SECURITIES INVESTMENT AND SUBSCRIPTION AGREEMENT
Exhibit
10.6
THIS SECURITIES INVESTMENT AND
SUBSCRIPTION AGREEMENT, dated as of May 5, 2010 (this “Agreement”),
is by and between Think Holdings AS, a Norwegian limited liability company, with
corporate registration number 992 714 344 (the “Company”),
and each of the investors that are or become party to this Agreement as
evidenced by the execution by such investor of a counterpart signature page to
this Agreement (such investor, and its permitted successors and
assigns, are each referred to herein as an “Investor”
and, collectively, as the “Investors”.
A. This
Agreement contemplates the issuance by the Company to the Investors of up to
approximately 30,000,000 shares of its Series B Convertible Preferred Stock,
having a nominal value of NOK 1.00 per share (the “Series B
Preferred Stock”), for a subscription price of NOK 10.00 per
share. It is anticipated that the sale and issuance of Series B
Preferred Stock hereunder will occur in two or more closings. In
order to meet the Company’s immediate funding needs, it is anticipated that a
smaller, first closing of approximately 6,000,000 shares of Series B Preferred
Stock will occur promptly following the date hereof, and the second and any
additional closings for the remainder of the Series B Preferred Stock will occur
on or about June 4, 2010 or as otherwise determined in accordance with this
Agreement. The Company gives no assurances that the timing and the
amount of each closing will be as described in the foregoing
sentence. Each closing hereunder is referred to herein a “Closing”
and the first closing hereunder is referred to herein as the “First
Closing”.
B. The
Series B Preferred Stock is senior to the Company’s Series A Convertible
Preferred Stock, having a nominal value of NOK 1.00 per share (the “Series A
Preferred Stock”), and the Company’s common stock, having a nominal value
of NOK 1.00 per share (the “Common
Stock”). As of the date hereof, each Investor has committed to
subscribe for the number of shares of Series B Preferred Stock set forth
opposite its name on Exhibit
A. This Agreement shall not in any respect prevent the Company
from raising further capital, through a share offering or otherwise, including
sales of Series B Preferred Stock to new and existing Investors.
C. The
terms of the Common Stock, Series A Preferred Stock and the Series B Preferred
Stock are set forth in the Company’s Amended and Restated Articles of
Association (which are subject to approval by the Company’s extraordinary
shareholders’ meeting (EGM)), a copy of which is annexed hereto as Exhibit B
(the “Articles of
Association”). The terms of the Series B Preferred Stock will
include, among other things, (i) a priority in liquidation that is senior to all
other capital stock of the Company, including the Series A Preferred Stock, (ii)
an annual cumulative cash dividend of NOK 1.00, (iii) a liquidation preference
equal to two times the sum of its subscription price and accrued and unpaid
dividends, (iv) two votes per share, and (v) cash redemption
rights. The Series B Preferred Stock will be convertible into Common
Stock. The shares of Common Stock into which Series B Preferred Stock
are convertible are sometimes referred to herein as the “Conversion
Shares”.
D. On
or prior to the First Closing, the existing Shareholders Agreement among the
Company’s shareholders will have been duly and validly amended and restated into
the form annexed hereto as Exhibit C
(the “Shareholders
Agreement”).
E. On
or prior to the First Closing, Vision Ridge Partners LLC and Novus Energy
Partners LLC/Rebelijo AS will each tender to the Company for cancellation (and
for no consideration) one-half of the “ATVM Warrant” exercisable for
Series B Preferred Stock that it received in the prior Series B Preferred Stock
financing (for the avoidance of doubt, neither party is tendering for
cancellation any of the warrants it received in connection with the bridge
financing provided to the Company during its recent debt-settlement
proceeding).
F. Each
Investor will receive a warrant exercisable for Series B Preferred
Stock (the “New ATVM
Warrants”). The number of New ATVM Warrants received by each
Investor will be equal to the total number of shares of Series B Preferred Stock
purchased by such Investor multiplied by the lesser of (i) 0.75 and (ii) a
fraction, the numerator of which is 18,000,000 and the denominator of which is
the total number of shares of Series B Preferred Stock issued under this
Agreement. The New ATVM Warrants will have a term of one year from
the date of the First Closing, and a per share exercise price of NOK 10.00 (as
adjusted for stock splits, stock dividends, reverse stock splits and similar
events). The New ATVM Warrants will be issued to the Investors
promptly after the final Closing hereunder.
G. Investors
will have the right to put their shares of Series B Preferred Stock purchased
under this Agreement to Ener1, Inc. (“Ener1”) in
consideration for Ener1 common stock, subject to the limitations described
below. The per share put price will be US$1.67 (as adjusted for stock
splits, stock dividends, reverse stock splits and similar events), and the
number of shares of Ener1 common stock issued in connection with a put will be
calculated using the 15 day moving average price of Ener1 common stock subject
to a floor price of US$4.00 (as adjusted for stock splits, stock dividends,
reverse stock splits and similar events). Each Investor that
exercises such put right will be required to assign to Ener1 for no additional
consideration one-half of the New ATVM Warrants it received as part of its
purchase of the Series B Preferred Stock subject to such put. Ener1
will undertake to register its shares of common stock issued in connection with
such put with the U.S. Securities and Exchange Commission (the “SEC”). This
put right will have a term of one year from the date of the First Closing, and
all of the terms and conditions pertaining to this put right are set forth in
the Shareholders Agreement. The aggregate put amount that Ener1 will
be obligated to honor will be capped at US$27,500,000, and the maximum amount an
Investor may put to Ener1 will be equal to the product of US$27,500,000 and a
fraction, the numerator of which is the total number of shares of Series B
Preferred Stock purchased by such Investor under this Agreement, and the
denominator of which is the total number of shares of Series B Preferred Stock
purchased by all Investors under this Agreement other than Ener1. The
foregoing put right will not be granted to ITOCHU Corporation.
H. The
issuance and sale of the Series B Preferred Stock, Conversion Shares and the
shares for which the New ATVM Warrants are exercisable (collectively, the “Securities”)
by the Company to U.S. Investors shall be effected in reliance upon the
exemption from securities registration afforded by the provisions of Regulation
D (“Regulation
D”), as promulgated by the SEC under the U.S. Securities Act of 1933, as
amended.
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In consideration of the mutual promises
made herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and the Investors
hereby agree as follows:
1. TERMINOLOGY
AND USAGE.
1.1 Definitions. When
used herein, the terms below shall have the respective meanings
indicated:
“Affiliate”
means, as to any Person (the “subject
Person”), any other Person (a) that directly or indirectly through
one or more intermediaries controls or is controlled by, or is under direct or
indirect common control with, the subject Person, (b) that directly or
indirectly beneficially owns or holds ten percent (10%) or more of any class of
voting equity of the subject Person, or (c) ten percent (10%) or more of
the voting equity of which is directly or indirectly beneficially owned or held
by the subject Person. For the purposes of this definition, “control”
when used with respect to any Person means the power to direct the management
and policies of such Person, directly or indirectly, whether through the
ownership of voting securities, through representation on such Person’s board of
directors or other management committee or group, by contract or
otherwise.
“Board of
Directors” means the Company’s Board of Directors, as constituted from
time to time.
“Business
Day” means any day other than a Saturday, a Sunday or other day on which
commercial banks located in Norway are authorized or permitted by law to be
closed.
“Closing
Date” means the date on which a Closing occurs.
“Company
Subsidiary” means Think Global, Think NA, Think Technology AS and any
Person that is a Subsidiary of the Company.
“Execution
Date” means the date of this Agreement.
“Governmental
Authority” means any nation or government, any state, provincial or
political subdivision thereof and any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to government,
including, without limitation, any stock exchange, securities market and
self-regulatory organization.
“Governmental
Requirement” means any law, statute, code, ordinance, order, rule,
regulation, judgment, decree, injunction, franchise, license or other directive
or requirement of any federal, state, county, municipal, parish, provincial,
foreign or other Governmental Authority or any department, commission, board,
court, agency or any other instrumentality of any of them.
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“Holder”
shall initially mean the Investors, provided that any Person that
(i) subsequently holds any Securities and (ii) is also party to this Agreement
shall also be deemed a Holder.
“Lead
Investors” means Rockport Capital Partners and Ener1.
“Lien”
means, with respect to any property, any mortgage, pledge, hypothecation,
assignment, deposit arrangement, security interest, tax lien, financing
statement, pledge, charge, or other lien, charge, easement, encumbrance,
preference, priority or other security agreement or preferential arrangement of
any kind or nature whatsoever on or with respect to such property (including,
without limitation, any conditional sale or other title retention agreement
having substantially the same economic effect as any of the
foregoing).
“Person”
means any individual, corporation, trust, association, company, partnership,
joint venture, limited liability company, joint stock company, Governmental
Authority or other entity.
“Qualified Public
Offering” means a firm commitment underwritten public offering of not
less than NOK 250,000,000 in Common Stock at a per share offering price of not
less than NOK 40.00 (as adjusted for stock splits, stock dividends, reverse
stock splits and similar events).
“Requisite
Holders” means, as of a date of determination, Holders holding at least
two-thirds of the aggregate number of Conversion Shares in to which the Series B
Preferred Stock issued hereunder are convertible (determined on an
“as-converted” and “as exercised” basis).
“Requisite
Investors” means, as of a date of determination, Holders holding at least
two-thirds of the aggregate Commitment Percentage that remains undrawn as of
such date.
“Securities
Act” means the Securities Act of 1933 (as amended, and the rules and
regulations promulgated thereunder).
“Subsidiary”
means, with respect to any Person, any corporation or other entity of which at
least a majority of the outstanding shares of stock or other ownership interests
having by the terms thereof ordinary voting power to elect a majority of the
board of directors (or Persons performing similar functions) of such corporation
or entity is at the time directly or indirectly owned or controlled by such
Person or one or more of its Subsidiaries or by such Person and one or more of
its Subsidiaries.
“Termination
Date” means the earlier of (i) the date on which there is no more Series
B Preferred Stock or warrants exercisable for Series B Preferred Stock
outstanding and (ii) the date on which a Qualified Public Offering is resolved
by the Company or a successor to the Company.
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“Transaction
Documents” means (i) this Agreement, (ii) the Articles of Association,
(iii) the Shareholders Agreement, (iv) the New ATVM Warrants, and (v) all other
agreements, documents and other instruments executed and delivered by or on
behalf of the Company or any of its respective officers in connection with the
transactions contemplated under this Agreement, provided that the parties
hereto acknowledge that the Company is not a party to the Shareholders Agreement
and therefore references herein to the Transaction Documents that pertain to the
Company shall not be deemed to include the Shareholders Agreement.
1.2 Definitional
Cross-References. Each of the following additional terms shall
have the meaning defined for such term in the Section or Transaction Document
set forth opposite such term below:
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“Agreement”
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Preamble
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“Articles of
Association”
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Recitals
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“Closing”
|
Recitals
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“Common
Stock”
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Recitals
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“Company”
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Preamble
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“Conversion
Shares”
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Recitals
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“Ener1”
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Recitals
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“First
Closing”
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Recitals
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“Holder
Party”
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Section
6
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“Investors”
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Preamble
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“New ATVM
Warrants”
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Recitals
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“Novus”
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Recitals
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“Regulation
D”
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Recitals
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“SEC”
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Recitals
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“Securities”
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Recitals
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“Series A
Preferred Stock”
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Recitals
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“Series B
Preferred Stock”
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Recitals
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“Shareholders
Agreement”
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Recitals
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“U.S.
Person”
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Section
3.2
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1.3 Other Definitional
Provisions. All definitions contained in this Agreement are
equally applicable to the singular and plural forms of the terms
defined. The words “hereof”, “herein” and “hereunder” and words of
similar import contained in this Agreement refer to this Agreement as a whole
and not to any particular provision of this Agreement.
1.4 Adjustments for Stock
Splits, Reverse Stock Splits and Other Events. The number of
shares to be sold, any per share sales price, conversion rate or exercise price;
all as stated herein, are subject to proportional adjustments for stock splits,
reverse stock splits, and similar events, as well as further adjustments that
may be made under the Articles of Association.
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2. ISSUANCE
AND SUBSCRIPTION OF SHARES OF SERIES B PREFERRED STOCK.
2.1 Closing. Upon
the terms and subject to the satisfaction or waiver of the conditions set forth
in Section
2.2, the Company agrees to issue to each Investor, and such Investor
agrees to subscribe from the Company the number of shares of Series B Preferred
Stock set forth opposite such Investor’s name on Exhibit A,
at a per share subscription price of NOK 10.00. The First Closing
shall occur on or about May 7, 2010 or such other date agreed to by the Lead
Investors and the Company. Any subsequent Closing shall occur on such
date, time, terms and conditions as agreed to by the Lead Investors and the
Company. Each Investor acknowledges and agrees that is has had the
opportunity to subscribe for the number of shares of Series B Preferred Stock
that it desires to purchase, and as such it hereby waives any preemptive rights
it may have with respect to additional sales of Series B Preferred Stock made
under this Agreement, including any sales made to ITOCHU Corporation or any
other new or existing Investor.
2.2
Conditions to
Closing.
(a) Conditions to Each
Investor’s Obligations at a Closing. Each Investor’s
obligations to effect a Closing, including, without limitation, its obligation
to subscribe for Series B Preferred Stock at such Closing, are conditioned upon
the fulfillment (or waiver by such Investor in its sole and absolute discretion)
of each of the following events as of the applicable Closing Date, and the
Company shall use commercially reasonable efforts to cause each of such
conditions to be satisfied:
(i)
the representations and warranties of the Company set forth in this Agreement
shall be true and correct in all material respects as of such date as if made on
such date; provided,
however, that (x) any representation or warranty relating to a particular
date shall only need to be true and correct in all material respects as of such
particular date, and (y) if any representation or warranty is not true or
correct in all material respects, (1) the Company shall have
submitted a certificate to such Holder disclosing all material inaccuracies or
omissions in such representation or warranty, (2) the Requisite Investors shall
have deemed, in their sole and absolute discretion, the representation or
warranty, as so qualified by such certificate, to be acceptable, and (3) such
certificate shall be deemed an amendment under this Agreement to such
representation or and warranty;
(ii) the
Company shall have complied with or performed in all material respects all of
the agreements, obligations and conditions set forth in this Agreement and in
the other Transaction Documents that are required to be complied with or
performed by the Company on or before such Closing;
(iii) there
shall be no injunction, restraining order or decree of any nature of any court
or Governmental Authority of competent jurisdiction that is in effect that
restrains or prohibits the consummation of the transactions contemplated hereby
and by the other Transaction Documents;
(iv) the
Company shall have executed and delivered to such Investor the Transaction
Documents required to be delivered by it on such Closing; and
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(v) the
Company shall have delivered to such Investor (x) a certified, filed copy of the
Articles of Association, and (y) a certified copy of the resolutions passed by
the Board of Directors authorizing all of the transactions contemplated by the
Transaction Documents to which the Company is a party.
(b) Conditions to the Company’s Obligations
at a Closing. The Company’s obligations to effect a Closing
with an Investor are conditioned upon the fulfillment (or waiver by the Company
in its sole and absolute discretion) of each of the following events as of the
applicable Closing Date:
(i) the
representations and warranties of such Investor set forth in this Agreement
shall be true and correct in all material respects as of such date as if made on
such date (except that to the extent that any such representation or warranty
relates to a particular date, such representation or warranty shall be true and
correct in all material respects as of that date);
(ii) such
Investor shall have complied with or performed all of the agreements,
obligations and conditions set forth in this Agreement that are required to be
complied with or performed by such Investor on or before such
Closing;
(iii) there
shall be no injunction, restraining order or decree of any nature of any court
or Governmental Authority of competent jurisdiction that is in effect that
restrains or prohibits the consummation of the transactions contemplated hereby
and by the other Transaction Documents;
(iv) such
Investor shall have executed each Transaction Document to which it is a party
and shall have delivered the same to the Company (including a duly executed
application form for the Series B Preferred Stock being subscribed by it at such
Closing);
(v) such
Investor shall have paid to the Company (or into in escrow account established
on behalf of the Company) the subscription price for the Series B Preferred
Stock being subscribed by it at such Closing;
(vi) to
the extent requested by the Company, such Investor shall have delivered to the
Company the information necessary to register such Investor’s Series B Preferred
Stock at such Investor’s account in the Norwegian Securities Depository
Verdipapirsentralen; and
(vii) the
Company shall have received the requisite corporate resolutions and other
documents necessary for it to duly and validly issue the Series B Preferred
Stock hereunder.
2.3 Post-Closing
Obligations. The Company shall, promptly following each
Closing, but in no event later than 7 days after such Closing, deliver to each
Holder a certificate of incorporation from the Norwegian Register of Business
Enterprises stating the new share capital of the Company, and, if requested by a
Holder, promptly assist such Holder in verifying the number and type of the
Company’s securities registered in such Holder’s name. Promptly after
the final Closing hereunder, the Company shall issue the New ATVM Warrants to
each Investor.
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2.4 Claw-Back
Rights. If a Holder fails to fulfill its obligation to
effectuate a Closing, and such failure is not caused by a breach by the Company
of its obligations hereunder, the Company shall send written notice of such
failure to such Holder. If such Holder fails to effectuate such
Closing within 10 Business Days of receiving such notice, such Holder shall be
deemed to have breached its investment commitment hereunder, and all of its
Series A and Series B Preferred Stock shall be automatically converted into
Common Stock, subject to the Company obtaining the necessary corporate
resolutions from its shareholders for such conversion, and such Holder shall
thereafter cease to have any rights as a holder of Series A or Series B
Preferred Stock.
2.5 Further
Assurances. The Investors shall cooperate with the Company in
good faith to effectuate each Closing as promptly as practicable, including,
without limitation, voting in favor of such Closing at the applicable
extraordinary general meeting and taking such other actions as are customary or
as may be reasonably requested to effectuate such Closing.
3. REPRESENTATIONS
AND WARRANTIES OF EACH HOLDER.
Each Holder (with respect to itself
only) hereby represents and warrants to the Company and agrees with the Company
that, as of the Execution Date:
3.1 Authorization;
Enforceability. Such Holder, if an entity, is duly and validly
organized, validly existing and in good standing under the laws of its formation
with the requisite corporate power and authority to subscribe for the Securities
to be subscribed by it hereunder and to execute and deliver this Agreement and
the other Transaction Documents to which it is a party. This
Agreement constitutes, and upon execution and delivery thereof, each other
Transaction Document to which such Holder is a party shall constitute, such
Holder’s valid and legally binding obligation, enforceable in accordance with
its terms, subject to (i) applicable bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium or other similar laws of general
application relating to or affecting the enforcement of creditors’ rights
generally and (ii) general principles of equity.
3.2 U.S. Investor. If
such Holder is a U.S. Person (as defined below), such Holder (i) is an
“accredited investor” as that term is defined in Rule 501 of Regulation D, (ii)
was not formed or organized for the specific purpose of making an investment in
the Company, and (iii) is acquiring the Securities solely for its own account
and not with a present view to the public resale or distribution of all or any
part thereof, except pursuant to sales that are registered under, or exempt from
the registration requirements of, the Securities Act and/or sales registered
under the Securities Act; provided, however, that in
making such representation, such Holder does not agree to hold the Securities
for any minimum or specific term and reserves the right to sell, transfer or
otherwise dispose of the Securities at any time in accordance with the
provisions of this Agreement and with federal and state securities laws
applicable to such sale, transfer or disposition. As used herein, a
“U.S.
Person” means: (i) any natural person resident in the United
States; (ii) any partnership or corporation organized or incorporated under the
laws of the United States; (iii) any estate of which any executor or
administrator is a U.S. Person; (iv) any trust of which any trustee is a U.S.
Person; (v) any agency or branch of a foreign entity located in the United
States; (vi) any non-discretionary account or similar account (other than an
estate or trust) held by a dealer or other fiduciary for the benefit or account
of a U.S. Person; (vii) any discretionary account or similar account (other than
an estate or trust) held by a dealer or other fiduciary organized, incorporated,
or (if an individual) resident in the United States; and (viii) any partnership
or corporation if: (x) organized or incorporated under the laws of
any foreign jurisdiction; and (y) formed by a U.S. Person principally for the
purpose of investing in securities not registered under the Securities Act,
unless it is organized or incorporated, and owned, by “accredited investors” as
that term is defined in Rule 501 of Regulation D who are not natural persons,
estates or trusts.
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3.3 Non U.S.
Investor. If such Holder is a not a U.S. Person, the sale of
the Securities by the Company to such Holder will not (i) violate any
Governmental Requirements applicable to such sale, and (ii) require any filing,
notice, registration or any other action by the Company under any Governmental
Requirements applicable to such sale, except for such filings, notices,
registrations and other actions which such Holder has in writing requested the
Company to make and which has been accepted by the Company.
3.4 Information; Economic
Risk. The Company has, prior to the date on which it is issuing
Securities under this Agreement, provided to such Holder information regarding
the business, operations and financial condition of the Company and has, prior
to the date on which it is issuing Securities under this Agreement, granted such
Holder the opportunity to ask questions of and receive answers from
representatives of the Company, its officers, directors, employees and agents
concerning the Company in order for such Holder to make an informed decision
with respect to its investment in such Securities. Neither such
information nor any other investigation conducted by such Holder or any of its
representatives shall modify, amend or otherwise affect such Holder’s right to
rely on the Company’s representations and warranties contained in this
Agreement. Such Holder can bear the economic risk of a total loss of
its investment in the Securities and has such knowledge and experience in
business and financial matters so as to enable it to understand the risks of and
form an investment decision with respect to its investment in the
Securities.
3.5 Limitations on
Disposition. Such Holder acknowledges that, except as
contemplated in this Agreement, the Securities have not been and are not being
registered under the Securities Act (or any other Governmental Requirements that
would enable the public distribution of the Securities) and may not be
transferred or resold to any other Person without the requisite registration
under applicable Governmental Requirements or pursuant to an exemption
therefrom.
3.6 Reliance on
Exemptions. Such Holder understands that the Securities are
being offered and sold to it in reliance upon specific exemptions from the
registration requirements of certain Governmental Requirements and that the
Company is relying upon the truth and accuracy of the representations and
warranties of such Holder set forth in this Section 3
in order to determine the availability of such exemptions and the eligibility of
such Holder to acquire the Securities. Such Holder acknowledges that
it did not subscribe for the Securities based upon any advertisement in any
publication of general circulation.
3.7 Fees. Such
Holder has not agreed to pay any compensation or other fee, cost or related
expenditure to any underwriter, broker, agent or other representative in
connection with the transactions contemplated hereby.
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3.8 No
Conflicts. The execution and performance of this Agreement and
the other Transaction Documents to which such Holder is a party do not conflict
in any material respect with any agreement to which such Holder is a party or is
bound, any court order or judgment applicable to such Holder, or the constituent
documents of such Holder.
3.9 No Governmental
Review. Such Holder understands that no Governmental Authority
has passed on or made any recommendation or endorsement of the Securities or the
fairness or suitability of an investment in the Securities nor have such
authorities passed upon the accuracy of any information provided to such Holder
or made any findings or determinations as to the merits of the offering of the
Securities.
4. REPRESENTATIONS
AND WARRANTIES OF THE COMPANY. The Company hereby represents
and warrants to each Holder and agrees with such Holder that, as of the
Execution Date:
4.1 Organization, Good Standing
and Qualification. The Company is duly organized, validly
existing and in good standing under the laws of Norway, and has all requisite
power and authority to carry on its business as now or proposed to be
conducted.
4.2 Authorization;
Consents. The Company has the requisite corporate power and
authority to enter into and perform its obligations under the Transaction
Documents, including, without limitation, the issuance of the Securities to the
Holders in accordance with the terms hereof and thereof.
4.3 Enforcement. This
Agreement has been and, at or prior to the applicable Closing Date, each other
Transaction Document required to be delivered by the Company on such date shall
be, duly executed and delivered by the Company. This Agreement
constitutes and, upon the execution and delivery thereof by the Company, each
other Transaction Document shall constitute, the valid and legally binding
obligation of the Company, enforceable against the Company in accordance with
their respective terms, subject to (i) applicable bankruptcy, insolvency,
fraudulent transfer, moratorium, reorganization or other similar laws of general
application relating to or affecting the enforcement of creditors’ rights
generally and (ii) general principles of equity.
4.4 Capitalization; Company
Subsidiaries.
(a) Capitalization. The
capitalization of the Company as of the Execution Date, and the pro forma
capitalization of the Company after giving effect to the applicable Closing,
including the number of shares issued and outstanding, the additional shares
which may be issued subject to power of attorney granted to the Board of
Directors (hereunder any power of attorney granted for the purpose of issuing
shares pursuant to the Company’s stock compensation plan and any other equity
compensation or incentive plans, and the number of shares issuable pursuant to
securities (other than the Securities) payable in, exercisable, exchangeable or
redeemable for or convertible into any shares of Common Stock are all set forth
on Schedule
4.4(a) on an indicative basis.
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(b) Company
Subsidiaries. Schedule 4.4(b)
sets forth all of the Company Subsidiaries. Except as
disclosed on Schedule
4.4(b), the Company or a wholly-owned Company Subsidiary owns all of the
share capital of each Company Subsidiary.
4.5 Due Authorization; Valid
Issuance. The Securities are duly authorized and, when issued,
delivered in accordance with the terms of the Transaction Documents, shall be
duly and validly issued, free and clear of any Liens imposed by or through the
Company. Assuming the accuracy of each Holder’s representations
contained herein, the issuance of the Securities under this Agreement shall be
effected in compliance with all applicable Governmental
Requirements.
4.6 No
Conflict. The execution, delivery and performance of this
Agreement and the other Transaction Documents shall not (i) violate the
Company’s articles of association or any other organizational document, or (ii)
violate any Governmental Requirement applicable to the Company.
4.7 Compliance with Laws;
Litigation. The Company is not in violation of (and no event
has occurred which, with notice or lapse of time or both, would constitute a
violation under) any applicable Governmental Requirement. No material
claim, investigation or proceeding is pending or, to the Company’s knowledge
threatened, against the Company.
4.8 Solicitation; Other Issuances
of Securities. Neither the Company nor any of its Affiliates,
nor any Person acting on its or their behalf, (i) has engaged in any form of
general solicitation or general advertising (within the meaning of Regulation D)
in connection with the offer or sale of the Securities, or (ii) has, directly or
indirectly, made any offers or sales of any security or the right to purchase or
subscribe for any security, or solicited any offers to buy any security or any
such right, under circumstances that would require registration of the
Securities under the Securities Act.
4.9 No Fees. Neither
the Company nor any Company Subsidiary is obligated to pay any brokers, finders
or financial advisory fees or commissions to any underwriter, broker, agent or
other representative in connection with the transactions contemplated
hereby.
5. COVENANTS
AND AGREEMENTS OF THE COMPANY AND HOLDERS.
5.1 Use of
Proceeds. The Company shall use the proceeds from the
subscription of Series B Preferred Stock primarily to position the Company to
undertake a successful initial public offering of its Common Stock and the
remainder for general working capital purposes. The Company shall not
make any other use of proceeds without the consent of the Board of
Directors.
5.2 Board
Composition. The Board of Directors will be increased from six
to eight members, with the two new board seats being filled by independent
directors designated by the Lead Investors. The remaining six board
seats will continue to be designated as follows: two members to be
designated by Ener1, one member to be designated by Rockport Capital Partners,
one member to be designated by Valmet, one member to be designated by Investinor
AS, and the final member to be Xx. Xxxxxx Xxxxxx. The foregoing shall
be embodied in the Shareholders Agreement since the obligations pursuant to this
Section
5.2 apply only to the Holders.
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5.3 Additional Affirmative
Covenants of the Company. The Company agrees that, during the
period beginning on the Execution Date and ending on the Termination Date, the
Company shall, and to the extent legally permitted, shall cause the Company
Subsidiaries to:
(a) maintain
its corporate existence in good standing;
(b) comply
with all material Governmental Requirements applicable to the operation of its
business in all material respects;
(c) comply
with all material agreements, documents and instruments binding on it or
affecting its Properties or business, including, without limitation, all
material contracts, in all material respects; and
(d) maintain
commercially reasonable insurance coverage (including D&O insurance) for the
Company and each Company Subsidiary.
5.4 Certain Negative Covenants
of the Company. The Company agrees that, during the period
beginning on the Execution Date and ending on the Termination Date, the Company
shall not, and shall, to the extent legally permitted, not permit any Company
Subsidiary to:
(a) enter
into any transaction or arrangement with any Affiliate, employee, officer,
director or equity holder of the Company or Company Subsidiary, unless such
transaction is effectuated on an arm’s length basis and approved by the
independent members of the Board of Directors;
(b) if
the Company is permitted to redeem the Series A Preferred Stock, redeem such
stock at a per share redemption price that is greater than the redemption price
contemplated in the Articles of Association; or
(c) materially
diverge from the Company’s or any Company Subsidiary’s current operating budget
as adopted and approved hereunder without the prior consent of the Board of
Directors.
5.5 Use of Holder’s
Name. Except as may be required by applicable law and/or this
Agreement, the Company shall not use, directly or indirectly, any Holder’s name
or the name of any of its Affiliates in any advertisement, announcement, press
release or other similar communication unless it has received the prior written
consent of such Holder for the specific use contemplated or as otherwise
required by applicable law or regulation.
5.6 Requisite
Approvals. Promptly after the date hereof, the Company shall
use its reasonable best efforts to take all actions, and to obtain all consents
and approvals, necessary for it to consummate each Closing as contemplated
hereunder as soon as practicable after the date hereof.
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6. INDEMNIFICATION
OF HOLDERS.
The obligations of the Company under
this Section 6
shall be subject to applicable Norwegian Governmental Requirements and may not
be enforceable under some or all instances. The Company shall
indemnify and hold each Holder and its directors, managers, officers,
shareholders, members, partners, employees and agents (each, a “Holder
Party”) harmless from any and all losses, liabilities, obligations,
claims, contingencies, damages, costs and expenses, including all judgments,
amounts paid in settlements, court costs and reasonable attorneys’ fees and
costs of investigation that any such Holder Party may suffer or incur as a
result of or relating to (a) any breach of any of the representations,
warranties, covenants or agreements made by the Company in any of the
Transaction Documents, or (b) any action instituted against a Holder, or any of
its Affiliates, by any shareholder or creditor of the Company or any of the
Company Subsidiaries with respect to any of the transactions contemplated by the
Transaction Documents. With respect to legal expenses and other
out-of-pocket expenses that a Holder Party may reasonably incur in connection
with investigating or defending an action, claim, loss or other matter covered
hereunder, the Company shall reimburse such Holder Party for such expenses
promptly upon request by such Holder Party. If any action shall be
brought against any Holder Party in respect of which indemnity may be sought
pursuant to this Agreement, such Holder Party shall promptly notify the Company
in writing, and the Company shall have the right to assume the defense thereof
with counsel of its own choosing. Any Holder Party shall have the
right to employ separate counsel in any such action and participate in the
defense thereof, but the fees and expenses of such counsel shall be at the
expense of such Holder Party except to the extent that (i) the employment
thereof has been specifically authorized by the Company in writing, (ii) the
Company has failed after a reasonable period of time following such Holder
Party’s written request that it do so, to assume such defense and to employ
counsel or (iii) in such action there is, in the reasonable opinion of such
separate counsel, a material conflict on any material issue between the position
of the Company and the position of such Holder Party. The Company
shall not be liable to any Holder Party under this Section 6
(1) for any settlement by a Holder Party effected without the Company’s prior
written consent, which shall not be unreasonably withheld or delayed; or (2) to
the extent, but only to the extent that a loss, claim, damage or liability is
attributable to such Holder Party’s wrongful actions or omissions, or gross
negligence or to such Holder Party’s breach of any of the representations,
warranties, covenants or agreements made by such Holder in any of the
Transaction Documents.
7.
MISCELLANEOUS.
7.1 Survival. The
representations, warranties, covenants and indemnities made by the parties
herein and in the other Transaction Documents shall survive each Closing
notwithstanding any due diligence investigation made by or on behalf of the
party seeking to rely thereon.
7.2 Successors and
Assigns. The terms and conditions of this Agreement shall
inure to the benefit of and be binding upon the respective successors and
permitted assigns of the parties. Nothing in this Agreement, express
or implied, is intended to confer upon any party other than the parties hereto
or their respective successors and permitted assigns any rights, remedies,
obligations or liabilities under or by reason of this Agreement, except as
expressly provided in this Agreement. A Holder may assign its rights and
obligations hereunder in connection with any private sale or transfer of Series
B Preferred Stock, but not any Conversion Shares, as long as, as a condition
precedent to such transfer, the transferee executes an acknowledgment agreeing
to be bound by the applicable provisions of this Agreement, in which case the
term “Holder” shall be deemed to refer to such transferee as though such
transferee were an original signatory hereto, and such assignment complies with
applicable Governmental Requirements. The Company may not assign its
rights or obligations under this Agreement.
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7.3 No
Reliance. Each party acknowledges that (i) it has such
knowledge in business and financial matters as to be fully capable of evaluating
this Agreement, the other Transaction Documents and the transactions
contemplated hereby and thereby, (ii) it is not relying on any advice or
representation of any other party in connection with entering into this
Agreement, the other Transaction Documents or such transactions (other than the
representations made in this Agreement or the other Transaction Documents),
(iii) it has not received from any other party any assurance or guarantee as to
the merits (whether legal, regulatory, tax, financial or otherwise) of entering
into this Agreement or the other Transaction Documents or the performance of its
obligations hereunder and thereunder, and (iv) it has consulted with its own
legal, regulatory, tax, business, investment, financial and accounting advisors
to the extent that it has deemed necessary, and has entered into this Agreement
and the other Transaction Documents based on its own independent judgment and,
if applicable, on the advice of such advisors, and not on any view (whether
written or oral) expressed by any other party.
7.4 Governing Law and
Jurisdiction. This Agreement shall be governed by and construed in
accordance with the laws of Norway. Any dispute arising out of or in
connection with this Agreement shall be finally settled by arbitration in
accordance with the Norwegian Arbitration Act of 2004. The place of arbitration
shall be Oslo, Norway. Unless otherwise agreed by the parties, the
arbitration court shall be composed by three (3) arbitrators appointed according
to the provisions in the Norwegian Arbitration Act of 2004. The language to be
used in the arbitration proceedings shall be English, unless otherwise
agreed. Each of the Holders agrees that any arbitration and arbitral
awards shall be confidential.
7.5 Counterparts. This
Agreement may be executed in any number of counterparts, each of which shall be
deemed an original, and all of which together shall constitute one and the same
instrument. This Agreement may be executed and delivered by
facsimile.
7.6 Headings. The
headings used in this Agreement are used for convenience only and are not to be
considered in construing or interpreting this Agreement.
7.7 Notices. Any
notice, demand or request required or permitted to be given by the Company or a
Holder pursuant to the terms of this Agreement shall be in writing and shall be
deemed delivered (i) when delivered personally or by verifiable facsimile,
unless such delivery is made on a day that is not a Business Day (or after 4
p.m., Central European time on a Business Day), in which case such delivery
shall be deemed to be made on the next succeeding Business Day, (ii) on the next
Business Day after timely delivery to an internationally recognized overnight
courier service providing overnight service to the applicable address; in each
case, addressed as follows:
If to the
Company:
Think
Holdings AS
Xxxxxx
Linges xxx 00, 0000 Xxxxxxx, Xxxxxx
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Attn: The
Chief Executive Officer
Tel: + 00
00 00 00 00
Fax: + 00
00 00 00 00
and if to
a Holder, to the address for such Holder as designated by such Holder in writing
to the Company in accordance with this Section
7.7.
7.8 Expenses. The
Company and each Holder shall pay all costs and expenses that it incurs in
connection with the negotiation, execution, delivery and performance of this
Agreement or the other Transaction Documents.
7.9 Failure or Delay 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 any other or further exercise thereof or of any other right,
power or privilege.
7.10 Amendments;
Waivers. Except as expressly provided herein, neither this
Agreement nor any term hereof may be amended except pursuant to a written
instrument executed by the Company and the Requisite Holders. A
waiver of any provision of this Agreement that is enforceable against the
Company shall be valid only if given in writing by the Company, and may be
relied upon by all of the Holders. A waiver of any provision in this
Agreement that is enforceable against a specific Holder shall be valid only if
given in writing by such Holder. A waiver of any provision in this
Agreement that is enforceable against all of the Holders shall be valid only if
given in writing by the Requisite Holders. Any waiver given hereunder
shall be effective only in the specific instance and for the specific purpose
for which it was given.
7.11 Entire
Agreement. This Agreement and the other Transaction Documents
constitute the entire agreement between the parties with regard to the subject
matter hereof and thereof, superseding all prior agreements or understandings,
whether written or oral, between or among the parties.
7.12 Severability. If
any provision of this Agreement becomes or is declared by a court of competent
jurisdiction to be illegal, unenforceable or void, this Agreement shall continue
in full force and effect without said provision; provided that in such case
the parties shall negotiate in good faith to replace such provision with a new
provision which is not illegal, unenforceable or void, as long as such new
provision does not materially change the economic benefits of this Agreement to
the parties.
7.13 Attorneys’
Fees. In the event that any suit or action is instituted under
or in relation to this Agreement, including without limitation to enforce any
provision in this Agreement, the prevailing party in such dispute shall be
entitled to recover from the losing party all fees, costs and expenses of
enforcing any right of such prevailing party under or with respect to this
Agreement, including without limitation, such reasonable fees and expenses of
attorneys and accountants, which shall include, without limitation, all fees,
costs and expenses of appeals. With respect to the Company this Section
7.13 is subject to what is permitted under applicable
law.
-15-
7.14 Exculpation Among
Investors. Each Investor acknowledges that it is not relying
upon any person, firm, or corporation, other than the Company and its officers
and directors, in making its investment or decision to invest in the
Company. Each Investor agrees that no Investor nor the respective
controlling persons, officers, directors, partners, agents, or employees of any
Investor shall be liable to any other Investor for any action heretofore or
hereafter taken or omitted to be taken by any of them in connection with the
Securities.
[Signature
Pages to Follow]
-16-
IN
WITNESS WHEREOF, the undersigned have executed this Agreement as of the date
first-above written.
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THINK
HOLDINGS AS
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By:
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Name:
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Title:
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IN
WITNESS WHEREOF, the undersigned have executed this Agreement as of the date
first-above written.
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INVESTOR:
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By:
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Name:
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Title:
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