Transmission of Shares |
| 17.1 | If a Member dies, the survivor or survivors (where he was a joint holder) or his legal personal representatives (where he was a sole holder), shall be the only persons recognised by the Company as having any title to his shares. The estate of a deceased Member is not thereby released from any liability in respect of any share, for which he was a joint or sole holder. |
| 17.2 | Any person becoming entitled to a share in consequence of the death or bankruptcy, liquidation or dissolution of a Member (or in any other way than by transfer) may, upon such evidence being produced as may be required by the Directors, elect, by a notice in writing sent by him to the Company, either to become the holder of such share or to have some person nominated by him registered as the holder of such share. If he elects to have another person registered as the holder of such share he shall sign an instrument of transfer of that share to that person. The Directors shall, in either case, have the same right to decline or suspend registration as they would have had in the case of a transfer of the share by the relevant Member before his death or bankruptcy, liquidation or dissolution, as the case may be. |
| 17.3 | A person becoming entitled to a share by reason of the death or bankruptcy or liquidation or dissolution of a Member (or in any other case than by transfer) shall be entitled to the same Dividends, other distributions and other advantages to which he would be entitled if he were the holder of such share. However, he shall not, before becoming a Member in respect of a share, be entitled in respect of it to exercise any right conferred by membership in relation to general meetings of the Company and the Directors may at any time give notice requiring any such person to elect either to be registered himself or to have some person nominated by him be registered as the holder of the share (but the Directors shall, in either case, have the same right to decline or suspend registration as they would have had in the case of a transfer of the share by the relevant Member before his death or bankruptcy or liquidation or dissolution or any other case than by transfer, as the case may be). If the notice is not complied with within ninety days of being received or deemed to be received (as determined pursuant to these Articles) the Directors may thereafter withhold payment of all Dividends, other distributions, bonuses or other monies payable in respect of the share until the requirements of the notice have been complied with. |
| 18 | Alteration of Capital |
| 18.1 | Subject to these Articles, the Company may from time to time by Ordinary Resolution increase the share capital by such sum, to be divided into shares of such classes and amount, as the resolution shall prescribe. |
| 18.2 | Subject to these Articles, the Company may by Ordinary Resolution: |
| (a) | consolidate and divide all or any of its share capital into shares of larger amount than its existing shares, provided that the Directors shall have the power to deal with any fractions of a share that result from such a consolidation or division of its share capital as they, in their absolute discretion and without approval of the holders of the Ordinary Shares, deem appropriate, including but not limited to rounding up or rounding down such fractions of shares to the nearest whole share, repurchasing or arranging for the sale of any or all of such fractions of shares (including by arranging through the Company’s agents for such fractions to be aggregated and sold), or any combination of the foregoing; |
| (b) | sub-divide its existing shares, or any of them into shares of a smaller amount provided that in the subdivision the proportion between the amount paid and the amount, if any, unpaid on each reduced share shall be the same as it was in case of the share from which the reduced share is derived; |
| (c) | divide shares into multiple classes; and |
| (d) | cancel any shares which, at the date of the passing of the resolution, have not been taken or agreed to be taken by any person and diminish the amount of its share capital by the amount of the shares so cancelled. |
| 18.3 | All new shares created hereunder shall be subject to the same provisions with reference to the payment of calls, liens, transfer, transmission, forfeiture and otherwise as the shares in the original share capital. |
| 18.4 | Subject to these Articles, the Company may by Special Resolution: |
| (a) | change its name; |
| (b) | alter or add to the Articles; |
| (c) | alter or add to the Memorandum of Association with respect to any objects, powers or other matters specified therein; and |
| (d) | reduce its share capital and any capital redemption reserve in any manner authorised by law. |
| 19 | Offices and Places of Business |
Subject to the provisions of the Statute, the Company may by resolution of the Directors change the location of its Registered Office. The Company may, in addition to its Registered Office, maintain such other offices or places of business as the Directors determine.
| 20 | General Meetings |
| 20.1 | All general meetings of the Company other than annual general meetings shall be called extraordinary general meetings. |
| 20.2 | The Company shall hold a general meeting in each fiscal year of the Company as its annual general meeting, and shall specify the meeting as such in the notices calling it. Any annual general meeting shall be held at such time and place as the Directors shall approve. At these meetings the report of the Directors (if any) shall be presented. |
| 20.3 | Extraordinary general meetings for any purpose or purposes may be called at any time (i) by a resolution adopted by the majority of the Directors or (ii) by the Board upon written request by a Member (or Members) holding greater than an aggregate of 10.0% of the issued Ordinary Shares. A requisition by a Member or Members to call an extraordinary general meeting: |
| (a) | must state the general nature of the business to be dealt with at the extraordinary general meeting; |
| (b) | may include the text of the resolution proposed to be presented and voted at the extraordinary general meeting; |
| (c) | may be in hard copy form or electronic form; and |
| (d) | must be signed by the person or persons making it. |
| 20.4 | The Board can, in good faith, refuse the calling of an extraordinary general meeting at the request of a Member (or Members) holding greater than an aggregate of 10.0% of the issued Ordinary Shares, but only if the resolution proposed to be dealt with at the extraordinary general meeting cannot be properly moved because it would be contrary to Applicable Law. If the Board refuses to call an extraordinary general meeting in accordance with this Article they shall provide written notice to the Member (or Members) setting out the reason for such refusal. |
| 20.5 | If the Board does not convene an extraordinary general meeting within twenty-one (21) days from the date in which the requisition is received pursuant to this Article, except where the Board does not convene an extraordinary general meeting for the reasons set forth in Article 20.4, the requisitionists may convene an extraordinary general meeting. An extraordinary general meeting convened by requisitionists shall be convened in the same manner as nearly as possible as that in which extraordinary general meetings are to be convened by the Board. |
| 20.6 | A person may participate at a general meeting by conference telephone or other communications equipment by means of which all the persons participating in the meeting can communicate with one another. Participation by a person in a general meeting in this manner is treated as presence in person at that meeting. |
| 21 | Notice of Business to be Brought before a General Meeting |
| 21.1 | No business may be transacted at any general meeting other than the business properly brought before the meeting in accordance with Article 21.2. |
| 21.2 | Matters brought before a general meeting |
| (a) | To be properly brought before an annual general meeting, business must be: |
| (i) | specified in a notice of meeting given by or at the direction of the Board; |
| (ii) | if not specified in a notice of meeting, otherwise brought before the meeting by the Board or the Chairman of the Board; or |
| (iii) | notified to the Company in writing not later than the seventh (7) day after the delivery of a notice of such meeting pursuant to Article 20.2 above, by a Member (or Members) who (1) (x) was a record owner of shares of the Company both at the time of giving the notice provided for in Article 20.2 and remains a Member (or Members) at the time of the meeting, (y) is entitled to vote at the meeting, and (z) has complied with this Article 21 in all applicable respects, and (2) holds greater than an aggregate of 10.0% of the issued Ordinary Shares. This clause (iii) shall be the exclusive means for a Member (or Members) to propose business to be brought before an annual general meeting. |
| (b) | To be properly brought before an extraordinary general meeting, business must be specified in the notice of meeting given by or at the direction of the person calling the meeting pursuant to Articles 20.3 and 20.5, which may include such business as the Member or Members who are entitled to request the Board to call a meeting under limb (ii) of Article 20.3 may propose to be brought before an extraordinary general meeting which includes, but is not limited to, the matters set out in Article 30.13, and all other matters permitted by Applicable Law, which if tabled shall be approved by Ordinary Resolution or Special Resolution in accordance with these Articles and Applicable Law. |
| 21.3 | To be in proper form for purposes of this Article 21, a member’s notification to the Company shall set forth: |
| (a) | As to each Proposing Person (as defined below), (i) the name and address of such Proposing Person (including, if applicable, the name and address that appear on the Company’s books and records); and (ii) the class and number of Ordinary Shares of the Company that are held, directly or indirectly, by such Proposing Person, and any other securities of the Company that such Proposing Person beneficially owns or as to which such Proposing Person has a right to acquire beneficial ownership, directly or indirectly, at any time in the future (the disclosures to be made pursuant to the foregoing clauses (i) and (ii) are referred to as “Stockholder Information”); |
| (b) | As to each Proposing Person, (i) the full notional amount of any securities that, directly or indirectly, underlie any “derivative security” (as such term is defined in Rule 16a-l(c) under the Exchange Act) that constitutes a “call equivalent position” (as such term is defined in Rule l6a-l(b) under the Exchange Act) (“Synthetic Equity Position”) and that is, directly or indirectly, held or maintained by such Proposing Person with respect to any shares of any class or series of shares of the Company; provided that, for the purposes of the definition of “Synthetic Equity Position,” the term “derivative security” shall also include any security or instrument that would not otherwise constitute a “derivative security” as a result of any feature that would make any conversion, exercise or similar right or privilege of such security or instrument becoming determinable only at some future date or upon the happening of a future occurrence, in which case the determination of the amount of securities into which such security or instrument would be convertible or exercisable shall be made assuming that such security or instrument is immediately convertible or exercisable at the time of such determination; and, provided, further, that any Proposing Person satisfying the requirements of Rule l 3d-l (b)(1) under the Exchange Act (other than a Proposing Person that so satisfies Rule 13d-l(b)(1) under the Exchange Act solely by reason of Rule 13d-l (b)(1)(ii)(E)) shall not be deemed to hold or maintain the notional amount of any securities that underlie a Synthetic Equity Position held by such Proposing Person as a hedge with respect to a bona fide derivatives trade or position of such Proposing Person arising in the ordinary course of such Proposing Person’s business as a derivatives dealer, (ii) any rights to dividends on the shares of any class or series of shares of the Company held, directly or indirectly, by such Proposing Person that are separated or separable from the underlying shares of the Company, (iii) any material pending or threatened legal proceeding in which such Proposing Person is a party or material participant involving the Company or any of its officers or directors, or any affiliate of the Company, (iv) any other material relationship between such Proposing Person, on the one hand, and the Company, any affiliate of the Company, on the other hand, (v) any direct or indirect material interest in any material contract or agreement of such Proposing Person with the Company or any affiliate of the Company (including, in any such case, any employment agreement, collective bargaining agreement or consulting agreement), (vi) a representation that such Proposing Person intends or is part of a group which intends to deliver a proxy statement or form of proxy to holders of at least the percentage of the issued share capital of the Company required to approve or adopt the proposal or otherwise solicit proxies from Members in support of such proposal and (vii) any other information relating to such Proposing Person that would be required to be disclosed in a proxy statement or other filing required to be made in connection with solicitations of proxies or consents by such Proposing Person in support of the business proposed to be brought before the meeting pursuant to Section l4(a) of the Exchange Act (the disclosures to be made pursuant to the foregoing clauses (i) through (vii) are referred to as “Disclosable Interests”); provided, however, that Disclosable Interests shall not include any such disclosures with respect to the ordinary course business activities of any broker, dealer, commercial bank, trust company or other nominee who is a Proposing Person solely as a result of being the member directed to prepare and submit the notice required by these Articles on behalf of a beneficial owner; and |
| (c) | As to each item of business that the Member notifies to the Company to be brought before the annual general meeting, (i) a brief description of the business desired to be brought before the annual general meeting, the reasons for conducting such business at the annual general meeting and any material interest in such business of each Proposing Person, (ii) the text of the proposal or business (including the text of any resolutions proposed for consideration and in the event that such business includes a proposal to amend the Articles of association of the Company, the language of the proposed amendment), and (iii) a reasonably detailed description of all agreements, arrangements and understandings (x) between or among any of the Proposing Persons or (y) between or among any Proposing Person and any other record or beneficial holder(s) or persons(s) who have a right to acquire beneficial ownership at any time in the future of the shares of any class or series of the Company (including their names) in connection with the proposal of such business by such Member; and (iv) any other information relating to such item of business that would be required to be disclosed in a proxy statement or other filing required to be made in connection with solicitations of proxies in support of the business proposed to be brought before the meeting pursuant to Section l4(a) of the Exchange Act; provided, however, that the disclosures required by this paragraph (c) shall not include any disclosures with respect to any broker, dealer, commercial bank, trust company or other nominee who is a Proposing Person solely as a result of being the Member directed to prepare and submit the notice required by these Articles on behalf of a beneficial owner. |
For purposes of this Article 21, the term “Proposing Person” shall mean (i) the Member providing the notification to the Company of any business proposed to be brought before an annual general meeting, (ii) the direct or indirect owner or owners, if different, on whose behalf the notification of business to the Company is proposed to be brought before the annual meeting is made, and (iii) any participant (as defined in paragraphs (a)(ii)-(vi) of Instruction 3 to Item 4 of Schedule 14A) with such Member in such solicitation.
| (d) | Notwithstanding anything in these Articles to the contrary, no business shall be conducted at an annual general meeting that is not properly brought before the meeting in accordance with this Article 21. The presiding officer of the meeting shall, if the facts warrant, determine that the business was not properly brought before the meeting in accordance with this Article 21, and if he or she should so determine, he or she shall so declare to the meeting and any such business not properly brought before the meeting shall not be transacted. |
| (e) | For purposes of these Articles, “public disclosure” shall mean disclosure in a press release reported by a national news service or in a document publicly filed by the Company with the Securities and Exchange Commission pursuant to Sections 13, 14 or 15(d) of the Exchange Act. |
| 22 | Notice of Nominations for Election to the Board |
| (a) | To the extent that there is a casual vacancy (whether as a result of death, resignation, removal or otherwise) on the Board in respect of a General Director position, nominations of any person for election to the Board to fill such casual vacancy at an annual general meeting or at an extraordinary general meeting (but only if the election of directors is a matter specified in the notice of meeting given by or at the direction of the person calling such extraordinary general meeting) may be made at such meeting only (i) by or at the direction of the Board, including by any committee or persons authorized to do so by the Board or these Articles, or (ii) by a Member or Members present in person who (A) was or were a record owner(s) of shares greater than an aggregate of 10.0% of the issued Ordinary Shares both at the time of giving the notice provided for in this Article 22 and at the time of the meeting, (B) is or are entitled to vote at the meeting, (C) has or have complied with this Article 22 and Article 23 as to such notice and nomination and (D) in the case of MC, is not prohibited by Article 30.13(a) from tabling appointments for General Directors to the Board at such general meeting. In the event that there is more than one nomination to fill such casual vacancy, the nominee that receives the greatest number of Member votes, and is eligible for election, shall be appointed as the General Director. For purposes of this Article 22, “present in person” shall mean that the Member proposing that the business be brought before the meeting of the Company, or a qualified representative of such Member, appear at such meeting. A “qualified representative” of such proposing Member shall be a duly authorized officer, manager or partner of such Member or any other person authorized by a writing executed by such Member or an electronic transmission delivered by such Member to act for such Member as proxy at the meeting of Members and such person must produce such writing or electronic transmission, or a reliable reproduction of the writing or electronic transmission, at the meeting of Members. The foregoing clause (ii) shall be the exclusive means for a Member to make any nomination of a person or persons for election to the Board at an annual general meeting or extraordinary general meeting. |
| (b) |
| (i) | Without qualification, for a Member to make any nomination of a person or persons for election to the Board at an annual general meeting, the Member must (1) provide notice in writing and in proper form to the Secretary of the Company in accordance with Article 21.2(a)(iii), (2) provide the information, agreements and questionnaires with respect to such Member and its candidate for nomination as required to be set forth by this Article 22 and Article 23 and (3) provide any updates or supplements to such notification at the times and in the forms required by this Article 22 and Article 23. Without qualification, if the election of directors is a matter specified in the notice of meeting given by or at the direction of the person calling an extraordinary general meeting, then for a Member to make any nomination of a person or persons for election to the Board at an extraordinary general meeting, the Member must (A) provide notice thereof in accordance with Article 20.3 in writing and in proper form to the Secretary of the Company at the principal executive offices of the Company, (B) provide the information with respect to such Member and its candidate for nomination as required by this Article 22 and Article 23 and (C) provide any updates or supplements to such notice at the times and in the forms required by this Article 22. |
| (ii) | In no event shall any adjournment or postponement of an annual general meeting or extraordinary general meeting or the announcement thereof commence a new time period for the giving of a Member’s notification to the Company as described above. |
| (iii) | In no event may a Nominating Person provide notice with respect to a greater number of director candidates than are subject to election by Members at the applicable meeting. If the Company shall, subsequent to such notice, increase the number of directors subject to election at the meeting, such notice as to any additional nominees shall be due no later than the fifth day (5) following the date of public disclosure (as defined in Article 21) of such increase. |
| (c) | To be in proper form for purposes of this Article 22, a Member’s notification to the Directors shall set forth: |
| (i) | As to each Nominating Person (as defined below), the Stockholder Information (as defined in Article 21.3(a), except that for purposes of this Article 22 the term “Nominating Person” shall be substituted for the term “Proposing Person” in all places it appears in Article 2 l.3(a)); |
| (ii) | As to each Nominating Person, any Disclosable Interests (as defined in Article 21.3(b), except that for purposes of this Article 22 the term “Nominating Person” shall be substituted for the term “Proposing Person” in all places it appears in Article 21.3(b) and the disclosure with respect to the business to be brought before the meeting in Article 2 l .3(b) shall be made with respect to the election of directors at the meeting); and |
| (iii) | As to each candidate whom a Nominating Person proposes to nominate for election as a director, (A) all information with respect to such candidate for nomination that would be required to be set forth in a Member’s notification pursuant to this Article 22 and Article 23 if such candidate for nomination were a Nominating Person, (B) all information relating to such candidate for nomination that is required to be disclosed in a proxy statement or other filings required to be made in connection with solicitations of proxies for election of directors in a contested election pursuant to Section l 4(a) under the Exchange Act (including such candidate’s written consent to being named in the proxy statement as a nominee and to serving as a director if elected), (C) a description of any direct or indirect material interest in any material contract or agreement between or among any Nominating Person, on the one hand, and each candidate for nomination or his or her respective associates or any other participants in such solicitation, on the other hand, including, without limitation, all information that would be required to be disclosed pursuant to Item 404 under Regulation S-K if such Nominating Person were the “registrant” for purposes of such rule and the candidate for nomination were a director or executive officer of such registrant (the disclosures to be made pursuant to the foregoing clauses (A) through (C) are referred to as “Nominee Information”), and (D) a completed and signed questionnaire, representation and agreement as provided in Article 23(a). |
For purposes of this Article 22, the term “Nominating Person” shall mean (i) the Member providing the notification of the nomination proposed to be made at the meeting, (ii) the beneficial owner or beneficial owners, if different, on whose behalf the notification of the nomination proposed to be made at the meeting is made, and (iii) any other participant in such solicitation.
| (d) | A Member providing notice of any nomination proposed to be made at a meeting shall further update and supplement such notice, if necessary, so that the information provided or required to be provided in such notice pursuant to this Article 22 shall be true and correct as of the record date for Members entitled to vote at the meeting and as of the date that is ten (10) Business Days prior to the meeting or any adjournment or postponement thereof, and such update and supplement shall be delivered to, or mailed and received by, the Secretary at the principal executive offices of the Company not later than five (5) Business Days after the record date for Members entitled to vote at the meeting (in the case of the update and supplement required to be made as of such record date), and not later than eight (8) Business Days prior to the date for the meeting or, if practicable, any adjournment or postponement thereof (and, if not practicable, on the first practicable date prior to the date to which the meeting has been adjourned or postponed) (in the case of the update and supplement required to be made as of ten (10) Business Days prior to the meeting or any adjournment or postponement thereof). For the avoidance of doubt, the obligation to update and supplement as set forth in this paragraph or any other Article of these Articles shall not limit the Company’s rights with respect to any deficiencies in any notice provided by a Member, extend any applicable deadlines hereunder or enable or be deemed to permit a Member who has previously submitted notice hereunder to amend or update any nomination or to submit any new nomination. |
In addition to the requirements of this Article 22 with respect to any nomination proposed to be made at a meeting, each Nominating Person shall comply with all applicable requirements of the Exchange Act with respect to any such nominations.
| 23 | Additional Requirements for Valid Nomination of Candidates to Serve as Director and, if Elected, to be Seated as Directors. |
| (a) | To be eligible to be a candidate for election as a director of the Company at an annual general meeting or extraordinary general meeting, a candidate must be nominated in the manner prescribed in Article 22 and the candidate for nomination, whether nominated by the Board or by a Member of record, must have previously delivered (in accordance with the time period prescribed for delivery in a notice to such candidate given by or on behalf of the Board), to the Directors at the principal executive offices of the Company, (1) a completed written questionnaire (in a form provided by the Company) with respect to the background, qualifications, share ownership and independence of such proposed nominee, and such additional information with respect to such proposed nominee as would be required to be provided by the Company pursuant to Schedule 14A if such proposed nominee were a participant in the solicitation of proxies by the Company in connection with such annual general meeting or extraordinary general meeting and (2) a written representation and agreement (in form provided by the Company) that such candidate for nomination (A) is not and, if elected as a director during his or her term of office, will not become a party to (x) any agreement, arrangement or understanding with, and has not given and will not give any commitment or assurance to, any person or entity as to how such proposed nominee, if elected as a director of the Company, will act or vote on any issue or question (a “Voting Commitment”) or (y) any Voting Commitment that could limit or interfere with such proposed nominee’s ability to comply, if elected as a director of the Company, with such proposed nominee’s fiduciary duties under Applicable Law, (B) is not, and will not become a party to, any agreement, arrangement or understanding with any person or entity other than the Company with respect to any direct or indirect compensation or reimbursement for service as a director that has not been disclosed to the Company, (C) if elected as a director of the Company, will comply with all applicable corporate governance, conflict of interest, confidentiality, stock or share ownership and trading and other policies and guidelines of the Company applicable to directors and in effect during such person’s term in office as a director (and, if requested by any candidate for nomination, the Secretary of the Company shall provide to such candidate for nomination all such policies and guidelines then in effect), (D) if elected as a director of the Company for a particular term, intends to serve the entire term until the next meeting at which such candidate would face re-election (it being understood that this clause (D) shall not apply to Appointed Directors, who shall not be appointed for a particular term) and (E) consents to being named as a nominee in the Company’s proxy statement pursuant to Rule 14a-4(d) under the Exchange Act and any associated proxy card of the Company and agrees to serve if elected as a director. |
| (b) | The Board may also require any proposed candidate for nomination as a Director to furnish such other information as may reasonably be requested by the Board in writing prior to the meeting of Members at which such candidate’s nomination is to be acted upon in order for the Board to determine the eligibility of such candidate for nomination to be an Independent Director of the Company in accordance with the Company’s Corporate Governance Guidelines. |
| (c) | A candidate for nomination as a director shall further update and supplement the materials delivered pursuant to this Article 23, if necessary, so that the information provided or required to be provided pursuant to this Article 23 shall be true and correct as of the record date for Members entitled to vote at the meeting and as of the date that is ten (10) Business Days prior to the meeting or any adjournment or postponement thereof, and such update and supplement shall be delivered to, or mailed and received by, the Secretary at the principal executive offices of the Company (or any other office specified by the Company in any public announcement) not later than five (5) Business Days after the record date for Members entitled to vote at the meeting (in the case of the update and supplement required to be made as of such record date), and not later than eight (8) Business Days prior to the date for the meeting or, if practicable, any adjournment or postponement thereof (and, if not practicable, on the first practicable date prior to the date to which the meeting has been adjourned or postponed) (in the case of the update and supplement required to be made as of ten (10) Business Days prior to the meeting or any adjournment or postponement thereof). For the avoidance of doubt, the obligation to update and supplement as set forth in this paragraph or any other Article of these Articles shall not limit the Company’s rights with respect to any deficiencies in any notice provided by a Member, extend any applicable deadlines hereunder or enable or be deemed to permit a Member who has previously submitted notice hereunder to amend or update any proposal or to submit any new proposal, including by changing or adding nominees, matters, business or resolutions proposed to be brought before a meeting of the Members. |
| (d) | No candidate shall be eligible for nomination as a director of the Company unless such candidate for nomination and the Nominating Person seeking to place such candidate’s name in nomination has complied with Article 22 and this Article 23, as applicable. The presiding officer at the meeting shall, if the facts warrant, determine that a nomination was not properly made in accordance with Article 22 and this Article 23, and if he or she should so determine, he or she shall so declare such determination to the meeting, the defective nomination shall be disregarded and any ballots cast for the candidate in question (but in the case of any form of ballot listing other qualified nominees, only the ballots cast for the nominee in question) shall be void and of no force or effect. |
| (e) | Notwithstanding anything in these Articles to the contrary, no candidate for nomination shall be eligible to be seated as a director of the Company unless nominated and elected or appointed in accordance with Article 22 and this Article 23. |
| (f) | To be eligible to serve as an Appointed Director, the candidate proposed by MC must have previously delivered each item set forth in this Article 23 (in accordance with the time period prescribed for delivery in a notice to such candidate given by or on behalf of the Board) to the Directors at the principal executive offices of the Company, and otherwise must have complied with this Article 23. |
| 24 | Notice of General Meetings |
| 24.1 | If a Member or Members validly request to call an extraordinary general meeting in accordance with limb (ii) of Article 20.3, the Company must send out notice for such extraordinary general meeting of the Company within fourteen (14) days of receipt of such valid requisition in accordance with Article 24. If the Company fails to call the extraordinary general meeting the requisitionists may call the meeting pursuant to Article 20.5. Where the extraordinary general meeting is convened by the requisitionists, notice of such meeting shall be sent by the requisitionists (or any one of them) in accordance with this Article 24. |
| 24.2 | The notice of any general meeting of Members shall be sent or otherwise given in accordance with these Articles not less than seven (7) clear days (but not more than sixty (60) clear days) before the date of the meeting to each Member entitled to vote at such meeting in accordance with Article 24. If the Directors consider that it is impractical or unreasonable to hold a general meeting on the date or at the time or place as set out in the notice calling the general meeting, the Directors may, acting pursuant to a resolution, postpone or reschedule any previously scheduled general meeting, before or after the notice for such meeting has been sent, except where such rearrangement would be contrary to Applicable Law. The Directors shall take reasonable steps to ensure that notice of the time, date and place of the rearranged meeting is given to any member trying to attend the meeting at the original time, date and place. Notice of the business to be transacted at such rearranged meeting shall not be required. If a meeting is rearranged in this way, the appointment of a proxy for that meeting is valid if it is done in accordance with these Articles and received not less than 48 hours before the commencement of the rearranged meeting to which it relates. The Directors may also change the place of or postpone (or both) the rearranged meeting under this Article. |
| 24.3 | Every notice shall be exclusive of the day on which it is given or deemed to be given and of the day for which it is given. The notice shall specify the place, if any, date and time of the meeting, the means of remote communication, if any, by which Members and proxy holders may be deemed to be present in person and vote at such meeting, and, in the case of an extraordinary general meeting, the purpose or purposes for which the meeting is called. |
| 24.4 | The notice shall be given in the manner hereinafter mentioned or in such other manner if any as may be prescribed by the Company, provided that a general meeting of the Company shall, whether or not the notice specified in this regulation has been given and whether or not the provisions of Articles regarding general meetings have been complied with, be deemed to have been duly convened if it is so agreed: |
| (a) | in the case of an annual general meeting, by all the Members (or their proxies) entitled to attend and vote thereat; and |
| (b) | in the case of an extraordinary general meeting, by the Members (or their proxies) having a right to attend and vote at the meeting, together holding not less than 90% of the shares giving that right. |
| 24.5 | The notice convening an annual general meeting shall specify the meeting as such, and the notice convening a meeting to pass a Special Resolution shall specify the intention to propose the resolution as a Special Resolution. Notice of every general meeting shall be given to all Members other than such as, under the provisions hereof or the terms of issue of the shares they hold, are not entitled to receive such notice from the Company. |
| 24.6 | In cases where instruments of proxy are sent out with a notice of general meeting, the accidental omission to send such instrument of proxy to, or the non-receipt of any such instrument of proxy by, any person entitled to receive notice shall not invalidate any resolution passed or any proceeding at any such meeting. |
| 24.7 | The accidental omission to give notice of a meeting to or the non receipt of a notice of a meeting by any Member shall not invalidate the proceedings at any meeting. |
| 25 | Proceedings at General Meetings |
| 25.1 | The date and time of the opening and the closing of the polls for each matter upon which the Members will vote at a meeting shall be announced at the meeting by the person presiding over the meeting. The person presiding over any meeting of Members shall have the right and authority to convene and (for any or no reason) to recess and/or adjourn the meeting, to prescribe such rules, regulations and procedures (which need not be in writing) and to do all such acts as, in the judgment of such presiding person, are appropriate for the proper conduct of the meeting. Such rules, regulations or procedures, prescribed by the person presiding over the meeting, may include, without limitation, the following: (i) the establishment of an agenda or order of business for the meeting; (ii) rules and procedures for maintaining order at the meeting and the safety of those present (including, without limitation, rules and procedures for removal of disruptive persons from the meeting); (iii) limitations on attendance at or participation in the meeting to Members entitled to vote at the meeting, their duly authorized and constituted proxies or such other persons as the person presiding over the meeting shall determine; (iv) restrictions on entry to the meeting after the time fixed for the commencement thereof; and (v) limitations on the time allotted to questions or comments by participants. The presiding person at any meeting of Members, in addition to making any other determinations that may be appropriate to the conduct of the meeting (including, without limitation, determinations with respect to the administration and/or interpretation of any of the rules, regulations or procedures of the meeting, prescribed by the person presiding over the meeting), shall, if the facts warrant, determine and declare to the meeting that a matter of business was not properly brought before the meeting and if such presiding person should so determine, such presiding person shall so declare to the meeting and any such matter or business not properly brought before the meeting shall not be transacted or considered. |
| 25.2 | No business shall be transacted at any general meeting unless a quorum of Members is present at the time when the meeting proceeds to business. Members holding in aggregate not less than a simple majority of all voting share capital of the Company in issue present in person or by proxy and entitled to vote shall be a quorum. A person may participate at a general meeting by conference telephone or other communications equipment by means of which all the persons participating in the meeting can communicate with one another. Participation by a person in a general meeting in this manner is treated as presence in person at that meeting. If, however, such quorum is not present or represented at any general meeting, then either (i) the chairman of the meeting or (ii) the Members entitled to vote thereat, present in person or represented by proxy, shall have power to adjourn the meeting. |
| 25.3 | When a meeting is adjourned to another time and place, unless these Articles otherwise require, notice need not be given of the adjourned meeting if the time and place thereof are announced at the meeting at which the adjournment is taken. At the adjourned meeting the Company may transact any business that might have been transacted at the original meeting. If the adjournment is for more than thirty (30) days, or if after the adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each Member of record entitled to vote at the meeting. |
| 25.4 | A determination of the Members of record entitled to notice of or to vote at a general meeting shall apply to any adjournment of such meeting unless the Directors fix a new record date for the adjourned meeting, but the Directors shall fix a new record date if the meeting is adjourned for more than thirty (30) days from the date set for the original meeting. |
| 25.5 | The chairman of the Board shall preside as chairman at every general meeting of the Company. If the chairman is absent, the Directors present shall elect one of their number or such other officer to preside as chairman of the meeting. If all the Directors present or the elected officer decline to take the chair or if no such persons are present, the Secretary of the Company shall preside as chairman, and if the Secretary declines to take the chair or if the Secretary is not present, the Members present shall choose one of their own number to be the chairman of the meeting. |
| 25.6 | At any general meeting a resolution put to the vote of the meeting shall be decided on a poll. |
| 25.7 | A poll shall be taken in such manner as the chairman directs, and the result of the poll shall be deemed to be the resolution of the meeting. |
| 25.8 | In the case of an equality of votes, the chairman of the meeting shall not be entitled to a second or casting vote. |
| 26 | Votes of Members |
| 26.1 | Subject to any rights and restrictions for the time being attached to any class or classes of shares, every Member present in person and every person representing a Member by proxy at a general meeting of the Company shall have one (1) vote for each share registered in such Member’s name in the Register of Members. No cumulative voting shall be allowed. |
| 26.2 | In the case of joint holders the vote of the senior who tenders a vote whether in person or by proxy shall be accepted to the exclusion of the votes of the joint holders and for this purpose seniority shall be determined by the order in which the names stand in the Register of Members. |
| 26.3 | A Member of unsound mind, or in respect of whom an order has been made by any court having jurisdiction in lunacy, may vote on a poll by his committee, or other person in the nature of a committee appointed by that court, and any such committee or other person, may on a poll, vote by proxy. |
| 26.4 | No Member shall be entitled to vote at any general meeting unless all sums presently payable by him in respect of shares in the Company have been paid. |
| 26.5 | On a poll, votes may be given either personally or by proxy. |
| 26.6 | The instrument appointing a proxy shall be in writing (whether by manual signature, typewriting or otherwise) under the hand of the appointor or of his attorney duly authorised in writing or, if the appointor is an entity, either under seal or under the hand of an officer or attorney duly authorised in that behalf provided however, that a Member may also authorise the casting of a vote by proxy pursuant to telephonic or electronically transmitted instructions (including, without limitation, instructions transmitted over the internet) obtained pursuant to procedures approved by the Directors which are reasonably designed to verify that such instructions have been authorised by such Member. A proxy need not be a Member of the Company. Notwithstanding the foregoing, no proxy shall be voted or acted upon after three (3) years from its date unless the proxy provides for a longer period. |
| 26.7 | An instrument appointing a proxy may be in any usual or common form or such other form as the Directors may approve. |
| 26.8 | The instrument appointing a proxy shall be deemed to confer authority to demand or join in demanding a poll. |
| 27 | Corporations Acting by Representatives at Meeting |
Any corporation or other entity which is a Member may, by resolution of its directors, other governing body or authorised individual(s), authorise such person as it thinks fit to act as its representative at any general meeting of the Company or of any class of Members, and the person so authorised shall be entitled to exercise the same powers on behalf of the corporation which he represents as that corporation could exercise if it were an individual Member.
| 28 | Clearing Houses |
If a clearing house or depository (or its nominee) is a Member it may, by resolution of its directors, other governing body or authorised individual(s) or by power of attorney, authorise such person or persons as it thinks fit to act as its representative or representatives at any general meeting of the Company or at any general meeting of any class of Members; provided that, if more than one person is so authorised, the authorisation shall specify the number and class of shares in respect of which each such person is so authorised. A person so authorised pursuant to this provision shall be entitled to exercise the same powers on behalf of the clearing house (or its nominee) which he represents as that clearing house (or its nominee) could exercise if it were an individual Member of the Company holding the number and class of shares specified in such authorisation.
| 29 | Shares that May Not be Voted |
Shares in the Company that are owned, directly or indirectly, by the Company shall not be voted, directly or indirectly, at any meeting and shall not be counted in determining the total number of issued Shares at any given time under these Articles.
| 30 | Directors |
| 30.1 | There shall be a Board consisting of up to nine Directors (but not less than one Director), unless increased or decreased from time to time by the Directors or the Company in general meeting and the Board shall consist of a majority of Independent Directors. Subject to Article 30.11, a nominee shall not be appointed as a Director where, as a consequence of the nominee’s appointment, the Board would no longer consist of a majority of Independent Directors. |
| 30.2 | Subject to Article 30.1 and the final sentence of this Article 30.2, and without limitation to SF’s right to serve as General Director of the Board pursuant to Article 30.11, MC shall be entitled to nominate for election individuals to serve as Directors in respect of the number of Director positions that is equal to the product, rounded to the nearest whole number (provided that such number is not less than one), of (i) the percentage of Ordinary Shares beneficially owned by MC at the relevant time multiplied by (ii) the total number of Director positions on the Board (for the avoidance of doubt, including any vacancies) at the relevant time (with such nomination right(s) being subject to Article 23(f) and, where applicable, the Nominating and Corporate Governance Committee’s review in accordance with Article 30.7) (each, upon the effectiveness of their appointment, an “Appointed Director”). MC’s nomination rights set forth in this Article 30.2 shall terminate on the first date on which MC beneficially owns less than 10.0% of the Ordinary Shares. |
| 30.3 | Any casual vacancy (whether as a result of death, resignation, removal or otherwise) on the Board in respect of an Appointed Director position shall be subject to MC’s nomination rights set forth in Article 30.2. |
| 30.4 | Any Director position for which MC does not have a right to nominate a candidate in accordance with Article 30.2 may, subject to Article 30.11, be filled in accordance with Article 30.13(a) or Article 30.9 (each such director, a “General Director”). |
| 30.5 | If, due to a decrease in MC’s beneficial ownership of the Company’s Ordinary Shares, there is a decrease in the number of Director positions in respect of which MC is permitted to nominate for election individuals to serve as Directors, then MC may elect to re-designate the applicable number of Appointed Director(s) as General Directors by delivering written notice to the Company. In the event that MC has not exercised this re-designation right within ten Business Days of such decrease, the Board shall re-designate the applicable number of Appointed Director(s) as General Director(s). Directors who are re-designated as General Directors may be removed from the Board in accordance with these Articles. |
| 30.6 | MC shall, in good faith, apply the criteria established by the Nominating and Corporate Governance Committee in nominating any Appointed Director. |
| 30.7 | The Nominating and Corporate Governance Committee shall review each candidate nominated by MC to be an Independent Director for fitness and, if deemed fit for service, the Nominating and Corporate Governance Committee will recommend the individuals for election by a majority vote of the Board. The Nominating and Corporate Governance Committee shall recommend for election by a majority vote of the Board each candidate deemed fit for service by MC and nominated by MC to be an Appointed Director who is not an Independent Director. |
| 30.8 | If an individual nominated by MC in accordance with Article 30.2 is deemed unfit by the Nominating and Corporate Governance Committee pursuant to Article 30.7, MC shall have the right to nominate successive individuals until such Director position is filled. |
| 30.9 | The Directors by the affirmative vote of a simple majority of the remaining Directors present and voting at a meeting of the Directors, even if less than a quorum, shall have the power from time to time and at any time to appoint any person as a Director to fill a casual vacancy (whether as a result of death, resignation, removal or otherwise) on the Board in respect of a General Director position, subject to these Articles, the rules and regulations of the Designated Stock Exchange, the SEC and/or any other competent regulatory authority or otherwise under Applicable Law. Any Director so appointed shall hold office until his earlier death, resignation or removal. |
| 30.10 | MC may remove any Appointed Director (whether or not the Appointed Director is an Independent Director) at its discretion, with or without cause, by delivering notice to the Company; provided, in the case of removal of an Appointed Director who is an Independent Director, that MC provides at least 30 days’ prior written notice to the Company and, following such removal (taking into account any appointment of another Director occurring substantially contemporaneous with or prior to such removal), the Board continues to consist of a majority of Independent Directors as required by Article 30.1. Any General Directors may be removed in accordance with the procedure set out in these Articles. Where any Appointed Director is removed, MC shall have the right to nominate individuals to sit on the Board as Appointed Directors to fill the vacancies resulting from any such removals, up to the number of individuals as set out in Article 30.2. |
| 30.11 | Notwithstanding Article 30.1, so long as SF beneficially owns at least 3% of the Company’s issued and outstanding Ordinary Shares, SF shall be entitled to serve as a General Director on the Board. Upon a decrease below 3.0% in his beneficial ownership of the Company’s issued and outstanding Ordinary Shares, SF may be removed from the Board in accordance with these Articles as applicable to General Directors. |
| 30.12 | Subject to Article 30.10, any Director may be removed from office by the Members by Ordinary Resolution with cause, and any Director other than SF may be removed from office by the Members by Ordinary Resolution without cause, in each case at any time before the expiration of his term notwithstanding anything in these Articles or in any agreement between the Company and such Director (but without prejudice to any claim for damages under such agreement). For purposes of this Article 30.12, the term “cause” for removal of a Director shall be deemed to exist only if (a) the Director whose removal is proposed has been convicted of a felony by a court of competent jurisdiction and such conviction is no longer subject to direct appeal; (b) such Director has been found (i) other than in respect of SF for so long as the entitlement under Article 30.11 is applicable, by the affirmative vote of a majority of the Directors then in office at a meeting of the Board called for that purpose, or (ii) by a court of competent jurisdiction, to have been guilty of wilful misconduct in the performance of such Director’s duties to the Company in a matter of substantial importance to the Company; or (c) such Director has been adjudicated by a court of competent jurisdiction to be mentally incompetent, which mental incompetency directly affects such director’s ability to perform his or her obligations as a Director. |
| 30.13 | Subject to inclusion in the applicable notice, the following matters may be brought before a general meeting: |
| (a) | the proposed appointment (subject to being deemed fit for service by the Nomination and Corporate Governance Committee) of individuals as General Directors (except that MC and its affiliates (as defined in Rule 405 of the regulations promulgated under the Securities Act) shall not be permitted to table appointments for General Directors to the Board for so long as MC has a right to nominate Appointed Directors); and |
| (b) | the removal of any Directors subject to Article 30.12. |
Matters referenced in (a) and (b) above shall require approval by Ordinary Resolution or, in the case of (a) above, in the event that there is more than one individual proposed in respect of a single General Director position, by a plurality of the Member votes at such general meeting.
| 30.14 | The Directors may, from time to time, and except as required by the rules and regulations of the Designated Stock Exchange, the SEC and/or any other competent regulatory authority or otherwise under Applicable Law, adopt, institute, amend, modify or revoke the corporate governance policies or initiatives, which shall be intended to set forth the policies of the Company and the Directors on various corporate governance related matters, as the Directors shall determine by resolution from time to time. |
| 30.15 | A Director shall not be required to hold any shares in the Company by way of qualification. A Director who is not a Member of the Company shall nevertheless be entitled to receive notice of and to attend and speak at general meetings of the Company and all classes of shares of the Company. |
| 31 | Directors’ Fees and Expenses |
| 31.1 | The Directors may receive such remuneration as the Directors may from time to time determine. The Directors may be entitled to be repaid all traveling, hotel and incidental expenses reasonably incurred or expected to be incurred by such Director in attending meetings of the Directors or committees of the Directors or general meetings or separate meetings of any class of securities of the Company or otherwise in connection with the discharge of his duties as a Director. |
| 31.2 | Any Director who performs services which in the opinion of the Directors go beyond the ordinary duties of a Director may be paid such extra remuneration (whether by way of salary, commission, participation in profits or otherwise) as the Directors may determine and such extra remuneration shall be in addition to or in substitution for any ordinary remuneration provided for, by or pursuant to any other Article. |
| 32 | Powers and Duties of Directors |
| 32.1 | Subject to the provisions of the Statute, these Articles and any resolutions made in a general meeting, the business of the Company shall be managed by or under the direction of the Board, who may pay all expenses incurred in setting up and registering the Company and may exercise all powers of the Company. No resolution made by the Company in a general meeting shall invalidate any prior act of the Directors that would have been valid if that resolution had not been made. |
| 32.2 | The Directors may delegate any of their powers, authorities and discretions, including the power to sub-delegate, to any committees consisting of such member or members of their body as they think fit (including, without limitation, the Audit Committee, the Compensation Committee and the Nominating and Corporate Governance Committee); provided that, any committee so formed shall include amongst its members at least two Directors unless otherwise permitted or required by the rules and regulations of the Designated Stock Exchange, the SEC and/or any other competent regulatory authority or otherwise under Applicable Law. No committee shall have the power of authority to (a) recommend to the Members an amendment of these Articles (except that a committee may, to the extent authorised in the resolution or resolutions providing for the issuance of shares adopted by the Directors as provided under the laws of the Cayman Islands, fix the designations and any of the preferences or rights of such shares relating to dividends, redemption, dissolution, any distribution of assets of the Company or the conversion into, or the exchange of such shares for, shares of any other class or classes or any other series of the same or any other class or classes of shares of the Company); (b) adopt an agreement of merger or consolidation; (c) recommend to the Members the sale, lease or exchange of all or substantially all of the Company’s property and assets; (d) recommend to the Members a dissolution of the Company or a revocation of a dissolution; (e) recommend to the Members an amendment of the Memorandum of Association of the Company; or (f) declare a dividend or authorise the issuance of shares unless the resolution establishing such committee (or the charter of such committee approved by the Directors) or the Memorandum of Association or these Articles so provide. Any committee so formed shall in the exercise of the powers so delegated conform to any regulations that may be imposed on it by the Directors. The Directors may also delegate to any Director holding any executive office such of their powers as they consider desirable to be exercised by him or her. Any such delegation may be made subject to any conditions the Directors may impose, and either collaterally with or to the exclusion of their own powers, and may be revoked or altered. |
| 32.3 | The Audit Committee shall comprise only Independent Directors and all other committees of the Board shall comprise a majority of Independent Directors. Subject to the foregoing, for so long as MC beneficially owns at least 10.0% of the Ordinary Shares and to the extent permitted by the Governance Requirements (as defined below), MC has the right to designate Appointed Director(s) to serve on each of the Board’s committees in respect of the number of committee positions that is equal to the product, rounded to the nearest whole number (provided that such number is not less than one), of (i) the percentage of Ordinary Shares beneficially owned by MC at the relevant time multiplied by (ii) the total number of Director positions on the applicable committee (for the avoidance of doubt, including any vacancies) at the relevant time, and, to the extent such designation is made, such Appointed Director shall be appointed to and serve on the relevant committee until such time as MC requests by notice in writing to the Company that they be removed from or replaced on the relevant committees or such Appointed Director resigns from the relevant committee upon which MC shall have the right to designate their replacement; provided that, if such removal shall cause the Company to be in noncompliance with the rules and regulations of the Designated Stock Exchange, the SEC, and/or any other competent regulatory authority or otherwise under Applicable Law (together, the “Governance Requirements”), the Company may defer such removal until the earlier of (a) such time as the Company shall have effected any changes in the composition of the relevant committee to permit compliance with the Governance Requirements upon such removal and (b) 60 days following the initial notification to the Company of such removal. If such designation is not permitted under the Governance Requirements, MC may appoint one observer to serve on each of the Board’s committees. MC’s right to remove an Appointed Director who is an Independent Director from any committee other than the Audit Committee is subject to the requirement that, following such removal, such committee continues to consist of a majority of Independent Directors as required by this Article 32.3. |
| 32.4 | The Directors may from time to time and at any time by power of attorney or otherwise appoint any company, firm or person or body of persons, whether nominated directly or indirectly by the Directors, to be the attorney or attorneys of the Company for such purposes and with such powers, authorities and discretion (not exceeding those vested in or exercisable by the Directors under these Articles) and for such period and subject to such conditions as they may think fit, and any such power of attorney may contain such provisions for the protection and convenience of persons dealing with any such attorney as the Directors may think fit, and may also authorise any such attorney to delegate all or any of the powers, authorities and discretion vested in him. |
| 32.5 | The Directors may from time to time provide for the management of the affairs of the Company in such manner as they shall think fit and the provisions contained in the following paragraphs shall be without prejudice to the general powers conferred by this paragraph. |
| 32.6 | The Directors from time to time and at any time may establish any advisory committees, local boards or agencies for managing any of the affairs of the Company and may appoint any persons to be members of such advisory committees or local boards and may appoint any managers or agents of the Company and may fix the remuneration of any of the aforesaid. |
| 32.7 | The Directors from time to time and at any time may delegate to any such advisory committee, local board, manager or agent any of the powers, authorities and discretions for the time being vested in the Directors and may authorise the members for the time being of any such local board, or any of them to fill up any vacancies therein and to act notwithstanding vacancies and any such appointment or delegation may be made on such terms and subject to such conditions as the Directors may think fit and the Directors may at any time remove any person so appointed and may annul or vary any such delegation, but no person dealing in good faith and without notice of any such annulment or variation shall be affected thereby. |
| 32.8 | The Directors may adopt formal written charters for committees and, if so adopted, shall review and assess the adequacy of such formal written charters on an annual basis. Each of these committees shall be empowered to do all things necessary to exercise the rights of such committee set forth in the Articles and shall have such powers as the Directors may delegate pursuant to the Articles and as required by the rules and regulations of the Designated Stock Exchange, the SEC and/or any other competent regulatory authority or otherwise under Applicable Law. Each of the Audit Committee, the Compensation Committee and the Nominating and Corporate Governance Committee, if established, shall consist of such number of Directors as the Directors shall from time to time determine (or such minimum number as may be required from time to time by the rules and regulations of the Designated Stock Exchange, the SEC and/or any other competent regulatory authority or otherwise under Applicable Law). For so long as any class of Shares is listed on the Designated Stock Exchange, the Audit Committee, the Compensation Committee and the Nominating and Corporate Governance Committee shall be made up of such number of Independent Directors as is required from time to time by the rules and regulations of the rules and regulations of the Designated Stock Exchange, the SEC and/or any other competent regulatory authority or otherwise under Applicable Law. |
| 32.9 | Any such delegates as aforesaid may be authorised by the Directors to sub-delegate all or any of the powers, authorities, and discretions for the time being vested to them. |
| 32.10 | The Directors may elect, by the affirmative vote of a majority of the Directors then in office, a chairman; provided that, MC shall have the right to designate the chairman for so long as MC beneficially owns at least 33.0% of the Ordinary Shares. The chairman of the Board may be a director or an officer of the Company. Subject to the provisions of these Articles and the direction of the Directors, the chairman of the Board shall perform all duties and have all powers which are commonly incident to the position of chairman of a board or which are delegated to him or her by the Directors, preside at all general meetings and meetings of the Directors at which he or she is present and have such powers and perform such duties as the Directors may from time to time prescribe. |
| 33 | Disqualification of Directors |
Subject to these Articles, the office of Director shall be vacated, if the Director:
| (a) | becomes bankrupt or makes any arrangement or composition with his creditors; |
| (b) | dies or is found to be or becomes of unsound mind; |
| (c) | resigns his office by notice in writing to the Company; |
| (d) | is prohibited by applicable law or the Designated Stock Exchange, the SEC and/or any other competent regulatory authority or otherwise under Applicable Law from being a director; |
| (e) | without special leave of absence from the Directors, is absent from meetings of the Directors for six consecutive months and the Directors resolve that his office be vacated; |
| (f) | shall be removed from office pursuant to these Articles; or |
| (g) | is subject to a term of office and such term expires and he or she is not re-elected or re-appointed as a Director. |
| 34 | Proceedings of Directors |
| 34.1 | Subject to these Articles, the Directors may meet together for the dispatch of business, adjourn, and otherwise regulate their meetings and proceedings as they think fit. Such meetings may be held at any place within or outside the Cayman Islands that has been designated by the Directors. In the absence of such a designation, meetings of the Directors shall be held at the principal executive office of the Company. Questions arising at any meeting of the Directors shall be decided by the method set forth in Article 34.4. |
| 34.2 | The chairman of the Board or the Secretary on request of a Director, may, at any time summon a meeting of the Directors by twenty-four (24) hour notice to each Director in person, by telephone, electronic email, or in such other manner as the Directors may from time to time determine, which notice shall set forth the general nature of the business to be considered unless notice is waived by all the Directors either at, before or after the meeting is held. Notice of a meeting need not be given to any Director (i) who signs a waiver of notice or a consent to holding the meeting or an approval of the minutes thereof, whether before or after the meeting, or (ii) who attends the meeting without protesting, prior thereto or at its commencement, the lack of notice to such Directors. All such waivers, consents, and approvals shall be filed with the corporate records or made part of the minutes of the meeting. A waiver of notice need not specify the purpose of any regular or extraordinary general meeting of the Directors. |
| 34.3 | A Director or Directors may participate in any meeting of the Directors, or of any committee appointed by the Directors of which such Director or Directors are members, by means of telephone or similar communication equipment by way of which all persons participating in such meeting can hear each other and such participation shall be deemed to constitute presence in person at the meeting. |
| 34.4 | The quorum necessary for the transaction of the business of the Directors shall be a majority of the authorised number of Directors. If at any time there is only a sole Director, the quorum shall be one (1) Director. Every act or decision done or made by a majority of the Directors present at a duly held meeting at which a quorum is present shall be regarded as the act of the Directors, subject to the provisions of these Articles and other applicable law. In the case of an equality of votes, the chairman shall not have an additional tie-breaking vote. |
| 34.5 | A meeting of the Directors may be held by means of telephone or teleconferencing or any other telecommunications facility provided that all participants are thereby able to communicate immediately by voice with all other participants. |
| 34.6 | Subject to these Articles, a Director who is in any way, whether directly or indirectly, interested in a contract or proposed contract with the Company shall declare the nature of his interest at a meeting of the Directors. A general notice given to the Directors by any Director to the effect that he is a member of any specified company or firm and is to be regarded as interested in any contract which may thereafter be made with that company or firm shall be deemed a sufficient declaration of interest in regard to any contract so made. A Director may vote in respect of any contract or proposed contract or arrangement notwithstanding that he may be interested therein and if he does so his vote shall be counted and he may be counted in the quorum at any meeting of the Directors at which any such contract or proposed contract or arrangement shall come before the meeting for consideration. |
| 34.7 | A Director may hold any other office or place of profit under the Company (other than the office of auditor) in conjunction with his office of Director for such period and on such terms (as to remuneration and otherwise) as the Directors may determine and no Director or intending Director shall be disqualified by his office from contracting with the Company either with regard to his tenure of any such other office or place of profit or as vendor, purchaser or otherwise, nor shall any such contract or arrangement entered into by or on behalf of the Company in which any Director is in any way interested, be liable to be avoided, nor shall any Director so contracting or being so interested be liable to account to the Company for any profit realised by any such contract or arrangement by reason of such Director holding that office or of the fiduciary relation thereby established. A Director, notwithstanding his interest, may be counted in the quorum present at any meeting whereat he or any other Director is appointed to hold any such office or place of profit under the Company or whereat the terms of any such appointment are arranged and he may vote on any such appointment or arrangement. Any Director who enters into a contract or arrangement or has a relationship that is reasonably likely to be implicated under this Article 34.7 or that would reasonably be likely to affect a Director’s status as an “Independent Director” under the rules and regulations of the Designated Stock Exchange, Designated Stock Exchange, the SEC and/or any other competent regulatory authority or otherwise under Applicable Law shall disclose the nature of his or her interest in any such contract or arrangement in which he is interested or any such relationship. |
| 34.8 | Any Director may act by himself or his firm in a professional capacity for the Company, and he or his firm shall be entitled to reasonable expense reimbursement consistent with the Company’s policies in connection with such Directors service in his official capacity; provided that, nothing herein contained shall authorise a Director or his firm to act as auditor to the Company. |
| 34.9 | The Directors shall cause minutes to be made in books or loose-leaf folders provided for the purpose of recording: |
| (a) | all appointments of officers made by the Directors; |
| (b) | the names of the Directors present at each meeting of the Directors and of any committee of the Directors; and |
| (c) | all resolutions and proceedings at all meetings of the Company, and of the Directors and of committees of Directors. |
| 34.10 | When the chairman of a meeting of the Directors signs the minutes of such meeting the same shall be deemed to have been duly held notwithstanding that all the Directors have not actually come together or that there may have been a technical defect in the proceedings. |
| 34.11 | A resolution in writing (in one or more counterparts) signed by all the Directors or all the members of a committee or, in the case of a resolution in writing relating to the removal of any Director or the vacation of office by any Director, all of the Directors other than the Director who is the subject of such resolution shall be as valid and effectual as if it had been passed at a meeting of the Directors, or committee as the case may be, duly convened and held. |
| 34.12 | The continuing Directors may act notwithstanding any vacancy in their body but if and so long as their number is reduced below the number fixed by or pursuant to these Articles as the necessary quorum of Directors, the continuing Directors may act for the purpose of increasing the number, or of summoning a general meeting of the Company, but for no other purpose. |
| 34.13 | A committee appointed by the Directors may elect a chairman of its meetings. If no such chairman is elected, or if at any meeting the chairman is not present within five minutes after the time appointed for holding the same, the members present may choose one of their number to be chairman of the meeting. |
| 34.14 | A committee appointed by the Directors may meet and adjourn as it thinks proper. Questions arising at any meeting shall be determined by a majority of votes of the committee members present and in case of an equality of votes the chairman shall not have a second or casting vote. |
| 34.15 | Meetings and actions of committees of the Directors shall be governed by, and held and taken in accordance with, the provisions of Article 34.1 (place of meetings), Article 34.2 (notice), Article 34.3 (telephonic meetings), and Article 34.4 (quorum), with such changes in the context of these Articles as are necessary to substitute the committee and its members for the Directors; provided, however, that the time of regular meetings of committees may be determined either by resolution of the Directors or by resolution of the committee, that special meetings of committees may also be called by resolution of the Directors, and that notice of special meetings of committees shall also be given to all alternate members, who shall have the right to attend all meetings of the committee. The Directors may adopt rules for the government of any committee not inconsistent with the provisions of these Articles. |
| 34.16 | All acts done by any meeting of the Directors or of a committee of Directors, or by any person acting as a Director, shall, notwithstanding that it be afterwards discovered that there was some defect in the appointment of any such Director or person acting as aforesaid, or that they or any of them were disqualified, be as valid as if every such person had been duly appointed and was qualified to be a Director. |
| 35 | Presumption of Assent |
A Director of the Company who is present at a meeting of the Directors at which action on any Company matter is taken shall be presumed to have assented to the action taken unless his dissent or abstention shall be entered in the Minutes of the meeting or unless he shall file his written dissent or abstention from such action with the person acting as the chairman or Secretary of the meeting before the adjournment thereof or shall forward such dissent or abstention by registered post to such person immediately after the adjournment of the meeting. Such right to dissent or abstain shall not apply to a Director who voted in favour of such action.
| 36 | Dividends, Distributions and Reserve |
| 36.1 | Subject to any rights and restrictions for the time being attached to any class or classes of shares and these Articles, the Directors may from time to time declare dividends (including interim dividends) and other distributions on shares in issue and authorise payment of the same out of the funds of the Company lawfully available therefor. All dividends unclaimed for one (1) year after having been declared may be invested or otherwise made use of by the Directors for the benefit of the Company until claimed. Subject to any applicable unclaimed property or other laws, any dividend unclaimed after a period of six (6) years from the date of declaration shall be forfeited and shall revert to the Company. The payment by the Directors of any unclaimed dividend or other sums payable on or in respect of a share into a separate account shall not constitute the Company a trustee in respect thereof. |
| 36.2 | The Directors may, before recommending or declaring any dividend, set aside out of the funds legally available for distribution such sums as they think proper as a reserve or reserves which shall, at the discretion of the Directors be applicable for meeting contingencies, or for equalising dividends or for any other purpose to which those funds be properly applied and pending such application may, at the like discretion, either be employed in the business of the Company or be invested in such investments (other than shares of the Company) as the Directors may from time to time think fit. The Directors shall establish an account to be called the “Share Premium Account” and shall carry to the credit of such account from time to time a sum equal to the amount or value of the premium paid on the issue of any share in the Company. Unless otherwise provided by the provisions of these Articles, the Directors may apply the share premium account in any manner permitted by the Statute and the rules and regulations of the Designated Stock Exchange, the SEC and/or any other competent regulatory authority or otherwise under Applicable Law. The Company shall at all times comply with the provisions of these Articles, the Statute and the rules and regulations of the Designated Stock Exchange, the SEC and/or any other competent regulatory authority or otherwise under Applicable Law in relation to the share premium account. |
| 36.3 | Any dividend may be paid by cheque or warrant sent through the post to the registered address of the Member or person entitled thereto, or in the case of joint holders, to any one of such joint holders at his registered address or to such person and such address as the Member or person entitled, or such joint holders as the case may be, may direct. Every such cheque or warrant shall be made payable to the order of the person to whom it is sent or to the order of such other person as the Member or person entitled, or such joint holders as the case may be, may direct. Notwithstanding the foregoing, dividends may also be paid electronically to the account of the Members or persons entitled thereto or in such other manner approved by the Directors. |
| 36.4 | The Directors when paying dividends to the Members in accordance with the foregoing provisions may make such payment either in cash or in specie. |
| 36.5 | No dividend shall be paid otherwise than out of profits or, subject to the restrictions of the Statute, the share premium account. |
| 36.6 | Subject to the rights of persons, if any, entitled to shares with special rights as to dividends, all dividends shall be declared and paid according to the amounts paid or credited as fully paid on the shares, but if and so long as nothing is paid up on any of the shares in the Company dividends may be declared and paid according to the amounts of the shares. No amount paid on a share in advance of calls shall, while carrying interest, be treated for the purposes of this Article as paid on the share. |
| 36.7 | If several persons are registered as joint holders of any share, any of them may give effectual receipts for any dividend or other moneys payable on or in respect of the share. |
| 36.8 | No dividend shall bear interest against the Company. |
| 37 | Book of Accounts |
| 37.1 | The books of account relating to the Company’s affairs shall be kept in such manner as may be determined from time to time by the Directors. |
| 37.2 | The books of account shall be kept at such place or places as the Directors think fit, and shall always be open to the inspection of the Directors. |
| 37.3 | The Directors shall from time to time determine whether and to what extent and at what times and places and under what conditions or regulations the accounts and books of the Company or any of them shall be open to the inspection of Members not being Directors, and no Member (not being a Director) shall have any right of inspecting any account or book or document of the Company except as conferred by Statute or authorised by the Directors. |
| 37.4 | The accounts relating to the Company’s affairs shall be audited in such manner and with such financial year end as may be determined from time to time by the Directors or failing any determination as aforesaid shall not be audited. |
| 38 | Audit |
| 38.1 | The Directors or, if authorised to do so, the Audit Committee of the Directors, may appoint an auditor of the Company who shall hold office until removed from office by a resolution of the Directors and may fix his or their remuneration. |
| 38.2 | Every auditor of the Company shall have a right of access at all times to the books and accounts and vouchers of the Company and shall be entitled to require from the Directors and officers of the Company such information and explanation as may be necessary for the performance of the duties of the auditors. |
| 38.3 | Auditors shall, if so required by the Directors, make a report on the accounts of the Company during their tenure of office at the next annual general meeting following their appointment in the case of a company which is registered with the Registrar of Companies as an ordinary company, and at the next extraordinary general meeting following their appointment in the case of a company which is registered with the Registrar of Companies as an exempted company, and at any other time during their term of office, upon request of the Directors or any general meeting of the Members. |
| 39 | The Seal |
| 39.1 | The Seal of the Company shall not be affixed to any instrument except by the authority of a resolution of the Directors, provided always that such authority may be given prior to or after the affixing of the Seal and if given after may be in general form confirming a number of affixings of the Seal. The Seal shall be affixed in the presence of any one or more persons as the Directors may appoint for the purpose and every person as aforesaid shall sign every instrument to which the Seal of the Company is so affixed in their presence. |
| 39.2 | The Company may maintain a facsimile of its Seal in such countries or places as the Directors may appoint and such facsimile Seal shall not be affixed to any instrument except by the authority of a resolution of the Directors provided always that such authority may be given prior to or after the affixing of such facsimile Seal and if given after may be in general form confirming a number of affixing’s of such facsimile Seal. The facsimile Seal shall be affixed in the presence of such person or persons as the Directors shall for this purpose appoint and such person or persons as aforesaid shall sign every instrument to which the facsimile Seal of the Company is so affixed in their presence of and the instrument signed by a Director or the Secretary (or an Assistant Secretary) of the Company or in the presence of any one or more persons as the Directors may appoint for the purpose. |
| 39.3 | Notwithstanding the foregoing, a Director shall have the authority to affix the Seal, or the facsimile Seal, to any instrument for the purposes of attesting authenticity of the matter contained therein but which does not create any obligation binding on the Company. |
| 40 | Officers |
| 40.1 | Subject to these Articles, the Directors may from time to time appoint any person, whether or not a director of the Company, to hold the office of the Chief Executive Officer, the President, the Chief Financial Officer, one or more Vice Presidents or such other officers as the Directors may think necessary for the administration of the Company, for such term and at such remuneration (whether by way of salary or commission or participation in profits or partly in one way and partly in another), and with such powers and duties as the Directors may think fit. |
| 40.2 | All officers of the Company shall respectively have such authority and perform such duties in the management of the business of the Company as may be provided herein or designated from time to time by the Board and, to the extent not so provided, as generally pertain to their respective offices, subject to the control of the Board. |
| 41 | Register of Directors and Officers |
The Company shall cause to be kept in one or more books at its office a register of Directors and Officers in which there shall be entered the full names and addresses of the Directors and Officers and such other particulars as required by the Statute. The Company shall send to the Registrar of Companies in the Cayman Islands a copy of such register, and shall from time to time notify the said Registrar of any change that takes place in relation to such Directors and Officers as required by the Statute.
| 42 | Capitalisation of Profits |
Subject to the Statute and these Articles, the Directors may capitalise any sum standing to the credit of any of the Company’s reserve accounts (including a share premium account or a capital redemption reserve fund) or any sum standing to the credit of profit and loss account or otherwise available for distribution and to appropriate such sum to Members in the proportions in which such sum would have been divisible amongst them had the same been a distribution of profits by way of dividend and to apply such sum on their behalf in paying up in full unissued shares for allotment and distribution credited as fully paid up to and amongst them in the proportion aforesaid. In such event the Directors shall do all acts and things required to give effect to such capitalisation, with full power to the Directors to make such provisions as they think fit for the case of shares becoming distributable in fractions (including provisions whereby the benefit of fractional entitlements accrue to the Company rather than to the Members concerned). The Directors may authorise any person to enter on behalf of all of the Members interested into an agreement with the Company providing for such capitalisation and matters incidental thereto and any agreement made under such authority shall be effective and binding on all concerned.
| 43 | Notices |
| 43.1 | Except as otherwise provided in these Articles, any notice or document may be served by the Company or by the person entitled to give notice to any Member either personally, by email or by sending it through the post in a prepaid letter or via a recognised courier service, fees prepaid, addressed to the Member at his address as appearing in the Register of Members or, to the extent permitted by all applicable laws and regulations, by electronic means by transmitting it to any electronic number or address or website supplied by the Member to the Company or by placing it on the Company’s Website, provided that, (i) with respect to notification via electronic means, the Company has obtained the Member’s prior express positive confirmation in writing to receive or otherwise have made available to him notices in such fashion, and (i) with respect to posting to Company’s Website, notification of such posting is provided to such Member. In the case of joint holders of a share, all notices shall be given to that one of the joint holders whose name stands first in the Register of Members in respect of the joint holding, and notice so given shall be sufficient notice to all the joint holders. |
| 43.2 | An affidavit of the mailing or other means of giving any notice of any general meeting, executed by the Secretary, Assistant Secretary or any transfer agent of the Company giving the notice, shall be prima facie evidence of the giving of such notice. |
| 43.3 | Any Member present, either personally or by proxy, at any meeting of the Company shall for all purposes be deemed to have received due notice of such meeting and, where requisite, of the purposes for which such meeting was convened. |
| 43.4 | Any notice or other document, if served by (a) post, shall be deemed to have been served when the letter containing the same is posted, or (b) email, shall be deemed to have been served upon confirmation of successful transmission, or (c) recognised courier service, shall be deemed to have been served when the letter containing the same is delivered to the courier service and in proving such service it shall be sufficient to provide that the letter containing the notice or documents was properly addressed and duly posted or delivered to the courier, or (d) electronic means as provided herein shall be deemed to have been served and delivered on the day on which it is successfully transmitted or at such later time as may be prescribed by any applicable laws or regulations. |
| 43.5 | Any notice or document delivered or sent to any Member in accordance with the terms of these Articles shall notwithstanding that such Member be then dead or bankrupt, and whether or not the Company has notice of his death or bankruptcy, be deemed to have been duly served in respect of any share registered in the name of such Member as sole or joint holder, unless his name shall at the time of the service of the notice or document, have been removed from the Register of Members as the holder of the share, and such service shall for all purposes be deemed a sufficient service of such notice or document on all persons interested (whether jointly with or as claiming through or under him) in the share. |
| 43.6 | Notice of every general meeting shall be given to: |
| (a) | all Members who have supplied to the Company an address for the giving of notices to them, except that in case of joint holders, the notice shall be sufficient if given to the joint holder first named in the Register of Members; and |
| (b) | each Director. |
| 43.7 | No other person shall be entitled to receive notices of general meetings. |
| 44 | Information |
| 44.1 | No Member shall be entitled to require discovery of any information in respect of any detail of the Company’s trading or any information which is or may be in the nature of a trade secret or secret process which may relate to the conduct of the business of the Company and which in the opinion of the Directors would not be in the interests of the Members of the Company to communicate to the public. |
| 44.2 | The Directors shall be entitled (but not required, except as provided by law) to release or disclose any information in its possession, custody or control regarding the Company or its affairs to any of its Members including, without limitation, information contained in the Register of Members and transfer books of the Company. |
| 45 | Indemnity |
| 45.1 | The Company shall indemnify and hold harmless, to the fullest extent permitted under the laws of the Cayman Islands as they presently exist or may hereafter be amended, any director or officer of the Company who was or is made or is threatened to be made a party or is otherwise involved in any action, suit or proceeding, whether civil, criminal, administrative or investigative (a “Proceeding”) by reason of the fact that he or she, or a person for whom he or she is the legal representative, is or was a director or officer of the Company or, while serving as a director or officer of the Company, is or was serving at the request of the Company as a director, officer, employee or agent of another corporation or of a partnership (a “covered person”), joint venture, trust, enterprise or non-profit entity, including service with respect to employee benefit plans, against all liability and loss suffered and expenses (including attorneys’ fees, judgments, fines ERISA excise taxes or penalties and amounts paid in settlement) reasonably incurred by such person in connection with any such Proceeding. Notwithstanding the preceding sentence, except as otherwise provided in Article 45.4, the Company shall be required to indemnify a person in connection with a Proceeding initiated by such person only if the Proceeding was authorized in the specific case by the Board. |
| 45.2 | The Company shall have the power to indemnify and hold harmless, to the fullest extent permitted by applicable law as it presently exists or may hereafter be amended, any employee or agent of the Company who was or is made or is threatened to be made a party or is otherwise involved in any Proceeding by reason of the fact that he or she, or a person for whom he or she is the legal representative, is or was an employee or agent of the Company or is or was serving at the request of the Company as a director, officer, employee or agent of another corporation or of a partnership, joint venture, trust, enterprise or non-profit entity, including service with respect to employee benefit plans, against all liability and loss suffered and expenses reasonably incurred by such person in connection with any such Proceeding. |
| 45.3 | The Company shall to the fullest extent not prohibited by applicable law pay the expenses (including attorneys’ fees) incurred by any covered person, and may pay the expenses incurred by any employee or agent of the Company, in defending any Proceeding in advance of its final disposition; provided, however, that such payment of expenses in advance of the final disposition of the Proceeding shall be made only upon receipt of an undertaking by the person to repay all amounts advanced if it should be ultimately determined that the person is not entitled to be indemnified under this Article 45 or otherwise. |
| 45.4 | If a claim for indemnification (following the final disposition of such Proceeding) under this Article 45 is not paid in full within sixty (60) days, or a claim for advancement of expenses under this Article 45 is not paid in full within thirty (30) days, after a written claim therefor has been received by the Company the claimant may thereafter (but not before) file suit to recover the unpaid amount of such claim and, if successful in whole or in part, shall be entitled to be paid the expense of prosecuting such claim to the fullest extent permitted by law. In any such action the Company shall have the burden of proving that the claimant was not entitled to the requested indemnification or payment of expenses under applicable law. |
| 45.5 | The rights conferred on any person by this Article 45 shall not be exclusive of any other rights which such person may have or hereafter acquire under any statute, provision of these Articles, agreement, vote of Members or disinterested directors or otherwise. |
| 45.6 | The Directors, on behalf of the Company may purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the Company, or is or was serving at the request of the Company as a director, officer, employee or agent of another corporation, partnership, joint venture, trust enterprise or non-profit entity against any liability asserted against him or her and incurred by him or her in any such capacity, or arising out of his or her status as such, whether or not the Company would have the power to indemnify him or her against such liability under Cayman Islands law. |
| 45.7 | The Company’s obligation, if any, to indemnify or advance expenses to any person who was or is serving at its request as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, enterprise or non-profit entity shall be reduced by any amount such person may collect as indemnification or advancement of expenses from such other corporation, partnership, joint venture, trust, enterprise or non-profit enterprise. |
| 45.8 | The rights to indemnification and to prepayment of expenses provided by, or granted pursuant to, this Article 45 shall continue notwithstanding that the person has ceased to be a director or officer of the Company and shall inure to the benefit of the estate, heirs, executors, administrators, legatees and distributees of such person. |
| 45.9 | The provisions of this Article 45 shall constitute a contract between the Company, on the one hand, and, on the other hand, each individual who serves or has served as a director or officer of the Company (whether before or after the adoption of these Articles), in consideration of such person’s performance of such services, and pursuant to this Article 45 the Company intends to be legally bound to each such current or former director or officer of the Company. With respect to current and former directors and officers of the Company, the rights conferred under this Article 45 are present contractual rights and such rights are fully vested, and shall be deemed to have vested fully, immediately upon adoption of these Articles. With respect to any directors or officers of the Company who commence service following adoption of these Articles, the rights conferred under this provision shall be present contractual rights and such rights shall fully vest, and be deemed to have vested fully, immediately upon such director or officer commencing service as a director or officer of the Company. |
| 45.10 | Any repeal or modification of the foregoing provisions of this Article 45 shall not adversely affect any right or protection (i) hereunder of any person in respect of any act or omission occurring prior to the time of such repeal or modification or (ii) under any agreement providing for indemnification or advancement of expenses to an officer or director of the Company in effect prior to the time of such repeal or modification. |
| 45.11 | Any reference to an officer of the Company in this Article 45 shall be deemed to refer exclusively to the Chief Executive Officer, President, and Secretary, Vice President or other officer of the Company appointed by (x) the Board pursuant to these Articles or (y) an officer to whom the Board has delegated the power to appoint officers pursuant to these Articles, and any reference to an officer of any other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise shall be deemed to refer exclusively to an officer appointed by the Board (or equivalent governing body) of such other entity pursuant to the memorandum of association, Articles of association, certificate of incorporation and bylaws (or equivalent organizational documents) of such other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise. The fact that any person who is or was an employee of the Company or an employee of any other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise has been given or has used the title of “Vice President” or any other title that could be construed to suggest or imply that such person is or may be an officer of the Company or of such other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise shall not result in such person being constituted as, or being deemed to be, an officer of the Company or of such other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise for purposes of this Article 45. |
| 46 | Financial Year |
Unless the Directors otherwise prescribe, the financial year of the Company shall end on December 31 in each year and shall begin on the day following.
| 47 | Winding Up |
| 47.1 | If the Company shall be wound up the liquidator shall apply the assets of the Company in satisfaction of creditors’ claims in such manner and order as such liquidator thinks fit. Subject to the rights attaching to any shares, in a winding up: |
| (a) | if the assets available for distribution amongst the Members shall be insufficient to repay the whole of the Company’s issued share capital, such assets shall be distributed so that, as nearly as may be, the losses shall be borne by the Members in proportion to the par value of the shares held by them; or |
| (b) | if the assets available for distribution amongst the Members shall be more than sufficient to repay the whole of the Company’s issued share capital at the commencement of the winding up, the surplus shall be distributed amongst the Members in proportion to the par value of the shares held by them at the commencement of the winding up subject to a deduction from those shares in respect of which there are monies due, of all monies payable to the Company for unpaid calls or otherwise. |
| 47.2 | If the Company shall be wound up the liquidator may, subject to the rights attaching to any shares and with the sanction of a Special Resolution of the Company and any other sanction required by the Statute, divide amongst the Members in kind the whole or any part of the assets of the Company (whether such assets shall consist of property of the same kind or not) and may for that purpose value any assets and determine how the division shall be carried out as between the Members or different classes of Members. The liquidator may, with the like sanction, vest the whole or any part of such assets in trustees upon such trusts for the benefit of the Members as the liquidator, with the like sanction, shall think fit, but so that no Member shall be compelled to accept any asset upon which there is a liability. |
| 48 | Amendment of Memorandum and Articles of Association and Name of Company |
| 48.1 | Subject to the provisions of the Statute and the provisions of these Articles as regards the matters to be dealt with by Ordinary Resolution, the following actions shall require a Special Resolution of the Company: |
| (a) | change its name; |
| (b) | alter or add to these Articles; |
| (c) | alter or add to the Memorandum with respect to any objects, powers or other matters specified therein; and |
| (d) | reduce its share capital or any capital redemption reserve fund. |
| 49 | Registration by Way of Continuation |
Subject to these Articles, the Company may by Special Resolution resolve to be registered by way of continuation in a jurisdiction outside the Cayman Islands or such other jurisdiction in which it is for the time being incorporated, registered or existing. In furtherance of a resolution adopted pursuant to this Article, the Directors may cause an application to be made to the Registrar of Companies to deregister the Company in the Cayman Islands or such other jurisdiction in which it is for the time being incorporated, registered or existing and may cause all such further steps as they consider appropriate to be taken to effect the transfer by way of continuation of the Company.
| 50 | Mergers and Consolidations |
The Company shall, with the approval of a Special Resolution, have the power to merge or consolidate with one or more constituent companies (as defined in the Statute), upon such terms as the Directors may determine.
| 51 | Business Opportunities |
| 51.1 | To the fullest extent permitted by Applicable Law, any Director who is not employed by the Company or its subsidiaries shall not have any duty, except and to the extent expressly assumed by contract, to refrain from engaging directly or indirectly in the same or similar business activities or lines of business as the Company. To the fullest extent permitted by Applicable Law, the Company renounces any interest or expectancy of the Company in, or in being offered an opportunity to participate in, any potential transaction or matter which may be a corporate opportunity for any Director who is not employed by the Company or its subsidiaries, on the one hand, and the Company, on the other. Except to the extent expressly assumed by contract, to the fullest extent permitted by Applicable Law, no Director who is not employed by the Company or its subsidiaries shall have no duty to communicate or offer any such corporate opportunity to the Company and shall not be liable to the Company or its Members for breach of any fiduciary duty as a Member, Director and/or Officer solely by reason of the fact that such party pursues or acquires such corporate opportunity for itself, himself or herself, directs such corporate opportunity to another person, or does not communicate information regarding such corporate opportunity to the Company. |
| 51.2 | The Company hereby renounces any interest or expectancy of the Company in, or in being offered an opportunity to participate in, any potential transaction or matter which may be a corporate opportunity for both the Company and any Director who is not employed by the Company or its subsidiaries, about which any such Director acquires knowledge; provided that, the Company does not renounce any interest or expectancy it may have in any business opportunity that is expressly offered to any Director solely in his or her capacity as a Director or Officer, and not in any other capacity. |
| 51.3 | In addition to and notwithstanding the foregoing provisions of this Article, a corporate opportunity shall not be deemed to belong to the Company if it is a business opportunity the Company is not financially able or contractually permitted or legally able to undertake, or that is, from its nature, not in the line of the Company’s business or is of no practical advantage to it or that is one in which the Company has no interest or reasonable expectancy. |
| 51.4 | To the extent a court might hold that the conduct of any activity related to a corporate opportunity that is renounced in this Article to be a breach of duty to the Company or its Members, the Company hereby waives, to the fullest extent permitted by Applicable Law, any and all claims and causes of action that the Company may have for such activities. To the fullest extent permitted by Applicable Law, the provisions of this Article apply equally to activities conducted in the future and that have been conducted in the past. |
Exhibit 99.3
Execution Version
AMENDED AND RESTATED
CERTIFICATE OF DESIGNATIONS OF
SERIES A CONVERTIBLE PREFERRED SHARES
OF
VERTICAL AEROSPACE LTD.
I, Stuart Simpson, hereby certify that I am the Chief Executive Officer of Vertical Aerospace Ltd. (the “Company”), an exempted company incorporated with limited liability in the Cayman Islands, and further do hereby certify on behalf of the Company and not in my personal capacity:
WHEREAS, that pursuant to the authority expressly conferred upon the Board of Directors of the Company (the “Board”) by the Company’s Fifth Amended and Restated Memorandum and Articles of Association (the “Memorandum and Articles of Association”), the Board, or a committee thereof, on April 20, 2026, adopted resolutions creating a series of three hundred twenty five thousand five hundred ninety (325,590) preferred shares having a par value of $0.001 per share, designated as “Series A Convertible Preferred Shares”;
WHEREAS, that, in accordance with the provisions of the Memorandum and Articles of Association, the Board authorized the establishment, allotment and issuance of a series of preferred shares, par value $0.001 per share, of the Company designated as “Series A Convertible Preferred Shares” and fixed the designation and number of shares thereof and the voting and other relative rights, powers and preferences of the shares of such series and the qualifications, limitations and restrictions thereof, as set forth in the Certificate of Designations of Series A Convertible Preferred Shares, dated April 20, 2026 (the “Original Certificate of Designations”); and
WHEREAS, that, in accordance with the provisions of the Memorandum and Articles of Association, the Board, on August 11, 2026, approved the amendment and restatement in its entirety of the Original Certificate of Designations in the form of this Amended and Restated Certificate of Designations (this “Certificate of Designations”).
WHEREAS, on August 10, 2026, the Required Holders, by written consent, approved the amendment and restatement in its entirety of the Original Certificate of Designations in the form of this Certificate of Designations.
NOW THEREFORE, BE IT RESOLVED, that, pursuant to the authority expressly vested in the Board and in accordance with the provisions of the Memorandum and Articles of Association, the Original Certificate of Designations shall, subject to approval of the Required Holders, be amended and restated as follows:
TERMS OF SERIES A CONVERTIBLE PREFERRED SHARES
1. Designation and Number of Shares. There shall hereby be created and established a series of preferred shares of the Company designated as “Series A Convertible Preferred Shares” (the “Preferred Shares”). The authorized number of Preferred Shares shall be 325,590 shares. Each Preferred Share shall have a par value of $0.001 and shall be uncertificated and represented in Book-Entry form unless and until otherwise determined by the Board. Capitalized terms not defined herein shall have the meanings as set forth in Section 31 below.
2. Ranking. For so long as any Preferred Shares are issued, except (x) as permitted pursuant to Section 15(e) or (y) to the extent that the Required Holders (as defined below) expressly consent to the creation of Parity Shares or Senior Preferred Shares (as defined below) in accordance with Section 18, all shares in the capital of the Company shall be junior in rank to the Preferred Shares with respect to the preferences as to dividends, distributions and payments upon the liquidation, dissolution and winding up of the Company (such junior shares is referred to herein collectively as “Junior Shares”). The Preferred Shares shall rank junior to any existing Indebtedness as of the Subscription Date as well as any Permitted Indebtedness incurred on or after the Subscription Date. The rights of all shares in the capital of the Company shall be subject to the rights, powers, preferences and privileges of the Preferred Shares. Without limiting any other provision of this Certificate of Designations, without the prior express consent of holders of at least a majority of the issued Preferred Shares (provided that such holders must include Yorkville Advisors Global LP or its Affiliates (collectively, “Yorkville”) for so long as (i) any Preferred Shares are issued and (ii) Yorkville beneficially owns any of the issued Preferred Shares) (collectively, the “Required Holders”), voting separately as a single class, the Company shall not hereafter authorize or issue any additional or other shares in the capital of the Company that is (i) of senior rank to the Preferred Shares in respect of the preferences as to dividends, distributions and payments upon the liquidation, dissolution and winding up of the Company (collectively, the “Senior Preferred Shares”), (ii) of pari passu rank to the Preferred Shares in respect of the preferences as to dividends, distributions and payments upon the liquidation, dissolution and winding up of the Company (collectively, the “Parity Shares”) or (iii) any Junior Shares having a maturity date or which is mandatorily redeemable or redeemable at the option of the holder thereof, in whole or in part, on or prior to the date no Preferred Shares remain issued, except, in the case of the foregoing clause (i) and (ii), to the extent permitted pursuant to Section 15(e). In the event of the merger or consolidation of the Company with or into another corporation, so long as any Preferred Shares remain issued, the Preferred Shares shall maintain their relative rights, powers, designations, privileges and preferences provided for herein and no such merger or consolidation shall be consummated if it would result in the Preferred Shares being treated in any manner inconsistently with the foregoing, unless the Company has exercised its right of Company Redemption in full prior to or in connection with such merger or consolidation and actually pays the applicable Company Redemption Price prior to or simultaneously with such merger or consolidation.
3. Dividends.
(a) Dividends. From and after the occurrence of any Triggering Event (each, a “Trigger Date”) and during the continuance thereof, each holder of a Preferred Share (each, a “Holder” and collectively, the “Holders”), shall be entitled to receive dividends (“Dividends”) on the Stated Value of its Preferred Shares at the Dividend Rate (as defined below), which shall be payable “in kind” in the form of additional Preferred Shares as provided herein. Dividends on the Preferred Shares shall commence accruing on the Trigger Date and shall be computed on the basis of a 360-day year and twelve 30-day months. In the event that such Triggering Event is subsequently cured (and no other Triggering Event then exists), dividends shall cease accruing effective as of the calendar day immediately following the date of such cure. If, as and when declared by the Board out of funds legally available therefor to the maximum extent not prohibited by Cayman Islands law, any such Dividends shall be payable quarterly in arrears on the last Trading Day of each quarter (each, a “Dividend Date”) during which such Dividends accrue, and, on each Dividend Date, the Company shall issue additional Preferred Shares (“PIK Shares”) to each holder equal to the quotient of the (x) the aggregate amount of Dividends accrued on such Holder’s Preferred Shares and (y) the Stated Value. The Company shall promptly after each Dividend Date deliver to each Holder Book-Entry receipts evidencing the issuance of the PIK Shares on such Dividend Date, if any such PIK Shares are so issued on such Dividend Date. Dividends on the Preferred Shares as provided in this Section 3(a) shall accrue and be payable whether or not declared, set aside for payment or otherwise authorized by the Board and whether or not in any fiscal year there shall be net profits or surplus available for the payment of dividends, such that if Dividends are not paid as provided in this Section 3(a), the unpaid Dividends shall accumulate until paid.
2
4. Conversion. At any time after the Initial Issuance Date, each Preferred Share shall be convertible into validly issued, fully paid and non-assessable Ordinary Shares (as defined below), on the terms and conditions set forth in this Section 4.
(a) Holder’s Conversion Right. Subject to the provisions of Section 4(d), at any time or times on or after the Initial Issuance Date, each Holder shall be entitled to convert any Preferred Shares held by such Holder into validly issued, fully paid and non-assessable Ordinary Shares in accordance with Section 4(c) at the Conversion Rate (as defined below). The Company shall not issue any fraction of a share of Ordinary Shares upon any conversion. If the issuance would result in the issuance of a fraction of a share of Ordinary Shares, the Company shall round such fraction of a share of Ordinary Shares up to the nearest whole share. The Company shall pay any and all transfer, stamp, issuance and similar taxes, costs and expenses (including, without limitation, fees and expenses of the Transfer Agent (as defined below)) that may be payable with respect to the issuance and delivery of Ordinary Shares upon conversion of any Preferred Shares, except any such taxes that are due because the converting Holder requests those Ordinary Shares to be registered in a name other than the Holder’s name.
(b) Conversion Rate. The number of Ordinary Shares issuable upon conversion of any Preferred Share pursuant to Section 4(a) shall be determined by dividing (x) the Conversion Amount of such Preferred Share by (y) the Conversion Price (the “Conversion Rate”):
(i) “Conversion Amount” means, with respect to each Preferred Share, as of the applicable date of determination, the sum of (A) the Stated Value thereof plus (B) any Additional Amount thereon as of such date of determination.
(ii) “Conversion Price” means, with respect to each Preferred Share, as of any Conversion Date or other date of determination, the lesser of (x) $3.588, in the case of any Preferred Shares issued on the Initial Issuance Date (or, in the case of any Preferred Shares issued on any Additional Issue Date, 120% multiplied by the Closing Sale Price of the Ordinary Shares on the Trading Day immediately prior to such Additional Issue Date) (such price described in this clause (x), “Fixed Conversion Price”), and (y) 96% of the lowest VWAP of the Ordinary Shares during the five (5) consecutive Trading Day period immediately preceding but not including the Conversion Date (such price described in this clause (y), “Variable Conversion Price”), provided that the Variable Conversion Price shall not be lower than the Floor Price and subject to adjustment as provided herein.
3
(c) Mechanics of Conversion. The conversion of each Preferred Share shall be conducted in the following manner:
(i) Optional Conversion. To convert a Preferred Share into Ordinary Shares on any date (a “Conversion Date”), a Holder shall deliver (whether via electronic mail or otherwise), for receipt on or prior to 11:59 p.m., New York City time, on such date, a copy of an executed notice of conversion of the share(s) of Preferred Shares subject to such conversion in the form attached hereto as Exhibit I (the “Conversion Notice”) to the Company. On or before the first (1st) Trading Day (or the second (2nd) Trading Day, if the Conversion Notice is received after 7:00 p.m., New York City time, on the Conversion Date) following the date of receipt of a Conversion Notice, the Company shall transmit by electronic mail an acknowledgment of confirmation of receipt of such Conversion Notice, substantially in the form attached hereto as Exhibit II, to such Holder and the Company’s transfer agent (the “Transfer Agent”), which confirmation shall constitute an instruction to the Transfer Agent to process such Conversion Notice in accordance with the terms herein. On or before the first (1st) Trading Day (or the second (2nd) Trading Day, if the Conversion Notice is received after 7:00 p.m., New York City time, on the Conversion Date) following each date on which the Company has received a Conversion Notice (the “Share Delivery Deadline”), the Company shall: (1) provided that the Transfer Agent is participating in DTC’s Fast Automated Securities Transfer Program (“FAST”), credit such aggregate number of Ordinary Shares to which such Holder shall be entitled pursuant to such conversion to such Holder’s or its designee’s balance account with DTC through its Deposit/Withdrawal at Custodian system, or (2) if the Transfer Agent is not participating in FAST, upon the request of such Holder, issue and deliver (whether via electronic email or reputable overnight courier) to the address as specified in such Conversion Notice, a Book-Entry statement, registered in the name of such Holder or its designee, for the number of Ordinary Shares to which such Holder shall be entitled. If less than all of the Preferred Shares then held by a Holder are submitted for conversion pursuant to any Conversion Notice, then the Company shall, as soon as practicable and in no event later than two (2) Trading Days after receipt of the applicable Conversion Notice and at its own expense, issue and deliver to such Holder (or its designee) a new Book Entry (in accordance with Section 20(c)) representing the number of Preferred Shares not converted. The Person or Persons entitled to receive the Ordinary Shares issuable upon a conversion of Preferred Shares shall be treated for all purposes as the record holder or holders of such Ordinary Shares on the Conversion Date. References herein to a “conversion” or “exchange” of Preferred Shares shall mean the automatic repurchase without notice of the Preferred Shares and, on behalf of such holder(s) of Preferred Shares, the automatic application of the repurchase proceeds in paying for such new Ordinary Shares into which the Preferred Shares are to be converted or exchanged. For the avoidance of doubt, upon the conversion of any Preferred Shares pursuant to a Conversion Notice, such Preferred Shares so converted will be deemed to cease to be outstanding unless such Conversion Notice has been rescinded by the Holder in accordance with the Transaction Documents.
4
(ii) Company’s Failure to Timely Convert. If the Company shall fail, for any reason or for no reason, on or prior to the applicable Share Delivery Deadline, if the Transfer Agent is not participating in FAST, to issue and deliver to such Holder (or its designee) a Book-Entry for the number of Ordinary Shares to which such Holder is entitled and register such Ordinary Shares on the Company’s share register or, if the Transfer Agent is participating in FAST, to credit such Holder’s or its designee’s balance account with DTC for such number of Ordinary Shares to which such Holder is entitled upon such Holder’s conversion of any Conversion Amount (as the case may be) (a “Conversion Failure”), then, in addition to all other remedies available to such Holder, such Holder, upon written notice to the Company, may void its Conversion Notice with respect to, and retain or have returned, as the case may be, all, or any portion, of such Preferred Shares that has not been converted pursuant to such Conversion Notice; provided that the voiding of a Conversion Notice shall not affect the Company’s obligations to make any payments which have accrued prior to the date of such notice pursuant to this Section 4(c)(ii) or otherwise. In addition to the foregoing, if on or prior to the Share Delivery Deadline the Transfer Agent is not participating in FAST, the Company shall fail to issue and deliver to such Holder (or its designee) a Book-Entry and register such Ordinary Shares on the Company’s share register or, if the Transfer Agent is participating in FAST, the Transfer Agent shall fail to credit the balance account of such Holder or such Holder’s designee, as applicable, with DTC for the number of Ordinary Shares to which such Holder is entitled upon such Holder’s conversion hereunder or pursuant to the Company’s obligation pursuant to clause (II) below, and if on or after such Share Delivery Deadline such Holder purchases (in an open market transaction, shares loan or otherwise) Ordinary Shares corresponding to all or any portion of the number of Ordinary Shares issuable upon such conversion that such Holder is entitled to receive from the Company and has not received from the Company in connection with such Conversion Failure, as applicable (a “Buy-In”), then, in addition to all other remedies available to such Holder, the Company shall, within three (3) Business Days after receipt of such Holder’s request and in such Holder’s discretion, either: (I) pay cash to such Holder in an amount equal to such Holder’s total purchase price (including brokerage commissions, shares loan costs and other out-of- pocket expenses, if any) for the Ordinary Shares so purchased (including, without limitation, by any other Person in respect, or on behalf, of such Holder) (the “Buy-In Price”), at which point the Company’s obligation to so issue and deliver such Book-Entry (and to issue such Ordinary Shares) or credit to the balance account of such Holder or such Holder’s designee, as applicable, with DTC for the number of Ordinary Shares to which such Holder is entitled upon such Holder’s conversion hereunder (as the case may be) (and to issue such Ordinary Shares) shall terminate, or (II) promptly honor its obligation to so issue and deliver to such Holder a Book-Entry representing such Ordinary Shares or credit the balance account of such Holder or such Holder’s designee, as applicable, with DTC for the number of Ordinary Shares to which such Holder is entitled upon such Holder’s conversion hereunder (as the case may be) and pay cash to such Holder in an amount equal to the excess (if any) of the Buy-In Price over the product of (x) such number of Ordinary Shares multiplied by (y) the lowest Closing Sale Price of the Ordinary Shares on any Trading Day during the period commencing on the date of the applicable Conversion Notice and ending on the date of such issuance and payment under this clause (II). Nothing herein shall limit the Holder’s right to pursue any other remedies available to it hereunder, at law or in equity, including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company’s failure to timely deliver a Book-Entry representing Ordinary Shares (or to electronically deliver such Ordinary Shares) upon the conversion of Preferred Shares as required pursuant to the terms hereof.
5
(iii) Registration; Book-Entry. The Company (or the Transfer Agent, as custodian for the Preferred Shares) shall maintain a register (the “Register”) for the recordation of the names and addresses of the Holders of each Preferred Share and the Stated Value of the Preferred Shares (the “Registered Preferred Shares”). The entries in the Register shall be conclusive and binding for all purposes absent manifest error. The Company and each Holder of the Preferred Shares shall treat each Person whose name is recorded in the Register as the owner of a Preferred Share for all purposes (including, without limitation, the right to receive payments and Dividends hereunder) notwithstanding notice to the contrary. A Registered Preferred Share may be assigned, transferred or sold only by registration of such assignment or sale on the Register. Upon its receipt of a written request to assign, transfer or sell one or more Registered Preferred Shares by such Holder thereof, the Company shall record the information contained therein in the Register and issue one or more new Registered Preferred Shares in the same aggregate Stated Value as the Stated Value of the surrendered Registered Preferred Shares to the designated assignee or transferee pursuant to Section 20, provided that, subject to Section 19, if the Company has granted its consent to an assignment or other transfer (or such consent is not required in accordance with Section 19) and the Company does not so record an assignment, transfer or sale (as the case may be) of such Registered Preferred Shares within two (2) Business Days of such a request, then the Register shall be automatically deemed updated to reflect such assignment, transfer or sale (as the case may be). Each Holder and the Company shall maintain records showing the Stated Value, Dividends converted and/or paid (as the case may be) and Late Charges converted and/or paid (as the case may be), and the dates of such conversions and/or payments (as the case may be), or shall use such other method, reasonably satisfactory to such Holder and the Company, and if the Company does not update the Register to record such Stated Value, Dividends converted and/or paid (as the case may be) and Late Charges converted and/or paid (as the case may be), and the dates of such conversions and/or payments (as the case may be), within two (2) Business Days of such occurrence, then the Register shall be automatically deemed updated to reflect such occurrence. In the event of any dispute or discrepancy, such records of the Company establishing the number of Preferred Shares to which the record holder is entitled shall be controlling and determinative in the absence of manifest error. A Holder and any transferee or assignee, by acceptance of a Book-Entry, acknowledge and agree that, by reason of the provisions of this paragraph, following conversion of any Preferred Shares, the number of Preferred Shares represented by such Book-Entry may be less than the number of Preferred Shares stated in the most recent Book-Entry statement delivered to the Holder. Each Book-Entry representing Preferred Shares shall bear the following legend:
ANY TRANSFEREE OR ASSIGNEE OF THIS INSTRUMENT SHOULD CAREFULLY REVIEW THE TERMS OF THE CORPORATION’S CERTIFICATE OF DESIGNATIONS RELATING TO THE SERIES A CONVERTIBLE PREFERRED SHARES REPRESENTED BY THIS INSTRUMENT, INCLUDING SECTION 4(c)(iii) THEREOF.
6
THE NUMBER OF SERIES A CONVERTIBLE PREFERRED SHARES REPRESENTED BY THIS INSTRUMENT MAY BE LESS THAN THE NUMBER OF SERIES A CONVERTIBLE PREFERRED SHARES STATED ON THE FACE HEREOF PURSUANT TO SECTION 4(c)(iii) OF THE CERTIFICATE OF DESIGNATIONS RELATING TO THE SERIES A CONVERTIBLE PREFERRED SHARES REPRESENTED BY THIS INSTRUMENT.
(iv) Pro Rata Conversion; Disputes. In the event that the Company receives a Conversion Notice from more than one Holder for the same Conversion Date and the Company can convert some, but not all, of such Preferred Shares submitted for conversion, the Company shall convert from each Holder electing to have Preferred Shares converted on such date a Holder Pro Rata Amount of such Holder’s Preferred Shares submitted for conversion on such date based on the number of Preferred Shares submitted for conversion on such date by such Holder relative to the aggregate number of Preferred Shares submitted for conversion on such date. In the event of a dispute as to the number of Ordinary Shares issuable to a Holder in connection with a conversion of Preferred Shares, the Company shall issue to such Holder the number of Ordinary Shares not in dispute and resolve such dispute in accordance with Section 25.
(d) Limitation on Beneficial Ownership. The Company shall not effect the conversion of any of the Preferred Shares held by a Holder, and such Holder shall not have the right to convert any of the Preferred Shares held by such Holder pursuant to the terms and conditions of this Certificate of Designations and any such conversion shall be null and void and treated as if never made, to the extent that after giving effect to such conversion, such Holder together with the other Attribution Parties collectively would beneficially own in excess of 4.99% (the “Maximum Percentage”) of the Ordinary Shares outstanding immediately after giving effect to such conversion. For purposes of the foregoing sentence, the aggregate number of Ordinary Shares beneficially owned by such Holder and the other Attribution Parties shall include the number of Ordinary Shares held by such Holder and all other Attribution Parties plus the number of Ordinary Shares issuable upon conversion of the Preferred Shares with respect to which the determination of such sentence is being made, but shall exclude Ordinary Shares which would be issuable upon (A) conversion of the remaining, nonconverted Preferred Shares beneficially owned by such Holder or any of the other Attribution Parties and (B) exercise or conversion of the unexercised or nonconverted portion of any other securities of the Company (including, without limitation, any convertible notes, convertible preferred shares or warrants, including the Preferred Shares) beneficially owned by such Holder or any other Attribution Party subject to a limitation on conversion or exercise analogous to the limitation contained in this Section 4(d). For purposes of this Section 4(d), beneficial ownership shall be calculated in accordance with Section 13(d) of the 1934 Act. In addition, a determination as to any group status as contemplated above shall be determined in accordance with Section 13(d) of the 1934 Act and the rules and regulations promulgated thereunder. For purposes of determining the number of outstanding Ordinary Shares a Holder may acquire upon the conversion of such Preferred Shares without exceeding the Maximum Percentage, such Holder may rely on the number of outstanding Ordinary Shares as reflected in (x) the Company’s most recent Annual Report on Form 20-F, Current Report on Form 6-K or other public filing with the SEC, as the case may be, (y) a more recent public announcement by the Company or (z) any other written notice by the Company or the Transfer Agent, if any, setting forth the number of Ordinary Shares outstanding (the “Reported Outstanding Share Number”). If the Company receives a Conversion Notice from a Holder at a time when the actual number of outstanding Ordinary Shares is less than the Reported Outstanding Share Number, the Company shall notify such Holder in writing of the number of Ordinary Shares then outstanding and, to the extent that such Conversion Notice would otherwise cause such Holder’s beneficial ownership, as determined pursuant to this Section 4(d), to exceed the Maximum Percentage, such Holder must notify the Company of a reduced number of Ordinary Shares to be purchased pursuant to such Conversion Notice. For any reason at any time, upon the written or oral request of any Holder, the Company shall within two (2) Business Days confirm in writing or by electronic mail to such Holder the number of Ordinary Shares then outstanding. In any case, the number of outstanding Ordinary Shares shall be determined after giving effect to the conversion or exercise of securities of the Company, including such Preferred Shares, by such Holder and any other Attribution Party since the date as of which the Reported Outstanding Share Number was reported. In the event that the issuance of Ordinary Shares to a Holder upon conversion of such Preferred Shares results in such Holder and the other Attribution Parties being deemed to beneficially own, in the aggregate, more than the Maximum Percentage of the number of outstanding Ordinary Shares (as determined under Section 13(d) of the 1934 Act), the number of shares so issued by which such Holder’s and the other Attribution Parties’ aggregate beneficial ownership exceeds the Maximum Percentage (the “Excess Shares”) shall be deemed null and void and shall be cancelled ab initio, and such Holder shall not have the power to vote or to transfer the Excess Shares. For purposes of clarity, the Ordinary Shares issuable to a Holder pursuant to the terms of this Certificate of Designations in excess of the Maximum Percentage shall not be deemed to be beneficially owned by such Holder for any purpose including for purposes of Section 13(d) or Rule 16a-1(a)(1) of the 1934 Act. No prior inability to convert such Preferred Shares pursuant to this paragraph shall have any effect on the applicability of the provisions of this paragraph with respect to any subsequent determination of convertibility. The provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity with the terms of this Section 4(d) to the extent necessary to correct this paragraph (or any portion of this paragraph) which may be defective or inconsistent with the intended beneficial ownership limitation contained in this Section 4(d) or to make changes or supplements necessary or desirable to properly give effect to such limitation. The limitation contained in this paragraph may not be waived and shall apply to a successor holder of such Preferred Shares.
7
5. Triggering Events.
(a) Triggering Event. Each of the following events shall constitute a “Triggering Event”:
(i) the suspension from trading or the failure of the Ordinary Shares to be trading or listed (as applicable) on an Eligible Market for a period of five (5) consecutive Trading Days;
(ii) the Company’s (A) failure to cure a Conversion Failure (as defined herein) by delivery of the required number of Ordinary Shares within three (3) Trading Days after the applicable Conversion Date or (B) written notice to any Holder of Preferred Shares, including, without limitation, by way of public announcement or through any of its agents, at any time, of its intention not to comply, as required, with a request for conversion of any Preferred Shares into Ordinary Shares that is requested in accordance with the provisions of this Certificate of Designations, other than pursuant to Section 4(d) hereof;
(iii) except to the extent the Company is in compliance with Section 10(b) below, at any time following the tenth (10th) consecutive day that a Holder’s Authorized Share Allocation (as defined in Section 10(a) below) is less than 100% of the number of Ordinary Shares that such Holder would be entitled to receive upon a conversion in full, of all of the Preferred Shares then held by such Holder (assuming conversion at the Floor Price then in effect without regard to any limitations on conversion set forth in this Certificate of Designations);
(iv) the Company’s failure to pay to any Holder any Dividend on any Dividend Date (whether or not declared by the Board);
(v) the Company’s failure to pay any other amount due in cash when and as due under this Certificate of Designations (including, without limitation, the Company’s failure to pay any Late Charges or other amounts due in cash hereunder), the Securities Purchase Agreement or any other Transaction Document or any other agreement, document, certificate or other instrument delivered in connection with the transactions contemplated hereby and thereby (in each case, whether or not permitted pursuant to the Cayman Islands laws), solely to the extent such failure remains uncured for a period of at least five (5) Trading Days;
8
(vi) the Company fails to deliver the Ordinary Shares issuable upon a conversion of Preferred Shares without a restrictive legend either on any Book-Entry representing such Ordinary Shares or by credit of such Ordinary Shares to such Holder’s or its designee’s balance account with DTC as and when required by this Certificate of Designations, unless otherwise then prohibited by applicable federal securities laws, and any such failure remains uncured for at least five (5) Trading Days;
(vii) the Company or any of its Significant Subsidiaries, pursuant to or within the meaning of any Bankruptcy Law, either:
| (1) | commences a voluntary case or proceeding; |
| (2) | consents to the entry of an order for relief against it in an involuntary case or proceeding; |
| (3) | consents to the appointment of a custodian of it or for substantially all of its property; |
| (4) | makes a general assignment for the benefit of its creditors; |
| (5) | takes any comparable action under any foreign Bankruptcy Law; or |
| (6) | is not paying its undisputed debts as they become due, and such failure continues unremedied for a period of thirty (30) consecutive days; |
(viii) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that either:
| (1) | is for relief against the Company or any of its Significant Subsidiaries in an involuntary case or proceeding; |
| (2) | appoints a custodian of the Company or any of its Significant Subsidiaries, or for any substantial part of the property of the Company or any of its Significant Subsidiaries; |
| (3) | orders the winding up or liquidation of the Company or any Significant Subsidiary; or |
| (4) | grants any similar relief under any foreign Bankruptcy Law, |
and, in each case under this subsection (viii), such order or decree remains unstayed and in effect for at least sixty (60) days;
9
(ix) one or more final and non-appealable judgment being rendered against the Company or any of its Significant Subsidiaries for the payment of at least $10,000,000 in the aggregate (excluding any amounts covered by insurance or bond), where such judgment is not discharged, stayed, vacated or otherwise satisfied within sixty (60) days after (A) the date on which the right to appeal the same has expired, if no such appeal has commenced or (B) the date on which all rights to appeal have been extinguished;
(x) a default by the Company or any of its Subsidiaries with respect to any one or more mortgages, agreements or other instruments under which there is outstanding, or by which there is secured or evidenced, any indebtedness for money borrowed of at least $10,000,000 (or its foreign currency equivalent) in the aggregate of the Company or any of its Subsidiaries, whether such indebtedness exists as of the Initial Issuance Date or is thereafter created, where such default: (A) constitutes a failure to pay the principal of, or premium or interest on, any of such indebtedness when due and payable in accordance with its terms, upon required repurchase, upon declaration of acceleration or otherwise, in each case after the expiration of any applicable grace period; or (B) results in such indebtedness becoming or being declared due and payable before its stated maturity;
(xi) other than as specifically set forth in another clause of this Section 5(a), the Company or any Subsidiary breaches any representation or warranty made by or on behalf of the Company or such Subsidiary in any Transaction Document in any material respect (other than the representations or warranties subject to material adverse effect or materiality, which may not be breached in any respect) or any material covenant or other material term or condition of any Transaction Document, except, in the case of a breach of a covenant or other term or condition that is curable, only if such breach remains uncured for a period of five (5) consecutive Trading Days;
(xii) a false or inaccurate certification (including a false or inaccurate deemed certification) by the Company that either (A) the Equity Conditions are satisfied, or (B) as to whether any Triggering Event has occurred;
(xiii) any breach or failure in any respect by the Company or any Subsidiary to comply with any provision of Section 15(e) of this Certificate of Designations; or
(xiv) any material provision of any Transaction Document shall at any time for any reason (other than pursuant to the express terms thereof) cease to be valid and binding on or enforceable against the Company, or the validity or enforceability thereof shall be contested, directly or indirectly, by the Company or any Subsidiary, or a proceeding shall be commenced by the Company or any Subsidiary or any governmental authority having jurisdiction over any of them, seeking to establish the invalidity or unenforceability thereof or the Company or any of its Subsidiaries shall deny in writing that it has any liability or obligation purported to be created under one or more Transaction Documents, except resulting from the satisfaction of the obligations under such Transaction Document or resulting from the application of applicable law.
10
(b) Notice of a Triggering Event. Within two (2) Business Days after the occurrence of a Triggering Event, the Company shall deliver written notice thereof via electronic mail (a “Triggering Event Notice”) to each Holder.
6. Rights Upon Fundamental Transactions.
(a) Assumption. The Company shall not enter into or be party to a Fundamental Transaction unless (i) (x) the Successor Entity or its Parent Entity (in which case, all subsequent references to “Successor Entity” in this paragraph shall be deemed to refer to such Parent Entity) assumes in writing all of the obligations of the Company under this Certificate of Designations and the other Transaction Documents in accordance with the provisions of this Section 6(a) pursuant to written agreements in form and substance reasonably satisfactory to the Required Holders and approved by the Required Holders prior to such Fundamental Transaction (such approval not to be unreasonably withheld, conditioned or delayed), including agreements to deliver to each Holder of Preferred Shares in exchange for such Preferred Shares a security of the Successor Entity evidenced by a written instrument substantially similar in form and substance to this Certificate of Designations, including, without limitation, having a stated value and dividend rate equal to the stated value and dividend rate of the Preferred Shares held by the Holders and having similar ranking to the Preferred Shares, and satisfactory to the Required Holders and (y) the Successor Entity is a publicly traded corporation whose common equity is quoted on or listed for trading on an Eligible Market or (ii) the Company exercises its right of Company Redemption in full effective upon the consummation of such Fundamental Transaction. Except in the case of the foregoing clause (ii), upon the occurrence of any Fundamental Transaction, (A) the Successor Entity shall succeed to, and be substituted for (so that from and after the date of such Fundamental Transaction, the provisions of this Certificate of Designations and the other Transaction Documents referring to the “Company” shall refer instead to the Successor Entity), and may exercise every right and power of the Company and shall assume all of the obligations of the Company under this Certificate of Designations and the other Transaction Documents with the same effect as if such Successor Entity had been named as the Company herein and therein, and (B) the Successor Entity shall deliver to each Holder confirmation that there shall be issued upon conversion of the Preferred Shares at any time after the consummation of such Fundamental Transaction, in lieu of the Ordinary Shares (or other securities, cash, assets or other property (except such items still issuable under Sections 7 and 15, which shall continue to be receivable thereafter)) issuable upon the conversion of the Preferred Shares prior to such Fundamental Transaction, such shares of the publicly traded common equity (or their equivalent) of the Successor Entity which each Holder would have been entitled to receive upon the happening of such Fundamental Transaction had all the Preferred Shares held by each Holder been converted immediately prior to such Fundamental Transaction at the Conversion Price in effect at such time (without regard to any limitations on the conversion of the Preferred Shares contained in this Certificate of Designations), as adjusted in accordance with the provisions of this Certificate of Designations. Notwithstanding the foregoing, such Holder may elect, at its sole option, by delivery of written notice to the Company to waive this Section 6(a) to permit the Fundamental Transaction without the assumption of the Preferred Shares. The provisions of this Section 6 shall apply similarly and equally to successive Fundamental Transactions and shall be applied without regard to any limitations on the conversion of the Preferred Shares.
11
7. Rights Upon Issuance of Purchase Rights and Other Corporate Events.
(a) Purchase Rights. In addition to any adjustments pursuant to Section 8 and Section 15 below, if at any time the Company grants, issues or sells any Options, Convertible Securities or rights to purchase shares, warrants, securities or other property pro rata to all or substantially all of the record holders of Ordinary Shares (the “Purchase Rights”), then each Holder will be entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which such Holder could have acquired if such Holder had held the number of Ordinary Shares acquirable upon complete conversion of all the Preferred Shares (without taking into account any limitations or restrictions on the convertibility of the Preferred Shares and assuming for such purpose that all the Preferred Shares were converted at the Conversion Price as of the applicable record date) held by such Holder immediately prior to the date on which a record is taken for the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record holders of Ordinary Shares are to be determined for the grant, issue or sale of such Purchase Rights, provided, however, to the extent that such Holder’s right to participate in any such Purchase Right would result in such Holder and the other Attribution Parties exceeding the Maximum Percentage, then such Holder shall not be entitled to participate in such Purchase Right to such extent of the Maximum Percentage (and shall not be entitled to beneficial ownership of such Ordinary Shares as a result of such Purchase Right (and beneficial ownership) to such extent of any such excess) and such Purchase Right to such extent shall be held in abeyance (and, if such Purchase Right has an expiration date, maturity date or other similar provision, such term shall be extended by such number of days held in abeyance, if applicable) for the benefit of such Holder until such time or times, if ever, as its right thereto would not result in such Holder and the other Attribution Parties exceeding the Maximum Percentage, at which time or times such Holder shall be granted such right (and any Purchase Right granted, issued or sold on such initial Purchase Right or on any subsequent Purchase Right to be held similarly in abeyance (and, if such Purchase Right has an expiration date, maturity date or other similar provision, such term shall be extended by such number of days held in abeyance, if applicable)) to the same extent as if there had been no such limitation.
(b) Other Corporate Events. In addition to and not in substitution for any other rights hereunder, prior to the consummation of any Fundamental Transaction pursuant to which holders of Ordinary Shares are entitled to receive securities or other assets with respect to or in exchange for Ordinary Shares (a “Corporate Event”), except to the extent the Company exercises its right of Company Redemption effective upon the consummation of such Fundamental Transaction, the Company shall make appropriate provision to ensure that each Holder will thereafter have the right, at such Holder’s option, to receive upon a conversion of all the Preferred Shares held by such Holder (i) such securities or other assets to which such Holder would have been entitled with respect to the Ordinary Shares receivable upon such conversion had such Ordinary Shares been held by such Holder upon the consummation of such Corporate Event (without taking into account any limitations or restrictions on the convertibility of the Preferred Shares set forth in this Certificate of Designations) or (ii) in lieu of the Ordinary Shares otherwise receivable upon such conversion, such securities or other assets received by the holders of Ordinary Shares in connection with the consummation of such Corporate Event in such amounts as such Holder would have been entitled to receive had the Preferred Shares held by such Holder initially been issued with conversion rights for the form of such consideration (as opposed to Ordinary Shares) at a conversion rate for such consideration commensurate with the Conversion Rate in effect at such time. Provision made pursuant the preceding sentence shall be in a form and substance reasonably satisfactory to the Required Holders. The provisions of this Section 7 shall apply similarly and equally to successive Corporate Events and shall be applied without regard to any limitations on the conversion of the Preferred Shares set forth in this Certificate of Designations.
12
8. Rights Upon Issuance of Other Securities.
(a) Adjustment of Fixed Conversion Price upon Subdivision or Combination of Ordinary Shares. Without limiting any provision of Section 7, if the Company at any time on or after the Subscription Date subdivides (by any share split, shares dividend, shares combination, recapitalization or other similar transaction) its issued Ordinary Shares into a greater number of shares, the Fixed Conversion Price in effect immediately prior to such subdivision will be proportionately reduced. Without limiting any provision of Section 7, if the Company at any time on or after the Subscription Date combines (by any share split, shares dividend, shares combination, recapitalization or other similar transaction) its issued Ordinary Shares into a smaller number of shares, the Fixed Conversion Price in effect immediately prior to such combination will be proportionately increased. Any adjustment pursuant to this Section 8(a) shall become effective immediately after the effective time of such subdivision or combination.
(b) Holder’s Right of Adjusted Conversion Price. In addition to and not in limitation of the other provisions of this Section 8(b) and Section 15(h), if, notwithstanding the provisions of Section 15(h), the Company in any manner issues or sells or enters into (whether initially or pursuant to any subsequent amendment thereof) any agreement to issue or sell, any Ordinary Shares, Options or Convertible Securities (any such securities other than the securities described in clauses (i) through (iii) below, “Variable Price Securities”) after the Subscription Date that are issuable pursuant to such agreement or convertible into or exchangeable or exercisable for Ordinary Shares at a price which varies or may vary with the market price of the Ordinary Shares, including by way of one or more reset(s) to a fixed price, but exclusive of (i) Excluded Securities, (ii) Permitted Variable Price Securities (as defined below) and (iii) such formulations reflecting customary anti-dilution provisions (such as share splits, share combinations, share dividends and similar transactions) or a customary “make-whole” provision (each of the formulations for such variable price being herein referred to as, the “Variable Price”), including, but not limited to, an equity line of credit or an “at-the-market” facility, whereby the Company may issue securities at a future determined price regardless of whether shares pursuant to such agreement have actually been issued and regardless of whether such agreement is subsequently canceled, the Company shall provide written notice thereof via electronic mail and overnight courier to each Holder on the date of such agreement and/or the issuance of such Ordinary Shares, Convertible Securities or Options, as applicable. From and after the date the Company enters into such agreement or issues any such Variable Price Securities (such date of entrance or issuance, the “Variable Price Securities Reference Date”), each Holder of Preferred Shares issued and outstanding as of such Variable Price Securities Reference Date shall have the right, but not the obligation, in its sole discretion to substitute the Variable Price for the Conversion Price upon conversion of the Preferred Shares by designating in the Conversion Notice delivered upon any conversion of Preferred Shares that solely for purposes of such conversion such Holder is relying on the Variable Price rather than the Conversion Price then in effect; provided that the Variable Price shall not be lower than the Floor Price. For the avoidance of doubt, such right shall not apply to any Preferred Shares issued after the Variable Price Securities Reference Date. A Holder’s election to rely on a Variable Price for a particular conversion of Preferred Shares shall not obligate such Holder to rely on a Variable Price for any future conversions of Preferred Shares. Notwithstanding anything to the contrary herein, this Section 8(b) will not prohibit the Company from issuing, selling or entering into any agreement (whether initially or pursuant to any subsequent amendment thereof) or arrangement to issue or sell any securities permitted under Section 15(h) (“Permitted Variable Price Securities”).
13
(c) Calculations. All calculations under this Section 8 shall be made by rounding to the nearest cent or the nearest 1/100th of a share, as applicable. The number of Ordinary Shares issued at any given time shall not include shares owned or held by or for the account of the Company, and the disposition of any such shares shall be considered an issue or sale of Ordinary Shares. The Company will make all calculations in good faith, and, absent manifest error, its calculations will be final and binding on all Holders. The Company will provide a schedule of such calculations to any Holder upon written request.
(d) Voluntary Adjustment by Company. Subject to the rules and regulations of the Principal Market, the Company may at any time any Preferred Shares remain issued, with the prior written consent of the Required Holders, reduce the then current Conversion Price to any amount and for any period of time deemed appropriate by the Board.
9. Non-circumvention. The Company hereby covenants and agrees, to the extent that it is within the power and control of the Company, that the Company will not, by amendment of its Memorandum and Articles of Association or through any reorganization, transfer of assets, consolidation, merger, scheme of arrangement, dissolution, issue or sale of securities, or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Certificate of Designations, and will at all times in good faith carry out all the provisions of this Certificate of Designations and take all action as may be required to protect the rights of the Holders hereunder. Without limiting the generality of the foregoing or any other provision of this Certificate of Designations or the other Transaction Documents, the Company (a) shall not increase the par value of any Ordinary Shares receivable upon the conversion of any Preferred Shares above the Conversion Price then in effect, (b) shall take all such actions as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and non-assessable Ordinary Shares upon the conversion of Preferred Shares and (c) shall, so long as any Preferred Shares are issued, take all action necessary to reserve and keep available out of its authorized and unissued Ordinary Shares, solely for the purpose of effecting the conversion of the Preferred Shares, the maximum number of Ordinary Shares as shall from time to time be necessary to effect the conversion of the Preferred Shares then issued (without regard to any limitations on conversion contained herein). Notwithstanding anything herein to the contrary, if each Holder is not permitted to convert such Holder’s Preferred Shares in full for any reason (other than pursuant to restrictions set forth in Section 4(d) hereof), the Company shall use its reasonable best efforts to promptly remedy such failure, including, without limitation, obtaining such consents or approvals as necessary to effect such conversion into Ordinary Shares.
14
10. Authorized Shares.
(a) Reservation. So long as any Preferred Shares remain issued, the Company shall at all times reserve out of its authorized and unissued Ordinary Shares a number of Ordinary Shares equal to the sum of (i) 100% of the aggregate number of Ordinary Shares as shall from time to time be necessary to effect the conversion of all of the Preferred Shares then issued at the Floor Price then in effect (without regard to any limitations on conversions) and (ii) 100% of the aggregate number of Ordinary Shares that would be necessary to effect the conversion of that number of PIK Shares equal to eighteen (18) months of Dividends on the Preferred Shares then issued at the Floor Price then in effect (without regard to any limitations on conversions set forth herein) (the “Required Reserve Amount”). The Required Reserve Amount (including, without limitation, each increase in the number of shares so reserved) shall be allocated pro rata among the Holders based on the number of the Preferred Shares held by each Holder on each Issuance Date or increase in the number of reserved shares, as the case may be (the “Authorized Share Allocation”). In the event that a Holder shall sell or otherwise transfer any of such Holder’s Preferred Shares, each transferee shall be allocated a pro rata portion of such Holder’s Authorized Share Allocation. Any Ordinary Shares reserved and allocated to any Person which ceases to hold any Preferred Shares shall be allocated to the remaining Holders of Preferred Shares, pro rata based on the number of the Preferred Shares then held by the Holders.
(b) Insufficient Authorized Shares. If, notwithstanding Section 10(a) and not in limitation thereof, at any time while any of the Preferred Shares remain issued the Company does not have a sufficient number of authorized and unreserved Ordinary Shares to satisfy its obligation to reserve for issuance upon conversion of the Preferred Shares at least a number of Ordinary Shares equal to the Required Reserve Amount (an “Authorized Share Failure”), then the Company shall immediately take all action necessary to increase the Company’s authorized Ordinary Shares to an amount sufficient to allow the Company to reserve the Required Reserve Amount for the Preferred Shares then issued (or deemed issued pursuant to Section 10(a) above). Without limiting the generality of the foregoing sentence, as soon as practicable after the date of the occurrence of an Authorized Share Failure, but in no event later than sixty (60) days after the occurrence of such Authorized Share Failure, the Company shall hold a meeting of its shareholders for the approval of an increase in the number of authorized Ordinary Shares. Nothing contained in Section 10(a) or this Section 10(b) shall limit any obligations of the Company under any provision of the Securities Purchase Agreement.
15
11. Redemption at the Option of the Company.
(a) On or after the date that is 181 days after the Issuance Date for the applicable Preferred Shares, the Company shall have the right to redeem, all or some, of such issued Preferred Shares at such Closing (the “Company Optional Redemption”) at a redemption price equal to the Conversion Amount of the Preferred Shares being redeemed multiplied by the Specified Premium (such price, the “Company Optional Redemption Price”) so long as the Equity Conditions are satisfied on the date on which the Company provides the Notice of Company Optional Redemption to the Holders and on each Trading Day during the Company Optional Redemption Notice Period prior to the Company Optional Redemption Date. Notwithstanding the foregoing, the Company will not exercise its rights to Company Optional Redemption, or otherwise send a Notice of Company Optional Redemption unless the Company has sufficient funds legally available to fully pay the Company Optional Redemption Price in respect of all Preferred Shares called for Company Optional Redemption. The Company Optional Redemption Price shall be payable in cash.
(b) If the Company elects to effect a Company Optional Redemption, the Company shall send to the Holders a written notice (i) notifying the Holders of the election of the Company to redeem all or the applicable part of the Preferred Shares and the date set for redemption (the “Company Optional Redemption Date”), (ii) the Conversion Amount subject to the Company Optional Redemption (the “Company Optional Redemption Amount”), (iii) stating the place or places at which the Preferred Shares shall be redeemed (and other instructions a Holder must follow to receive payment), and (iv) stating the Company Optional Redemption Price therefor (such notice, a “Notice of Company Optional Redemption”). The Company Optional Redemption Date selected by the Company shall be no less than ten (10) Trading Days and no more than sixty-five (65) Trading Days after the date on which the Company provides the Notice of Company Optional Redemption to the Holders (such period, “Company Optional Redemption Notice Period”). In the case of a partial redemption, then (x) the Preferred Shares to be redeemed will be selected pro rata among the Holders based on the number of the Preferred Shares held by each Holder on the Company Optional Redemption Date and (y) all Conversion Amounts converted by the Holder after the date of the Notice of Company Optional Redemption shall reduce the Company Optional Redemption Amount required to be redeemed on the Company Optional Redemption Date.
(c) In connection with any Fundamental Transaction, the Company shall have the right to redeem all, and not less than all, of the Preferred Shares then issued (the “Company Fundamental Transaction Redemption” and, together with a Company Optional Redemption, a “Company Redemption”) at a redemption price equal to the Conversion Amount of the Preferred Shares being redeemed multiplied by the Specified Premium (such price, the “Company Fundamental Transaction Redemption Price” and, together with the Company Optional Redemption Price, the “Company Redemption Price”), by delivering to the Holders a written notice of such redemption (a “Notice of Company Fundamental Transaction Redemption” and, together with a Notice of Company Optional Redemption, a “Notice of Company Redemption”) not less than ten (10) Trading Days prior to the consummation of such Fundamental Transaction (or such shorter time as may be agreed by the Required Holders), which Company Fundamental Transaction Redemption shall be effected substantially concurrently with the consummation of such Fundamental Transaction (the date of such redemption, the “Company Fundamental Transaction Redemption Date” and, together with the Company Optional Redemption Date, the “Company Redemption Date”; and such period, the “Company Fundamental Transaction Redemption Notice Period” and, together with the Company Optional Redemption Notice Period, the “Company Redemption Notice Period”). The Company Fundamental Transaction Redemption Price shall be payable in cash. For the avoidance of doubt, the Company Fundamental Transaction Redemption shall not be subject to the Equity Conditions.
16
(d) For the avoidance of doubt, the Holder may convert Preferred Shares, at any time and from time to time during or after a Company Redemption Notice Period until 5:00p.m. New York City time on the second (2nd) Business Day immediately before the applicable Company Redemption Date, except to the extent the Company fails to pay he Company Redemption Price for such Preferred Shares in accordance with this Section 11. With respect to any portion of the Conversion Amount of the Preferred Shares which have not been converted by a Holder prior to the applicable Company Redemption Date and have been specified to be redeemed by the Company pursuant to the Company Redemption and which have been redeemed in accordance with the provisions of this Section 11, (i) Dividends, if any, shall cease to accrue on such Preferred Shares, (ii) such Preferred Shares shall no longer be deemed outstanding and (iii) all rights with respect to such Preferred Shares shall cease and terminate.
(e) Any such Notice of Company Redemption given in accordance with the provisions of this Section 11 may, at the Company’s discretion, be given prior to the completion of a transaction (including a Fundamental Transaction or other transaction) and be subject to the satisfaction (or waiver by the Company) of one or more conditions precedent, including, but not limited to, completion of a related transaction. If such Company Redemption is so subject to satisfaction of one or more conditions precedent, such Notice of Company Redemption shall describe each such condition, and if applicable, shall state that, in the Company’s discretion, the applicable Company Redemption Date may be delayed until such time (including more than 65 Trading Days after the date the Notice of Company Redemption was delivered) as any or all such conditions shall be satisfied (or waived by the Company), or such Company Redemption may not occur and such Notice of Company Redemption may be rescinded in the event that any or all such conditions shall not have been satisfied (or waived by the Company) by such Company Redemption Date, or by such Company Redemption Date as so delayed. In addition, the Company may provide in such Notice of Company Redemption that payment of the Company Redemption Price and performance of the Company’s obligations with respect to such Company Redemption may be performed by another Person. If any such condition precedent has not been satisfied (or waived by the Company), the Company shall provide written notice to the Holders no later than the close of business on the third (3rd) Business Day prior to the applicable Company Redemption Date. To the extent any such condition precedent is satisfied (or waived by the Company) prior to the Company Redemption Date, the Company shall promptly provide written notice to the Holders of the completion of the conditions precedent. Upon the Company providing such written notice to the Holders, the Notice of Company Redemption shall be rescinded or delayed, and the Company Redemption of the Preferred Shares shall be rescinded or delayed, in each case, as provided in such Notice of Company Redemption.
17
12. Redemption at the Option of the Holders.
(a) Upon the occurrence of a Triggering Event, each Holder shall have the right to require the Company to redeem, all or some, of the Preferred Shares outstanding at such time (the “Holder Optional Redemption”) at a redemption price equal to the Conversion Amount of the Preferred Shares being redeemed multiplied by the Specified Premium (such price, the “Holder Optional Redemption Price”). The Holder Optional Redemption Price shall be payable in cash.
(b) If a Holder elects to effect a Holder Optional Redemption, such Holder shall send to the Company a written notice (i) notifying the Company of the election by such Holder to require the Company to redeem all or the applicable part such Holder’s Preferred Shares and the date set for redemption (the “Holder Optional Redemption Date”), (ii) stating the Conversion Amount to be redeemed (the “Holder Optional Redemption Amount”), (iii) stating the place or places at which the Preferred Shares shall be redeemed, and (iv) stating the Holder Optional Redemption Price therefor (such notice, a “Notice of Holder Optional Redemption”). The Holder Optional Redemption Date selected by the Holder shall be no less than twenty (20) Trading Days and no more than thirty-five (35) Trading Days after the date on which the Holder provides the Notice of Holder Optional Redemption to the Company (such period, “Holder Optional Redemption Notice Period”). For the avoidance of doubt, a Holder may convert Preferred Shares, at any time and from time to time during the Holder Optional Redemption Notice Period until 5:00 p.m., New York City time, on the second (2nd) Business Day immediately before the applicable Holder Optional Redemption Date, except to the extent the Company fails to pay the Holder Optional Redemption Price for such Preferred Shares in accordance with this Section 12. In the case of a partial redemption, all Conversion Amounts subject to a Notice of Holder Optional Redemption converted by the Holder after the date of the Notice of Holder Optional Redemption shall reduce the Holder Optional Redemption Amount required to be redeemed on the Holder Optional Redemption Date.
(c) With respect to any Holder Optional Redemption Amount which has not been converted by a Holder prior to the Holder Optional Redemption Date and has been specified to be redeemed by the Company pursuant to the Holder Optional Redemption and which have been redeemed in accordance with the provisions of this Section 12, (i) Dividends, if any, shall cease to accrue on such Preferred Shares, (ii) such Preferred Shares shall no longer be deemed issued and (iii) all rights with respect to such Preferred Shares shall cease and terminate.
13. Repurchase at the Option of the Holders Upon a Fundamental Transaction.
(a) No sooner than thirty (30) days nor later than fifteen (15) days prior to the consummation of a Fundamental Transaction (to the extent the timing of such consummation is within the Company’s control and the Company has the knowledge of the expected date of consummation), but not prior to the public announcement of such Fundamental Transaction, the Company shall deliver written notice thereof via electronic mail to the Holders (a “Fundamental Transaction Notice”). If the Company fails to deliver such Fundamental Transaction Notice, the Holders may deliver such notice to the Company of the Fundamental Transaction, and it shall be deemed as if the Company delivered such notice to the Holders.
18
(b) On a Business Day of the Company’s choosing during the period beginning twenty (20) Business Days after the date the Company delivers (or is deemed to deliver) the related Fundamental Transaction Notice and ending thirty five (35) Business Days from such date (a “Fundamental Transaction Repurchase Date”), a Holder may require the Company to repurchase (a “Fundamental Transaction Repurchase”) all or any portion of such Holder’s Preferred Shares at a redemption price equal to the Conversion Amount of the Preferred Shares being redeemed multiplied by the Specified Premium (such price, the “Fundamental Transaction Repurchase Price” and, such Holder’s right to require a Fundamental Transaction Repurchase, a “Fundamental Transaction Repurchase Right”) by delivering written notice thereof (such notice, a “Notice of Fundamental Transaction Repurchase”) to the Company before 5:00 p.m., New York City time, on the second (2nd) Business Day immediately before the related Fundamental Transaction Repurchase Date (or such later time as may be required by law), which Notice of Fundamental Transaction Repurchase shall indicate the Preferred Shares a Holder is electing to require the Company to repurchase on such Fundamental Transaction Repurchase Date. A Holder that has delivered a Notice of Fundamental Transaction Repurchase with respect to any Preferred Shares may withdraw such Notice of Fundamental Transaction Repurchase by delivering a written notice of withdrawal to the Company at any time before 5:00 p.m., New York City time, on the second (2nd) Business Day immediately before the related Fundamental Transaction Repurchase Date. For the avoidance of doubt, the Holder may convert Preferred Shares, at any time and from time to time after the delivery of a Fundamental Transaction Notice until 5:00 p.m. New York City time on the second (2nd) Business Day immediately before the applicable Fundamental Transaction Repurchase Date, except to the extent the Company fails to pay the Fundamental Transaction Repurchase Price for such Preferred Shares in accordance with this Section 13. In the case of a partial repurchase, all Conversion Amounts subject to a Notice of Fundamental Transaction Repurchase converted by the Holder after the date of the Notice of Fundamental Transaction Repurchase shall reduce the Fundamental Transaction Repurchase Price required to be repurchased on the Fundamental Transaction Repurchase Date.
(c) With respect to any portion of the Conversion Amount of the Preferred Shares which have not been converted by a Holder prior to the applicable Fundamental Transaction Repurchase Date and have been specified to be repurchased by the Company pursuant to the Fundamental Transaction Repurchase Right and which have been repurchased in accordance with the provisions of this Section 13, (i) Dividends, if any, shall cease to accrue on such Preferred Shares, (ii) such Preferred Shares shall no longer be deemed outstanding and (iii) all rights with respect to such Preferred Shares shall cease and terminate.
(d) As a condition to each Holder’s exercise of its Fundamental Transaction Repurchase Rights under this Section 13, such Holder must own beneficially and of record, the Preferred Shares to be repurchased, free and clear of any liens, claims, equities, charges, options, rights of first refusal or encumbrances (other than such imposed by applicable securities laws) and make customary representations solely regarding the ability to transfer, convey and deliver full ownership and title of such Preferred Shares to the Company, free and clear of any liens, claims, equities, charges, options, rights of first refusal or encumbrances.
19
(e) Notwithstanding anything to the contrary in this Section 13, the Company will be deemed to satisfy its obligations under this Section 13 if (i) one or more third parties conduct any Fundamental Transaction Repurchase required by this Section 13 in a manner that would have satisfied the requirements of this Section 13 if conducted directly by the Company; and (ii) a Holder of Preferred Shares repurchased by such third party or parties will not receive a lesser amount (as a result of withholding or other similar taxes) than such Holder would have received had the Company repurchased such Preferred Shares.
(f) To the extent applicable, the Company will comply, in all material respects, with all federal and state securities laws in connection with a Fundamental Transaction Repurchase (including complying with Rules 13e-4 and 14e-1 under the 1934 Act and filing any required Schedule TO, to the extent applicable) so as to permit effecting such Fundamental Transaction Repurchase in the manner set forth in this Section 13; provided, however, that, to the extent that the Company’s obligations pursuant to this Section 13 conflict with any law or regulation that is applicable to the Company and enacted after the Subscription Date, the Company’s compliance with such law or regulation will not be considered to be a Triggering Event.
14. Voting Rights.
(a) Voting. Except as otherwise provided herein or as otherwise required by law, the Holders of Preferred Shares shall vote as a single class with the holders of the Ordinary Shares (and any other class or series of capital shares of the Company that votes as a single class with the holders of the Ordinary Shares) on an “as converted” (taking into account the restrictions on conversion set forth in Section 4(d) and based on the Conversion Rate then in effect) basis on all matters submitted to a vote of shareholders of the Company.
(b) To the extent that under the Cayman Islands laws or this Certificate of Designations the vote of the holders of the Preferred Shares, voting separately as a class or series, as applicable, is required to authorize a given action of the Company, the affirmative vote or consent of the Required Holders of the Preferred Shares, voting together in the aggregate and not in separate series unless required under Cayman Islands law, represented at a duly held meeting at which a quorum is presented or by written consent of the Required Holders (except as otherwise may be required under the Cayman Islands law), voting together in the aggregate and not in separate series unless required under the Cayman Islands law, shall constitute the approval of such action by both the class or the series, as applicable. Subject to Section 4(d), each Preferred Share shall entitle the holder thereof to cast that number of votes per share as is equal to the number of Ordinary Shares into which it is then convertible (subject to the ownership limitations specified in Section 4(d) hereof) using the record date for determining the shareholders of the Company eligible to vote on such matters as the date as of which the Conversion Price is calculated. Holders of the Preferred Shares shall be entitled to written notice of all shareholders meetings or written consents (and copies of proxy materials and other information sent to shareholders) with respect to which they would be entitled to vote, which notice would be provided pursuant to the Memorandum and Articles and Cayman Islands law.
20
15. Covenants. For so long as any Preferred Shares are outstanding, without the prior written consent of the Required Holders:
(a) Incurrence of Indebtedness. The Company shall not, nor shall the Company permit any of its Restricted Subsidiaries to create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise with respect to any Indebtedness for borrowed money except for Permitted Indebtedness.
(b) Existence of Liens. The Company shall not, nor shall the Company permit any of its Restricted Subsidiaries to create, assume or suffer to exist any Lien to secure Indebtedness on any property or assets now owned or hereafter acquired by the Company or any of its Restricted Subsidiaries except for Permitted Liens.
(c) Restriction on Redemption and Cash Dividends. The Company shall not, and the Company shall cause each of its Subsidiaries to not, directly or indirectly, redeem, repurchase or declare or pay any cash dividend or distribution on any of its capital shares (other than as required by this Certificate of Designations or permitted under the Convertible Notes Indenture or the Convertible Note Purchase Agreement).
(d) Preservation of Existence, Etc. The Company shall maintain and preserve, and cause each of its Subsidiaries to maintain and preserve, its existence, rights and privileges, and become or remain, and cause each of its Subsidiaries to become or remain, duly qualified and in good standing in each jurisdiction in which the character of the properties owned or leased by it or in which the transaction of its business makes such qualification necessary; provided, however, that the Company shall not be required to preserve any such corporate existence of any of its Subsidiaries if, in the judgment of the Company, the preservation thereof is no longer desirable in the conduct of the business of the Company and its Subsidiaries, taken as a whole, and all material assets of any such Subsidiaries have been assigned to the Company or another Subsidiary, in each case where such restructuring does not have a material impact on the Company’s ability to comply with the provisions hereof.
(e) Restricted Issuances. The Company shall not, directly or indirectly, without the prior written consent of the Required Holders, (i) issue any Preferred Shares (other than as contemplated by the Securities Purchase Agreement and this Certificate of Designations), (ii) issue any other securities that would cause a breach or default under this Certificate of Designations or (iii) other than where the use of proceeds are used to (x) redeem the Preferred Shares in full or (y) refinance the Company or its Subsidiary’s Indebtedness existing as of the Subscription Date, create, or authorize the creation of, any additional class or series of capital shares of the Company (or any equity security convertible into or exercisable for any such class or series of capital shares of the Company) or issue or sell, or obligate itself to issue or sell, any equity securities of the Company (or any equity security convertible into or exercisable for any such class or series of capital shares of the Company) that ranks on par or superior (except in the case of clause (y), in which case such securities may only rank par or junior) to the Preferred Shares as to dividends, distributions and payments upon the liquidation, dissolution or winding up of the Company or as to redemption or repurchase rights.
21
(f) Stay, Extension and Usury Laws. To the extent that it may lawfully do so, the Company (A) agrees that it will not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law (wherever or whenever enacted or in force) that may affect the covenants or the performance of this Certificate of Designations; and (B) expressly waives all benefits or advantages of any such law and agrees that it will not, by resort to any such law, hinder, delay or impede the execution of any power granted to the Holders by this Certificate of Designations, but will suffer and permit the execution of every such power as though no such law has been enacted.
(g) Taxes. The Company and its Subsidiaries shall pay when due (taking into account all available extensions) all taxes, fees or other charges of any nature whatsoever (together with any related interest or penalties) now or hereafter imposed or assessed against the Company and its Subsidiaries or their respective assets or upon their ownership, possession, use, operation or disposition thereof or upon their rents, receipts or earnings arising therefrom (except where the failure to pay would not, individually or in the aggregate, have a material adverse effect on the Company or any of its Subsidiaries). The Company and its Subsidiaries shall file on or before the due date therefor (taking into account all available extensions) all personal property tax returns (except where the failure to file would not, individually or in the aggregate, have a material adverse effect on the Company or any of its Subsidiaries). Notwithstanding the foregoing, the Company and its Subsidiaries may contest, in good faith and by appropriate proceedings, taxes for which they maintain adequate reserves therefor in accordance with IFRS.
(h) Variable Rate Transaction. Neither the Company nor its Subsidiaries will be party to, enter into, effect or consummate any Variable Rate Transaction or enter into any agreement to effect or consummate any Variable Rate Transaction. “Variable Rate Transaction” means a transaction in which the Company or any Subsidiary (i) issues or sells any Convertible Securities either (A) at a conversion, exercise or exchange rate or other price that is based upon and/or varies with the trading prices of or quotations for the Ordinary Shares at any time after the initial issuance of such Convertible Securities, or (B) with a conversion, exercise or exchange price that is subject to being reset at some future date after the initial issuance of such Convertible Securities or upon the occurrence of specified or contingent events directly or indirectly related to the business of the Company or the market for the Ordinary Shares, other than pursuant to a customary anti-dilution provision (including a “weighted average” anti-dilution provision) or a customary “make-whole” provision, (ii) enters into any agreement (including, without limitation, an equity line of credit or an “at-the-market” offering) whereby the Company or any Subsidiary may sell securities at a future determined price (other than standard and customary “preemptive” or “participation” rights), provided, however, (i) Ordinary Shares issued and sold pursuant to the ATM Facility (so long as no Ordinary Shares are issued and sold pursuant to the ATM Facility during the ninety (90) Trading Period after each Issuance Date, unless any earlier issuance is otherwise mutually agreed between the Company and the Required Holders); (ii) Ordinary Shares issued and sold pursuant to the ELOC (so long as no Ordinary Shares are issued and sold pursuant to the ELOC during the ninety (90) Trading Period after each Issuance Date, unless any earlier issuance is otherwise mutually agreed between the Company and the Required Holders); (iii) the issuance of Excluded Securities; and (iv) the making of payments to customers, vendors or suppliers in the ordinary course of business consistent with past practice consisting of, or the consideration for which consists of, securities subject to a Variable Price, in each case, shall not be deemed a Variable Rate Transaction for purposes of this Section 15(h). For the avoidance of doubt, any Equity Offering (as defined below) shall not constitute a “Variable Rate Transaction”, for so long as the purchase price (or in the case of warrants, the exercise price) is determined at the time of pricing or issuance of such securities (including by reference to the then-prevailing market price of the Ordinary Shares) and is not subject to adjustment based on the trading price of the Ordinary Shares following the initial issuance (other than pursuant to customary anti-dilution or make-whole provisions). For purposes of the foregoing, “Equity Offering” shall mean any bona fide registered public offering or registered or non-registered private offering (whether on a best efforts basis or in a firm commitment underwriting) of Ordinary Shares and/or warrants exercisable for Ordinary Shares.
22
(i) Organizational Documents. The Company shall not amend, alter, modify, or repeal this Certificate of Designation, by the adoption or amendment of any Certificate of Designation or similar document, in each case, in any manner that materially adversely affects the rights of any of the Holders of the Preferred Shares. The Company shall not propose, sponsor or recommend any resolutions to its members, for approval at a general meeting or approval by written resolution, to amend, alter, modify, or repeal its Memorandum and Articles of Association, in any manner that materially adversely affects the rights of any of the Holders of the Preferred Shares.
(j) Agreement. The Company shall not enter into any agreement which would substantially impair its obligations under this Certificate of Designations or any other Transaction Document.
(k) Independent Investigation. At the request of any Holder holding not less than $5.0 million in Stated Value of Preferred Shares either (x) at any time when a Triggering Event has occurred and is continuing, (y) upon the occurrence of an event that with the passage of time or giving of notice would constitute a Triggering Event or (z) at any time such Holder reasonably believes a Triggering Event may have occurred or be continuing, the Company will permit an independent, reputable investment bank selected by the Company and approved by such Holder (such approval not to be unreasonably withheld) to investigate, at the Company’s expense, as to whether any breach of the Certificate of Designations has occurred (the “Independent Investigator”); provided that, absent the occurrence and continuance of a Triggering Event, no more than two (2) such investigations shall be permitted in any fiscal year. If the Independent Investigator determines that such breach of the Certificate of Designations has occurred, the Independent Investigator shall notify the Company of such breach and the Company shall deliver written notice to each Holder of such breach. In connection with such investigation, the Independent Investigator may, upon reasonable notice and at such reasonable times during normal business hours, inspect all contracts, books, records, personnel, offices and other facilities and properties of the Company and its Subsidiaries and, to the extent available to the Company after the Company uses reasonable efforts to obtain them, the records of its legal advisors and accountants (including the accountants’ work papers) and any books of account, records, reports and other papers not contractually required of the Company to be confidential or secret, or subject to attorney-client or other evidentiary privilege, and the Independent Investigator may make such copies and inspections thereof as the Independent Investigator may reasonably request; provided that, prior to being permitted to engage in any such visitation, inspection or access rights provided for under this Section 15(k), such Independent Investigator shall have executed a standard confidentiality agreement in favor of the Company on customary terms reasonably satisfactory to the Company. The Company shall furnish the Independent Investigator with such financial and operating data and other information with respect to the business and properties of the Company as the Independent Investigator may reasonably request. The Company shall permit the Independent Investigator to discuss the affairs, finances and accounts of the Company with, and to make proposals and furnish advice with respect thereto to, the Company’s officers, directors, key employees and independent public accountants or any of them (and by this provision the Company authorizes said accountants to discuss with such Independent Investigator the finances and affairs of the Company and any Subsidiaries), all at such reasonable times, upon reasonable notice, and as often as may be reasonably requested.
23
16. Liquidation, Dissolution, Winding-Up. In the event of a Liquidation Event, the Holders shall be entitled to receive in cash out of the assets of the Company, whether from capital or from earnings available for distribution to its shareholders (the “Liquidation Funds”), before any amount shall be paid to the holders of any Junior Shares, but pari passu with any Parity Shares then issued, an amount per Preferred Share equal to the amount per share such Holder would receive if such Holder converted such Preferred Share into Ordinary Shares immediately prior to the date of such payment, provided that if the Liquidation Funds are insufficient to pay the full amount due to the Holders and holders of Parity Shares, if any, then each Holder and each holder of Parity Shares shall receive a percentage of the Liquidation Funds equal to the full amount of Liquidation Funds payable to such Holder and such holder of Parity Shares as a liquidation preference, in accordance with their respective certificate of designations (or equivalent), as a percentage of the full amount of Liquidation Funds payable to all holders of Preferred Shares and all holders of Parity Shares. To the extent necessary, the Company shall cause such actions to be taken by each of its Subsidiaries so as to enable, to the maximum extent permitted by law, the proceeds of a Liquidation Event to be distributed to the Holders in accordance with this Section 16. All the preferential amounts to be paid to the Holders under this Section 16 shall be paid or set apart for payment before the payment or setting apart for payment of any amount for, or the distribution of any Liquidation Funds of the Company to the holders of Junior Shares in connection with a Liquidation Event as to which this Section 16 applies.
17. Distribution of Assets. In addition to any adjustments pursuant to Section 7(a) and Section 8, if the Company shall declare or make any dividend or other distributions of its assets (or rights to acquire its assets) to any or all holders of Ordinary Shares, by way of return of capital or otherwise (including without limitation, any distribution of cash, shares or other securities, property or options by way of a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (the “Distributions”), then each Holder, as holders of Preferred Shares, will be entitled to such Distributions as if such Holder had held the number of Ordinary Shares acquirable upon complete conversion of the Preferred Shares (without taking into account any limitations or restrictions on the convertibility of the Preferred Shares and assuming for such purpose that the Preferred Share was converted at the current Conversion Price as of the applicable record date) immediately prior to the date on which a record is taken for such Distribution or, if no such record is taken, the date as of which the record holders of Ordinary Shares are to be determined for such Distributions (provided, however, that to the extent that such Holder’s right to participate in any such Distribution would result in such Holder and the other Attribution Parties exceeding the Maximum Percentage, then such Holder shall not be entitled to participate in such Distribution to the extent of any such excess over the Maximum Percentage (and shall not be entitled to beneficial ownership of such Ordinary Shares as a result of such Distribution (and beneficial ownership) to the extent of any such excess) and the portion of such Distribution shall be held in abeyance for the benefit of such Holder until such time or times as its right thereto would not result in such Holder and the other Attribution Parties exceeding the Maximum Percentage, at which time or times, if any, such Holder shall be granted such Distribution (and any Distributions declared or made on such initial Distribution or on any subsequent Distribution held similarly in abeyance) to the same extent as if there had been no such limitation).
24
18. Vote to Change the Terms of or Issue Preferred Shares. For so long as any Preferred Shares are issued, in addition to any other rights provided by law, except where the vote or written consent of the holders of a greater number of shares is required by law or by another provision of the Memorandum and Articles of Association, without first obtaining the affirmative vote at a meeting duly called for such purpose or the written consent without a meeting of the Required Holders, voting together as a single class, the Company shall not: (a) propose, sponsor or recommend any resolutions to its members, for approval at a general meeting or approval by written resolution, to amend, alter, modify or repeal any provision of, or add any provision to, its Memorandum and Articles of Association, or file any certificate of designations or articles of amendment of any series of preferred shares, including this Certificate of Designations, if such action would materially adversely alter or change in any respect the preferences, rights, privileges or powers, or restrictions provided for the benefit of the Preferred Shares hereunder, regardless of whether any such action shall be by means of amendment to the Memorandum and Articles of Association or by merger, consolidation or otherwise; (b) propose, sponsor or recommend any resolutions to its members, for approval at a general meeting or approval by written resolution, to increase or decrease (other than by conversion) the authorized number of Preferred Shares; (c) without limiting any provision of Section 2, create or authorize (by reclassification or otherwise) any new class or series of Senior Preferred Shares or Parity Shares; (d) purchase, repurchase or redeem any Junior Shares (other than (x) pursuant to the terms of the Company’s equity incentive plans and options and other equity awards granted under such plans (that have in good faith been approved by the Board) or (y) as permitted by the Convertible Notes Indenture or the Convertible Note Purchase Agreement); (e) without limiting any provision of Section 2, pay dividends or make any other distribution on any shares of any Junior Shares except, for the avoidance of doubt, as permitted by the Convertible Notes Indenture or the Convertible Note Purchase Agreement; (f) issue any Preferred Shares other than as contemplated hereby or pursuant to the Securities Purchase Agreement; or (g) without limiting any provision of Section 9, whether or not prohibited by the terms of the Preferred Shares, circumvent a right of the Preferred Shares hereunder.
25
19. Transfer of Preferred Shares. A Holder may not transfer all or any portion of its Preferred Shares without the express prior written consent of the Company (through its Board), except to an Affiliate of such Holder or to the Company. Any transfer of Preferred Shares shall be in compliance with all applicable securities laws and Section 5 of the Securities Purchase Agreement. Any purported transfer of Preferred Shares in violation of this Certificate of Designations shall be null and void, and no such transfer shall be recorded on the Company’s books and the purported transferee in any such transfer shall not be treated (and the Holder proposing to make any such transfer shall continue be treated) as the owner of such Preferred Shares for all purposes of this Certificate of Designations. Each Holder shall pay all costs and expenses incurred by the Company in connection with any transfer of Preferred Shares by such Holder.
20. Reissuance of Book-Entries.
(a) Transfer. If any Preferred Shares are to be transferred, the applicable Holder shall provide written notice of such transfer to the Company and surrender the applicable Preferred Shares represented by Book-Entry to the Company by written instruction letter, whereupon the Company will forthwith issue and deliver upon the order of such Holder evidence of the transfer of such Book-Entry, registered as such Holder may request, representing the issued number of Preferred Shares being transferred by such Holder and, if less than the entire issued number of Preferred Shares is being transferred, a new Book-Entry (in accordance with Section 20(c)) to such Holder representing the issued number of Preferred Shares not being transferred. Such Holder and any assignee, by acceptance of the evidence of Book-Entry issuance acknowledge and agree that, by reason of the provisions of Section 4(c)(i) following conversion of any of the Preferred Shares, the issued number of Preferred Shares represented by the Book-Entry may be less than the number of Preferred Shares stated in such Book-Entry.
(b) Book-Entries Exchangeable for Different Denominations. Each Book Entry may be split by the applicable Holder by delivery of a written notice to the Company into two or more new Book-Entries (in accordance with Section 20(c)) representing, in the aggregate, the issued number of the Preferred Shares in the original Book-Entry, and each such new Book-Entry will represent such portion of such issued number of Preferred Shares from the original Book-Entry as is designated in writing by such Holder at the time of such surrender.
(c) Issuance of New Book-Entry. Whenever the Company is required to issue a new Book-Entry pursuant to the terms of this Certificate of Designations, such new Book-Entry (i) shall represent, as indicated in such Book-Entry the number of Preferred Shares remaining outstanding which, when added to the number of Preferred Shares represented by the other new Book-Entry issued in connection with such issuance, does not exceed the number of Preferred Shares remaining outstanding under the original Book-Entry immediately prior to such issuance of new Book-Entry, and (ii) shall have an issuance date, as indicated in such new Book-Entry, which is the same as the issuance date of such original Book-Entry.
26
21. Remedies, Characterizations, Other Obligations, Breaches and Injunctive Relief. The remedies provided in this Certificate of Designations shall be cumulative and in addition to all other remedies available under this Certificate of Designations and any of the other Transaction Documents, at law or in equity (including a decree of specific performance and/or other injunctive relief), and nothing herein shall limit any Holder’s right to pursue actual and consequential damages for any failure by the Company to comply with the terms of this Certificate of Designations. No failure on the part of a Holder to exercise, and no delay in exercising, any right, power or remedy hereunder shall operate as a waiver thereof; nor shall any single or partial exercise by such Holder of any right, power or remedy preclude any other or further exercise thereof or the exercise of any other right, power or remedy. In addition, the exercise of any right or remedy of a Holder at law or equity or under this Certificate of Designations or any of the documents shall not be deemed to be an election of such Holder’s rights or remedies under such documents or at law or equity. The Company covenants to each Holder that there shall be no characterization concerning this instrument other than as expressly provided herein. Amounts set forth or provided for herein with respect to payments, conversion and the like (and the computation thereof) shall be the amounts to be received by a Holder and shall not, except as expressly provided herein, be subject to any other obligation of the Company (or the performance thereof). No failure on the part of a Holder to exercise, and no delay in exercising, any right, power or remedy hereunder shall operate as a waiver thereof; nor shall any single or partial exercise by such Holder of any right, power or remedy preclude any other or further exercise thereof or the exercise of any other right, power or remedy. In addition, the exercise of any right or remedy of any Holder at law or equity or under Preferred Shares or any of the documents shall not be deemed to be an election of such Holder’s rights or remedies under such documents or at law or equity. The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Holders and that the remedy at law for any such breach may be inadequate. The Company therefore agrees that, in the event of any such breach or threatened breach, each Holder shall be entitled, in addition to all other available remedies, to specific performance and/or temporary, preliminary and permanent injunctive or other equitable relief from any court of competent jurisdiction in any such case without the necessity of proving actual damages and without posting a bond or other security. The Company shall provide all information and documentation to a Holder that is reasonably requested in writing by such Holder to enable such Holder to confirm the Company’s compliance with the terms and conditions of this Certificate of Designations; provided that, to the extent the Company indicates to such Holder that the requested information or documentation may contain material non-public information, such information or documentation will not be provided to such Holder without such Holder’s express prior written consent.
22. Payment of Collection, Enforcement and Other Costs. If (a) any Preferred Shares are placed in the hands of an attorney for collection or enforcement or is collected or enforced through any legal proceeding or a Holder otherwise takes action to collect amounts due under this Certificate of Designations with respect to the Preferred Shares or to enforce the provisions of this Certificate of Designations or (b) there occurs any bankruptcy, reorganization, receivership of the Company or other proceedings affecting Company creditors’ rights and involving a claim under this Certificate of Designations, then the Company shall pay the costs reasonably incurred by such Holder for such collection, enforcement or action or in connection with such bankruptcy, reorganization, receivership or other proceeding, including, without limitation, attorneys’ fees and disbursements. The Company expressly acknowledges and agrees that no amounts due under this Certificate of Designations with respect to any Preferred Shares shall be affected, or limited, by the fact that the purchase price paid for each Preferred Share was less than the original Stated Value thereof.
27
23. Construction; Headings. This Certificate of Designations shall be deemed to be jointly drafted by the Company and the Holders and shall not be construed against any such Person as the drafter hereof. The headings of this Certificate of Designations are for convenience of reference and shall not form part of, or affect the interpretation of, this Certificate of Designations. Unless the context clearly indicates otherwise, each pronoun herein shall be deemed to include the masculine, feminine, neuter, singular and plural forms thereof. The terms “including,” “includes,” “include” and words of like import shall be construed broadly as if followed by the words “without limitation.” The terms “herein,” “hereunder,” “hereof” and words of like import refer to this entire Certificate of Designations instead of just the provision in which they are found. Unless expressly indicated otherwise, all section references are to sections of this Certificate of Designations. Terms used in this Certificate of Designations and not otherwise defined herein, but defined in the other Transaction Documents, shall have the meanings ascribed to such terms on the Initial Issuance Date in such other Transaction Documents unless otherwise consented to in writing by the Required Holders.
24. Failure or Indulgence Not Waiver. No failure or delay on the part of a Holder in the exercise of any power, right or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude other or further exercise thereof or of any other right, power or privilege. No waiver shall be effective unless it is in writing and signed by an authorized representative of the waiving party. Notwithstanding the foregoing, nothing contained in this Section 24 shall permit any waiver of any provision of Section 4(d).
25. Dispute Resolution.
(a) Submission to Dispute Resolution for Certain Matters.
(i) In the case of a dispute relating to a Closing Bid Price, a Closing Sale Price, a Conversion Price, a VWAP or a fair market value or the arithmetic calculation of a Conversion Rate (including, without limitation, a dispute relating to the determination of any of the foregoing), the Company or the applicable Holder (as the case may be) shall submit the dispute to the other party via electronic mail (A) if by the Company, within two (2) Business Days after the occurrence of the circumstances giving rise to such dispute or (B) if by such Holder at any time after such Holder learned of the circumstances giving rise to such dispute. If such Holder and the Company are unable to promptly resolve such dispute relating to such Closing Bid Price, such Closing Sale Price, such Conversion Price, such VWAP or such fair market value, or the arithmetic calculation of such Conversion Rate, at any time after the tenth (10th) Business Day following such initial notice by the Company or such Holder (as the case may be) of such dispute to the Company or such Holder (as the case may be), then such Holder and the Company may select an independent, reputable investment bank mutually agreeable in good faith to them to resolve such dispute.
28
(ii) Such Holder and the Company shall each deliver to such investment bank (A) a copy of the initial dispute submission so delivered in accordance with the first sentence of this Section 25 and (B) written documentation supporting its position with respect to such dispute, in each case, no later than 5:00 p.m. (New York time) by the fifth (5th) Business Day immediately following the date on which such investment bank was selected (the “Dispute Submission Deadline”) (the documents referred to in the immediately preceding clauses (A) and (B) are collectively referred to herein as the “Required Dispute Documentation”) (it being understood and agreed that if either such Holder or the Company fails to so deliver all of the Required Dispute Documentation by the Dispute Submission Deadline, then the party who fails to so submit all of the Required Dispute Documentation shall no longer be entitled to (and hereby waives its right to) deliver or submit any written documentation or other support to such investment bank with respect to such dispute and such investment bank shall resolve such dispute based solely on the Required Dispute Documentation that was delivered to such investment bank prior to the Dispute Submission Deadline). Unless otherwise agreed to in writing by both the Company and such Holder or otherwise requested by such investment bank, neither the Company nor such Holder shall be entitled to deliver or submit any written documentation or other support to such investment bank in connection with such dispute (other than the Required Dispute Documentation).
(iii) The Company and such Holder shall cause such investment bank to determine the resolution of such dispute and notify the Company and such Holder of such resolution no later than ten (10) Business Days immediately following the Dispute Submission Deadline. The fees and expenses of such investment bank shall be borne solely by the Company, and such investment bank’s resolution of such dispute shall be final and binding upon all parties absent manifest error.
(b) Miscellaneous. The Company expressly acknowledges and agrees that (i) this Section 25 constitutes an agreement to arbitrate between the Company and each Holder (and constitutes an arbitration agreement) under § 7501, et seq. of the New York Civil Practice Law and Rules (“CPLR”) and that any Holder is authorized to apply for an order to compel arbitration pursuant to CPLR § 7503(a) in order to compel compliance with this Section 25, (ii) a dispute relating to a Conversion Price includes, without limitation, disputes as to (A) the consideration per share at which an issuance or deemed issuance of Ordinary Shares occurred, (B) whether any issuance or sale or deemed issuance or sale of Ordinary Shares was an issuance or sale or deemed issuance or sale of Excluded Securities, and (C) whether an agreement, instrument, security or the like constitutes an Option or Convertible Security, (iii) the terms of this Certificate of Designations and each other applicable Transaction Document shall serve as the basis for the selected investment bank’s resolution of the applicable dispute, such investment bank shall be entitled (and is hereby expressly authorized) to make all findings, determinations and the like that such investment bank determines are required to be made by such investment bank in connection with its resolution of such dispute and in resolving such dispute such investment bank shall apply such findings, determinations and the like to the terms of this Certificate of Designations and any other applicable Transaction Documents, (iv) either the Company or the applicable Holder (and only such Holder with respect to disputes solely relating to such Holder), in its sole discretion, shall have the right to submit any dispute described in this Section 25 to any state or federal court sitting in The City of New York, Borough of Manhattan in lieu of utilizing the procedures set forth in this Section 25 and (v) nothing in this Section 25 shall limit such Holder from obtaining any injunctive relief or other equitable remedies (including, without limitation, with respect to any matters described in this Section 25).
29
26. Notices; Currency; Payments.
(a) Notices. The Company shall provide each Holder of Preferred Shares with prompt written notice of all material actions taken pursuant to the terms of this Certificate of Designations, including in reasonable detail a description of such action and the reason therefor; provided that the Company shall not be required to provide any such notice in connection with (x) a Conversion Notice except as set forth in Section 4 or (y) transfers of any Book-Entry except as set forth in Section 20. Without limiting the generality of the foregoing and unless disclosed by the Company in a press release or in a filing on Form 6-K, the Company shall give written notice to each Holder (i) immediately upon any adjustment of the Conversion Price, setting forth in reasonable detail, and certifying, the calculation of such adjustment and (ii) at least fifteen (15) days prior to the date on which the Company closes its books or takes a record (A) with respect to any dividend or distribution upon the Ordinary Shares, (B) with respect to any grant, issuances, or sales of any Options, Convertible Securities or rights to purchase shares, warrants, securities or other property to holders of all or substantially all Ordinary Shares or (C) for determining rights to vote with respect to any Fundamental Transaction, dissolution or liquidation, provided in each case that such information shall be made known to the public prior to or simultaneously with such notice being provided to such Holder by issuance of press release or the filing of Form 6-K with the SEC. Whenever notice is required to be given under this Certificate of Designations, unless otherwise provided herein, such notice must be in writing and shall be given in accordance with Section 9(f) of the Securities Purchase Agreement.
(b) Currency. All dollar amounts referred to in this Certificate of Designations are in United States Dollars (“U.S. Dollars”), and all dollar amounts owing under this Certificate of Designations shall be paid in U.S. Dollars. All amounts denominated in other currencies (if any) shall be converted into the U.S. Dollar equivalent amount in accordance with the Exchange Rate on the date of calculation. “Exchange Rate” means, in relation to any amount of currency to be converted into U.S. Dollars pursuant to this Certificate of Designations, the U.S. Dollar exchange rate as published in the Wall Street Journal on the relevant date of calculation (it being understood and agreed that where an amount is calculated with reference to, or over, a period of time, the date of calculation shall be the final date of such period of time).
30
(c) Payments. Whenever any payment of cash is to be made by the Company to any Person pursuant to this Certificate of Designations, unless otherwise expressly set forth herein, such payment shall be made in lawful money of the United States of America by wire transfer of immediately available funds pursuant to wire transfer instructions that Holder shall provide to the Company in writing from time to time. Whenever any amount expressed to be due by the terms of this Certificate of Designations is due on any day which is not a Business Day, the same shall instead be due on the next succeeding day which is a Business Day. Any amount due under the Transaction Documents in cash which is not paid when due (except to the extent such amount is simultaneously accruing Dividends) shall result in a late charge being incurred and payable by the Company in an amount equal to interest on such amount at the rate of ten percent (10%) per annum from the date such amount was due until the same is paid in full (“Late Charge”).
27. Waiver of Notice. To the extent permitted by law, the Company hereby irrevocably waives demand, notice, presentment, protest and all other demands and notices in connection with the delivery, acceptance, performance, default or enforcement of this Certificate of Designations and the Securities Purchase Agreement.
28. Governing Law. This Certificate of Designations shall be construed and enforced in accordance with, and all questions concerning the construction, validity, interpretation and performance of this Certificate of Designations shall be governed by, the internal laws of the Cayman Islands, without giving effect to any choice of law or conflict of law provision or rule (whether of the Cayman Islands or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the Cayman Islands. Except as otherwise required by Section 25 above, the Company and each Holder (by acceptance of its Preferred Shares) hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in The City of New York, Borough of Manhattan, New York, for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding is improper. Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law. Nothing contained herein (i) shall be deemed or operate to preclude any Holder from bringing suit or taking other legal action against the Company in any other jurisdiction to collect on the Company’s obligations to such Holder, to realize on any collateral or any other security for such obligations, or to enforce a judgment or other court ruling in favor of such Holder or (ii) shall limit, or shall be deemed or construed to limit, any provision of Section 25 above. THE COMPANY AND EACH HOLDER (BY ACCEPTANCE OF ITS PREFERRED SHARES) HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE TO, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS CERTIFICATE OF DESIGNATIONS OR ANY TRANSACTION CONTEMPLATED HEREBY.
31
29. Judgment Currency.
(a) If for the purpose of obtaining or enforcing judgment against the Company in any court in any jurisdiction it becomes necessary to convert into any other currency (such other currency being hereinafter in this Section 29 referred to as the “Judgment Currency”) an amount due in U.S. dollars under this Certificate of Designations, the conversion shall be made at the Exchange Rate prevailing on the Trading Day immediately preceding:
(i) the date actual payment of the amount due, in the case of any proceeding in the courts of New York or in the courts of any other jurisdiction that will give effect to such conversion being made on such date: or
(ii) the date on which the foreign court determines, in the case of any proceeding in the courts of any other jurisdiction (the date as of which such conversion is made pursuant to this Section 29(a)(ii) being hereinafter referred to as the “Judgment Conversion Date”).
(b) If in the case of any proceeding in the court of any jurisdiction referred to in Section 29(a)(ii) above, there is a change in the Exchange Rate prevailing between the Judgment Conversion Date and the date of actual payment of the amount due, the applicable party shall pay such adjusted amount as may be necessary to ensure that the amount paid in the Judgment Currency, when converted at the Exchange Rate prevailing on the date of payment, will produce the amount of US dollars which could have been purchased with the amount of Judgment Currency stipulated in the judgment or judicial order at the Exchange Rate prevailing on the Judgment Conversion Date.
(c) Any amount due from the Company under this provision shall be due as a separate debt and shall not be affected by judgment being obtained for any other amounts due under or in respect of this Certificate of Designations.
30. Severability. If any provision of this Certificate of Designations is prohibited by law or otherwise determined to be invalid or unenforceable by a court of competent jurisdiction, the provision that would otherwise be prohibited, invalid or unenforceable shall be deemed amended to apply to the broadest extent that it would be valid and enforceable, and the invalidity or unenforceability of such provision shall not affect the validity of the remaining provisions of this Certificate of Designations so long as this Certificate of Designations as so modified continues to express, without material change, the original intentions of the parties as to the subject matter hereof and the prohibited nature, invalidity or unenforceability of the provision(s) in question does not substantially impair the respective expectations or reciprocal obligations of the parties or the practical realization of the benefits that would otherwise be conferred upon the parties. The parties will endeavor in good faith negotiations to replace the prohibited, invalid or unenforceable provision(s) with a valid provision(s), the effect of which comes as close as possible to that of the prohibited, invalid or unenforceable provision(s).
31. Maximum Payments. Without limiting Section 9(d) of the Securities Purchase Agreement, nothing contained herein shall be deemed to establish or require the payment of a rate of interest or other charges in excess of the maximum permitted by applicable law. In the event that the rate of interest required to be paid or other charges hereunder exceed the maximum permitted by such law, any payments in excess of such maximum shall be credited against amounts owed by the Company to the applicable Holder and thus refunded to the Company.
32
32. Amendment. Except for Section 4(d), which may not be amended or waived hereunder, this Certificate of Designations or any provision hereof may be amended by obtaining the affirmative vote at a meeting duly called for such purpose, or written consent without a meeting in accordance with the laws of the Cayman Islands, of the Required Holders, voting separate as a single class, and with such other shareholder approval, if any, as may then be required pursuant to the laws of the Cayman Islands and the Memorandum and Articles of Association.
33. Certain Defined Terms. For purposes of this Certificate of Designations, the following terms shall have the following meanings:
“1933 Act” means the Securities Act of 1933, as amended, and the rules and regulations thereunder.
“1934 Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder.
“Additional Amount” means, as of the applicable date of determination, with respect to each Preferred Share, all unpaid Dividends that have accrued on such Preferred Share and any other unpaid amounts then due and payable hereunder with respect to such Preferred Share.
“Additional Issuance Date” means, for any date after the Initial Issuance Date where Preferred Shares are issued pursuant to the Securities Purchase Agreement, the issuance date for such Preferred Shares.
“Affiliate” or “Affiliated” means, with respect to any Person, any other Person that directly or indirectly controls, is controlled by, or is under common control with, such Person, it being understood for purposes of this definition that “control” of a Person means the power directly or indirectly either to vote 10% (or solely for purposes of Section 19, 15%) or more of the shares having ordinary voting power for the election of directors of such Person or direct or cause the direction of the management and policies of such Person whether by contract or otherwise.
“Amendment and Restatement Date” means August 12, 2026.
“Approved Share Plan” means any employee benefit plan which has been approved by the Board prior to or subsequent to the Subscription Date pursuant to which Ordinary Shares and options to purchase Ordinary Shares or other awards convertible, exercisable for or exchangeable for Ordinary Shares may be issued to any employee, officer, consultant, director or other service provider of the Company or any of its Subsidiaries for services provided to the Company or any of its Subsidiaries in their capacity as such.
“ATM Facility” means the Company’s “at the market” equity offering program with Jefferies LLC, pursuant to which the company may issue and sell our Ordinary Shares, having an aggregate offering price of up to $100 million from time to time, as such amount may be increased from time to time.
33
“Attribution Parties” means, collectively, the following Persons and entities: (i) any investment vehicle, including, any funds, feeder funds or managed accounts, currently, or from time to time after the Initial Issuance Date, directly or indirectly managed or advised by a Holder’s investment manager or any of its Affiliates or principals, (ii) any direct or indirect Affiliates of such Holder or any of the foregoing, (iii) any Person acting or who could be deemed to be acting as a Group together with such Holder or any of the foregoing and (iv) any other Persons whose beneficial ownership of the Company’s Ordinary Shares would or could be aggregated with such Holder’s and the other Attribution Parties for purposes of Section 13(d) of the 1934 Act. For clarity, the purpose of the foregoing is to subject collectively such Holder and all other Attribution Parties to the Maximum Percentage.
“Bankruptcy Law” means Title 11, United States Code, or any similar U.S. federal or state or non-U.S. law for the relief of debtors.
“Bloomberg” means Bloomberg, L.P.
“Book-Entry” means each entry on the Register evidencing one or more Preferred Shares or Ordinary Shares held by a Holder.
“Business Day” means any day other than Saturday, Sunday or other day on which commercial banks in The City of New York are authorized or required by law to remain closed; provided, however, for clarification, commercial banks shall not be deemed to be authorized or required by law to remain closed due to “stay at home”, “shelter-in-place”, “non-essential employee” or any other similar orders or restrictions or the closure of any physical branch locations at the direction of any governmental authority so long as the electronic funds transfer systems (including for wire transfers) of commercial banks in The City of New York generally are open for use by customers on such day.
“Capital Lease Obligation” means, with respect to any Person, the obligations of such Person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital leases on a balance sheet of such Person under IFRS; the amount of such obligations shall be the capitalized amount thereof determined in accordance with IFRS, and the final maturity of such obligations shall be the date of the last payment of such amounts due under such lease (or other arrangement) prior to the first date on which such lease (or other arrangement) may be terminated by the lessee without payment of a premium or a penalty; and, for the purposes of this Certificate of Designations, the amount of such obligations at any time shall be the capitalized amount thereof at such time determined in accordance with IFRS.
34
“Closing Bid Price” and “Closing Sale Price” means, for any security as of any date, the last closing bid price and last closing trade price, respectively, for such security on the Principal Market, as reported by Bloomberg, or, if the Principal Market begins to operate on an extended hours basis and does not designate the closing bid price or the closing trade price (as the case may be), then the last bid price or last trade price, respectively, of such security prior to 4:00:00 p.m., New York City time, as reported by Bloomberg, or, if the Principal Market is not the principal securities exchange or trading market for such security, the last closing bid price or last trade price, respectively, of such security on the principal securities exchange or trading market where such security is listed or traded as reported by Bloomberg, or if the foregoing do not apply, the last closing bid price or last trade price, respectively, of such security in the over-the-counter market on the electronic bulletin board for such security as reported by Bloomberg, or, if no closing bid price or last trade price, respectively, is reported for such security by Bloomberg, the average of the bid prices, or the ask prices, respectively, of any market makers for such security as reported in the “pink sheets” by OTC Markets Group Inc. (formerly Pink Sheets LLC). If the Closing Bid Price or the Closing Sale Price cannot be calculated for a security on a particular date on any of the foregoing bases, the Closing Bid Price or the Closing Sale Price (as the case may be) of such security on such date shall be the fair market value as mutually determined by the Company and the Required Holder. If the Company and the Required Holders are unable to agree upon the fair market value of such security, then such dispute shall be resolved in accordance with the procedures in Section 25. All such determinations shall be appropriately adjusted for any share splits, shares dividends, shares combinations, recapitalizations or other similar transactions during such period.
“Convertible Secured Notes” means the Company’s 10.00% / 12.00% Convertible Senior Secured PIK Toggle Notes due 2030, issued from time to time pursuant to an Indenture, dated as of December 16, 2021 (the “Base Indenture”), between the Company and U.S. Bank National Association (“U.S. Bank”), as amended by that certain First Supplemental Indenture, dated as of December 23, 2024 (the “First Supplemental Indenture”), between the Company and U.S. Bank, as further amended by that certain Second Supplemental Indenture, dated as of December 23, 2024 (the “Second Supplemental Indenture”), between the Company, U.S. Bank and Vertical Aerospace Group Limited, as further amended by that certain Third Supplemental Indenture, dated as of April 20, 2026 (the “Third Supplemental Indenture”), and as further amended by that certain Fourth Supplemental Indenture, dated as of August 12, 2026 (the “Fourth Supplemental Indenture”, and together with the Base Indenture, the First Supplemental Indenture, the Second Supplemental Indenture, and the Third Supplemental Indenture, the “Convertible Notes Indenture”).
“Convertible Note Purchase Agreement” means that certain Convertible Note Purchase Agreement, dated as of April 20, 2026 between the Company and Mudrick Capital Management L.P., as amended and restated by that certain Amended and Restated Convertible Note Purchase Agreement, dated as of August 12, 2026.
“Convertible Securities” means any shares or other security (other than Options) that is at any time and under any circumstances, directly or indirectly, convertible into, exercisable or exchangeable for, or which otherwise entitles the holder thereof to acquire, any Ordinary Shares.
35
“Current Subsidiary” means any Person in which the Company on the Subscription Date, directly or indirectly, (i) owns more than fifty percent (50%) of the outstanding voting power of the capital shares or equity or similar interests of such Person entitled (without regard to the occurrence of any contingency, but after giving effect to any voting agreement or shareholders’ agreement that effectively transfers voting power) to vote in the election of directors, managers or trustees, as applicable, of such Person; or (ii) controls the business, operations or administration of such Person, and all of the foregoing, collectively, “Current Subsidiaries”. For purposes of this definition, “control” means the power to direct the management and the policies of such Person, whether through the ownership of voting capital, by contract or otherwise.
“Dividend Rate” means eighteen percent (18%) per annum.
“Eligible Market” means The New York Stock Exchange, the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market or the Nasdaq Global Select Market, or, in each case, any successor thereto.
“ELOC” an equity line of credit where Yorkville shall commit to purchase Ordinary Shares with an aggregate Purchase Price of up to $500,000,000 over the course of 36 months from the date of entry into definitive documents.
“Equity Conditions” means, with respect to a given date or period of determination: (i) on each day during the period beginning thirty (30) Trading Days prior to such applicable date of determination and ending on and including such applicable date of determination (the “Equity Conditions Measuring Period”), all Ordinary Shares issuable upon conversion of the Preferred Shares shall be eligible to be resold by the Holders without restriction or any legend under any applicable federal or state securities laws (in each case, disregarding any limitation on conversion of the Preferred Shares); (ii) during the Equity Conditions Measuring Period, the Company shall have delivered all Ordinary Shares issuable upon conversion of the Preferred Shares on a timely basis as set forth in Section 4 hereof and all other shares of capital shares required to be delivered by the Company on a timely basis as set forth in the other Transaction Documents; (iii) none of the Holders shall be in possession of any material, non-public information provided to any of them by the Company, any of its Subsidiaries or any of their respective affiliates, employees, officers, representatives, agents or the like; (iv) on each day during the Equity Conditions Measuring Period, the Company otherwise shall have been substantially in compliance with, and shall not have breached in any material respect any representation or warranty (other than representations or warranties subject to material adverse effect or materiality, which may not be breached in any respect) or any covenant or other term or condition of any Transaction Document (other than Section 4(f) of the Securities Purchase Agreement) in any material respect, including, without limitation, the Company shall not have failed to timely make any payment pursuant to any Transaction Document, except, in the case of a breach of a covenant or other term or condition that is curable, only if such breach remains uncured as of or after the date that is ten (10) Trading Days prior to the applicable date of determination; (v) on the applicable date of determination (A) no Authorized Share Failure shall exist or be continuing and the applicable Required Reserve Amount of Ordinary Shares is available under the Memorandum and Articles of Association of the Company and reserved by the Company to be issued pursuant to this Certificate of Designations and (B) all Ordinary Shares to be issued in connection with the event requiring this determination (or issuable upon conversion of the Conversion Amount being redeemed in the event requiring this determination (without regards to any limitations on conversion set forth herein)) may be issued in full without resulting in an Authorized Share Failure; or (vi) the Ordinary Shares issuable pursuant to the event requiring the satisfaction of the Equity Conditions are duly authorized.
36
“Excluded Securities” means (i) Ordinary Shares or options to purchase Ordinary Shares or other awards convertible, exercisable for or exchangeable for Ordinary Shares issued or issuable to directors, consultants, officers, employees or other service providers of the Company or any of its Subsidiaries for services rendered to the Company or any of its Subsidiaries in their capacity as such pursuant to an Approved Share Plan (as defined above), provided that the exercise price of any such options is not lowered, none of such options are amended to increase the number of shares issuable thereunder and none of the terms or conditions of any such options are otherwise materially changed in any manner that materially adversely affects any of the Holders; (ii) Convertible Securities and/or Ordinary Shares issued or issuable upon the conversion or exercise of Convertible Securities (other than options to purchase Ordinary Shares or other awards convertible, exercisable for or exchangeable for Ordinary Shares issued or issuable pursuant to an Approved Share Plan that are covered by clause (i) above) issued prior to the Subscription Date or Convertible Secured Notes issued subsequent to the Subscription Date pursuant to the Convertible Notes Indenture, provided that the conversion, exercise or issuance price of any such Convertible Securities (other than options to purchase Ordinary Shares or other awards convertible, exercisable for or exchangeable for Ordinary Shares issued pursuant to an Approved Share Plan that are covered by clause (i) above) is not lowered (other than in accordance with the terms thereof in effect as of the Amendment and Restatement Date, provided that, for the avoidance of doubt, the Convertible Secured Notes issued pursuant to the Convertible Notes Indenture shall continue to constitute Excluded Securities notwithstanding the amendment to the conversion price thereof effected pursuant to the Fourth Supplemental Indenture), none of such Convertible Securities (other than options to purchase Ordinary Shares or other awards convertible, exercisable for or exchangeable for Ordinary Shares issued pursuant to an Approved Share Plan that are covered by clause (i) above) are amended to increase the number of shares issuable thereunder (other than in accordance with the terms thereof in effect as of the Amendment and Restatement Date) and none of the terms or conditions of any such Convertible Securities (other than options to purchase Ordinary Shares or other awards convertible, exercisable for or exchangeable for Ordinary Shares issued pursuant to an Approved Shares Plan that are covered by clause (i) above) are otherwise materially changed in any manner that materially adversely affects any of the Holders; (iii) the Ordinary Shares issuable upon conversion of the Preferred Shares or otherwise pursuant to the terms of this Certificate of Designations; provided, that the terms of this Certificate of Designations are not amended, modified or changed on or after the Amendment and Restatement Date (other than antidilution adjustments pursuant to the terms hereof in effect as of the Amendment and Restatement Date); and (iv) securities issued as consideration for the acquisition of another entity by the Company by merger, purchase of substantially all of the assets or other reorganization or bona fide joint venture agreement, provided that such issuance is approved by the majority of the disinterested directors of the Company.
37
“Family Member” means, with respect to any individual, any other individual having a relationship by blood (to the second degree of consanguinity), marriage (including former spouses), domestic partnership (including former domestic partners) or adoption to such individual.
“Floor Price” means $0.598 (as adjusted for share splits, share dividends, share combinations, recapitalizations or other similar transactions occurring after the Subscription Date).
“Fundamental Transaction” means (A) that the Company shall, directly or indirectly, including through Subsidiaries, Affiliates or otherwise, in one or more related transactions, (i) consolidate or merge with or into (whether or not the Company is the surviving corporation) another Subject Entity, unless, for purposes of any Section hereunder other than Section 11(c), the holders of Ordinary Shares of the Company immediately prior to such consolidation or merger continue to hold at least 50% of the aggregate ordinary voting power represented by the Ordinary Shares of the Company (or the surviving or acquiring entity), or (ii) sell, assign, transfer, convey or otherwise dispose of all or substantially all of the properties or assets of the Company and its Subsidiaries, taken as a whole, to one or more Subject Entities, other than solely to one or more of the Company’s wholly owned Subsidiaries, or (iii) make, or allow one or more Subject Entities to make, or allow the Company to be subject to or have its Ordinary Shares be subject to or party to one or more Subject Entities making, a purchase, tender or exchange offer that is accepted by the holders of at least either (x) 50% of the issued Ordinary Shares, (y) 50% of the issued Ordinary Shares calculated as if any Ordinary Shares held by all Subject Entities making or party to, or Affiliated with any Subject Entities making or party to, such purchase, tender or exchange offer were not issued, or (z) such number of Ordinary Shares such that all Subject Entities making or party to, or Affiliated with any Subject Entity making or party to, such purchase, tender or exchange offer, become collectively the beneficial owners (as defined in Rule 13d-3 under the 1934 Act) of at least 50% of the issued Ordinary Shares , or (iv) consummate a shares or share purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization, spin-off or scheme of arrangement) with one or more Subject Entities whereby all such Subject Entities, individually or in the aggregate, in any transaction or series of related transactions, acquire, either (x) at least 50% of the issued Ordinary Shares, (y) at least 50% of the issued Ordinary Shares calculated as if any Ordinary Shares held by all the Subject Entities making or party to, or Affiliated with any Subject Entity making or party to, such shares purchase agreement or other business combination were not issued, or (z) such number of Ordinary Shares such that the Subject Entities become collectively the beneficial owners (as defined in Rule 13d-3 under the 1934 Act) of at least 50% of the issued Ordinary Shares , or (v) reorganize, recapitalize or reclassify its Ordinary Shares , unless the holders of Ordinary Shares of the Company immediately prior to such reorganization, recapitalization or reclassification continue to hold at least 50% of the aggregate ordinary voting power represented by the Ordinary Shares of the Company (or the surviving entity), (B) that the Company shall, directly or indirectly, including through Subsidiaries, Affiliates or otherwise, in one or more related transactions, allow any Subject Entity individually or the Subject Entities in the aggregate, other than the Company or its wholly owned Subsidiaries, or their respective employee benefit plans, to be or become the “beneficial owner” (as defined in Rule 13d-3 under the 1934 Act), directly or indirectly, whether through acquisition, purchase, assignment, conveyance, tender, tender offer, exchange, reduction in issued Ordinary Shares, merger, consolidation, business combination, reorganization, recapitalization, spin-off, scheme of arrangement, reorganization, recapitalization or reclassification or otherwise in any manner whatsoever, of either (x) at least 50% of the aggregate ordinary voting power represented by issued Ordinary Shares , (y) at least 50% of the aggregate ordinary voting power represented by issued Ordinary Shares not held by all such Subject Entities as of the date of this Certificate of Designations calculated as if any Ordinary Shares held by all such Subject Entities were not issued, or (z) a percentage of the aggregate ordinary voting power represented by issued Ordinary Shares or other equity securities of the Company sufficient to allow such Subject Entities to effect a statutory short form merger or other transaction requiring other shareholders of the Company to surrender their Ordinary Shares without approval of the shareholders of the Company or (C) directly or indirectly, including through Subsidiaries, Affiliates or otherwise, in one or more related transactions, the issuance of or the entering into any other instrument or transaction structured in a manner intended to circumvent, or that circumvents, the intent of this definition in which case this definition shall be construed and implemented in a manner otherwise than in strict conformity with the terms of this definition to the extent necessary to correct this definition or any portion of this definition which may be defective or inconsistent with the intended treatment of such instrument or transaction.
38
“Group” means a “group” as that term is used in Section 13(d) of the 1934 Act and as defined in Rule 13d-5 thereunder.
“Holder Pro Rata Amount” means, with respect to any Holder, a fraction (i) the numerator of which is the number of Preferred Shares issued to such Holder pursuant to the Securities Purchase Agreement on the Initial Issuance Date and (ii) the denominator of which is the number of Preferred Shares issued to all Holders pursuant to the Securities Purchase Agreement on the Initial Issuance Date.
“IFRS” International Financial Reporting Standards.
“Indebtedness” of any Person means, without duplication (A) all obligations of such Person for borrowed money, (B) all obligations of such Person evidenced by bonds, debentures, notes or similar instruments to the extent such obligations would appear as a liability on a balance sheet of such Person prepared in accordance with IFRS, (C) all guarantees by such Person of Indebtedness of others, (D) all Capital Lease Obligations of such Person, (E) all obligations, contingent or otherwise, of such Person as an account party in respect of letters of credit, letters of guaranty, bank guarantees, bankers’ acceptances and similar instruments and, (F) to the extent not otherwise included in this definition, net obligations of such Person under hedging obligations entered into by such Person in the ordinary course of business and entered into for bona fide hedging purposes (and not for speculative purposes) as determined in good faith by the Company (the amount of any such obligations to be equal at any time to the net payments under such agreement or arrangement giving rise to such obligation that would be payable by such person at the termination of such agreement or arrangement); provided that the term “Indebtedness” shall not include (i) deferred or prepaid revenue, (ii) purchase price holdbacks in respect of a portion of the purchase price of an asset to satisfy warranty or other unperformed obligations of the seller, (iii) contingent indemnity and similar obligations incurred in the ordinary course of business, (iv) Indebtedness of any parent entity (for which none of the Company or any Subsidiary is liable) appearing on the balance sheet of the Company solely by reason of push down accounting under IFRS, (v) obligations in connection with government auctions, subsidies, benefits or similar programs or processes, and (vi) obligations under any license, permit or other approval (or guarantees in respect of such obligations) incurred prior to the Subscription Date or in the ordinary course of business. The Indebtedness of any Person shall include the Indebtedness of any other entity (including any partnership in which such Person is a general partner), to the extent such Person is liable therefor as a result of such Person’s ownership interest in or other relationship with such entity, except to the extent the terms of such Indebtedness provide that such Person is not liable therefor. For all purposes hereof, the Indebtedness of the Company and any of its Subsidiaries shall exclude (i) intercompany liabilities between and among them arising solely from their cash management, tax and accounting operations in the ordinary course of business and (ii) intercompany loans, advances or Indebtedness between and among them having a term not exceeding 364 days (inclusive of any rollover, conversion or extension terms) and made in the ordinary course of business.
39
“Initial Issuance Date” means the date Preferred Shares are first issued pursuant to the Securities Purchase Agreement.
“Issuance Date” means the Initial Issuance Date or Additional Issuance Date, as applicable.
“Liens” means, with respect to any asset, (a) any mortgage, deed of trust, lien (statutory or otherwise), pledge, hypothecation, encumbrance, collateral assignment, charge or security interest in, on or of such asset and (b) the interest of a vendor or a lessor under any conditional sale agreement, capital lease or title retention agreement (or any financing lease having substantially the same economic effect as any of the foregoing) relating to such asset.
“Liquidation Event” means, whether in a single transaction or series of transactions, the voluntary or involuntary liquidation, dissolution or winding up of the Company or such Subsidiaries the assets of which constitute all or substantially all of the assets of the business of the Company and its Subsidiaries, taken as a whole.
“non-assessable” means, with respect to the issuance of shares, that a shareholder shall not, solely by virtue of its status as a shareholder, be liable for additional assessments or calls on shares of the Company or its creditors (except in exceptional circumstances, such as involving fraud, the establishment of an agency relationship or an illegal or improper purpose or other circumstances in which a court may be prepared to pierce or lift the corporate veil).
40
“Options” means any rights, warrants or options to subscribe for or purchase Ordinary Shares or Convertible Securities.
“Ordinary Shares” means (i) the Company’s ordinary shares, $0.001 par value per share, and (ii) any capital shares into which such ordinary shares shall have been changed or any share capital resulting from a reclassification of such ordinary shares.
“Parent Entity” of a Person means an entity that, directly or indirectly, controls the applicable Person and whose ordinary shares or equivalent equity security is quoted or listed on an Eligible Market, or, if there is more than one such Person or Parent Entity, the Person or Parent Entity with the largest public market capitalization as of the date of consummation of the Fundamental Transaction.
“Permitted Indebtedness” means:
(i) any Indebtedness that is secured by a Lien on the assets of the Company or any of its Restricted Subsidiaries in an amount not to exceed $100,000,000 and (II) any refinancing of Indebtedness incurred pursuant to the foregoing clause (I); provided that such Indebtedness complies with the Required Additional Secured Debt Terms;
(ii) any unsecured Indebtedness (whether senior or subordinated) in an amount not to exceed $50,000,000; and (II) any refinancing of Indebtedness incurred pursuant to the foregoing clause (I); provided that (x) such Indebtedness shall not be permitted unless the Company or any of its Restricted Subsidiaries have received, and are at the time of incurrence maintaining, type certification from the European Aviation Safety Agency or the UK Civil Aviation Authority and (y) the net proceeds of such Indebtedness shall be used only for the purposes of funding working capital and production of aircraft;
(iii) any Indebtedness represented by the Convertible Secured Notes (including, for the avoidance of doubt, any interest thereon that is paid in kind) or any refinancing of such Indebtedness;
(iv) any Indebtedness of the Company or of any of its Restricted Subsidiaries owing to the Company or any of its Restricted Subsidiaries;
(v) any Indebtedness to finance Capital Lease Obligations in the ordinary course of business, in an amount not to exceed $10,000,000;
(vi) any Indebtedness arising in connection with customary joint venture arrangements;
(vii) any other Indebtedness in an amount not to exceed $10,000,000 at any time; and
(viii) any Indebtedness where the proceeds are used to pay the Company Redemption Price upon the Company’s exercise of its Company Redemption right.
41
“Permitted Liens” shall have meaning ascribed to such term in the Convertible Notes Indenture.
“Person” means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization, any other entity or a government or any department or agency thereof.
“Principal Market” means, as of any date of determination, the Eligible Market on which the Ordinary Shares is then listed or quoted.
“Required Additional Secured Debt Terms” means with respect to any Indebtedness, (a) such Indebtedness does not mature earlier than the “Maturity Date” under the Convertible Notes Indenture, (b) such Indebtedness does not have mandatory redemption features (other than customary exceptions) that could result in redemptions of such Indebtedness prior to the “Maturity Date” under the Convertible Notes Indenture (it being understood that the Company and the Restricted Subsidiaries shall be permitted to make any AHYDO “catch up” payments, if applicable), (c) such Indebtedness is not guaranteed by any entity that is not the Company or Vertical Aerospace Group Limited, (d) such Indebtedness is incurred solely for the purposes of financing the development of one or more assembly facilities and related equipment and (e) such Indebtedness is secured solely by Liens on such assembly facilities and related equipment.
“Restricted Subsidiary” shall have the meaning ascribed to such term in the Convertible Notes Indenture.
“SEC” means the United States Securities and Exchange Commission or the successor thereto.
“Securities Purchase Agreement” means that certain Securities Purchase Agreement by and among the Company and the initial holders of Preferred Shares, originally entered into as of the Subscription Date, as amended and restated as of the Amendment and Restatement Date, and as may be amended, amended and restated, supplemented or otherwise modified from time to time in accordance with the terms thereof.
“Significant Subsidiary” means, as of any date of determination, any Subsidiary of the Company that constitutes, or any group of Subsidiaries of the Company that, in the aggregate, would constitute, a “significant subsidiary” (as defined in Rule 1-02(w) of Regulation S-X under the 1934 Act) of the Company.
“Specified Premium” means 105%.
“Stated Value” shall mean $1,000 per share, subject to adjustment for share splits, shares dividends, recapitalizations, reorganizations, reclassifications, combinations, subdivisions or other similar events occurring after the Issuance Date with respect to the Preferred Shares.
“Subscription Date” means April 20, 2026.
42
“Subject Entity” means any Person, Persons or Group or any Affiliate or associate of any such Person, Persons or Group.
“Subsidiaries” with respect to any Person, (A) any corporation, company, association or other business entity (other than a partnership or limited liability company) of which more than fifty percent (50%) of the total voting power of the common equity entitled (without regard to the occurrence of any contingency, but after giving effect to any voting agreement or stockholders’ or shareholders’ agreement that effectively transfers voting power) to vote in the election of directors, managers or trustees, as applicable, of such corporation, association or other business entity is owned or controlled, directly or indirectly, by such Person or one or more of the other Subsidiaries of such Person; and (B) any partnership or limited liability company where (i) more than fifty percent (50%) of the capital accounts, distribution rights, equity and voting interests, or of the general and limited partnership interests, as applicable, of such partnership or limited liability company are owned or controlled, directly or indirectly, by such Person or one or more of the other Subsidiaries of such Person, whether in the form of membership, general, special or limited partnership or limited liability company interests or otherwise; and (ii) such Person or any one or more of the other Subsidiaries of such Person is a controlling general partner of, or otherwise controls, such partnership or limited liability company.
“Successor Entity” means the Person formed by, resulting from or surviving any Fundamental Transaction or the Person with which such Fundamental Transaction shall have been entered into.
“Trading Day” means, as applicable, (x) with respect to all price or trading volume determinations relating to the Ordinary Shares, any day on which the Ordinary Shares are traded on the Principal Market, or, if the Principal Market is not the principal trading market for the Ordinary Shares, then on the principal securities exchange or securities market on which the Ordinary Shares is then traded, provided that “Trading Day” shall not include any day on which the Ordinary Shares are scheduled to trade on such exchange or market for less than 4.5 hours or any day that the Ordinary Shares are suspended from trading during the final hour of trading on such exchange or market (or if such exchange or market does not designate in advance the closing time of trading on such exchange or market, then during the hour ending at 4:00:00 p.m., New York City time) unless such day is otherwise designated as a Trading Day in writing by the applicable Holder or (y) with respect to all determinations other than price determinations relating to the Ordinary Shares, any day on which The New York Stock Exchange (or any successor thereto) is open for trading of securities.
“Transaction Documents” means the Securities Purchase Agreement, this Certificate of Designations and each of the other agreements and instruments entered into or delivered by the Company or any of the Holders in connection with the transactions contemplated by the Securities Purchase Agreement, all as may be amended from time to time in accordance with the terms thereof.
“Unrestricted Subsidiaries” shall have the meaning ascribed to such term in the Convertible Notes Indenture.
43
“VWAP” means, for any security as of any date, the dollar volume-weighted average price for such security on the Principal Market (or, if the Principal Market is not the principal trading market for such security, then on the principal securities exchange or securities market on which such security is then traded), during the period beginning at 9:30:00 a.m., New York City time, and ending at 4:00:00 p.m., New York time, as reported by Bloomberg through its “VAP” function (set to 09:30:00 start time and 16:00:00 end time) or, if the foregoing does not apply, the dollar volume-weighted average price of such security in the over-the-counter market on the electronic bulletin board for such security during the period beginning at 9:30:00 a.m., New York time, and ending at 4:00:00 p.m., New York time, as reported by Bloomberg, or, if no dollar volume-weighted average price is reported for such security by Bloomberg for such hours, the average of the highest Closing Bid Price and the lowest closing ask price of any of the market makers for such security as reported in the “pink sheets” by OTC Markets Group Inc. (formerly Pink Sheets LLC). If the VWAP cannot be calculated for such security on such date on any of the foregoing bases, the VWAP of such security on such date shall be the fair market value as mutually determined by the Company and the Required Holders. If the Company and the Required Holders are unable to agree upon the fair market value of such security, then such dispute shall be resolved in accordance with the procedures in Section 25. All such determinations shall be appropriately adjusted for any shares dividend, share split, shares combination, recapitalization or other similar transaction during such period.
34. Disclosure. Upon receipt or delivery by the Company of any notice in accordance with the terms of this Certificate of Designations, unless the Company has in good faith determined that the matters relating to such notice do not constitute material, non-public information relating to the Company and its Subsidiaries, taken as a whole, the Company shall within two (2) Business Days of such receipt or prior to (or simultaneous with) such delivery, as applicable, publicly disclose such material, non-public information on a Current Report on Form 6-K or otherwise. In the event that the Company believes that a notice contains material, non-public information relating to the Company or any of its Subsidiaries, the Company so shall indicate to such Holder explicitly in writing in such notice (or immediately upon receipt of notice from such Holder, as applicable), and in the absence of any such written indication in such notice (or notification from the Company immediately upon receipt of notice from such Holder), such Holder shall be allowed to presume that information contained in the notice does not constitute material, non-public information relating to the Company or any of its Subsidiaries. If the Company or any of its Subsidiaries provides material non-public information to a Holder that is not simultaneously filed in a Current Report on Form 6-K and such Holder has not agreed to receive such material non-public information, the Company hereby covenants and agrees that such Holder shall not have any duty of confidentiality to the Company, any of its Subsidiaries or any of their respective officers, directors, employees, affiliates or agents with respect to, or a duty to any of the foregoing not to trade on the basis of, such material non-public information. Nothing contained in this Section 34 shall limit any obligations of the Company, or any rights of any Holder, under Section 4(i) of the Securities Purchase Agreement.
35. Absence of Trading and Disclosure Restrictions. The Company acknowledges and agrees that no Holder is a fiduciary or agent of the Company and that, subject to such Holder’s compliance with the provisions of Section 4(k) of the Securities Purchase Agreement, each Holder shall have no obligation to (a) maintain the confidentiality of any information provided by the Company or (b) refrain from trading any securities while in possession of such information, in each case, in the absence of a written non-disclosure agreement signed by an officer of such Holder that explicitly provides for such confidentiality and trading restrictions. In the absence of such an executed, written non-disclosure agreement, the Company acknowledges that, subject to such Holder’s compliance with the provisions of Section 4(k) of the Securities Purchase Agreement, each Holder may freely trade in any securities issued by the Company, may possess and use any information provided by the Company in connection with such trading activity, and may disclose any such information to any third party.
* * *
44
IN WITNESS WHEREOF, the Company has caused this Certificate of Designations of Series A Convertible Preferred Shares of Vertical Aerospace Ltd. to be executed this 12th day of August, 2026.
/s/ Stuart Simpson
| Name: Stuart Simpson | |
| Title: Chief Executive Officer |
Signature Page to
Certificate of Designations
of the Series A Convertible Preferred Shares of
Vertical Aerospace Ltd.
EXHIBIT I
VERTICAL AEROSPACE
LTD.
CONVERSION NOTICE
Reference is made to the Amended and Restated Certificate of Designations of Series A Convertible Preferred Shares of Vertical Aerospace Ltd. (the “Certificate of Designations”). In accordance with and pursuant to the Certificate of Designations, the undersigned hereby elects to convert the number of shares of Series A Convertible Preferred Shares, $0.001 par value per share (the “Preferred Shares”), of Vertical Aerospace Ltd., a Cayman Islands exempted company with limited liability (the “Company”), indicated below into Ordinary Shares, $0.001 value per share (the “Ordinary Shares”), of the Company, as of the date specified below.
| Date of Conversion: |
| Aggregate number of Preferred Shares to be converted |
| Aggregate Stated Value of such Preferred Shares to be converted: |
Aggregate accrued and unpaid Dividends with respect to such Preferred Shares, and such Aggregate Dividends to be converted: |
| AGGREGATE CONVERSION AMOUNT TO BE CONVERTED: |
| Please confirm the following information: |
| Conversion Price: |
| Number of Ordinary Shares to be issued: |
Please issue the Ordinary Shares into which the applicable Preferred Shares are being converted to Holder, or for its benefit, as follows:
| ¨ | Check here if requesting delivery in book-entry form to the following name and to the following address: |
| Issue to: | ||
| ¨ | Check here if requesting delivery by Deposit/Withdrawal at Custodian as follows: |
| DTC Participant: | ||
| DTC Number: | ||
| Account Number: |
I-1
| Date: , | |||
| Name of Registered Holder | |||
| By: | |||
| Name: | |||
| Title: | |||
| Tax ID: | |||
| Facsimile: | |||
| E-mail Address: |
I-2
EXHIBIT II
EMAIL ACKNOWLEDGMENT
The Company acknowledges receipt of this Conversion Notice and hereby directs Continental Stock Transfer & Trust Company (the “Transfer Agent”) to issue the above indicated number of Ordinary Shares in accordance with the Transfer Agent Instructions dated [_], from the Company and acknowledged and agreed to by the Transfer Agent.
Exhibit 99.4
Execution Version
AMENDED AND RESTATED Securities Purchase Agreement
This AMENDED AND RESTATED Securities Purchase Agreement (the “Agreement”), dated as of August 12, 2026, to the original Securities Purchase Agreement, dated April 20, 2026, is by and among Vertical Aerospace Ltd., an exempted company incorporated with limited liability in the Cayman Islands (the “Company”), and YA II PN, Ltd. (the “Buyer”). Capitalized terms used in this Agreement without definition have the respective meanings ascribed to them in the Certificate of Designations (as defined below).
RECITALS
| A. | The Company authorized a new series of convertible preferred shares in the capital of the Company, designated as Series A Convertible Preferred Shares, $0.001 par value per share, the terms of which are set forth in the certificate of designations of preferences and rights for such series of preferred shares (the “Original Certificate of Designations”), dated as of April 20, 2026, as amended and restated in its entirety by the amended and restated certificate of designations in the form attached hereto as Exhibit A (the “Amended and Restated Certificate of Designations” and, upon its effectiveness, the “Certificate of Designations”) (together with any convertible preferred shares issued in replacement thereof in accordance with the terms thereof, the “Series A Preferred Shares”), which Series A Preferred Shares shall have a stated value of $1,000 per share and be convertible into ordinary shares of the Company, $0.001 par value per share (“Ordinary Shares”) (such Ordinary Shares issuable pursuant to the terms of the Certificate of Designations, including, without limitation, upon conversion or otherwise, collectively, the “Conversion Shares”), in accordance with the terms of the Certificate of Designations. |
| B. | The Buyer wishes to purchase, and the Company wishes to sell, upon the terms and conditions stated in this Agreement and pursuant to one or more effective registrations statement under the Securities Act of 1933, as amended (the “1933 Act”), up to an aggregate of $250,000,000 stated value of the Company’s Series A Preferred Shares at multiple closings, in each case, on the terms of and subject to the conditions set forth in this Agreement. |
| C. | On or around the date of this Agreement, on the terms of and subject to the conditions set forth herein, the Buyer wishes to purchase an aggregate of $25,000,000 stated value of Series A Preferred Shares (such amount, the “Buyer Initial Share Purchase Amount,” and such aggregate amount for the Buyer shall be referred to herein as the “Initial Preferred Shares”). |
| D. | The Buyer further wishes to purchase, on the terms of and subject to the conditions set forth in this Agreement, the Company’s Series A Preferred Shares at one or more closings after the First Closing Date (as defined below), each such closing in an aggregate amount of up to $25,000,000 stated value of Additional Preferred Shares (such amount, the “Buyer Additional Share Purchase Amount,” and together with the Buyer Initial Share Purchase Amount, the “Buyer Share Purchase Amount,” and such aggregate amount for the Buyer shall be referred to herein as the “Additional Preferred Shares” and, together with the Initial Preferred Shares, the “Preferred Shares”). |
| E. | The Preferred Shares are, under specific circumstances set forth in the Certificate of Designations, entitled to Dividends (as defined in the Certificate of Designations), PIK Shares, and certain other amounts (the “Dividend Shares”). |
| F. | The Preferred Shares, the Conversion Shares and the Dividend Shares are collectively referred to herein as the “Securities.” |
AGREEMENT
Now, therefore, in consideration of the premises and the mutual covenants contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and the Buyer hereby agree as follows:
1. Purchase and Sale of Preferred Shares.
| (a) | Purchase of Preferred Shares. Subject to the satisfaction (or waiver) of the conditions set forth in Sections 6(a) and 7(a) below, the Company shall issue and sell to the Buyer, and the Buyer agrees to purchase from the Company on the First Closing Date (as defined below), the Buyer’s Buyer Initial Share Purchase Amount. Subject to the satisfaction (or waiver) of the conditions set forth in Sections 6(b) and 7(b) below, the Company shall issue and sell to the Buyer, and the Buyer agrees to purchase from the Company on each Additional Closing Date (as defined below), the Buyer’s Buyer Additional Share Purchase Amount. |
| (b) | Closing. The first closing (the “First Closing”) of the purchase of the Initial Preferred Shares by the Buyer shall occur remotely by the electronic transfer of Closing documentation. The date and time of the Closing (the “First Closing Date”) shall be 10:00 a.m., New York City time, on the first (1st) Business Day on which the conditions to the Closing set forth in Sections 6(a) and 7(a) below are satisfied or waived by the Buyer (or such other date as is mutually agreed to by the Company and the Buyer). The second closing and each additional closing thereafter (each such closing an “Additional Closing” and all such Additional Closings collectively with the First Closing, the “Closings” and each a “Closing”) of the purchase of the Additional Preferred Shares by the Buyer shall occur remotely by the electronic transfer of Closing documentation. The date and time of each Additional Closing (each such date an “Additional Closing Date” and collectively with the First Closing Date, the “Closing Dates” and each a “Closing Date”) shall be 10:00 a.m., New York City time, on the first (1st) Business Day on which the conditions to the Closing set forth in Sections 6(b) and 7(b) below are satisfied or waived (or such other date as is mutually agreed to by the Company and the Buyer). As used herein “Business Day” means any day other than Saturday, Sunday or other day on which commercial banks in The City of New York are authorized or required by law to remain closed; provided, however, for clarification, commercial banks shall not be deemed to be authorized or required by law to remain closed due to “stay at home”, “shelter-in-place”, “non-essential employee” or any other similar orders or restrictions or the closure of any physical branch locations at the direction of any governmental authority so long as the electronic funds transfer systems (including for wire transfers) of commercial banks in The City of New York generally are open for use by customers on such day. |
2
| (c) | Purchase Price. The purchase price per Preferred Share is $960. The aggregate purchase price for the Initial Preferred Shares to be purchased by the Buyer (the “Initial Purchase Price”) shall be the amount set forth on the executed signature page of the Buyer under the label “Initial Purchase Price.” The aggregate purchase price for the Additional Preferred Shares to be purchased by the Buyer (the “Additional Purchase Price”) shall be up to the maximum amount set forth on the executed signature page of the Buyer under the label “Additional Purchase Price.” |
| (d) | Form of Payment. |
| (i) | On the First Closing Date, (i) the Buyer shall pay its respective Initial Purchase Price (less the Transaction Expenses to be withheld pursuant to Section 4(g)) to the Company for the Initial Preferred Shares to be issued and sold to the Buyer at the First Closing, by wire transfer of immediately available funds in accordance with the Company’s written wire instructions and (ii) the Company shall permit the transfer and shall promptly instruct the Transfer Agent to issue one or more book-entry statements representing the Buyer Initial Shares Purchase Amount registered in the name of the Buyer or its designee. |
| (ii) | On each Additional Closing Date, (i) the Buyer shall pay its respective Additional Purchase Price to the Company for the Additional Preferred Shares to be issued and sold to the Buyer at such Additional Closing, by wire transfer of immediately available funds in accordance with the Company’s written wire instructions and (ii) the Company shall permit the transfer and shall promptly instruct the Transfer Agent to issue one or more book-entry statements representing the Buyer Additional Share Purchase Amount to be issued and sold to the Buyer at such Additional Closing in the name of the Buyer or its designee. |
2. Buyer’s Representations and Warranties.
The Buyer represents and warrants to the Company with respect to only itself that, as of the date hereof and as of each Closing Date:
| (a) | Organization; Authority. The Buyer is an entity duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization with the requisite power and authority to enter into and to consummate the transactions contemplated by the Transaction Documents (as defined below) to which it is a party and otherwise to carry out its obligations hereunder and thereunder. |
| (b) | Accredited Investor Status; Experience. The Buyer is an “accredited investor” as that term is defined in Rule 501(a) of Regulation D. The Buyer, either alone or together with its representatives, has such knowledge, sophistication and experience in business and financial matters so as to be capable of evaluating the merits and risks of the prospective investment in the Securities, and has so evaluated the merits and risks of such investment. The Buyer is able to bear the economic risk of an investment in the Securities and, at the present time, is able to afford a complete loss of such investment. |
3
| (c) | Information. The Buyer acknowledges that it has had the opportunity to review the Transaction Documents (including all exhibits and schedules thereto) and the SEC Documents (as defined below). The Buyer and its advisors, if any, have been furnished with all materials relating to the business, finances and operations of the Company and materials relating to the offer and sale of the Securities that have been requested by the Buyer. The Buyer and its advisors, if any, have been afforded the opportunity to ask questions of the Company. Neither such inquiries nor any other due diligence investigations conducted by the Buyer or its advisors, if any, or its representatives shall modify, amend or affect the Buyer’s right to rely on the Company’s representations and warranties contained herein. The Buyer understands that its investment in the Securities involves a high degree of risk. The Buyer has sought such accounting, legal and tax advice as it has considered necessary to make an informed investment decision with respect to its acquisition of the Securities. The Buyer is not relying, and has not relied, upon any statement, advice (whether accounting, legal, tax or other), representation or warranty made by the Company or any of its affiliates or representatives except for (i) the statements made by the Company in the SEC Documents and (ii) the representations and warranties made by the Company in this Agreement. |
| (d) | No Governmental Review. The Buyer understands that no United States federal or state agency or any other government or governmental agency has passed on or made any recommendation or endorsement of the Securities or the fairness or suitability of the investment in the Securities nor have such authorities passed upon or endorsed the merits of the offering of the Securities. |
| (e) | Validity; Enforcement. This Agreement has been duly and validly authorized, executed and delivered on behalf of the Buyer and shall constitute the legal, valid and binding obligation of the Buyer enforceable against the Buyer in accordance with its terms, except as such enforceability may be limited by general principles of equity or to applicable bankruptcy, insolvency, reorganization, moratorium, liquidation and other similar laws relating to, or affecting generally, the enforcement of applicable creditors’ rights and remedies. |
| (f) | No Conflicts. The execution, delivery and performance by the Buyer of this Agreement and the consummation by the Buyer of the transactions contemplated hereby will not (i) result in a violation of the organizational documents of the Buyer, or (ii) conflict with, or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture or instrument to which the Buyer is a party, or (iii) result in a violation of any law, rule, regulation, order, judgment or decree (including federal and state securities laws) applicable to the Buyer, except in the case of clauses (ii) and (iii) above, for such conflicts, defaults, rights or violations which could not, individually or in the aggregate, reasonably be expected to have a material adverse effect on the ability of the Buyer to perform its obligations hereunder. |
| (g) | No Affiliates. The Buyer (i) is not, and has not been at any time during the consecutive three-month period preceding the date hereof, a director, officer or “affiliate” (as defined in Rule 144 (as defined below)) of the Company or any of its Subsidiaries and (ii) is not, to its knowledge, a “beneficial owner” of more than 10% of the Ordinary Shares (as defined for purposes of Rule 13d-3 of the 1934 Act). |
4
| (h) | Residency. The Buyer is a resident of that jurisdiction set forth in the Buyer’s address for notice as it appears on the executed signature page of the Buyer. |
| (i) | Certain Transactions and Confidentiality. Other than consummating the transactions contemplated hereunder, the Buyer has not, nor has any Person acting on behalf of or pursuant to any understanding with the Buyer, directly or indirectly, executed any purchases or sales, including Short Sales, of the securities of the Company, during the period commencing as of the time that the Buyer first received a term sheet (written or oral) from the Company or any other Person representing the Company setting forth the material terms of the transactions contemplated hereunder, and the Buyer will not engage, directly or indirectly, in any such activities until the public disclosure of the transactions contemplated by the Transaction Documents pursuant to the 6-K Filing (as defined below). Notwithstanding the foregoing, in the case of a Buyer that is a multi-managed investment vehicle whereby separate portfolio managers manage separate portions of the Buyer’s assets and the portfolio managers have no direct knowledge of the investment decisions made by the portfolio managers managing other portions of the Buyer’s assets, the representation set forth above shall only apply with respect to the portion of assets managed by the portfolio manager that made the investment decision to purchase the Securities covered by this Agreement. Other than to other Persons party to this Agreement or to the Buyer’s representatives, including, without limitation, its officers, directors, partners, legal and other advisors, employees, agents and affiliates, the Buyer has maintained the confidentiality of all disclosures made to it in connection with the transactions contemplated hereby or in any of the other Transaction Documents or any other agreements or instruments to be entered into in connection herewith or therewith (including the existence and terms of such transactions). “Short Sales” means all “short sales” as defined in Rule 200 of Regulation SHO under the 1934 Act (but shall not be deemed to include locating and/or borrowing Ordinary Shares). For purposes of this Agreement, “Person” means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization, any other entity and any Governmental Entity (as defined below) or any department or agency thereof. |
3. Representations and Warranties of the Company.
The Company represents and warrants to the Buyer that, as of the date hereof and as of each Closing Date:
| (a) | Organization and Qualification. The Company and any subsidiary that is a significant subsidiary (as such term is defined in Rule 1-02 of Regulation S-X promulgated by the Securities and Exchange Commission (the “SEC”)) (each, a “Subsidiary,” collectively, the “Subsidiaries”), are, and will be, duly organized, validly existing as a corporation and in good standing under the laws of their respective jurisdictions of organization. The Company and the Subsidiaries are duly licensed or qualified as a foreign corporation for transaction of business and in good standing under the laws of each other jurisdiction in which their respective ownership or lease of property or the conduct of their respective businesses requires such license or qualification, and have all corporate power and authority necessary to own or hold their respective properties and to conduct their respective businesses as described in the Registration Statement and the Prospectus, except where the failure to be so qualified or in good standing or have such power or authority would not, individually or in the aggregate, have a material adverse effect on the assets, business, operations, earnings, properties, condition (financial or otherwise), prospects, shareholders’ equity or results of operations of the Company and the Subsidiaries taken as a whole, or prevent the consummation of the transactions contemplated hereby (a “Material Adverse Effect”). Except as disclosed in the Registration Statement or Prospectus, the Company owns directly or indirectly, all of the equity interests of the Subsidiaries free and clear of any lien, charge, security interest, encumbrance, right of first refusal or other restriction, and all the equity interests of the Subsidiaries are validly issued and are fully paid, nonassessable and free of preemptive and similar rights. The Company does not own or control, directly or indirectly, any corporation, association or other entity other than the subsidiaries listed in Exhibit 8.1 to the Company’s Annual Report on Form 20-F for the most recently ended fiscal year and other than (i) those subsidiaries not required to be listed on Exhibit 8.1 under the 1934 Act and (ii) those subsidiaries formed since the last day of the most recently ended fiscal year. |
5
| (b) | Authorization; Enforcement; Validity. Except as disclosed in the Registration Statement or Prospectus, the Company has full legal right, power and authority to enter into this Agreement and the other Transaction Documents and perform the transactions contemplated hereby and thereby (including, without limitation, the issuance by the Company of the Preferred Shares and the reservation for issuance and issuance of the Conversion Shares issuable upon conversion of the Preferred Shares and the reservation for issuance and issuance of any Dividend Shares issuable pursuant to the terms of the Certificate of Designations). This Agreement has been, and the other Transaction Documents to which it is a party will be prior to the Closing, duly authorized, executed and delivered by the Company and a legal, valid and binding agreement of the Company enforceable against the Company in accordance with its terms, except to the extent that (i) enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights generally and by general equitable principles and (ii) the indemnification and contribution provisions herein and therein may be limited by federal or state securities laws and public policy considerations in respect thereof. “Transaction Documents” means, collectively, this Agreement, the Certificate of Designations, the Irrevocable Transfer Agent Instructions (as defined below) and each of the other agreements and instruments entered into or delivered by the Company in connection with the transactions contemplated hereby and thereby, as may be amended from time to time. |
| (c) | Issuance of Securities; Registration. The Preferred Shares, when issued and delivered against payment therefor as provided herein, and the Dividend Shares, when issued and delivered in accordance with the terms of the Certificate of Designations, if and as when lawfully declared as dividends by the Company, will be validly issued, fully paid and non-assessable and free from all preemptive or similar rights, mortgages, claims, liens, pledges, charges, taxes, rights of first refusal, encumbrances, security interests and other encumbrances (collectively “Liens”) (other than any Lien arising from an act or omission of a Buyer) with respect to the issuance thereof. As of the Closing, the Company shall have reserved out of its authorized and unissued Ordinary Shares a number of Ordinary Shares equal to the sum of (i) 100% of the aggregate number of Ordinary Shares as shall from time to time be necessary to effect the conversion of all of the Preferred Shares then outstanding (including the Preferred Shares being purchased by the Buyer at such Closing) at the Floor Price (as defined in the Certificate of Designations) then in effect (without regard to any limitations on conversions set forth in the Certificate of Designations) and (ii) 100% of the aggregate number of Ordinary Shares that would be necessary to effect the conversion of that number of Dividend Shares equal to eighteen (18) months of Dividends on the Preferred Shares then outstanding (including the Preferred Shares being purchased by the Buyer at such Closing) at the Floor Price then in effect (without regard to any limitations on conversions set forth in the Certificate of Designations). The Conversion Shares, when issued upon conversion of the Preferred Shares or the Dividend Shares in accordance with the terms of the Certificate of Designations, will be validly issued, fully paid and nonassessable and free from all preemptive or similar rights or Liens (other than any Lien arising from an act or omission of a Buyer) with respect to the issuance thereof. On or prior to each Closing Date, the Company has, or shall have, prepared and filed an effective registration statement (registering the issuance and sale of certain securities to be issued from time to time by the Company, including the Preferred Shares and certain Dividend Shares issuable in connection therewith and the Conversion Shares issuable upon conversion thereof) on Form F-3 with the SEC (a “Registration Statement”) in conformity with the requirements of the 1933 Act, which became effective on or prior to the applicable Closing Date (such date of effectiveness, the “Effective Date”), including a prospectus forming a part of such Registration Statement (the “Prospectus”), and such amendments and supplements thereto as may have been required prior to the applicable Closing Date, including, if necessary or appropriate, a supplement to the Prospectus relating to the Securities filed with the SEC pursuant to Rule 424(b) of the 1933 Act and delivered by the Company to the Buyer at the applicable Closing (a “Prospectus Supplement”). No stop order suspending the effectiveness of a Registration Statement or of any part thereof has been issued by the SEC and no proceedings for that purpose have been instituted or, to the knowledge of the Company, are threatened by the SEC. The Company, if required by the rules and regulations of the SEC, shall file each Prospectus with the SEC pursuant to Rule 424(b). At the time each Registration Statement and any amendments thereto became or becomes effective, at the date of its filing and at the applicable Closing Date, such Registration Statement and any amendments thereto conformed and will conform in all material respects with the requirements of the 1933 Act; and the applicable Prospectus and any amendments or supplements thereto, at the time such Prospectus or any amendment or supplement thereto was issued and at the applicable Closing Date, conformed and will conform in all material respects with the requirements of the 1933 Act. At the time each Registration Statement and any amendments thereto became or becomes effective did not and 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; and the applicable Prospectus and any amendments or supplements thereto, at the time such Prospectus or any amendment or supplement thereto was issued and at the applicable Closing Date, did not and will not contain an untrue statement of a material fact or 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. The Company (i) is, and will be, eligible to use Form F-3 under the 1933 Act, and (ii) is and will meet the transaction requirements as set forth in General Instruction I.B.1 of Form F-3. |
6
| (d) | No Conflicts. Neither the execution of the Transaction Documents by the Company, nor the issuance, offering or sale of the Securities, nor the consummation of any of the transactions contemplated herein or therein, nor the compliance by the Company with the terms and provisions hereof or thereof will conflict with, or will result in a breach of, any of the terms and provisions of, or has constituted or will constitute a default under, or has resulted in or will result in the creation or imposition of any lien, charge or encumbrance upon any property or assets of the Company pursuant to the terms of any contract or other agreement to which the Company may be bound or to which any of the property or assets of the Company is subject, except (i) such conflicts, breaches or defaults as may have been waived and (ii) such conflicts, breaches and defaults that would not have a Material Adverse Effect; nor will such action result (x) in any violation of the provisions of the Memorandum and Articles of Association of the Company (as defined below) or other organizational documents of the Company, or (y) in any material violation of the provisions of any statute or any order, rule or regulation applicable to the Company or of any court or of any federal, state or other regulatory authority or other government body having jurisdiction over the Company, including the Eligible Market on which the Ordinary Shares are then listed or quoted (the “Principal Market”), except where such violation would not have a Material Adverse Effect. |
| (e) | Consents. Except as disclosed in the Registration Statement or Prospectus, the Company is not required to obtain any consent from, authorization or order of, or make any filing or registration with (other than the filing with the SEC of any applicable Registration Statement, Prospectus, Prospectus Supplement, any other filings as may be required under the 1933 Act or the 1934 Act or by any state securities agencies, the notice and/or application(s) to the Principal Market for the issuance and sale of the Securities and the listing of the Conversion Shares for trading thereon in the time and manner required thereby), any Governmental Entity (as defined below) or any regulatory or self-regulatory agency or any other Person in order for it to execute, deliver or perform any of its obligations under or contemplated by the Transaction Documents, in each case, in accordance with the terms hereof or thereof. All consents, authorizations, orders, filings and registrations which the Company is required to obtain prior to the Closing Date pursuant to the preceding sentence have been or will be obtained or effected on or prior to the Closing Date, and the Company is not aware of any facts or circumstances which might prevent the Company from obtaining or effecting any of the registration, application or filings contemplated by the Transaction Documents. “Governmental Entity” means any (i) nation, state, county, city, town, village, district, or other political jurisdiction of any nature, (ii) federal, state, local, municipal, foreign, or other government, (iii) governmental or quasi-governmental authority of any nature (including any governmental agency, branch, department, official, or entity and any court or other tribunal), (iv) multi-national organization or body, or (v) body entitled to exercise any administrative, executive, judicial, legislative, police, regulatory, or taxing authority or power of any nature, or instrumentality of any of the foregoing, including any entity or enterprise owned or controlled by a government or a public international organization or any of the foregoing. |
7
| (f) | Acknowledgment Regarding Buyer’s Purchase of Securities. Assuming the accuracy of the Buyer’s representations and warranties hereunder, the Company acknowledges and agrees that the Buyer is acting solely in the capacity of an arm’s length purchaser with respect to the Transaction Documents and the transactions contemplated hereby and thereby and that no Buyer is (i) an officer or director of the Company or any of its Subsidiaries, (ii) an “affiliate” (as defined in Rule 144 or Rule 144A promulgated under the 1933 Act (or a successor rule thereto) (collectively, “Rule 144”)) of the Company or any of its Subsidiaries or (iii) to its knowledge, a “beneficial owner” of more than 10% of the Ordinary Shares (as defined for purposes of Rule 13d-3 of the Securities Exchange Act of 1934, as amended (the “1934 Act”)). The Company further acknowledges that no Buyer is acting as a financial advisor or fiduciary of the Company or any of its Subsidiaries (or in any similar capacity) with respect to the Transaction Documents and the transactions contemplated hereby and thereby, and any advice given by a Buyer or any of its representatives or agents in connection with the Transaction Documents and the transactions contemplated hereby and thereby is merely incidental to the Buyer’s purchase of the Securities. The Company further represents to the Buyer that the Company’s decision to enter into the Transaction Documents to which it is a party has been based solely on the independent evaluation by the Company and its representatives. |
| (g) | No Integrated Offering. Assuming the accuracy of the Buyer’s representations and warranties hereunder, none of the Company, its Subsidiaries nor, to the Company’s knowledge, any of its affiliates or any Person acting on its behalf has, directly or indirectly, made any offers or sales of any Company security or solicited any offers to buy any Company security under circumstances that would cause this offering of the Securities to be integrated with prior offerings by the Company for purposes of (i) the 1933 Act, which would require the registration of any such securities under the 1933 Act, or (ii) any applicable shareholder approval provisions of any exchange or automated quotation system on which any of the securities of the Company are listed or designated for quotation. |
| (h) | Dilutive Effect. The Company understands and acknowledges that the number of Conversion Shares and the Dividend Shares will increase in certain circumstances. The Company further acknowledges that its obligation to issue the Conversion Shares, the Preferred Shares and the Dividend Shares pursuant to the terms of the Certificate of Designations and in accordance with this Agreement, is, in each case, absolute and unconditional regardless of the dilutive effect that such issuance may have on the ownership interests of other shareholders of the Company. |
| (i) | Application of Takeover Protections; Rights Agreement. The Company and its board of directors have taken all necessary action, if any, in order to render inapplicable any control share acquisition, interested shareholder, business combination, poison pill (including, without limitation, any distribution under a rights agreement), shareholder rights plan or other similar anti-takeover provision under the Memorandum and Articles of Association or other organizational documents or the laws of the jurisdiction of its incorporation or otherwise which is or could become applicable to the Buyer as a result of the transactions contemplated by this Agreement, including, without limitation, the Company’s issuance of the Securities and the Buyer’s ownership of the Securities, except as set forth in the Certificate of Designations. The Company and its board of directors have taken all necessary action, if any, in order to render inapplicable any shareholder rights plan or similar arrangement relating to accumulations of beneficial ownership of Ordinary Shares or a change in control of the Company or any of its Subsidiaries. |
8
| (j) | SEC Documents; Financial Statements. During the two (2) years prior to the later of the date hereof and the most recent Closing Date, the Company has timely filed all reports, schedules, forms, proxy statements, statements and other documents required to be filed by it with the SEC pursuant to the reporting requirements of the 1934 Act (all of the foregoing filed prior to such date and all exhibits and appendices included therein and financial statements, notes and schedules thereto and documents incorporated by reference therein being hereinafter referred to as the “SEC Documents”). The Company has delivered or has made available to the Buyer or its respective representatives true, correct and complete copies of each of the SEC Documents not available on the EDGAR system. As of their respective dates (except to the extent amended by a subsequently filed SEC Document), the SEC Documents complied in all material respects with the requirements of the 1934 Act and the rules and regulations of the SEC promulgated thereunder applicable to the SEC Documents, and none of the SEC Documents, at the time they were filed with the SEC (except to the extent amended by a subsequently filed SEC Document), contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. The consolidated financial statements of the Company included in the SEC Documents, together with the related notes and schedules, present fairly, in all material respects, the consolidated financial position of the Company and the Subsidiaries as of the dates indicated and the consolidated results of operations, cash flows and changes in shareholders’ equity of the Company and the Subsidiaries for the periods specified (subject, in the case of unaudited statements, to normal year-end audit adjustments which will not be material, either individually or in the aggregate) and have been prepared in compliance with the published requirements of the 1933 Act and 1934 Act, as applicable, and in conformity with International Financial Reporting Standards as issued by the International Accounting Standards Board (“IFRS”) applied on a consistent basis (except (i) for such adjustments to accounting standards and practices as are noted therein and (ii) in the case of unaudited interim statements, to the extent they may exclude footnotes or may be condensed or summary statements) during the periods involved. No other information provided by or on behalf of the Company to the Buyer which is not included in the SEC Documents (including, without limitation, information referred to in Section 2(c) of this Agreement) contains any untrue statement of a material fact or omits to state any material fact necessary in order to make the statements therein not misleading, in the light of the circumstance under which they are or were made. The Company is not currently contemplating to amend or restate any of the financial statements (including, without limitation, any notes or any letter of the independent accountants of the Company with respect thereto) included or incorporated by reference in the Registration Statement and the Prospectus (the “Financial Statements”), nor is the Company currently aware of facts or circumstances which would require the Company to amend or restate any of the Financial Statements, in each case, in order for any of the Financials Statements to be in conformity with IFRS and in compliance with the published requirements of the 1933 Act and 1934 Act, as applicable. The Company has not been informed by its independent accountants that they recommend that the Company amend or restate any of the Financial Statements or that there is any need for the Company to amend or restate any of the Financial Statements. |
9
| (k) | Absence of Certain Changes. Since the date of the most recent financial statements of the Company included or incorporated by reference in the Registration Statement and Prospectus, there has not been (i) any Material Adverse Effect, or any development that would result in a Material Adverse Effect, (ii) any transaction which is material to the Company and the Subsidiaries taken as a whole, (iii) any obligation or liability, direct or contingent (including any off-balance sheet obligations), incurred by the Company or the Subsidiaries, which is material to the Company and the Subsidiaries taken as a whole, (iv) any material change in the share capital (other than (A) the grant of additional options under the Company’s existing share option plans, (B) changes in the number of outstanding Ordinary Shares of the Company due to the issuance of shares upon the exercise or conversion of securities exercisable for, or convertible into, Ordinary Shares outstanding on the date hereof, (C) as a result of the issuance of Placement Shares, (D) any repurchases of shares in the capital of the Company, (E) as described in a Registration Statement on Form F-4, or (F) otherwise publicly announced) or outstanding long-term indebtedness of the Company or the Subsidiaries or (v) any dividend or distribution of any kind declared, paid or made on the shares in the capital of the Company or any Subsidiary, other than in each case above in the ordinary course of business or as otherwise disclosed in the Registration Statement or Prospectus (including any document incorporated by reference therein). The Company has not taken any steps to seek protection pursuant to any law or statute relating to bankruptcy, insolvency, reorganization, receivership, liquidation or winding up, nor does the Company have any knowledge or reason to believe that any of its creditors intend to initiate involuntary bankruptcy proceedings or any actual knowledge of any fact which would reasonably lead a creditor to do so. The Company and its Subsidiaries, on a consolidated basis, are not as of the date hereof, and after giving effect to the transactions contemplated hereby to occur at the Closing, will not be Company Insolvent (as defined below). For purposes of this Section 3(k), “Company Insolvent” means, with respect to the Company and its Subsidiaries, on a consolidated basis, (A) the present fair saleable value of the Company’s and its Subsidiaries’ consolidated assets is less than the amount that will be required to pay the probable liability of its debts and other liabilities, subordinated, contingent or otherwise, as such debts and other liabilities become absolute and matured, (B) the Company and its Subsidiaries are unable to pay their debts and liabilities, subordinated, contingent or otherwise, as such debts and liabilities become absolute and matured or (C) the Company and its Subsidiaries intend to incur or believe that they will incur debts that would be beyond their ability to pay as such debts mature. Neither the Company nor any of its Subsidiaries has engaged in any business or in any transaction, and is not about to engage in any business or in any transaction, for which the Company’s and its Subsidiaries’ remaining consolidated assets constitute unreasonably small capital with which to conduct the business in which the Company is engaged as such business is now conducted and is proposed to be conducted. |
10
| (l) | Conduct of Business; Regulatory Permits. Neither the Company nor any Subsidiary is (i) in violation of its charter or similar organizational documents; (ii) in default, and no event has occurred that, with notice or lapse of time or both, would constitute such a default, in the due performance or observance of any term, covenant or condition contained in any indenture, mortgage, deed of trust, loan agreement or other similar agreement or instrument to which the Company or any Subsidiary is a party or by which the Company or any Subsidiary is bound or to which any of the property or assets of the Company or any Subsidiary is subject; or (iii) in violation of any law or statute or any judgment, order, rule or regulation of any court or arbitrator or governmental or regulatory authority, except, in the case of each of clauses (ii) and (iii) above, for any such violation or default that would not, individually or in the aggregate, have a Material Adverse Effect. To the Company’s knowledge, no other party under any material contract or other agreement to which it or any Subsidiary is a party is in default in any respect thereunder where such default would have a Material Adverse Effect. Without limiting the generality of the foregoing, the Company is not in violation of any of the rules, regulations or requirements of the Principal Market and has no knowledge of any facts or circumstances that could reasonably lead to delisting or suspension of the Ordinary Shares by the Principal Market in the foreseeable future. Since January 1, 2024, (i) the Ordinary Shares has been listed or designated for quotation on an Eligible Market, (ii) trading in the Ordinary Shares has not been suspended by the SEC or such Eligible Market and (iii) except as disclosed in the SEC Documents, the Company has received no communication, written or oral, from the SEC or such Eligible Market regarding the suspension or delisting of the Ordinary Shares from such Eligible Market. Except as disclosed in the Registration Statement or Prospectus, the Company and the Subsidiaries possess or have obtained, all licenses, certificates, consents, orders, approvals, permits and other authorizations issued by, and have made all declarations and filings with, the appropriate federal, state, local or foreign governmental or regulatory authorities that are necessary for the ownership or lease of their respective properties or the conduct of their respective businesses as currently conducted, as described in the Registration Statement and the Prospectus (the “Permits”), except where the failure to possess, obtain or make the same would not, individually or in the aggregate, have a Material Adverse Effect. Neither the Company nor any Subsidiary has received written notice of any proceeding relating to revocation or modification of any such Permit or has any reason to believe that such Permit will not be renewed in the ordinary course, except where the failure to obtain any such renewal would not, individually or in the aggregate, have a Material Adverse Effect. There is no agreement, commitment, judgment, injunction, order or decree binding upon the Company or any of its Subsidiaries or to which the Company or any of its Subsidiaries is a party which has or would reasonably be expected to have the effect of prohibiting or materially impairing any business practice of the Company or any of its Subsidiaries, any acquisition of property by the Company or any of its Subsidiaries or the conduct of business by the Company or any of its Subsidiaries as currently conducted other than such effects, individually or in the aggregate, which have not had and would not reasonably be expected to have a Material Adverse Effect on the Company and its Subsidiaries, taken as a whole. |
11
| (m) | No Improper Practices. (i) None of the Company or any of its Subsidiaries or affiliates, or any director or officer thereof, or, to the Company’s knowledge, any employee, 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; (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 in this paragraph (o); and (iii) neither the Company 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. |
| (n) | Sarbanes–Oxley Act. There is and has been no failure on the part of the Company or, to the knowledge of the Company, any of the Company’s directors or officers, in their capacities as such, to comply in all material respects with any applicable provisions of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”) and the rules and regulations promulgated thereunder. Each of the principal executive officer and the principal financial officer of the Company (or each former principal executive officer of the Company and each former principal financial officer of the Company as applicable) has made all certifications required by Sections 302 and 906 of the Sarbanes-Oxley Act with respect to all reports, schedules, forms, statements and other documents required to be filed by it or furnished by it to the Commission during the past 12 months. For purposes of the preceding sentence, “principal executive officer” and “principal financial officer” shall have the meanings given to such terms in Rules 13a-15 and 15d-15 under the 1934 Act. |
| (o) | Transactions With Affiliates. Except as disclosed in the SEC Documents or for which no disclosure is required in the SEC Documents, no current or former employee, director, officer or shareholder (direct or indirect) of the Company or its Subsidiaries, or, to the knowledge of the Company, any affiliate of any thereof, or any relative with a relationship no more remote than first cousin of any of the foregoing, is presently, or has ever been, (i) a party to any transaction with the Company or its Subsidiaries (including any contract, agreement or other arrangement providing for the furnishing of services by, or rental of real or personal property from, or otherwise requiring payments to, any such director, officer or shareholder or such associate or affiliate or relative Subsidiaries (other than for ordinary course services as employees, officers or directors of the Company or any of its Subsidiaries)) or (ii) the direct or indirect owner of an interest in any corporation, firm, association or business organization which is a competitor, supplier or customer of the Company or its Subsidiaries (except for a passive investment (direct or indirect) in less than 5% of the common equity of a company whose securities are traded on or quoted through an Eligible Market (as defined in the Certificate of Designations)), nor does any such Person receive income from any source other than the Company or its Subsidiaries which relates to the business of the Company or its Subsidiaries or should properly accrue to the Company or its Subsidiaries. No employee, officer, shareholder or director of the Company or any of its Subsidiaries or member of his or her immediate family is indebted to the Company or its Subsidiaries, as the case may be, nor is the Company or any of its Subsidiaries indebted (or committed to make loans or extend or guarantee credit) to any of them, other than (i) for payment of salary for services rendered, (ii) reimbursement for reasonable expenses incurred on behalf of the Company, and (iii) for other standard employee benefits made generally available to all employees or executives (including share option agreements outstanding under any share option plan approved by the Board of Directors of the Company). |
12
| (p) | Equity Capitalization. As of the date hereof, the authorized share capital of the Company consists solely of (i) 1,000,000,000 Ordinary Shares, of which 171,723,641 Ordinary Shares are issued and outstanding, (ii) 10,000,000 preferred shares, of which, 27,000 preferred shares are issued and outstanding. “Convertible Securities” means any capital stock, shares in the capital, or other security of the Company that is at any time and under any circumstances directly or indirectly convertible into, exercisable or exchangeable for, or which otherwise entitles the holder thereof to acquire, any capital stock or other security of the Company (including, without limitation, Ordinary Shares). 3,082,713 of the Company‘s issued and outstanding Ordinary Shares constitute earn out shares subject to forfeiture and surrender for cancellation for nil consideration on December 16, 2026 unless the Company satisfies certain milestones, including the closing price of the Company‘s shares as quoted on the Eligible Market equaling or exceeding $150.00 per share for any 20 trading days within a 30-trading day period. All of such outstanding shares are duly authorized and have been, or upon issuance will be, validly issued and are fully paid and non-assessable. Except as disclosed in the Form 20-F for the fiscal year most recently ended and in the Registration Statement, (i) none of the Company’s shares are subject to preemptive rights, rights of first refusal or similar rights; (ii) there are no outstanding options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into, or exercisable or exchangeable for, any shares in the capital of the Company, or contracts, commitments, understandings or arrangements by which the Company is or may become bound to issue additional shares in the capital of the Company or options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into, or exercisable or exchangeable for, any shares in the capital of the Company; (iii) there are no agreements or arrangements under which the Company is obligated to register the sale of any of its securities under the 1933 Act; (iv) there are no outstanding securities or other instruments of the Company which contain any redemption or similar provisions, and there are no contracts, commitments, understandings or arrangements by which the Company is or may become bound to redeem a security of the Company; (v) there are no securities or other instruments of the Company containing anti-dilution or similar provisions that will be triggered by the issuance of the Securities; (vi) the Company does not have any share or stock appreciation rights or “phantom stock” plans or agreements or any similar plan or agreement; and (vii) neither the Company nor any of its Subsidiaries have any liabilities or obligations required to be disclosed in the SEC Documents which are not so disclosed in the SEC Documents, other than those incurred in the ordinary course of the Company’s or its Subsidiaries’ respective businesses and which, individually or in the aggregate, do not or would not have a Material Adverse Effect. The Company has furnished to the Buyer, or filed on EDGAR, true, correct and complete copies of the Company’s Fifth Amended and Restated Memorandum and Articles of Association, as in effect on the date hereof (the “Memorandum and Articles of Association”) and the terms of all Convertible Securities convertible into, or exercisable or exchangeable for, Ordinary Shares and the material rights of the holders thereof in respect thereto. |
13
| (q) | Indebtedness and Other Contracts. Except as set forth in the Registration Statement, neither the Company nor any of its Subsidiaries, (i) has any outstanding debt securities, notes, credit agreements, credit facilities or other agreements, documents or instruments evidencing Indebtedness of the Company or any of its Subsidiaries or by which the Company or any of its Subsidiaries is or may become bound (x) that would be required to be reflected in the Company’s consolidated financial statements pursuant to IFRS or (y) that constitute material obligations of the Company and its Subsidiaries, taken as a whole, whether or not required to be so reflected, (ii) is a party to any contract, agreement or instrument, the violation of which, or default under which, by the other party(ies) to such contract, agreement or instrument could reasonably be expected to result in a Material Adverse Effect, (iii) has any financing statements securing obligations in any amounts filed in connection with the Company or any of its Subsidiaries; (iv) is in violation, except as waived or consented to therein, of any term of, or in default under, any contract, agreement or instrument relating to any Indebtedness, except where such violations and defaults would not result, individually or in the aggregate, in a Material Adverse Effect, or (v) is a party to any contract, agreement or instrument relating to any Indebtedness, the performance of which, in the judgment of the Company’s officers, has or is expected to have a Material Adverse Effect. For purposes of this Agreement, “Indebtedness” of any Person means, without duplication (A) all obligations of such Person for borrowed money, (B) all obligations of such Person evidenced by bonds, debentures, notes or similar instruments to the extent such obligations would appear as a liability on a balance sheet of such Person prepared in accordance with IFRS, (C) all guarantees by such Person of Indebtedness of others, (D) all Capital Lease Obligations of such Person, (E) all obligations, contingent or otherwise, of such Person as an account party in respect of letters of credit, letters of guaranty, bank guarantees, bankers’ acceptances and similar instruments and, (F) to the extent not otherwise included in this definition, net obligations of such Person under hedging obligations entered into by such Person in the ordinary course of business and entered into for bona fide hedging purposes (and not for speculative purposes) as determined in good faith by the Company (the amount of any such obligations to be equal at any time to the net payments under such agreement or arrangement giving rise to such obligation that would be payable by such person at the termination of such agreement or arrangement); provided that the term “Indebtedness” shall not include (i) deferred or prepaid revenue, (ii) purchase price holdbacks in respect of a portion of the purchase price of an asset to satisfy warranty or other unperformed obligations of the seller, (iii) contingent indemnity and similar obligations incurred in the ordinary course of business, (iv) Indebtedness of any parent entity (for which none of the Company or any Subsidiary is liable) appearing on the balance sheet of the Company solely by reason of push down accounting under IFRS, (v) obligations in connection with government auctions, subsidies, benefits or similar programs or processes, and (vi) obligations under any license, permit or other approval (or guarantees in respect of such obligations) incurred prior to the date hereof or in the ordinary course of business. The Indebtedness of any Person shall include the Indebtedness of any other entity (including any partnership in which such Person is a general partner), to the extent such Person is liable therefor as a result of such Person’s ownership interest in or other relationship with such entity, except to the extent the terms of such Indebtedness provide that such Person is not liable therefor. For all purposes hereof, the Indebtedness of the Company and any of its Subsidiaries shall exclude (i) intercompany liabilities between and among them arising solely from their cash management, tax and accounting operations in the ordinary course of business and (ii) intercompany loans, advances or Indebtedness between and among them having a term not exceeding 364 days (inclusive of any rollover, conversion or extension terms) and made in the ordinary course of business. Solely as used in the definition of “Indebtedness”, “Capital Lease Obligations” means, with respect to any Person, the obligations of such Person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital leases on a balance sheet of such Person under IFRS; the amount of such obligations shall be the capitalized amount thereof determined in accordance with IFRS, and the final maturity of such obligations shall be the date of the last payment of such amounts due under such lease (or other arrangement) prior to the first date on which such lease (or other arrangement) may be terminated by the lessee without payment of a premium or a penalty; and, for the purposes of this Agreement, the amount of such obligations at any time shall be the capitalized amount thereof at such time determined in accordance with IFRS. Solely as used in the definition of “Indebtedness”, “Subsidiaries” means respect to any Person, (A) any corporation, company, association or other business entity (other than a partnership or limited liability company) of which more than fifty percent (50%) of the total voting power of the common equity entitled (without regard to the occurrence of any contingency, but after giving effect to any voting agreement or stockholders’ or shareholders’ agreement that effectively transfers voting power) to vote in the election of directors, managers or trustees, as applicable, of such corporation, association or other business entity is owned or controlled, directly or indirectly, by such Person or one or more of the other Subsidiaries of such Person; and (B) any partnership or limited liability company where (i) more than fifty percent (50%) of the capital accounts, distribution rights, equity and voting interests, or of the general and limited partnership interests, as applicable, of such partnership or limited liability company are owned or controlled, directly or indirectly, by such Person or one or more of the other Subsidiaries of such Person, whether in the form of membership, general, special or limited partnership or limited liability company interests or otherwise; and (ii) such Person or any one or more of the other Subsidiaries of such Person is a controlling general partner of, or otherwise controls, such partnership or limited liability company. For purposes of this Agreement, “Contingent Obligation” means, as to any Person, any direct or indirect liability, contingent or otherwise, of that Person with respect to any Indebtedness, lease, dividend or other obligation of another Person if the primary purpose or intent of the Person incurring such liability, or the primary effect thereof, is to provide assurance to the obligee of such liability that such liability will be paid or discharged, or that any agreements relating thereto will be complied with, or that the holders of such liability will be protected (in whole or in part) against loss with respect thereto. |
14
| (r) | Litigation. Except as disclosed in the Registration Statement or Prospectus, there are no legal or governmental proceedings pending or threatened to which the Company or any Subsidiary is a party or to which any of the properties of the Company or any Subsidiary is subject (i) other than proceedings accurately described in all material respects in the Prospectus and proceedings that would not 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 the Transaction Documents or to consummate the transactions contemplated hereby or thereby or (ii) that are required to be described in the Registration Statement or the Prospectus and are not so described. Without limitation of the foregoing, there has not been, and to the knowledge of the Company, there is not pending or contemplated, any investigation by the SEC involving the Company, any of its Subsidiaries or any current or former director or officer of the Company or any of its Subsidiaries relating to the Company. Neither the Company nor any of its Subsidiaries is subject to any order, writ, judgment, injunction, decree, determination or award of any Governmental Entity. |
| (s) | Insurance. The Company and the Subsidiaries carry, or are covered by, insurance in such amounts and covering such risks as the Company and the Subsidiaries reasonably believe are adequate for the conduct of their business. |
| (t) | Employee Matters; Benefit Plans. |
| (i) | No labor disturbance by or dispute with employees of the Company or any Subsidiary exists or, to the knowledge of the Company, is threatened which would result in a Material Adverse Effect. |
| (ii) | To the knowledge of the Company, (i) each material employee benefit plan, within the meaning of Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”) that is maintained, administered or contributed to by the Company or any of its Subsidiaries for employees or former employees of the Company and the Subsidiaries has been maintained in material compliance with its terms and the requirements of any applicable statutes, orders, rules and regulations, including but not limited to ERISA and the Internal Revenue Code of 1986, as amended (the “Code”); (ii) no prohibited transaction, within the meaning of Section 406 of ERISA or Section 4975 of the Code, has occurred which would result in a material liability to the Company with respect to any such plan excluding transactions effected pursuant to a statutory or administrative exemption; and (iii) for each such plan that is subject to the funding rules of Section 412 of the Code or Section 302 of ERISA, no “accumulated funding deficiency” as defined in Section 412 of the Code has been incurred, whether or not waived, and the fair market value of the assets of each such plan (excluding for these purposes accrued but unpaid contributions) equals or exceeds the present value of all benefits accrued under such plan determined using reasonable actuarial assumptions, other than, in the case of (i), (ii) and (iii) above, as would not have a Material Adverse Effect. |
| (u) | Assets; Title. The Company and the Subsidiaries have good and marketable title to all items of real property and good and valid title to all personal property (other than Intellectual Property, which is addressed exclusively in Section 3(v) below) described in the Registration Statement or Prospectus as being owned by them that are material to the businesses of the Company or such Subsidiary, in each case free and clear of all Liens, except those that (i) do not materially interfere with the use made and proposed to be made of such property by the Company and the Subsidiaries or (ii) would not, individually or in the aggregate, have a Material Adverse Effect. Any real property described in the Registration Statement or Prospectus as being leased by the Company and the Subsidiaries is held by them under valid, existing and enforceable leases, except those that (A) do not materially interfere with the use made or proposed to be made of such property by the Company or the Subsidiaries or (B) would not, individually or in the aggregate, have a Material Adverse Effect. |
15
| (v) | Intellectual Property. Except as disclosed in the Registration Statement or Prospectus, the Company and the Subsidiaries own or possess adequate enforceable rights to use all patents, patent applications, trademarks (both registered and unregistered), trade names, trademark registrations, service marks, service mark registrations, Internet domain name registrations, copyrights, copyright registrations, licenses and know-how (including trade secrets and other unpatented and/or unpatentable proprietary or confidential information, systems or procedures) (collectively, the “Intellectual Property”), necessary for the conduct of their respective businesses as conducted as of the date hereof, except to the extent that the failure to own or possess adequate rights to use such Intellectual Property would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. Except as disclosed in the Registration Statement or Prospectus, the Company and the Subsidiaries have not received any written notice of any claim of infringement or conflict which asserted Intellectual Property rights of others, which infringement or conflict, if the subject of an unfavorable decision, would result in a Material Adverse Effect. There are no pending, or to the Company’s knowledge, threatened judicial proceedings or interference proceedings challenging the Company’s or any Subsidiary’s rights in or to or the validity of the scope of any of the Company’s or its Subsidiaries’ patents, patent applications or proprietary information. To the Company’s knowledge, there are no third parties who have established rights or have any claim in any of the Company’s or any of its Subsidiary’s patents, patent applications or any patent to be issued therefrom by virtue of any contract, license or other agreement entered into between such entity or individual and the Company or any Subsidiary or by any non-contractual obligation, other than by written licenses granted by the Company or any Subsidiary. The Company has not received any written notice of any claim challenging the rights of the Company or its Subsidiaries in or to any Intellectual Property owned, licensed or optioned by the Company or any Subsidiary which claim, if the subject of an unfavorable decision, would result in a Material Adverse Effect. |
| (w) | Environmental Laws. Except as disclosed in the Registration Statement or Prospectus, the Company and the Subsidiaries (i) are in compliance with any and all applicable federal, state, local and foreign laws, rules, regulations, decisions and orders relating to the protection of human health and safety, the environment or hazardous or toxic substances or wastes, pollutants or contaminants (collectively, “Environmental Laws”); (ii) have received and are in compliance with all permits, licenses or other approvals required of them under applicable Environmental Laws to conduct their respective businesses as described in the Registration Statement and the Prospectus; and (iii) have not received notice of any actual or potential liability for the investigation or remediation of any disposal or release of hazardous or toxic substances or wastes, pollutants or contaminants, except, in the case of any of clauses (i), (ii) or (iii) above, for any such failure to comply or failure to receive required permits, licenses, other approvals or liability as would not, individually or in the aggregate, have a Material Adverse Effect. |
16
| (x) | Subsidiary Rights. The Company or one of its Subsidiaries has the unrestricted right to vote, and (subject to limitations imposed by applicable law) to receive dividends and distributions on, all capital securities of its Subsidiaries as owned by the Company or such Subsidiary. |
| (y) | Tax Status. The Company and the Subsidiaries have filed all federal, state, local and foreign tax returns which have been required to be filed or have requested and been granted extensions for the filing in respect thereto and paid all taxes shown thereon through the date hereof, to the extent that such taxes have become due and are not being contested in good faith, except, in each case, where the failure to do so would not have a Material Adverse Effect. Except as otherwise disclosed in or contemplated by the Registration Statement or the Prospectus, no tax deficiency has been determined adversely to the Company or any Subsidiary which has had, or would have, individually or in the aggregate, a Material Adverse Effect. The Company has not received written notification of any material unpaid taxes in any material amount claimed to be due by the taxing authority of any jurisdiction, and to the knowledge of the officers of the Company and its Subsidiaries there is no basis for any such claim where the failure to pay would have or would be reasonably expected to have, individually or in the aggregate, a Material Adverse Effect. |
| (z) | Internal Accounting and Disclosure Controls. The Company maintains 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 IFRS and to maintain asset accountability; (iii) access to assets is permitted only in accordance with management’s general or specific authorization; and (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. The Company is not aware of any material weaknesses in its internal control over financial reporting (other than as set forth in the Registration Statement or the Prospectus). Since the date of the latest audited financial statements of the Company included in the Prospectus, there has been no change in the Company’s internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting (other than as set forth in the Registration Statement or the Prospectus). The Company has established disclosure controls and procedures (as defined in 1934 Act Rules 13a-15 and 15d-15) that comply with the requirements of the 1934 Act. The Company’s certifying officers have evaluated the effectiveness of the Company’s controls and procedures as of a date within 90 days prior to the filing date of the Form 20-F for the fiscal year most recently ended (such date, the “Evaluation Date”). The Company presented in its Form 20-F for the fiscal year most recently ended the conclusions of the certifying officers about the effectiveness of the disclosure controls and procedures based on their evaluations as of the most recent Evaluation Date. |
17
| (aa) | Off Balance Sheet Arrangements. There are no transactions, arrangements and other relationships between and/or among the Company, and/or, to the knowledge of the Company, any of its affiliates and any unconsolidated entity, including, but not limited to, any structured finance, special purpose or limited purpose entity (each, an “Off Balance Sheet Transaction”) that would affect materially the Company’s liquidity or the availability of or requirements for its capital resources, including those Off Balance Sheet Transactions described in the Commission’s Statement about Management’s Discussion and Analysis of Financial Conditions and Results of Operations (Release Nos. 33-8056; 34-45321; FR-61), required to be described in the Registration Statement or the Prospectus which have not been described as required. |
| (bb) | Investment Company Status. The Company is not, and upon consummation of the sale of the Securities will not be, required to register as an “investment company” or an entity “controlled” by an “investment company,” as such terms are defined in the Investment Company Act of 1940, as amended. |
| (cc) | Acknowledgement Regarding Buyer’s Trading Activity. The Company understands and acknowledges that, following the public disclosure of the transactions contemplated by the Transaction Documents pursuant to the 6-K Filing (as defined below), the Buyer may, subject to Section 4(w) hereof, engage in hedging and/or trading activities (including, without limitation, the location and/or reservation of borrowable Ordinary Shares) in compliance with Section 4(j) of this Agreement at various times during the period that the Securities are outstanding, including, without limitation, during the periods that the Dividend Shares or Conversion Shares, as applicable, deliverable with respect to the Securities are being determined and such hedging and/or trading activities (including, without limitation, the location and/or reservation of borrowable Ordinary Shares), if any, can reduce the value of the existing shareholders’ equity interest in the Company both at and after the time the hedging and/or trading activities are being conducted. |
| (dd) | Manipulation of Price. Neither the Company, nor any Subsidiary, nor, to the knowledge of the Company, any of their respective directors, officers or controlling persons has taken, directly or indirectly, any action designed, or that has constituted or would cause or result in, under the 1934 Act or otherwise, the stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of any of the Securities. Except as disclosed in the Registration Statement or Prospectus, neither the Company nor any Subsidiary has incurred any liability for any finder’s fees, brokerage commissions or similar payments in connection with the transactions herein contemplated (other than the Placement Agent). |
| (ee) | U.S. Real Property Holding Corporation. Neither the Company nor any of its Subsidiaries is, or has ever been a U.S. real property holding corporation within the meaning of Section 897 of the Code, and the Company and each Subsidiary shall so certify upon the Buyer’s reasonable request. |
| (ff) | Registration Rights. Except as disclosed in the Form 20-F for the fiscal year most recently ended and in the Registration Statement, no Person has any right to cause the Company or any Subsidiary to effect the registration under the 1933 Act of any securities of the Company or any Subsidiary. |
18
| (gg) | Transfer Taxes. On the Closing Date, all material share or stock transfer or other taxes (other than income or similar taxes) which are required to be paid in connection with the issuance, sale and transfer of the Securities to be sold to the Buyer hereunder will be, or will have been, fully paid or provided for by the Company, and all laws imposing such taxes will be or will have been complied with by the Company in all material respects. |
| (hh) | Bank Holding Company Act. Neither the Company nor any of its Subsidiaries is subject to the Bank Holding Company Act of 1956, as amended (the “BHCA”) and to regulation by the Board of Governors of the Federal Reserve System (the “Federal Reserve”). Neither the Company nor any of its Subsidiaries or affiliates owns or controls, directly or indirectly, five percent (5%) or more of the outstanding shares of any class of voting securities or twenty-five percent (25%) or more of the total equity of a bank or any entity that is subject to the BHCA and to regulation by the Federal Reserve. Neither the Company nor any of its Subsidiaries or affiliates exercises a controlling influence over the management or policies of a bank or any entity that is subject to the BHCA and to regulation by the Federal Reserve. |
| (ii) | Shell Company Status. The Company is not a shell company (as defined in Rule 405 under the 1933 Act) and has not been a shell company for at least 12 calendar months previously and if it has been a shell company at any time previously, has filed current Form 10 information (as defined in General Instruction I.B.5 of Form F-3) or an equivalent thereof with the Commission at least 12 calendar months previously reflecting its status as an entity that is not a shell company. |
| (jj) | Money Laundering. (i) Neither the Company nor any Subsidiary (solely for purposes of this paragraph (jj), collectively, the “Entity”) nor, to the Company’s knowledge, any director, officer, employee, agent, affiliate or representative of the Entity, is a government, individual, or entity (solely for purposes of this paragraph (jj), “Person”) that is, or is owned or controlled by a Person that is: (A) the subject of any sanctions administered or enforced by the U.S. Department of Treasury’s Office of Foreign Assets Control, the United Nations Security Council, the European Union, His Majesty’s Treasury, or other relevant sanctions authority (collectively, “Sanctions”), nor (B) located, organized or resident in a country or territory that is the subject of Sanctions. (ii) The Entity will not, directly or indirectly, knowingly 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) The Entity represents and covenants that, except as detailed in the Registration Statement and the Prospectus, for the past 5 years, it has not knowingly engaged in and is not now knowingly engaged in any dealing 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. |
19
| (kk) | Share or Stock Option Plans. Each share or stock option granted by the Company was granted in accordance with the terms of the applicable share or stock option plan of the Company. No share or stock option granted under the Company’s share or stock option plan has been backdated. The Company has not knowingly granted, and there is no and has been no policy or practice of the Company to knowingly grant, share or stock options prior to, or otherwise knowingly coordinate the grant of share or stock options with, the release or other public announcement of material information regarding the Company or its Subsidiaries or their financial results or prospects. |
| (ll) | No Disagreements with Accountants and Lawyers. There are no material disagreements of any kind presently existing, or reasonably anticipated by the Company to arise, between the Company and the accountants and lawyers formerly or presently employed by the Company and the Company is current with respect to any fees owed to its accountants and lawyers which could affect the Company’s ability to perform any of its obligations under any of the Transaction Documents. In addition, on or prior to the date hereof, the Company had discussions with its accountants about its financial statements previously filed with the SEC. Based on those discussions, the Company has no reason to believe that it will need to restate any such financial statements or any part thereof. |
| (mm) | No Additional Agreements. The Company does not have any agreement or understanding with the Buyer with respect to the transactions contemplated by the Transaction Documents other than as specified in the Transaction Documents. |
| (nn) | Public Utility Holding Act. None of the Company nor any of its Subsidiaries is a “holding company,” or an “affiliate” of a “holding company,” as such terms are defined in the Public Utility Holding Act of 2005. |
| (oo) | Federal Power Act. None of the Company nor any of its Subsidiaries is subject to regulation as a “public utility” under the Federal Power Act, as amended. |
| (pp) | Cybersecurity. (i)(x) Except as disclosed in the Registration Statement or Prospectus, and to the knowledge of Company, there has been no security breach or other compromise of any Company’s information technology and computer systems, networks, hardware, software, data (including the data of their respective customers, employees, suppliers, vendors and any third party data maintained by or on behalf of them), equipment or technology (collectively, “IT Systems and Data”) and (y) the Company has not been notified of, and has no knowledge of any event or condition that would reasonably be expected to result in, any security breach or other compromise to their IT Systems and Data, except as would not, in the case of this clause (i), individually or in the aggregate, have a Material Adverse Effect; (ii) the Company is presently in material compliance with all applicable laws or statutes and all judgments, orders, rules and regulations of any court or arbitrator or governmental or regulatory authority, internal policies and contractual obligations relating to the privacy and security of IT Systems and Data and to the protection of such IT Systems and Data from unauthorized use, access, misappropriation or modification, except as would not, in the case of this clause (ii), individually or in the aggregate, have a Material Adverse Effect; and (iii) the Company has implemented backup and disaster recovery technology consistent with industry standards and practices. |
20
| (qq) | Compliance with Data Privacy Laws. Except as would not, individually or in the aggregate, have a Material Adverse Effect, (i) the Company and its Subsidiaries have complied and are presently in compliance with all internal and external privacy policies, contractual obligations, industry standards, applicable laws, statutes, judgments, orders, rules and regulations of any court or arbitrator or other governmental or regulatory authority and any other legal obligations, 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, household, sensitive, confidential or regulated data (“Data Security Obligations”); (ii) the Company has not received any 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, to the Company’s knowledge, threatened alleging non-compliance with any Data Security Obligation.. |
| (rr) | Disclosure. The Company confirms that neither it nor any other Person acting on its behalf has provided the Buyer or their agents or counsel with any information that constitutes or would reasonably be expected to constitute material, non-public information concerning the Company or any of its Subsidiaries, other than (i) the existence of the transactions contemplated by this Agreement and the other Transaction Documents, and (ii) any such information that shall be disclosed in accordance with Section 4(i). The Company understands and confirms that the Buyer will rely on the foregoing representations in effecting transactions in securities of the Company. All disclosure provided to the Buyer regarding the Company and its Subsidiaries, their businesses and the transactions contemplated hereby furnished by or on behalf of the Company or any of its Subsidiaries is true and correct and does not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading. Each press release issued by the Company or any of its Subsidiaries during the twelve (12) months preceding the date of this Agreement did not at the time of release contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they are made, not misleading. Other than with respect to the transactions contemplated by this Agreement and the other Transaction Documents, no event or circumstance has occurred or information exists with respect to the Company or any of its Subsidiaries or its or their business, properties, liabilities, prospects, operations (including results thereof) or conditions (financial or otherwise), which, under applicable law, rule or regulation, requires public disclosure at or before the date hereof or announcement by the Company but which has not been so publicly disclosed. The Company acknowledges and agrees that no Buyer makes or has made any representations or warranties with respect to the transactions contemplated hereby other than those specifically set forth in Section 2. |
21
4. Covenants.
| (a) | Best Efforts. The Buyer shall use its best efforts to timely satisfy each of the covenants hereunder and conditions to be satisfied by it as provided in Section 6 of this Agreement. The Company shall use its best efforts to timely satisfy each of the covenants hereunder and conditions to be satisfied by it as provided in Section 7 of this Agreement. |
| (b) | Underlying Shares. The Issuer shall ensure that Conversion Shares will be issued free of legends. The Company shall keep a registration statement (including a Registration Statement) registering the issuance of the Conversion Shares effective during the term of this Agreement. |
| (c) | Reporting Status. From the date hereof until the date on which no Series A Preferred Shares are outstanding or may become outstanding pursuant to the Transaction Documents (the “Reporting Period”), the Company shall timely file all reports required to be filed with the SEC pursuant to the 1934 Act, and the Company shall not terminate its status as an issuer required to file reports under the 1934 Act even if the 1934 Act or the rules and regulations thereunder would no longer require or otherwise permit such termination. As of their respective dates of filing, all such reports filed with the SEC shall comply in all material respects with the requirements of the 1934 Act and the rules and regulations of the SEC promulgated thereunder applicable to the SEC Documents, and none of such reports, at the time they are filed with the SEC, shall contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. As of their respective dates of filing, the financial statements of the Company included in such reports shall comply in all material respects with applicable accounting requirements and comply as to form in all material respects with the published rules and regulations of the SEC with respect thereto, in each case, as in effect as of the time of filing. Such financial statements will be prepared in all material respects in accordance with IFRS, consistently applied, during the periods involved (except (i) as may be otherwise indicated in such financial statements or the notes thereto or as permitted by Regulation S-X, or (ii) in the case of unaudited financial statements, as permitted by the rules and regulations of the SEC) and fairly present in all material respects the consolidated financial position of the Company and its consolidated Subsidiaries as of the dates thereof and the results of their operations and cash flows for the periods covered thereby (subject, in the case of unaudited financial statements, to normal year-end audit adjustments which will not be material, either individually or in the aggregate, and to the absences of notes). |
| (d) | Use of Proceeds. The Company shall use the proceeds from the sale of the Securities for working capital and general corporate purposes. |
| (e) | Financial Information. The Company agrees to send the following to the Buyer during the Reporting Period (i) unless the following are filed with the SEC through EDGAR and are available to the public through the EDGAR system, within one (1) Business Day after the filing thereof with the SEC, a copy of its Annual Report on Form 20-F, any other interim reports or any consolidated balance sheets, income statements, shareholders’ equity statements and/or cash flow statements for any period other than any annual report filed with the SEC, any Current Reports on Form 6-K and any registration statements (other than on Form S-8) or amendments filed pursuant to the 1933 Act, (ii) unless the following are either filed with the SEC through EDGAR or are otherwise widely disseminated via a recognized news release service (such as PR Newswire or Business Wire), on the same day as the release thereof, email copies of all press releases issued by the Company or any of its Subsidiaries and (iii) unless the following are filed with the SEC through EDGAR, copies of any notices and other information made available or given to the shareholders of the Company, as applicable, generally, contemporaneously with the making available or giving thereof to the shareholders. |
22
| (f) | Listing. To the extent required by the rules of the Principal Market, the Company shall promptly secure the listing or designation for quotation (as the case may be) of all of the Conversion Shares upon the Principal Market (subject to official notice of issuance) and shall maintain the listing or designation for quotation (as the case may be) of all of the Conversion Shares from time to time issuable under the terms of the Transaction Documents on an Eligible Market. The Company shall maintain the Ordinary Share’s listing on an Eligible Market. Neither the Company nor any of its Subsidiaries shall take any action which would be reasonably expected to result in the delisting or suspension of the Ordinary Shares from an Eligible Market, except upon the immediate transfer of the listing thereof to another Eligible Market. The Company shall pay all fees and expenses in connection with satisfying its obligations under this Section 4(f). |
| (g) | Fees. The Company shall reimburse YA II PN, Ltd., a Cayman Islands exempted company (the “Buyer”), in an amount up to $200,000 for the costs and expenses incurred by it or its affiliates in connection with the structuring, documentation, negotiation and closing of the transactions contemplated by the Transaction Documents (including without limitation, as applicable, all reasonable legal fees of outside counsel and disbursements of Haynes & Boone LLP (“Buyer Counsel”), counsel to the Buyer, any other reasonable fees and expenses in connection with the structuring, documentation, negotiation and closing of the transactions contemplated by the Transaction Documents and due diligence and regulatory filings in connection therewith) (the “Transaction Expenses”) and shall be withheld by the Buyer from its Initial Purchase Price at the First Closing. The Company shall be responsible for the payment of any placement agent’s fees, financial advisory fees, Transfer Agent fees, DTC (as defined below) fees or broker’s commissions (other than for Persons engaged by the Buyer) relating to or arising out of the transactions contemplated hereby (including, without limitation, any fees or commissions payable to the Placement Agent). The Company shall pay, and the Company shall hold the Buyer harmless against, any liability, loss or expense (including, without limitation, reasonable attorneys’ fees and out-of-pocket expenses) arising in connection with any claim relating to any such payment. Except as otherwise set forth in the Transaction Documents, each party to this Agreement shall bear its own expenses in connection with the sale of the Securities to the Buyer. |
| (h) | [Reserved]. |
| (i) | Disclosure of Transactions and Other Material Information. |
| (i) | Disclosure of Transaction. The Company shall no later than 5:30 p.m., New York City time, on the Business Day following the date of this Agreement, file a Current Report on Form 6-K with the SEC describing all the material terms of the transactions contemplated by the Transaction Documents in the form required by the 1934 Act and attaching all the material Transaction Documents (including, without limitation, this Agreement (and all schedules to this Agreement, to the extent material) and the form of Certificate of Designations) (including the attachments thereto, the “6-K Filing”). From and after the filing of the 6-K Filing, the Company shall have publicly disclosed all material, non-public information (if any) provided to the Buyer by the Company or any of its Subsidiaries or any of their respective officers, directors, employees or agents in connection with the transactions contemplated by the Transaction Documents. In addition, effective upon the filing of the 6-K Filing, the Company acknowledges and agrees that any and all confidentiality or similar obligations in effect with respect to the transactions contemplated by the Transaction Documents under any agreement, whether written or oral, between the Company, any of its Subsidiaries or any of their respective officers, directors, affiliates, employees or agents, on the one hand, and the Buyer or any of their affiliates, on the other hand, including that certain Confidentiality Agreement, by and between the Company and Yorkville Advisors Global, LP, a Delaware limited partnership, dated as of March 23, 2026, shall terminate in their entirety and be of no further force or effect in any respect. |
23
| (ii) | Disclosure of Additional Closings. The Company shall no later than 5:30 p.m., New York City time, on the date of each Additional Closing, file a Current Report on Form 6-K describing the Additional Closing in the form required by the 1934 Act (each, an “Additional 6-K Filing”). From and after the filing of any such Additional 6-K Filing, the Company shall have publicly disclosed all material, non-public information (if any) provided to the Buyer by the Company or any of its Subsidiaries or any of their respective officers, directors, employees or agents in connection with such Additional Closing. |
| (iii) | Limitations on Disclosure. The Company shall not, and the Company shall cause each of its Subsidiaries and each of its and their respective officers, directors, employees and agents not to, provide the Buyer with any material, non-public information regarding the Company or any of its Subsidiaries from and after the date hereof without the express prior written consent of the Buyer (which may be granted or withheld in the Buyer’s sole discretion and, if granted, must include an agreement to keep such information confidential until publicly disclosed). In the event of a breach of the foregoing covenant by the Company, any of its Subsidiaries, or any of its or their respective officers, directors, employees and agents (as determined in the reasonable good faith judgment of the Buyer), in addition to any other remedy provided herein or in the Transaction Documents, the Buyer shall have the right to make a public disclosure, in the form of a press release, public advertisement or otherwise, of such material, non-public information without the prior approval by the Company, any of its Subsidiaries, or any of its or their respective officers, directors, employees or agents. No Buyer shall have any liability to the Company, any of its Subsidiaries, or any of its or their respective officers, directors, employees, affiliates, shareholders or agents, for any such disclosure. To the extent that the Company, directly or indirectly, delivers any material, non-public information to a Buyer without the Buyer’s consent, the Company hereby covenants and agrees that the Buyer shall not have any duty of confidentiality with respect to, or a duty not to trade on the basis of, such material, non-public information. Subject to the foregoing, neither the Company, its Subsidiaries nor the Buyer shall issue any press releases or any other public statements with respect to the transactions contemplated hereby other than the 6-K Filing and the Additional 6-K Filings; provided, however, the Company shall be entitled, without the prior approval of the Buyer, to make any press release or other public disclosure with respect to such transactions (i) in substantial conformity with the 6-K Filing and each Additional 6-K Filing and, in each case, contemporaneously therewith and (ii) as is required by applicable law and regulations (provided that in the case of clause (i) the Buyer shall be consulted by the Company in connection with any such press release or other public disclosure prior to its release). Without the prior written consent of the applicable Buyer (which may be granted or withheld in the Buyer’s sole discretion), the Company shall not (and shall cause each of its Subsidiaries and affiliates to not) disclose the name of the Buyer in any filing, announcement, release or otherwise, except as required by applicable law, legal process or regulatory request; provided that, prior to any such disclosure, the Company notifies the Buyer as soon as practicable of such requirement (except where prohibited by any such applicable law, legal process or regulatory request) so that the Buyer may seek a protective order or other appropriate remedy prior to such disclosure. Notwithstanding the foregoing, the Company may make disclosures to an auditor or governmental or regulatory authority pursuant to any routine investigation, inspection, examination or inquiry without providing the Buyer with any notification thereof, unless the Buyer is the subject of any such investigation, inspection, examination or inquiry (in which case the preceding sentence shall govern). Notwithstanding anything contained in this Agreement to the contrary and without implication that the contrary would otherwise be true, the Company expressly acknowledges and agrees that no Buyer shall have (unless expressly agreed to by a particular Buyer on or after the date hereof in a written definitive and binding agreement executed by the Company and such particular Buyer (it being understood and agreed that no Buyer may bind any other Buyer with respect thereto)), any duty of confidentiality with respect to, or a duty not to trade on the basis of, any material, non-public information regarding the Company and/or any of its Subsidiaries from and after the public disclosure of the transactions contemplated by the Transaction Documents pursuant to the 6-K Filing. |
24
| (j) | Short Sales. The Buyer hereby agrees on behalf of itself and its Affiliates, for so long as the Buyer owns Preferred Shares and provided this Agreement has not been terminated in accordance with the terms specified herein, the Buyer and its Affiliates shall not maintain a Short Position (as defined below). Notwithstanding the foregoing, but subject to Section 4(w) hereof, in the case of a Buyer that is a multi-managed investment vehicle whereby separate portfolio managers manage separate portions of the Buyer’s assets and the portfolio managers have no direct knowledge of the investment decisions made by the portfolio managers managing other portions of the Buyer’s assets, the agreements set forth in this Section 4(j) shall only apply with respect to the portion of assets managed by the portfolio manager that made the investment decision to purchase the Securities covered by this Agreement, subject to the obligations of the Buyer and such other portfolio managers under applicable law. For purposes hereof, a “Short Position” by a Person means a position whereby such Person has executed one or more sales of Ordinary Shares that is marked as a Short Sale (but not including any sale marked “short exempt”) and that is executed at a time when such Person or its Affiliates have no equivalent offsetting long position in the Ordinary Shares (or is deemed to have a long position hereunder or otherwise in accordance with Regulation SHO of the 1934 Act); provided, that, for purposes of such calculations, any Short Sales either (x) consummated by such Person due to a Conversion Failure, (y) that is a result of a bona fide trading error on behalf of such Person or its Affiliates or (z) that would otherwise be marked as a “long” sale, but for the occurrence of any other breach by the Company (or its Affiliates or agents, including, without limitation, its Transfer Agent) of any Transaction Document in each case, shall be excluded from such calculations. For purposes of determining whether a Buyer or its Affiliates has an equivalent offsetting “long” position in Ordinary Shares (A) all Ordinary Shares that are owned by the Buyer or its Affiliates shall be deemed held “long”, (B) at any time a Conversion Notice is delivered by the Buyer to the Company, any Ordinary Shares issued or issuable to the Buyer (or its designee, if applicable) in connection therewith shall be deemed held “long” by the Buyer from and after the date of such Conversion Notice until such time as the Buyer shall no longer beneficially own such Ordinary Shares, and (C) at any other time the Company is required to issue Ordinary Shares to the Buyer pursuant to the terms of the Certificate of Designation or any other Transaction Document, any Ordinary Shares issued or issuable to the Buyer (or their designee, if applicable) in connection therewith shall be deemed held “long” by the Buyer until such time as the Buyer shall no longer beneficially own such Ordinary Shares. In addition, the Buyer agrees that it shall not, and that it will cause its Affiliates not to, engage in any loans on the Ordinary Shares, except that Buyer may deposit Ordinary Shares in its prime brokerage accounts that are subject to customary margin and rehypothecation agreements. The Buyer shall deliver to the Company on the last Trading Day of each week or, at the Buyer’s option, on each Trading Day on which it makes sales of Ordinary Shares, commencing on the first such date after the First Closing hereunder until the Buyer no longer owns any Ordinary Shares, a trading report stating the number of Ordinary Shares sold during such week by the Buyer and the average sales price for such week, provided that the Buyer made sales during such week. |
25
| (k) | Reservation of Shares. So long as any of the Preferred Shares remain issued or are issuable pursuant to the terms hereof, the Company shall at all times reserve out of its authorized and unissued Ordinary Shares a number of Ordinary Shares equal to the sum of (i) 100% of the aggregate number of Ordinary Shares as shall from time to time be necessary to effect the conversion of all of the Preferred Shares then outstanding at the Floor Price (as defined in the Certificate of Designations) then in effect (without regard to any limitations on conversions set forth in the Certificate of Designations) and (ii) 100% of the aggregate number of Ordinary Shares that would be necessary to effect the conversion of that number of Dividend Shares equal to eighteen (18) months of Dividends on the Preferred Shares then outstanding at the Floor Price then in effect (without regard to any limitations on the issuance of securities set forth in the Certificate of Designations) (collectively, the “Required Reserve Amount”); provided that at no time shall the number of Ordinary Shares reserved pursuant to this Section 4(l) be reduced other than proportionally in connection with any conversion, exercise and/or redemption, as applicable, of the Preferred Shares. If at any time the number of Ordinary Shares authorized and reserved for issuance is not sufficient to meet the Required Reserve Amount, the Company will promptly take all corporate action necessary to authorize and reserve a sufficient number of shares, including, without limitation, calling a special meeting of shareholder s to authorize additional shares to meet the Company’s obligations pursuant to the Transaction Documents, in the case of an insufficient number of authorized shares, obtain shareholder approval of an increase in such authorized number of shares, and voting the management shares of the Company in favor of an increase in the authorized shares of the Company to ensure that the number of authorized shares is sufficient to meet the Required Reserve Amount. |
26
| (l) | Conduct of Business. The business of the Company and its Subsidiaries shall not be conducted in violation of any law, ordinance or regulation of any Governmental Entity, except where such violations would not reasonably be expected to result, either individually or in the aggregate, in a Material Adverse Effect. |
| (m) | Covenants. During the term of this Agreement, the Company and its Subsidiaries shall not, without the prior written consent of the Buyer (as defined below), breach any of the covenants set forth in Section 15 of the Certificate of Designations. |
| (n) | Acknowledgment of Dilution. Without limiting, and in addition to the Company’s representations in Section 3(h), the Company acknowledges that the issuance of the Securities may result in dilution of the outstanding Ordinary Shares, which dilution may be substantial under certain market conditions. The Company further acknowledges that its obligations under the Transaction Documents, including, without limitation, its obligation to issue the Conversion Shares pursuant to the Transaction Documents, are unconditional and absolute and not subject to any right of set off, counterclaim, delay or reduction, regardless of the effect of any such dilution or any claim the Company may have against the Buyer and regardless of the dilutive effect that such issuance may have on the ownership of the other shareholders of the Company. |
| (o) | Acknowledgement Regarding Buyer. The Company hereby acknowledges and agrees that the Buyer is not acting as an agent, financial advisor, placement agent or broker-dealer of the Company or any of its Affiliates. |
| (p) | Corporate Existence. So long as the Buyer beneficially owns any Preferred Shares, the Company shall not be party to any Fundamental Transaction (as defined in the Certificate of Designations) unless the Company is in compliance with the applicable provisions governing Fundamental Transactions set forth in the Certificate of Designations. |
| (q) | Stock Splits. Until the Preferred Shares are no longer outstanding, the Company shall not effect any share combination, share consolidation or other similar transaction in respect of the Ordinary Shares (or make any public announcement or disclosure with respect to any of the foregoing) without the prior written consent of the Buyer; provided, however, that the Company may effect a stock combination, reverse stock split or other similar transaction in respect of the Ordinary Shares if necessary to comply with the requirements of the Principal Market without the prior written consent of the Buyer. |
27
| (r) | Conversion Procedures. The form of Conversion Notice (as defined in the Certificate of Designations) included in the Certificate of Designations sets forth the totality of the procedures required of the Buyer in order to convert the Preferred Shares. No additional legal opinion, other information or instructions shall be required of the Buyer to convert their Preferred Shares. The Company shall honor conversions of the Preferred Shares and shall deliver the Conversion Shares and the Dividend Shares in accordance with the terms, conditions and time periods set forth in the Certificate of Designations. |
| (s) | Regulation M. The Company will not take any action prohibited by Regulation M under the 1934 Act, in connection with the distribution of the Securities contemplated hereby. |
| (t) | Integration. None of the Company, any of its affiliates (as defined in Rule 501(b) under the 1933 Act), or any person acting on behalf of the Company or such affiliate will sell, offer for sale, or solicit offers to buy any security (as defined in the 1933 Act) in a transaction which would be integrated with the offer and sale of the Securities for purposes of the 1933 Act or the rules and regulations of the Principal Market. |
| (u) | Books and Records. The Company will keep proper books of record and account, in which full and correct entries shall be made of all financial transactions and the asset and business of the Company and its Subsidiaries in accordance with IFRS. |
| (v) | Conversion Shares. The Buyer agrees to use commercially reasonable efforts to sell most of the Conversion Shares (provided it can do so profitably) issued upon conversion of the Preferred Shares within 15 Trading Days following such conversion. |
| (w) | Compliance with Applicable Laws. In connection with any sale of Ordinary Shares, the Buyer shall comply in all respects with all applicable laws, rules, regulations and orders, including, without limitation, the requirements of the 1933 Act and the 1934 Act. |
| (x) | Mandatory Repurchase Upon Adverse Amendment. If the Company or any of its shareholders adopts, approves, or otherwise effects any amendment, modification, restatement or other change to the Memorandum and Articles of Association or any other governing document of the Company that directly or indirectly adversely alters, diminishes, or otherwise adversely affects the rights, preferences, privileges or protections of the Preferred Shares as set forth in the Certificate of Designation (excluding any amendment that is solely administrative, technical, or clarifying in nature and does not substantively affect the economic rights, conversion rights, dividend rights, voting rights or liquidation preferences of the Preferred Shares), then the Buyer shall have the right to require the Company to repurchase all or any portion of the Preferred Shares then held by the Buyer at a price equal to 105% of the stated value of the Preferred Shares, with payment for such repurchase due within 2 Business Days of written notice of such election by the Buyer. |
28
5. Register; Transfer Agent Instructions; Legend.
| (a) | Register. The Company shall maintain at its principal executive offices (or such other office or agency of the Company as it may designate by notice to each holder of Securities), a register for the Preferred Shares in which the Company shall record the name and address of the Person in whose name the Preferred Shares have been issued (including the name and address of each transferee), the number and stated value of the Preferred Shares held by such Person, the number of Conversion Shares issuable pursuant to the terms of the Preferred Shares, the number of Dividend Shares issuable with respect to the Preferred Shares held by such Person. The Company shall keep the register open and available at all times during business hours for inspection of the Buyer or its legal representatives. |
| (b) | Transfer Agent Instructions. On or prior to each Closing Date, the Company shall issue irrevocable instructions to its transfer agent and any subsequent transfer agent (as applicable, the “Transfer Agent”) in a form acceptable to the Buyer (the “Irrevocable Transfer Agent Instructions”) to issue book-entry statements or credit shares (to the extent unrestricted shares are issued) to the applicable balance accounts at The Depository Trust Company (“DTC”), registered in the name of the Buyer or its respective nominee(s), for the Conversion Shares in such amounts as specified from time to time by the Buyer to the Company upon conversion of the Preferred Shares. The Company represents and warrants that no instruction other than the Irrevocable Transfer Agent Instructions referred to in this Section 5(b) will be given by the Company to the Transfer Agent with respect to such Conversion Shares, and that, assuming the accuracy of the Buyer’s representations and warranties hereunder, the Securities shall otherwise be freely transferable on the books and records of the Company, as applicable, to the extent provided in this Agreement and the other Transaction Documents. If a Buyer effects a sale, assignment or transfer of the Securities in accordance with this Agreement and the other Transaction Documents, the Company shall, subject to applicable laws, permit the transfer and shall promptly instruct the Transfer Agent to issue one or more book-entry statements in such name and in such denominations as specified by the Buyer to effect such sale, transfer or assignment; provided that the Issuer and Buyer each agree to use best efforts to provide any documentation reasonably requested by the Transfer Agent. The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to a Buyer. Accordingly, the Company acknowledges that the remedy at law for a breach of its obligations under this Section 5(b) will be inadequate and agrees, in the event of a breach or threatened breach by the Company of the provisions of this Section 5(b), that a Buyer shall be entitled, in addition to all other available remedies, to an order and/or injunction restraining any breach and requiring immediate issuance and transfer, without the necessity of showing economic loss and without any bond or other security being required. The Company shall cause its counsel to issue the legal opinion referred to in the Irrevocable Transfer Agent Instructions to the Transfer Agent on the effective date of the Prospectus Supplement. Any fees (with respect to the Transfer Agent, counsel to the Company or otherwise) associated with the issuance of such opinion or the Securities shall be borne by the Company. |
| (c) | Legends. Assuming the accuracy of the Buyer’s representations and warranties hereunder, the Issuer and the Buyer shall use best efforts to cooperate with the Issuer’s Transfer Agent, including providing any documentation reasonably requested by the Issuer’s Transfer Agent, to ensure that Book-entry statements and any other instruments evidencing the Conversion Shares shall not bear any restrictive or other legend. |
29
6. Conditions to the Company’s Obligation to Sell.
(a) First Closing. The obligation of the Company hereunder to issue and sell the Preferred Shares to the Buyer at the First Closing is subject to the satisfaction, at or before the First Closing Date, of each of the following conditions, provided that these conditions are for the Company’s sole benefit and may be waived by the Company at any time in its sole discretion by providing the Buyer with prior written notice thereof:
| (i) | The Buyer shall have executed each of the other Transaction Documents to which it is a party and delivered the same to the Company. |
| (ii) | The Buyer and each other Buyer shall have delivered to the Company the Purchase Price (less the amounts withheld pursuant to Section 4(g)) for the Preferred Shares being purchased by the Buyer at the Closing by wire transfer of immediately available funds in accordance with the wire instructions provided by the Company. |
| (iii) | The representations and warranties of the Buyer shall be true and correct in all material respects (except for those representations and warranties that are qualified by materiality or material adverse effect, which shall be true and correct in all respects) as of the date when made and as of the First Closing Date as though originally made at that time (except for representations and warranties that speak as of a specific date, which shall be true and correct as of such specific date), and the Buyer shall have performed, satisfied and complied in all material respects with the covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by the Buyer at or prior to the First Closing Date. |
| (iv) | No statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed by any court or Governmental Entity of competent jurisdiction that prohibits the consummation of any of the transactions contemplated by the Transaction Documents. |
(b) Additional Closing. The obligation of the Company hereunder to issue and sell the Preferred Shares to the Buyer at each Additional Closing is subject to the satisfaction, at or before the Additional Closing Date, of each of the following conditions, provided that these conditions are for the Company’s sole benefit and may be waived by the Company at any time in its sole discretion by providing the Buyer with prior written notice thereof:
| (i) | The Buyer and each other Buyer shall have delivered to the Company the Additional Purchase Price for the Preferred Shares being purchased by the Buyer at the Additional Closing by wire transfer of immediately available funds in accordance with the wire instructions provided by the Company. |
| (ii) | The representations and warranties of the Buyer shall be true and correct in all material respects (except for those representations and warranties that are qualified by materiality or material adverse effect, which shall be true and correct in all respects) as of the date when made and as of the Additional Closing Date as though originally made at that time (except for representations and warranties that speak as of a specific date, which shall be true and correct as of such specific date), and the Buyer shall have performed, satisfied and complied in all material respects with the covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by the Buyer at or prior to the Additional Closing Date. |
30
| (iii) | No statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed by any court or Governmental Entity of competent jurisdiction that prohibits the consummation of any of the transactions contemplated by the Transaction Documents. |
7. Conditions to the Buyer’s Obligation to Purchase.
(a) First Closing. The obligation of the Buyer hereunder to purchase its Preferred Shares at the First Closing is subject to the satisfaction, at or before the First Closing Date, of each of the following conditions, provided that these conditions are for the Buyer’s sole benefit and may be waived only by the Buyer at any time in its sole discretion by providing the Company with prior written notice thereof:
| (i) | The Company shall have duly executed and delivered to the Buyer each of the Transaction Documents to which it is a party and the Company shall have duly delivered to the Buyer the Buyer Initial Shares Purchase Amount, as being purchased by the Buyer at the First Closing pursuant to this Agreement. |
| (ii) | The Closing Sale Price (as defined in the Certificate of Designations) of the Ordinary Shares on each of the twenty (20) consecutive Trading Days immediately preceding the First Closing Date shall be no less than $1.00 per share of Ordinary Shares. |
| (iii) | No Triggering Event (as defined in the Certificate of Designations) has occurred and is continuing or that, with notice, the passage of time or both, is expected to occur, including, but not limited to, under Section 5(a)(vii) of the Certificate of Designations. |
| (iv) | The Buyer shall have received the opinions of Latham & Watkins LLP, the Company’s U.S. counsel, and Walkers (Cayman) LLP, the Company's Cayman counsel, each dated as of the First Closing Date, addressed to the Buyer, in form and substance reasonably acceptable to the Buyer. |
| (v) | The Company shall have delivered to the Buyer a copy of the Irrevocable Transfer Agent Instructions, which instructions shall have been delivered to and acknowledged in writing by the Transfer Agent. |
| (vi) | The Company shall have delivered to the Buyer a certificate of good standing for the Company issued by the Cayman Islands Registrar of Companies (or comparable office) as of a date within ten (10) days of the Closing Date. |
31
| (vii) | The Company shall have delivered to the Buyer a certified true copy of the Memorandum and Articles of Association as stamped by the Cayman Islands Registrar of Companies as of a date within ten (10) days of the First Closing Date. |
| (viii) | The Company shall have delivered to the Buyer a certificate, in form and substance reasonably acceptable to the Buyer, executed by a director or officer of the Company and dated as of the Closing Date, as to (i) the resolutions consistent with Section 3(b) as adopted by the Company’s board of directors in form and substance reasonably acceptable to the Buyer and (ii) the Memorandum and Articles of Association of the Company as in effect at the Closing. |
| (ix) | The representations and warranties of the Company shall be true and correct in all material respects (except for those representations and warranties that are qualified by materiality or material adverse effect, which shall be true and correct in all respects) as of the date when made and as of the First Closing Date as though originally made at that time (except for representations and warranties that speak as of a specific date, which shall be true and correct as of such specific date), and the Company shall have performed, satisfied and complied in all material respects with the covenants, agreements and conditions required to be performed, satisfied or complied with by the Company at or prior to the First Closing Date. The Buyer shall have received a certificate, duly executed by the Chief Executive Officer or Chief Financial Officer of the Company, dated as of the Closing Date, to the foregoing effect. |
| (x) | The Company shall have delivered to the Buyer a letter from the Transfer Agent certifying the number of Ordinary Shares outstanding on the Trading Day immediately prior to the Closing Date. |
| (xi) | The Ordinary Shares (A) shall be designated for quotation or listed (as applicable) on the Principal Market and (B) shall not have been suspended, as of the Closing Date, by the SEC or the Principal Market from trading on the Principal Market nor shall suspension by the SEC or the Principal Market have been threatened, as of the Closing Date, either (I) in writing by the SEC or the Principal Market or (II) by falling below the minimum maintenance requirements of the Principal Market. |
| (xii) | The Company shall have obtained all governmental, regulatory or third party consents and approvals, if any, necessary for the sale of the Preferred Shares, including without limitation, those required by the Principal Market, if any. |
| (xiii) | No statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed by any court or Governmental Entity of competent jurisdiction that prohibits the consummation of any of the transactions contemplated by the Transaction Documents. |
| (xiv) | Since the date of execution of this Agreement, no event or series of events shall have occurred that has had or would reasonably be expected to have or result in a Material Adverse Effect. |
32
| (xv) | The Company shall have obtained approval, if necessary, of the Principal Market to list or designate for quotation (as the case may be) the Conversion Shares. |
| (xvi) | The Buyer shall have received the wire transfer instructions of the Company. |
| (xvii) | A Registration Statement shall be effective and available for the issuance and sale of (x) the Initial Preferred Shares to be issued in the First Closing, (y) Preferred Shares in an amount equal to not less than eighteen (18) months of Dividends on such Initial Preferred Shares and (z) the Conversion Shares issuable upon conversion thereof, and the Company shall have delivered (or made publicly available through EDGAR) to the Buyer the Prospectus and the Prospectus Supplement with respect thereto. |
| (xviii) | The Company shall have delivered to the Buyer such other documents, instruments or certificates relating to the transactions contemplated by this Agreement as the Buyer or its counsel may reasonably request. |
| (xix) | No default or event of default, except as waived or consented to therein, shall have occurred and be continuing under the Convertible Secured Notes (as defined in the Certificate of Designations), regardless of the outstanding principal amount thereof. |
(b) Additional Closing. The obligation of the Buyer hereunder to purchase its Preferred Shares at each Additional Closing is subject to the satisfaction, at or before each Additional Closing Date, of each of the following conditions, provided that these conditions are for the Buyer’s sole benefit and may be waived only by the Buyer at any time in its sole discretion by providing the Company with prior written notice thereof:
| (i) | The Company shall have delivered to each a Buyer a written notice indicating the aggregate number of Additional Preferred Shares to be issued and sold by the Company at the applicable Additional Closing (the “Additional Closing Tranche”) at least ten (10) Trading Days, prior to the desired Additional Closing Date, provided that the Additional Closing Tranche at such Additional Closing shall be no more than 25,000 Additional Preferred Shares. |
| (ii) | Such Buyer shall not be required to purchase additional Preferred Shares at any Additional Closing to the extent that such purchase would result in the Buyer holding, at any time, in excess of 35,000 Preferred Shares in the aggregate. |
| (iii) | The Additional Closing Date shall be at least (60) calendar days following the immediately preceding Closing Date and since the immediately preceding Closing the aggregate dollar trading volume in the Ordinary Shares on the principal market (the “Aggregate Trading Volume Amount”), was at least 12x the aggregate stated value of the Preferred Shares issued and sold in the immediately preceding Closing. |
33
| (iv) | Subject to Section 7(b)(v) below, the arithmetic average of the daily dollar trading volume (as reported on Bloomberg) of the Ordinary Shares on the Principal Market during the twenty (20) consecutive Trading Day period ending on the Trading Day immediately preceding the Additional Closing Date (such average, “Average Daily Trading Volume Amount”), must be greater than $4,000,000 per Trading Day. |
| (v) | Notwithstanding Section 7(b)(iv), if the trading volume condition pursuant to Sections 7(b)(iv), is not satisfied (but so long as the Average Daily Trading Volume Amount is at least $1,500,000), the Additional Purchase Price and the number of Additional Preferred Shares, for such Additional Closing, shall be proportionally adjusted to the Average Daily Trading Volume Amount divided by $4,000,000. |
| (vi) | The Closing Sale Price (as defined in the Certificate of Designations) of the Ordinary Shares on each of the ten (10) consecutive Trading Days immediately preceding the Additional Closing Date shall be no less than the greater of (i) $1.00 per Ordinary Share and (ii) 150% of the Floor Price (as defined in the Certificate of Designations). |
| (vii) | No Triggering Event as defined in the Certificate of Designations has occurred or that, in respect of any Triggering Event, with notice, the passage of time or both, is expected to occur. |
| (viii) | The Buyer shall have received the opinions of Latham & Watkins LLP, the Company’s U.S. counsel, and Walkers (Cayman) LLP, the Company's Cayman counsel, each dated as of the Additional Closing Date, addressed to the Buyer, in form and substance reasonably acceptable to the Buyer. |
| (ix) | The Company shall have delivered to the Buyer a copy of the Irrevocable Transfer Agent Instructions, which instructions shall have been delivered to and acknowledged in writing by the Transfer Agent. |
| (x) | The Company shall have delivered to the Buyer a certificate of good standing issued by the Cayman Islands Registrar of Companies as of a date within ten (10) days of the Additional Closing Date. |
| (xi) | The representations and warranties of the Company shall be true and correct in all material respects (except for those representations and warranties that are qualified by materiality or material adverse effect, which shall be true and correct in all respects) as of the date when made and as of the Additional Closing Date as though originally made at that time (except for representations and warranties that speak as of a specific date, which shall be true and correct as of such specific date), and the Company shall have performed, satisfied and complied in all material respects with the covenants, agreements and conditions required to be performed, satisfied or complied with by the Company at or prior to the Additional Closing Date. The Buyer shall have received a certificate, duly executed by the Chief Executive Officer or Chief Financial Officer of the Company, dated as of the Closing Date, to the foregoing effect. |
34
| (xii) | The Company shall have delivered to the Buyer a letter from the Transfer Agent certifying the number of Ordinary Shares outstanding on the Trading Day immediately prior to the Closing Date. |
| (xiii) | The Ordinary Shares (A) shall be designated for quotation or listed (as applicable) on the Principal Market and (B) shall not have been suspended, as of the Closing Date, by the SEC or the Principal Market from trading on the Principal Market nor shall suspension by the SEC or the Principal Market have been threatened, as of the Closing Date, either (I) in writing by the SEC or the Principal Market or (II) by falling below the minimum maintenance requirements of the Principal Market. |
| (xiv) | The Company shall have obtained all governmental, regulatory or third party consents and approvals, if any, necessary for the sale of the Securities, including without limitation, those required by the Principal Market, if any. |
| (xv) | No statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed by any court or Governmental Entity of competent jurisdiction that prohibits the consummation of any of the transactions contemplated by the Transaction Documents. |
| (xvi) | Since the date of the immediately preceding Closing Date, no condition, event or series of events shall exist or have occurred that has had or would reasonably be expected to have or result in a Material Adverse Effect. |
| (xvii) | The Company has at all times prior to such Additional Closing Date duly and timely delivered all Conversion Shares required to be delivered upon the conversion of any Preferred Shares in accordance with the terms of the Certificate of Designation. |
| (xviii) | The Company has an unrestricted cash and cash equivalent balance of at least $50,000,000 as of such Additional Closing Date. |
| (xix) | A Registration Statement shall be effective and available for the issuance and sale of (x) the Additional Preferred Shares to be issued in the Additional Closing, (y) Preferred Shares in an amount equal to not less than eighteen (18) months of Dividends on such Additional Preferred Shares and (z) the Conversion Shares issuable upon conversion thereof, and the Company shall have delivered (or made publicly available through EDGAR) to the Buyer the Prospectus and the Prospectus Supplement with respect thereto. |
| (xx) | No default or event of default, except as waived or consented to in writing therein, shall have occurred and be continuing under (a) any Indebtedness of the Company or any Subsidiary having an outstanding principal amount in excess of ten million dollars ($10,000,000) since the date of the First Closing Date, or (b) the Convertible Secured Notes (as defined in the Certificate of Designations), regardless of the outstanding principal amount thereof. |
35
=
| (xxi) | The Company shall have delivered to the Buyer such other documents, instruments or certificates relating to the transactions contemplated by this Agreement as the Buyer or its counsel may reasonably request. |
| (xxii) | There are no outstanding classes of capital stock of the Company that would rank senior to or on parity with the Preferred Shares. |
8. Termination.
This Agreement may be terminated by either the Company or the Buyer, if the First Closing shall not have occurred by April 27, 2026 (provided that no party shall have the right to terminate if they were the proximate cause of the failure to close by such date). The Buyer may terminate its commitment to purchase Additional Preferred Shares at any Additional Closing by delivering a written notice to the Company (i) at any time after the date that is twenty-four (24) months after the First Closing Date, (ii) at any time, if the Company has breached the terms of this Agreement in a manner that would cause the failure of the conditions to closing applicable to the Company hereunder to be met (and such breach remains uncured or unwaived after 30 days’ notice from the Buyer), or (iii) upon the occurrence and continuation of a Triggering Event for a consecutive period of twenty (20) days. This Agreement may be terminated by the Company at any time after the Company has effected a Company Redemption (as defined in the Certificate of Designations) of all Preferred Shares then outstanding, provided that all (and not less than all) of the Preferred Shares then outstanding have been redeemed. Upon any termination in accordance with this Section 8 by a Buyer, such party shall have the right to terminate its obligations under this Agreement with respect to itself at any time on or after the close of business on such date (without liability of the Buyer to any other party); provided, however, the abandonment of the sale and purchase of the Preferred Shares by the Buyer shall be applicable only to the Buyer providing such written notice, provided further that no such termination by any party shall affect any obligation of the Company under this Agreement to reimburse the Buyer for the expenses described in Section 4(g) above. Nothing contained in this Section 8 shall be deemed to release any party from any liability for any breach by such party of the terms and provisions of this Agreement or the other Transaction Documents or to impair the right of any party to compel specific performance by any other party of its obligations under this Agreement or the other Transaction Documents that survive the termination hereof or thereof.
9. Miscellaneous.
| (a) | Governing Law; Jurisdiction; Jury Trial. All questions concerning the construction, validity, enforcement and interpretation of this Agreement shall be governed by the internal laws of the State of New York, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of New York or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of New York. Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in The City of New York, Borough of Manhattan, for the adjudication of any dispute hereunder or in connection herewith or under any of the other Transaction Documents or with any transaction contemplated hereby or thereby, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding is improper. Each party hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof to such party at the address for such notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law. Nothing contained herein shall be deemed or operate to preclude the Buyer from bringing suit or taking other legal action against the Company in any other jurisdiction to enforce a judgment or other court ruling in favor of the Buyer. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE TO, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR UNDER ANY OTHER TRANSACTION DOCUMENT OR IN CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT, ANY OTHER TRANSACTION DOCUMENT OR ANY TRANSACTION CONTEMPLATED HEREBY OR THEREBY. |
36
| (b) | Counterparts. This Agreement may be executed in two or more identical counterparts, all of which shall be considered one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other party. In the event that any signature is delivered by facsimile or electronic transmission (including DocuSign and similar) or by an email which contains a portable document format (.pdf) file of an executed signature page, such signature page shall create a valid and binding obligation of the party executing (or on whose behalf such signature is executed) with the same force and effect as if such signature page were an original thereof. |
| (c) | Headings; Gender. The headings of this Agreement are for convenience of reference and shall not form part of, or affect the interpretation of, this Agreement. Unless the context clearly indicates otherwise, each pronoun herein shall be deemed to include the masculine, feminine, neuter, singular and plural forms thereof. The terms “including,” “includes,” “include” and words of like import shall be construed broadly as if followed by the words “without limitation.” The terms “herein,” “hereunder,” “hereof” and words of like import refer to this entire Agreement instead of just the provision in which they are found. |
| (d) | Severability; Maximum Payment Amounts. If any provision of this Agreement is prohibited by law or otherwise determined to be invalid or unenforceable by a court of competent jurisdiction, the provision that would otherwise be prohibited, invalid or unenforceable shall be deemed amended to apply to the broadest extent that it would be valid and enforceable, and the invalidity or unenforceability of such provision shall not affect the validity of the remaining provisions of this Agreement so long as this Agreement as so modified continues to express, without material change, the original intentions of the parties as to the subject matter hereof and the prohibited nature, invalidity or unenforceability of the provision(s) in question does not substantially impair the respective expectations or reciprocal obligations of the parties or the practical realization of the benefits that would otherwise be conferred upon the parties. The parties will endeavor in good faith negotiations to replace the prohibited, invalid or unenforceable provision(s) with a valid provision(s), the effect of which comes as close as possible to that of the prohibited, invalid or unenforceable provision(s). Notwithstanding anything to the contrary contained in this Agreement or any other Transaction Document (and without implication that the following is required or applicable), it is the intention of the parties that in no event shall amounts and value paid by the Company and/or any of its Subsidiaries (as the case may be), or payable to or received by the Buyer, under the Transaction Documents (including without limitation, any amounts that would be characterized as “interest” under applicable law) exceed amounts permitted under any applicable law. Accordingly, if any obligation to pay, payment made to the Buyer, or collection by the Buyer pursuant the Transaction Documents is finally judicially determined to be contrary to any such applicable law, such obligation to pay, payment or collection shall be deemed to have been made by mutual mistake of the Buyer, the Company and its Subsidiaries and such amount shall be deemed to have been adjusted with retroactive effect to the maximum amount or rate of interest, as the case may be, as would not be so prohibited by the applicable law. Such adjustment shall be effected, to the extent necessary, by reducing or refunding, at the option of the Buyer, the amount of interest or any other amounts which would constitute unlawful amounts required to be paid or actually paid to the Buyer under the Transaction Documents. For greater certainty, to the extent that any interest, charges, fees, expenses or other amounts required to be paid to or received by the Buyer under any of the Transaction Documents or related thereto are held to be within the meaning of “interest” or another applicable term to otherwise be violative of applicable law, such amounts shall be pro-rated over the period of time to which they relate. |
37
| (e) | Entire Agreement; Amendments. This Agreement, the other Transaction Documents and the schedules and exhibits attached hereto and thereto and the instruments referenced herein and therein supersede all other prior oral or written agreements between the Buyer, the Company, its Subsidiaries, their affiliates and Persons acting on their behalf with respect to the subject matter hereof, including, without limitation, any transactions by the Buyer with respect to the Securities, and the other matters contained herein and therein, and this Agreement, the other Transaction Documents, the schedules and exhibits attached hereto and thereto and the instruments referenced herein and therein contain the entire understanding of the parties solely with respect to the matters covered herein and therein; provided, however, nothing contained in this Agreement or any other Transaction Document shall (or shall be deemed to) (i) have any effect on any agreements the Buyer has entered into with, or any instruments the Buyer has received from, the Company or any of its Subsidiaries prior to the date hereof with respect to any prior investment made by the Buyer in the Company, if any, or (ii) waive, alter, modify or amend in any respect any obligations of the Company or any of its Subsidiaries, or any rights of or benefits to the Buyer or any other Person, in any agreement entered into prior to the date hereof between or among the Company and/or any of its Subsidiaries and the Buyer, or any instruments the Buyer received from the Company and/or any of its Subsidiaries prior to the date hereof, if any, and, to the extent any such agreements or instruments have been entered into and are in full force and effect in accordance with the terms thereof, all such agreements and instruments shall continue in full force and effect. Except as specifically set forth herein or therein, neither the Company nor the Buyer makes any representation, warranty, covenant or undertaking with respect to such matters. For clarification purposes, the Recitals are part of this Agreement. No provision of this Agreement may be amended other than by an instrument in writing signed by the Company and the Buyer, and any amendment to any provision of this Agreement made in conformity with the provisions of this Section 9(e) shall be binding on the Buyer and holders of Securities, as applicable; provided that no such amendment shall be effective to the extent that it (A) applies to less than all of the holders of the Securities then outstanding or (B) imposes any obligation or liability on the Buyer without the Buyer’s prior written consent (which may be granted or withheld in the Buyer’s sole discretion). No waiver shall be effective unless it is in writing and signed by an authorized representative of the waiving party, provided that the Buyer may waive any provision of this Agreement, and any waiver of any provision of this Agreement made in conformity with the provisions of this Section 9(e) shall be binding on the Buyer and holders of Securities, as applicable, provided that no such waiver shall be effective to the extent that it (1) applies to less than all of the holders of the Securities then outstanding (unless a party gives a waiver as to itself only) or (2) imposes any obligation or liability on the Buyer without the Buyer’s prior written consent (which may be granted or withheld in the Buyer’s sole discretion). No consideration (other than reimbursement of legal fees) shall be offered or paid to any Person to amend or consent to a waiver or modification of any provision of any of the Transaction Documents unless the same consideration also is offered to all of the parties to the Transaction Documents or all holders of the Preferred Shares. From the date hereof and while any Preferred Shares are outstanding, the Company shall not be permitted to receive any consideration from a Buyer or a holder of Preferred Shares that is not otherwise contemplated by the Transaction Documents in order to, directly or indirectly, induce the Company or any Subsidiary (i) to treat the Buyer or holder of Preferred Shares in a manner that is more favorable than to other similarly situated holders of Preferred Shares or (ii) to treat the Buyer or holder(s) of Preferred Shares in a manner that is less favorable than the Buyer or holder of Preferred Shares that is paying such consideration; provided, however, that the determination of whether a Buyer has been treated more or less favorably than another holder shall disregard any securities of the Company purchased or sold by the Buyer. The Company has not directly or indirectly, made any agreements with the Buyer relating to the terms or conditions of the transactions contemplated by the Transaction Documents except as set forth in the Transaction Documents. Without limiting the foregoing, the Company confirms that, except as set forth in this Agreement, no Buyer has made any commitment or promise or has any other obligation to provide any financing to the Company, any Subsidiary or otherwise. As a material inducement for the Buyer to enter into this Agreement, the Company expressly acknowledges and agrees that (x) no due diligence or other investigation or inquiry conducted by a Buyer, any of its advisors or any of its representatives shall affect the Buyer’s right to rely on, or shall modify or qualify in any manner or be an exception to any of, the Company’s representations and warranties contained in this Agreement or any other Transaction Document and (y) unless a provision of this Agreement or any other Transaction Document is expressly preceded by the phrase “except as disclosed in” (or similar disclosure qualification) the SEC Documents, the Registration Statement or the Prospectus, nothing contained in any of the SEC Documents, the Registration Statement or the Prospectus shall affect the Buyer’s right to rely on, or shall modify or qualify in any manner or be an exception to any of, Company’s representations and warranties contained in this Agreement or any other Transaction Document. |
38
| (f) | Notices. Any notices, consents, waivers or other communications required or permitted to be given under the terms of this Agreement must be in writing and will be deemed to have been delivered: (i) upon receipt, when delivered personally; (ii) upon receipt, when sent by electronic mail (provided that such sent email is kept on file (whether electronically or otherwise) by the sending party and the sending party does not receive an automatically generated message from the recipient’s email server that such email could not be delivered to such recipient); or (iii) one (1) Business Day after deposit with an overnight courier service with next day delivery specified, in each case, properly addressed to the party to receive the same. The mailing addresses and email addresses for such communications shall be: |
If to the Company:
Vertical Aerospace Ltd.
Unit 1 Camwal Court, Chapel Street
Bristol BS2 0uW
United Kingdom
Attention: Sanjay Verma, Chief Legal and Corporate Affairs Officer
Email: legal@vertical-aerospace.com
with a copy (which will not constitute notice) to:
Latham & Watkins (London) LLP
99 Bishopsgate
London, EC2M 3XF
United Kingdom
Attention: Jennifer Gascoyne and Robbie McLaren
Email: jennifer.gascoyne@lw.com and robbie.mclaren@lw.com
If to a Buyer, to its mailing address and email address set forth on the executed signature page of the Buyer, with copies to the Buyer’s representatives as set forth on the executed signature page of the Buyer,
with a copy (for informational purposes only) to:
Haynes and Boone, LLP
30 Rockefeller Plaza, 26th Floor
New York, New York 10112
Telephone: (212) 835 4819
Attention: Greg Kramer and Matt Fry
Email: greg.kramer@haynesboone.com and matt.fry@haynesboone.com
or to such other mailing address and/or email address and/or to the attention of such other Person as the recipient party has specified by written notice given to each other party five (5) days prior to the effectiveness of such change, provided that Buyer Counsel shall only be provided copies of notices sent to the Buyer. Written confirmation of receipt (A) given by the recipient of such notice, consent, waiver or other communication, (B) mechanically or electronically generated by the sender’s email containing the time, date and recipient’s email or (C) provided by an overnight courier service shall be rebuttable evidence of personal service, receipt by email or receipt from an overnight courier service in accordance with clause (i), (ii) or (iii) above, respectively.
39
| (g) | Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and assigns, including any purchasers of any of the Preferred Shares. The Company shall not assign this Agreement or any rights or obligations hereunder without the prior written consent of the Buyer, including, without limitation, by way of a Fundamental Transaction (as defined in the Certificate of Designations) (unless the Company is in compliance with the applicable provisions governing Fundamental Transactions set forth in the Certificate of Designations). A Buyer may assign some or all of its rights hereunder without the consent of the Company in connection with the transfer of any of its Preferred Shares in accordance with the terms of this Agreement and the other Transaction Documents, in which event such assignee shall be deemed to be a Buyer hereunder with respect to such assigned rights. No assignment shall be effective unless such assignee enters into a joinder to this Agreement, in form and substance reasonably satisfactory to the Company. |
| (h) | No Third Party Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective permitted successors and assigns, and is not for the benefit of, nor may any provision hereof be enforced by, any other Person, other than the Indemnitees referred to in Section 9(k) and the Placement Agent. |
| (i) | Survival. The representations, warranties, agreements and covenants shall survive each Closing. The Buyer shall be responsible only for its own representations, warranties, agreements and covenants hereunder. |
| (j) | Further Assurances. Each party shall do and perform, or cause to be done and performed, all such further acts and things, and shall execute and deliver all such other agreements, certificates, instruments and documents, as any other party may reasonably request in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby. |
| (k) | Indemnification. In consideration of the Buyer’s execution and delivery of the Transaction Documents and acquiring the Securities thereunder and in addition to all of the Company’s other obligations under the Transaction Documents, the Company shall defend, protect, indemnify and hold harmless the Buyer and all of its shareholders, partners, members, officers, directors, employees and direct or indirect investors and any of the foregoing Persons’ agents or other representatives (including, without limitation, those retained in connection with the transactions contemplated by this Agreement) (collectively, the “Indemnitees”) from and against any and all actions, causes of action, suits, claims, losses, costs, penalties, fees, liabilities and damages, and documented expenses reasonably incurred in connection therewith (irrespective of whether any such Indemnitee is a party to the action for which indemnification hereunder is sought), and including reasonable and documented attorneys’ fees and disbursements (the “Indemnified Liabilities”), incurred by any Indemnitee as a result of, or arising out of, or relating to (i) any misrepresentation or breach of any representation or warranty made by the Company or any Subsidiary in any of the Transaction Documents, (ii) any breach of any covenant, agreement or obligation of the Company or any Subsidiary contained in any of the Transaction Documents or (iii) any cause of action, suit, proceeding or claim brought or made against such Indemnitee by a third party (including for these purposes a derivative action brought on behalf of the Company or any Subsidiary) or which otherwise involves such Indemnitee that arises out of or results from (A) the execution, delivery, performance or enforcement of any of the Transaction Documents, (B) any transaction financed or to be financed in whole or in part, directly or indirectly, with the proceeds of the issuance of the Securities, (C) any disclosure properly made by the Buyer pursuant to Section 4(i), or (D) the status of the Buyer either as an investor in the Company pursuant to the transactions contemplated by the Transaction Documents or as a party to this Agreement (including, without limitation, as a party in interest or otherwise in any action or proceeding for injunctive or other equitable relief). To the extent that the foregoing undertaking by the Company may be unenforceable for any reason, the Company shall make the maximum contribution to the payment and satisfaction of each of the Indemnified Liabilities which is permissible under applicable law. |
40
| (l) | Construction. The language used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent, and no rules of strict construction will be applied against any party. No specific representation or warranty shall limit the generality or applicability of a more general representation or warranty. Each and every reference to share prices, Ordinary Shares and any other numbers in this Agreement that relate to the Ordinary Shares shall be automatically adjusted for any share splits, share dividends, share combinations, share consolidations, recapitalizations or other similar transactions that occur with respect to the Ordinary Shares after the date of this Agreement. |
| (m) | Remedies. The Buyer shall have all rights and remedies set forth in the Transaction Documents and all rights and remedies which the Buyer has been granted at any time under any other agreement or contract and all of the rights which the Buyer has under any law. Any Person having any rights under any provision of this Agreement shall be entitled to enforce such rights specifically, to recover damages by reason of any breach of any provision of this Agreement and to exercise all other rights granted by law. Furthermore, the Company recognizes that in the event that it or any Subsidiary fails to perform, observe, or discharge any or all of its or such Subsidiary’s (as the case may be) obligations under the Transaction Documents, any remedy at law would inadequate relief to the Buyer. The Company therefore agrees that the Buyer shall be entitled to specific performance and/or temporary, preliminary and permanent injunctive or other equitable relief from any court of competent jurisdiction in any such case. The remedies provided in this Agreement and the other Transaction Documents shall be cumulative and in addition to all other remedies available under this Agreement and the other Transaction Documents, at law or in equity (including a decree of specific performance and/or other injunctive relief). |
41
| (n) | Withdrawal Right. Notwithstanding anything to the contrary contained in (and without limiting any similar provisions of) the Transaction Documents, whenever the Buyer exercises a right, election, demand or option under a Transaction Document and the Company or any Subsidiary does not timely perform its related obligations within the periods therein provided, then the Buyer may rescind or withdraw, in its sole discretion from time to time upon written notice to the Company or such Subsidiary (as the case may be), any relevant notice, demand or election in whole or in part without prejudice to its future actions and rights. |
| (o) | Payment Set Aside; Currency. To the extent that the Company makes a payment or payments to the Buyer hereunder or pursuant to any of the other Transaction Documents or the Buyer enforce or exercise their rights hereunder or thereunder, and such payment or payments or the proceeds of such enforcement or exercise or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside, recovered from, disgorged by or are required to be refunded, repaid or otherwise restored to the Company, a trustee, receiver or any other Person under any law (including, without limitation, any bankruptcy law, foreign, state or federal law, common law or equitable cause of action), then to the extent of any such restoration the obligation or part thereof originally intended to be satisfied shall be revived and continued in full force and effect as if such payment had not been made or such enforcement or setoff had not occurred. Unless otherwise expressly indicated, all dollar amounts referred to in this Agreement and the other Transaction Documents are in United States Dollars (“U.S. Dollars”), and all amounts owing under this Agreement and all other Transaction Documents shall be paid in U.S. Dollars. All amounts denominated in other currencies (if any) shall be converted into the U.S. Dollar equivalent amount in accordance with the Exchange Rate on the date of calculation. “Exchange Rate” means, in relation to any amount of currency to be converted into U.S. Dollars pursuant to this Agreement, the U.S. Dollar exchange rate as published in the Wall Street Journal on the relevant date of calculation. |
| (p) | Judgment Currency. |
| (i) | If for the purpose of obtaining or enforcing judgment against the Company in connection with this Agreement or any other Transaction Document in any court in any jurisdiction it becomes necessary to convert into any other currency (such other currency being hereinafter in this Section 9(p) referred to as the “Judgment Currency”) an amount due in U.S. Dollars under this Agreement, the conversion shall be made at the Exchange Rate prevailing on the Trading Day immediately preceding: |
| (1) | the date actual payment of the amount due, in the case of any proceeding in the courts of New York or in the courts of any other jurisdiction that will give effect to such conversion being made on such date; or |
| (2) | the date on which the foreign court determines, in the case of any proceeding in the courts of any other jurisdiction (the date as of which such conversion is made pursuant to this Section 9(p)(i)(2) being hereinafter referred to as the “Judgment Conversion Date”). |
42
| (ii) | If in the case of any proceeding in the court of any jurisdiction referred to in Section 9(p)(i)(2) above, there is a change in the Exchange Rate prevailing between the Judgment Conversion Date and the date of actual payment of the amount due, the applicable party shall pay such adjusted amount as may be necessary to ensure that the amount paid in the Judgment Currency, when converted at the Exchange Rate prevailing on the date of payment, will produce the amount of U.S. Dollars which could have been purchased with the amount of Judgment Currency stipulated in the judgment or judicial order at the Exchange Rate prevailing on the Judgment Conversion Date. |
| (iii) | Any amount due from the Company under this provision shall be due as a separate debt and shall not be affected by judgment being obtained for any other amounts due under or in respect of this Agreement or any other Transaction Document. |
| (q) | Consent to the amendment and restatement of the Original Certificate of Designations. The Buyer, as the Required Holder (as defined in the Original Certificate of Designations) pursuant to Section 32 of the Original Certificate of Designations, hereby consents to the Company’s adoption and filing of the Amended and Restated Certificate of Designations, as contemplated herein. For the avoidance of doubt, the Buyer hereby provides its consent pursuant to Section 18 of the Original Certificate of Designations and further agrees that the Company’s adoption and filing of the Amended and Restated Certificate of Designations shall not constitute an event giving rise to the Buyer’s rights under Section 4(x) of this Agreement. |
[Signature pages follow.]
43
In witness whereof, the Buyer and the Company have caused their respective signature page to this Agreement to be duly executed as of the date first written above.
| Company: | |
| Vertical Aerospace ltd. | |
| /s/ Stuart Simpson | |
| Name: Stuart Simpson | |
| Title: Chief Executive Officer |
[Signature Page to Securities Purchase Agreement]
In witness whereof, the Buyer and the Company have caused their respective signature page to this Agreement to be duly executed as of the date first written above.
Buyer:
YA II PN, LTD.
By: Yorkville Advisors Global, LP
Its: Investment Manager
By: Yorkville Advisors Global II, LLC
Its: General Partner
| /s/ Mathew Beckman | |
| Name: Matthew Beckman | |
| Title: Manager |
Address for Notice to Buyer:
1012 Springfield Avenue
Mountainside, NJ 07092
Attention: Legal Department
Email: Legal@yorkvilleadvisors.com
Address for Delivery of Shares to Buyer (if not same as address for notice): N/A
Email: Legal@yorkvilleadvisors.com
Legal Representative’s Address:
1012 Spring Field Avenue
Mountainside, NJ 07092
Attention: David Fine, Esq.
Email: DFine@yorkvilleadvisors.com
Exhibit A
Form of Certificate of Designations
[Attached]