INVESTOR RIGHTS AGREEMENT
Exhibit 10.1
THIS
INVESTOR RIGHTS AGREEMENT (the “Agreement”) is entered into as of this 9th day
of November 2009, by and among Iris Energy Holdings Limited (“Iris”), The
Peierls Foundation (“TPF”), Xxxxx X. Peierls (“BEP”), and Xxxxxxx Xxxxxx
(“Barish”). Iris, TPF, BEP and Barish are referred to herein
sometimes collectively as the Parties and individually as a
“Party.”
WHEREAS,
Iris, TPF, BEP, and Barish are investors in an offering of up to 10,000,000
shares (the “Shares”) of $0.001 par value common stock (“Common Stock”) of New
Frontier Energy, Inc. (“NFEI”) pursuant to a Securities Purchase Agreement dated
as of the date hereof (the “Purchase Agreement”); and
WHEREAS,
Iris is the owner of a majority of NFEI’s 2.5% Series C Cumulative Convertible
Preferred Stock which automatically converts into shares of Common Stock on
December 1, 2009 and on such date, will become a significant owner of shares of
Common Stock in NFEI; and
WHEREAS,
the sole director of Iris is Xxxxxx Veera, a director of NFEI; and
WHEREAS,
TPF, BEP and Barish, as a condition to entering into the Purchase Agreement with
NFEI, have requested that Iris enter into this Agreement; and
WHEREAS,
in order to induce TPF, BEP and Barish to enter into the Purchase Agreement,
Iris hereby agrees to enter into this Agreement to define certain rights it has
agreed to give to TPF, BEP, and Barish and certain restrictions and limitations
on how it may vote its shares of Common Stock in NFEI; and
NOW,
THEREFORE, in consideration of the mutual agreements, covenants and conditions
contained herein, Iris, TPF, BEP and Barish hereby agree as
follows.
ARTICLE
I
CERTAIN
DEFINITIONS
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1.1
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The
term “Affiliate” shall mean an affiliate of, or person affiliated with, a
specified person, is a person that directly, or indirectly through one or
more intermediaries, controls or is controlled by, or is under common
control with, the person specified.
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1.2 The
term “Agreement” shall have the meaning set forth in the Recitals.
1.3 The
term “Barish” shall have the meaning set forth in the Recitals.
1.4 The
term “Common Stock” shall have the meaning set forth in the
Recitals.
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1.5
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The
term “Disqualified Nominee” shall mean any individual who is nominated to
join the board of directors of NFEI that is not Independent of
Iris.
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1.6
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The
term “Independent” with respect to any company shall mean a person who is
qualified to be an “Independent Director” of such company as defined by
NASDAQ Marketplace Rule 5605(a)(2).
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1.7
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The
term “New Securities” shall mean any capital stock of NFEI, whether now
authorized or not, and rights, options or warrants to purchase Common
Stock, and securities of any type whatsoever that under its terms, are, or
may become, convertible or exerciseable into Common
Stock.
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1.8 The
term “NFEI” shall have the meaning set forth in the Recitals.
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1.9
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The
term “Offering” means the offering of the Shares to Iris, TPF, BEP, and
Barish pursuant to the Purchase
Agreements.
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1.10
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The
term “Pro Rata Ratio” means the ratio (i) the numerator of which is the
number of shares of Common Stock to be acquired by such Party in the
Offering, and (ii) the denominator of which is
6,500,000.
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1.11 The
term “Purchase Agreement” shall have the meaning set forth in the
Recitals.
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1.12
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The
term “Qualified Nominee” shall mean any individual who is nominated to
join the board of directors of NFEI that is Independent of Iris.
Notwithstanding anything to the contrary, Xxxxxx Veera shall be considered
a Qualified Nominee so long as Xxxx Xxxxx is both a director of and the
CEO of NFEI.
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ARTICLE
2
SUBSCRIPTION
FOR SHARES
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2.1
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If
NFEI offers to Iris or its Affiliates the opportunity to invest in New
Securities of NFEI, Iris covenants not to subscribe for or invest in such
New Securities unless NFEI offers to each TPF, BEP, and Barish the
opportunity to invest, on substantially identical terms as is offered to
Iris or its Affiliates, in the New Securities an amount that is at minimum
the product of (i) the Pro Rata Ratio for such Party and (ii) the
aggregate amount offered by NFEI to Iris or its
Affiliates.
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2.2
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The
right to invest on a Pro Rata Basis pursuant to this Article 2 shall
expire three years from the date of this
Agreement.
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ARTICLE
3
VOTING
AGREEMENTS
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3.1
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Iris
agrees that so long as TPF and BEP each own 250,000 shares or more of
Common Stock in NFEI, Iris will not vote in favor of any reverse stock
split that would result in TPF or BEP being “cashed out” such that they no
longer own any Common Stock of NFEI and receive only cash in lieu of any
fractional shares in NFEI.
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3.2 Election
of Directors.
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(A)
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In
the event that NFEI holds a meeting of its common shareholders at which
members of the board of directors are elected, Iris shall vote 100% of its
shares of Common Stock then owned in the same proportion as the vote of
all other common shareholders of NFEI with respect to any Disqualified
Nominee. Iris shall have no restrictions or limitations whatsoever upon
how it shall vote it shares of Common Stock with respect to any Qualified
Nominee.
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(B)
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Until
such time as NFEI has a board of directors the majority of whom are
Independent of NFEI, Iris shall vote 100% of its shares of Common Stock
then owned in the same proportion as the vote of all other common
shareholders of NFEI with respect to the election of any
director.
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(C)
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With
respect to the selection of directors for NFEI, Iris intends to (i)
support persons who are knowledgeable about the oil and gas business
and/or have other skills or qualifications that would be of value to NFEI
and (ii) not support persons whose sole qualification is a relationship
with either one or more executives or significant shareholders of NFEI.
This Section 3.2(C) is merely a statement of intent, and does not create a
legal commitment, obligation, or duty of any
sort.
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3.3
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Termination
of Voting Agreement. The covenants set forth in this Article 3 shall
expire three years from the date of this
Agreement.
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ARTICLE
4
MISCELLANEOUS
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4.1.
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Expenses.
Each of the Parties will bear its own costs and expenses (including legal
fees and expenses) incurred in connection with this Agreement and the
transactions contemplated hereby.
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4.2.
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Assignment. This
Agreement shall be binding upon and inure to the benefit of the Parties
named herein and their respective successors and permitted
assigns. No Party may assign either this Agreement or any of
its rights, interests, or obligations hereunder without the prior written
approval of the other Parties.
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4.3.
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Amendment
and Modification; Waivers. This Agreement or any term hereof
may be changed, waived, discharged or terminated only by an agreement in
writing signed by the party against which such change, waiver, discharge
or termination is sought to be enforced. No waiver by a party
of any condition or of any breach of any term, covenant, representation or
warranty contained herein shall be effective unless in writing, and no
waiver in any one or more instances shall be deemed to be a further or
continuing waiver of any such condition or breach in any other instances
or a waiver of any other condition or breach of any other term, covenant,
representation or warranty.
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4.4.
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Entire
Agreement. This Agreement constitutes the entire agreement among the
Parties and supersedes any prior understandings, agreements, or
representations by or among the Parties, written or oral, to the extent
they related in any way to the subject matter hereof. In the
event of any conflict, this Agreement will take precedence over any other
instrument or document.
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4.5.
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Severability. Any
term or provision of this Agreement that is invalid or unenforceable in
any situation in any jurisdiction shall not affect the validity or
enforceability of the remaining terms and provisions hereof or the
validity or enforceability of the offending term or provision in any other
situation or in any other
jurisdiction.
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4.6.
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Counterparts/Facsimile
copies. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of which
together will constitute one and the same instrument. Facsimile
copies of this Agreement will be
binding.
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4.7.
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Headings.
The section headings contained in this Agreement are inserted for
convenience only and shall not affect in any way the meaning or
interpretation of this Agreement.
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4.8.
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Notices.
All notices, requests, demands, claims, and other communications hereunder
will be in writing. Any notice, request, demand, claim, or other
communication hereunder shall be deemed duly given if (and then six (6)
business days after) it is sent by registered or certified mail, return
receipt requested, postage prepaid, and addressed to the intended
recipient as set forth below:
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If to
Iris:
Iris
Energy Holdings Limited
c/o
Altius Business Services Pte Ltd
00-00X
Xxx Xxxxxxxx
00 Xxx
Xxxxxxxx, Xxxxxxxxx
If to
TPF:
The
Peierls Foundation
000 Xxxx
00xx
Xxxxxx
Xxx Xxxx
XX 00000
If to
BEP:
Xxxxx X.
Peierls
0000
Xxxxxxxxxx Xxxx
Xxxxxx XX
00000
If to
Barish:
Xxxxxxx
Xxxxxx
0000 Xxxx
0xx Xxxxxx, #000
Xxxxxx,
XX 00000
Any Party
may send any notice, request, demand, claim, or other communication hereunder to
the intended recipient at the address set forth above using any other means
(including personal delivery, expedited courier, messenger service, telecopy,
telex, ordinary mail, or electronic mail), but no such notice, request, demand,
claim, or other communication shall be deemed to have been duly given unless and
until it actually is received by the intended recipient. Any party may change
the address to which notices, requests, demands, claims, and other
communications hereunder are to be delivered by giving the other Parties notice
in the manner herein set forth.
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4.9.
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Applicable
Law. This Agreement and all claims relating to or arising out
of it, including claims relating to its making, performance and
interpretation, and the rights and liabilities of the parties, shall be
construed, interpreted and enforced in accordance with the internal laws
(as opposed to conflicts of law provisions) of the State of
Colorado. The Parties hereby consent to the exclusive
jurisdiction of any state or federal court in the State of
Colorado. The Parties waive any objection which they may have
based on lack of jurisdiction or improper venue or forum non conveniens to
any suit or proceeding instituted by the other party under this Agreement
in any such state or federal court and consent to the granting of such
legal or equitable relief as is deemed appropriate by the
court. This provision is a material inducement for the Parties
to enter into this Agreement.
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4.10.
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Construction. The
Parties have participated jointly in the negotiation and drafting of this
Agreement. In the event an ambiguity or question of intent or
interpretation arises, this Agreement shall be construed as if drafted
jointly by the Parties and no presumption or burden of proof shall arise
favoring or disfavoring any Party by virtue of the authorship of any of
the provisions of this Agreement. Any reference to any federal,
state, local, or foreign statute or law shall be deemed also to refer to
all rules and regulations promulgated thereunder, unless the context
otherwise requires.
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4.11.
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Time
of the Essence. Time shall in all respects be of the essence,
provided that the time for doing or
completing any matter provided for in this Agreement may be extended or
abridged by an agreement in writing signed by each of the
Parties.
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IN
WITNESS WHEREOF, the Parties hereto have executed this Agreement on the date
first above written.
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The
Peierls Foundation
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Iris Energy Holdings Limited | |||
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/s/
Xxxxx X. Peierls
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/s/
Samyek Veera
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Xxxxx
X. Peierls
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Xxxxxx
Veera, Director
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/s/
Xxxxx X. Peierls
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/s/
Xxxxxxx Xxxxxx
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Xxxxx
X. Peierls
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Xxxxxxx
Xxxxxx
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