000182885212/31False00018288522023-12-142023-12-14
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): December 14, 2023
Mondee Holdings, Inc.
(Exact name of registrant as specified in its charter)
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| Delaware | | 001-39943 | | 88-3292448 |
(State or other jurisdiction
of incorporation) | | (Commission
File Number) | | (I.R.S. Employer
Identification No.) |
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10800 Pecan Park Blvd Suite 315 Austin, Texas | | 78750 |
(Address of principal executive offices) | | (Zip Code) |
(650) 646-3320
(Registrant’s telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
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| ☐ | Written communications pursuant to Rule 425 under the Securities Act |
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| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act |
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| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act |
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| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act |
Securities registered pursuant to Section 12(b) of the Act:
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| Title of each class | | Trading
Symbol(s) | | Name of each exchange
on which registered |
Class A common stock, $0.0001 par value per share | | MOND | | The Nasdaq Stock Market LLC |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☒
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 1.01 Entry into a Material Definitive Agreement
As previously disclosed by Mondee Holdings, Inc. (the “Company”) on its Current Report on Form 8-K, filed on September 30, 2022, on September 29, 2022 the Company completed a private placement of the Company’s Series A Preferred Stock, par value $0.0001 per share (the “Series A Preferred Stock”), and warrants (the “Original Warrants”) to purchase shares of the Company’s Class A Common Stock, par value $0.0001 ( “Common Stock”), pursuant to the terms of those certain Subscription Agreements, dated September 29, 2022, by and between the Company and certain subscribers thereto, that certain Registration Rights Agreement, dated September 29, 2022, by and between the Company and certain subscribers thereto, and that certain Warrant Agreement, dated September 29, 2022 (the “Original Warrant Agreement”) by and between the Company and Continental Stock Transfer & Trust Company (“CST”).
As previously disclosed by the Company on its Current Report on Form 8-K, filed on October 23, 2023, on October 17, 2023 the Company completed a subsequent private placement of the Company’s newly designated Series A-3 Preferred Stock, par value $0.0001 per share (the “Series A-3 Preferred Stock”), and warrants to purchase shares of Common Stock (the “October 2023 Financing Transaction”), pursuant to the terms of that certain Subscription Agreement and Plan of Reorganization, dated October 17, 2023, by and between the Company and Tuesday Investor LLC (the “TI Subscriber”), that certain Amended and Restated Registration Rights Agreement, dated October 17, 2023, by and between the Company, the TI Subscriber and NH Credit Partners III Holdings L.P. (the “MS Subscriber” and, together with the TI Subscriber, the “Original Subscribers”) and that certain Warrant Agreement, dated October 17, 2023, by and between the Company and CST. In connection with the October 2023 Financing Transaction and as previously disclosed by the Company on the same Current Report on Form 8-K, the Company entered into a letter agreement (the “Letter Agreement”) with MS Subscriber whereby the Company and MS Subscriber agreed to certain terms relating to a potential future investment in the Company and MS Subscriber provided certain agreements and waivers relating to the October 2023 Financing Transaction.
In connection with the Letter Agreement, on December 14, 2023 the Company completed a subsequent private placement of the Series A-3 Preferred Stock and warrants (the “Warrants”) to purchase shares of Common Stock (the “December 2023 Financing Transaction”), pursuant to the terms of that certain Subscription Agreement and Plan of Reorganization, dated December 14, 2023 (the “Subscription Agreement”), by and between the Company and MS Subscriber, that certain Second Amended and Restated Registration Rights Agreement, dated December 14, 2023 (the “Second A&R Registration Rights Agreement”), by and between the Company and the Original Subscribers, and that certain Amended and Restated Warrant Agreement, dated December 14, 2023 (the “A&R Warrant Agreement”), by and between the Company and CST.
Subscription Agreement
In accordance with the terms and conditions of the Subscription Agreement, the Company sold to the MS Subscriber 1,300 shares of Series A-3 Preferred Stock (the “Incremental Shares”) at a purchase price of $1,000 per share (the “Stated Value”), together with Warrants (including 150,000 warrants issued to the MS Subscriber in exchange for surrendering the Original Warrants held by MS Subscriber and 19,500 additional warrants) to purchase 169,500 shares of Common Stock (the “Warrant Shares”).
In connection with the December 2023 Financing Transaction, the Company received gross proceeds of $1.3 million, before deducting transaction expenses.
The Subscription Agreement contains representations and warranties by the Company and the MS Subscriber and covenants of the Company and the MS Subscriber (including indemnification from the Company in the event of breaches of its representations and warranties) and other rights, obligations and restrictions, which the Company believes are customary for transactions of this type.
Second A&R Registration Rights Agreement
Pursuant to the Second A&R Registration Rights Agreement, the Company is required to file a registration statement to cover the resale of the Warrants and Warrant Shares within 30 calendar days following the closing of the December 2023 Financing Transaction and use commercially reasonable efforts to have such registration
statement declared effective as soon as practicable after the filing thereof, but no later than the earlier of (i) 90 days following the closing of the December 2023 Financing Transaction (or 120 days if the Company is notified by the Securities and Exchange Commission that the registration statement will be reviewed) and (ii) the 10th business day after the Company is notified by the Securities and Exchange Commission that the registration statement will not be reviewed or will not be subject to further review. The Second A&R Registration Rights Agreement further provides that the Original Subscribers will be entitled to certain customary “piggyback” registration rights and contains additional customary covenants between the Company and the Original Subscribers.
Second A&R Certificate of Designation
In connection with the December 2023 Financing Transaction, on December 14, 2023, the Company filed a Second Amended and Restated Certificate of Designation of Preferences, Rights and Limitations of Series A-1, Series A-2 and Series A-3 Preferred Stock (the “Second A&R Certificate of Designation”) with the Secretary of State of the State of Delaware, which (i) converted the Series A-1 Preferred Stock held by MS Subscriber to Series A-2 Preferred Stock on a one-for-one basis (the “Additional Series A-2 Preferred Stock” and, together with the Series A-3 Preferred Stock, the “Preferred Stock”), reduced the number of authorized shares constituting Series A-1 Preferred Stock to zero, and increased the number of authorized shares constituting Series A-2 Preferred Stock to 85,000 and (ii) otherwise amended and restated the rights, preferences, privileges, qualifications, limitations and restrictions relating to the Preferred Stock. The Second A&R Certificate of Designation became effective with the Secretary of State of the State of Delaware upon filing.
Pursuant to the Second A&R Certificate of Designation, the Preferred Stock is not convertible into shares of Common Stock of the Company. Holders of the Preferred Stock are entitled to receive dividends with respect to each share of Preferred Stock at a rate equal to (i) with respect to the Series A-1 Preferred Stock (x) with respect to a dividend accrued prior to the second anniversary of September 29, 2022 (the “Original Issue Date”), the Secured Overnight Finance Rate (“SOFR”) plus 7.00% per annum and (y) with respect to a dividend accrued from and after the second anniversary of the Original Issue Date, SOFR plus 10.50% per annum, and (ii) with respect to the Series A-2 Preferred Stock and Series A-3 Preferred Stock, except for the Additional Series A-2 Preferred Stock and the Incremental Shares (x) with respect to a dividend accrued from the Original Issue Date to, but excluding, October 17, 2023 (the “Incremental Closing Date”), SOFR plus 7.00% per annum, (y) with respect to a dividend accrued from and after the Incremental Closing Date to, but excluding, the second anniversary of the Original Issue Date, SOFR plus 8.50% per annum, and (z) with respect to a dividend accrued from and after the second anniversary of the Original Issue Date, SOFR plus 12.00% per annum, payable quarterly and (iii) with respect to the Additional Series A-2 Preferred Stock and Incremental Shares, (x) with respect to a dividend accrued from the Original Issue Date to, but excluding, December 14, 2023 (the “Additional Incremental Closing Date”), SOFR + 7.00% per annum, (y) with respect to a dividend accrued from and after the Additional Incremental Closing Date to, but excluding, the second anniversary of the Original Issue Date, SOFR + 8.50% per annum, and (z) with respect to a dividend accrued from and after the second anniversary of the Original Issue Date, SOFR + 12.00% per annum. The Company, at its option, may redeem for cash all, but not less than all, of the outstanding shares of Preferred Stock at a redemption price for each class of Preferred Stock as determined pursuant to the terms of the Second A&R Certificate of Designation (the “Redemption Price”). The Company has also granted holders of (i) the Series A-1 Preferred Stock the right to cause the Company to purchase the shares of Preferred Stock (the “Series A-1 Put Right”) any time after the fifth anniversary of Original Issue Date and (ii) the Series A-2 and Series A-3 Preferred Stock the right to cause the Company to purchase the shares of Preferred Stock (together with the Series A-1 Put Right, as applicable, the “Put Right”) any time after the fourth anniversary of the Original Issue Date, which date shall be accelerated to March 31, 2026 if the Company fails to have an Adjusted EBITDA (as defined in the Second A&R Certificate of Designation) of at least $50 million for the Company’s 2025 fiscal year, in each case, at a price equal to the Stated Value plus accrued and unpaid dividends (the “Put Price”).
In the event a Non-Compliance Event (as defined in the Second A&R Certificate of Designation) occurs, the Stated Value and the accrued but unpaid dividends shall each accrete by an additional 0.50% each month during the continuance of such Non-Compliance Event. In the event the holders exercise the Put Right and the Company fails to pay the Put Price to the holders for a period of six months following receipt of notice of exercise of the Put Right, the holders of a majority of outstanding shares of Series A-2 Preferred Stock and Series A-3 Preferred Stock, acting as one class (the “A-2 and A-3 Majority Holders”), may elect to have the Company deliver a promissory note in the amount equal to the unpaid Put Price, a form a which is attached to the Second A&R Certificate of Designation.
The Preferred Stock of each series, with respect to dividend rights, rights on the distribution of assets on any voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Company and redemption rights, rank: (a) on a parity basis with each other and with each other class or series of any and all shares of, rights to purchase, warrants or options for, or other equivalents of or interests in (however designated) equity (“Capital Stock”) of the Company now existing or hereafter authorized, classified or reclassified, the terms of which expressly provide that such class or series ranks on a parity basis with the Preferred Stock as to dividend rights, rights on the distribution of assets on any voluntary or involuntary liquidation, dissolution or winding up of the affairs of the
Company and (except as permitted hereby) redemption rights (such Capital Stock, “Parity Stock”); (b) junior to each other class or series of Capital Stock of the Company now existing or hereafter authorized, classified or reclassified, the terms of which expressly provide that such class or series ranks senior to the Preferred Stock as to dividend rights, rights on the distribution of assets on any voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Company and (except as permitted hereby) redemption rights (such Capital Stock, “Senior Stock”); and (c) senior to the Common Stock and each other class or series of Capital Stock of the Company now existing or hereafter authorized, classified or reclassified, the terms of which do not expressly provide that such class or series ranks on a parity basis with, or senior to, the Preferred Stock as to dividend rights, rights on the distribution of assets on any voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Company and (except as permitted hereby) redemption rights (such Capital Stock, “Junior Stock”).
In the event of any voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Company, the holders of Preferred Stock are entitled, out of assets legally available therefor, before any distribution or payment out of the assets of the Company may be made to or set aside for the holders of any Junior Stock, and subject to the rights of the holders of any Senior Stock or Parity Stock issued in accordance with the Second A&R Certificate of Designation and the rights of the Company’s existing and future creditors, to receive in full a liquidating distribution in cash and in the amount per share of Preferred Stock equal to the Redemption Price as of the date of such voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Company.
Holders of Preferred Stock do not have any voting rights except in respect of such matters as set forth in the Second A&R Certificate of Designation or otherwise required by applicable law. On any matter on which holders of Preferred Stock are entitled to vote, the holders shall vote separately as a single class with respect to the Preferred Stock, in person or by proxy, at a meeting called for such purpose or by written consent without a meeting. Shares of Preferred Stock held by an Excluded Holder (as defined in the Second A&R Certificate of Designation) are not be entitled to vote. The Preferred Stock also have certain protective provisions, such as requiring the vote of a majority of Preferred Stock to change or amend their rights, powers, privileges, limitations and restrictions. The A-2 and A-3 Majority Holders have certain additional protective provisions, including relating to the use of proceeds from the December 2023 Financing Transaction, the appointment or removal without cause of any director designated by the majority holders of the Series A-2 Preferred Stock and Series A-3 Preferred Stock (as discussed below) and increasing the size of the Company’s board of directors to more than eight directors.
So long as the holder of the majority of the Preferred Stock issued on the Incremental Closing Date (the “Majority Preferred Investor”) continues to own at least 50% of the shares of Series A Preferred Stock then outstanding, the Majority Preferred Investor has the right to appoint one observer to the Company’s board of directors and any committee thereof, subject to the terms and conditions set forth in the Second A&R Certificate of Designation. If the Company fails to achieve an adjusted EBITDA of at least $40 million for the Company’s 2024 fiscal year and the holders of the A-2 Preferred Stock and Series A-3 Preferred Stock hold Series A-2 Preferred Stock and Series A-3 Preferred Stock representing an aggregate Stated Value of at least $23,976,322.56, the A-2 and A-3 Majority Holders shall be entitled to appoint an individual of the A-2 and A-3 Majority Holder’s choosing to the Company’s board of directors not later than the date of the immediately upcoming meeting of stockholders for the election of directors. In addition, if the holders of Series A-2 Preferred Stock and Series A-3 Preferred Stock hold Series A-2 Preferred Stock and Series A-3 Preferred Stock representing an aggregate Stated Value of at least $23,976,322.56 (or, to the extent the right in the preceding sentence shall have been triggered, at least $71,928,967.69), as of January 1, 2026, the A-2 and A-3 Majority Holders shall be entitled to appoint one additional individual of the A-2 and A-3 Majority Holders’ choosing to the Company’s board of directors not later than the date of the immediately upcoming meeting of stockholders for the election of directors. In each case the directors serving immediately prior to these board changes shall approve the appointment of such additional directors designated by the A-2 and A-3 Majority Holders as the case may be. If the A-2 and A-3 Majority Holders fail to elect a sufficient number of directors to fill all directorships for which they are entitled to elect directors pursuant to these provisions, then any directorship not
so filled shall remain vacant until such time as the A-2 and A-3 Majority Holders elect an individual to fill such directorship by vote or written consent. The foregoing director appointment rights were granted in connection with the October 2023 Financing Transaction.
Warrants
The Warrants are exercisable from the date of issuance through the five-year anniversary of the date of the Original Warrant Agreement at an exercise price of $7.50 per share, subject to customary anti-dilution adjustments in the event of certain future equity issuances, future subdivisions (by any stock split, recapitalization or otherwise), combinations or similar events, and certain events of capital reorganization, reclassification, consolidation or merger, or sale of substantially all of the Company’s assets, and subject to price-based adjustment, in the event of any issuances of Common Stock, or securities convertible, exercisable or exchangeable for, or any rights, warrants or options to subscribe for or purchase any of the foregoing for, Common Stock at a price below the then-applicable exercise price (subject to certain exceptions), or other similar transaction of the Company as set forth in the Warrants. The Warrants also have participation rights on an as-converted basis with respect to certain distributions made by the Company. The Warrants may be exercised for cash in an amount equal to the aggregate exercise price, or in lieu of paying the aggregate exercise price, the holder of the Warrants may elect a cashless exercise in accordance with the terms of the Warrants.
Prior to the issuance of shares of Common Stock upon exercise of the Warrants, the Warrant holder is not entitled to vote or be deemed the holder of shares of Common Stock.
The foregoing descriptions of the Second A&R Certificate of Designation, the A&R Warrant Agreement, the Subscription Agreement and the Second A&R Registration Rights Agreement do not purport to be complete and are qualified in their entirety by reference to the full text of the Second A&R Certificate of Designation, the A&R Warrant Agreement, the Subscription Agreement and the Second A&R Registration Rights Agreement, which are filed as Exhibits 3.1, 4.1, 10.1 and 10.2, respectively, to this Current Report on Form 8-K and are incorporated herein by reference.
Item 3.02 Unregistered Sale of Equity Securities
The information contained in Item 1.01 of this Current Report on Form 8-K regarding the sale and offer of the Preferred Stock and Warrants, the Subscription Agreement, the Second A&R Registration Rights Agreement and the terms of the Preferred Stock is incorporated herein by reference.
The securities issued to the MS Subscriber under the Subscription Agreement were issued pursuant to the exemption from the registration requirements of the Securities Act set forth under Section 4(a)(2) of the Securities Act of 1933, as amended. Neither this Current Report on Form 8-K nor any of the exhibits attached hereto is an offer to sell or the solicitation of an offer to buy the securities described herein or therein.
Item 3.03 Material Modification to Rights of Securityholders
The information contained in Item 1.01 of this Current Report on Form 8-K regarding the Second A&R Certificate of Designation and the terms of the Preferred Stock is incorporated herein by reference.
Item 5.03 Amendments to Articles of Incorporation or Bylaws: Change in Fiscal Year.
The information contained in Item 1.01 of this Current Report on Form 8-K regarding the Second A&R Certificate of Designation and the terms of the Preferred Stock is incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits.
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| Exhibit No. | | Description |
| 3.1 | | |
4.1 | | |
10.1† | | |
10.2† | | |
| 104 | | Cover Page Interactive Data File |
| † | Certain confidential information (indicated by brackets and asterisks) has been omitted from this exhibit because it is both (i) not material and (ii) the type of information that the registrant treats as private or confidential |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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| | | | MONDEE HOLDINGS, INC. |
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Dated: December 20, 2023 | | | | |
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| | | | By: | | /s/ Jesus Portillo |
| | | | | | Name: Jesus Portillo Title: Chief Financial Officer |
SECOND AMENDED AND RESTATED CERTIFICATE OF DESIGNATION OF
PREFERENCES, RIGHTS AND LIMITATIONS
OF SERIES A-1, SERIES A-2 AND SERIES A-3 PREFERRED STOCK
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Pursuant to Section 151 of the
General Corporation Law of the State of Delaware |
Pursuant to the provisions of Section 151 of the General Corporation Law of the State of Delaware (the “DGCL”), Mondee Holdings, Inc. (f/k/a ITHAX Acquisition Corp.), a corporation organized and existing under the DGCL (hereinafter called the “Company”), in accordance with the provisions of Section 103 thereof, does hereby submit the following:
WHEREAS, the Amended and Restated Certificate of Incorporation of the Company (as amended, restated, amended and restated, supplemented or otherwise modified from time to time, the “Certificate”) authorizes the issuance of preferred stock, par value $0.0001 per share, of the Company (“Preferred Stock”) in one or more series; and expressly authorizes the Board of Directors of the Company (the “Board” or “Board of Directors”), subject to limitations prescribed by the Requirements of Law, to provide, out of the unissued shares of Preferred Stock, for series of Preferred Stock, and, with respect to each such series, to establish and fix the number of shares to be included in any series of Preferred Stock and the designations, rights, preferences, powers, restrictions and limitations of the shares of such series;
WHEREAS, the Board, pursuant to its authority as aforesaid, designated a series of Preferred Stock, par value $0.0001 per share, as the Series A Preferred Stock (under and as defined in the September 2022 Certificate of Designation), by resolution dated September 29, 2022;
WHEREAS, the Company, in accordance with Sections 103 and 151 of the DGCL, filed a certificate of designation on September 29, 2022 (the “September 2022 Certificate of Designation”) with the Secretary of State of the State of Delaware to set the number of shares constituting the Series A Preferred Stock (under and as defined in the September 2022 Certificate of Designation) and the voting powers, designations, preferences and relative, participating, optional or other special rights, and the qualifications, limitations and restrictions thereof;
WHEREAS, the Company, in accordance with Sections 103 and 151 of the DGCL, filed an amended and restated certificate of designation on October 17, 2023 (the “October 2023 Certificate of Designation”) with the Secretary of State of the Delaware to set the number of shares constituting the Series A Preferred Stock (under and as defined in the October 2023 Certificate of Designation), and the voting powers, designations, preferences and relative, participating, optional or other special rights, and the qualifications, limitations and restrictions thereof;
WHEREAS, certain amendments (the “Amendments”) to the October 2023 Certificate of Designation have been duly adopted and approved by the Board in accordance with the provisions of Sections 141 and 242 of the DGCL;
WHEREAS, the changes made by the Amendments do not require further approval or consent by the Preferred Majority Holders or any other Holders (under and as defined in the October 2023 Certificate of Designation).
NOW THEREFORE, BE IT RESOLVED, that, pursuant to authority conferred upon the Board of Directors by the Certificate, the Board of Directors hereby amends and restates the October 2023 Certificate of Designation in its entirety as set forth herein and hereby creates and fixes the series, designations, powers, preferences and other rights, and the qualifications, limitations or restrictions, of the Preferred Stock to be issued hereunder, as follows:
Section 1. Designation. The Series A-1 Preferred Stock that is currently held by the Holder thereof shall be converted into Series A-2 Preferred Stock on a one-for-one basis. The number of authorized shares constituting the Series A-1 Preferred Stock, Series A-2 Preferred Stock and Series A-3 Preferred Stock shall be 0, 85,000 and 15,000, respectively. Subject to the provisions of Section 8, that number from time to time may be increased or decreased (but not below the number of shares of Series A Preferred Stock of any series then outstanding) by (a) further resolution duly adopted by the Board, or any duly authorized committee thereof and (b) the filing of an amendment to this Certificate of Designation pursuant to the provisions of the DGCL stating that such increase or decrease, as applicable, has been so authorized.
Section 2. Ranking. The Series A Preferred Stock of each series will rank, with respect to dividend rights, rights on the distribution of assets on any voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Company and (except as permitted hereby) redemption rights:
(a)on a parity basis with each other and with each other class or series of Capital Stock of the Company now existing or hereafter authorized, classified or reclassified, the terms of which expressly provide that such class or series ranks on a parity basis with the Series A Preferred Stock as to dividend rights, rights on the distribution of assets on any voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Company and (except as permitted hereby) redemption rights (such Capital Stock, “Parity Stock”);
(b)junior to each other class or series of Capital Stock of the Company now existing or hereafter authorized, classified or reclassified, the terms of which expressly provide that such class or series ranks senior to the Series A Preferred Stock as to dividend rights, rights on the distribution of assets on any voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Company and (except as permitted hereby) redemption rights (such Capital Stock, “Senior Stock”); and
(c)senior to the Common Stock and each other class or series of Capital Stock of the Company now existing or hereafter authorized, classified or reclassified, the terms of which do not expressly provide that such class or series ranks on a parity basis with, or senior to, the Series A Preferred Stock as to dividend rights, rights on the distribution of assets on any voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Company and (except as permitted hereby) redemption rights (such Capital Stock, “Junior Stock”).
The Company’s ability to issue Parity Stock, Senior Stock and Junior Stock shall be subject in all respects to the provisions of Section 8, and the Company shall not, and shall not be permitted to, issue any Parity Stock, Senior Stock or Junior Stock in violation thereof. The respective definitions of Parity Stock, Senior Stock and Junior Stock shall also include any securities, rights or options exercisable or exchangeable or convertible into Parity Stock, Senior Stock or Junior Stock, as the case may be.
Section 3. Definitions. As used herein with respect to Series A Preferred Stock:
“A-2 and A-3 Majority Holders” means, at any time of determination, the Holders of a majority of outstanding shares of Series A-2 Preferred Stock and Series A-3 Preferred Stock acting as one class, as modified by Section 8(a).
“Accrued Dividends” means, as of any date, with respect to any share of Series A Preferred Stock, all Dividends that have accrued on such share through the most recent Dividend Payment Date on or prior to such date pursuant to Section 4(b) or Section 11, whether or not declared, but that have not, as of such date, been paid in cash.
“Acquisition” has the meaning set forth in Section 8(b)(x).
“Additional Holders” has the meaning set forth in Section 8(b).
“Additional Incremental Closing Date” means December 14, 2023.
“Additional Series A-2 Preferred Stock” means those shares of Series A-2 Preferred Stock that are not held by the Series A Investor.
“Adjusted EBITDA” shall have the meaning ascribed to such term as set forth in the Earnings Release for Q2 2023 issued by the Company on August 15, 2023; provided, however, if, during the period for which Adjusted EBITDA is calculated, there occurs any material adverse change in the business, results of operations or financial condition of the Company, taken as a whole, which affects the industry in which the Company’s business is engaged, including as a result of any acts of war or terrorism or any escalation or material worsening of any such acts of war or terrorism existing as of the date hereof, acts of God and natural disasters, including floods, tornados, hurricanes, earthquakes and fires and pandemics, such as COVID-19, and/or general economic, political and financial market changes, then, except to the extent such change disproportionately affects the Company as compared to other persons or businesses that operate in the industries in which the Company operates, the duration of such change, not to exceed six months in the aggregate for all such events during the term of the Preferred Stock, shall be excepted from the period for which Adjusted EBITDA is calculated hereunder and, as such, Adjusted EBITDA shall be calculated on a pro rata basis in determining whether the applicable Adjusted EBITDA target has been achieved.
“Affiliate” means, with respect to any specified Person, any other Person, directly or indirectly, controlling or controlled by or under direct or indirect common control with such specified 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, by contract or otherwise; provided that beneficial ownership of 10% or more of the Voting Stock of a Person will be deemed to be control. For purposes of this definition, the terms “controlling” and “controlled” have meanings correlative to the foregoing.
“Amendments” has the meaning set forth in the recitals above.
“Authorized Investors” means (a) funds affiliated with (i) NH Credit Partners III Holdings L.P., (ii) Fly OCP LLC, (iii) ARCPE LLC and (iv) Siris Capital and (b) members of the Company’s management as of the Incremental Closing Date and funds affiliated with such members of the Company’s management.
“Board” and “Board of Directors” has the meaning set forth in the recitals above.
“Board Information” has the meaning set forth in Section 9(b).
“Board Member” has the meaning set forth in Section 9(b).
“Business Day” means a day other than a Saturday, Sunday or other day on which commercial banks in New York, New York are authorized or required by law to close.
“Bylaws” means the Amended and Restated By-laws of the Company, as may be amended from time to time in accordance with the terms of the Certificate (including this Certificate of Designation).
“Capital Stock” means, of any Person, any and all shares of, rights to purchase, warrants or options for, or other equivalents of or interests in (however designated) equity of such Person, including any Preferred Stock.
“Certificate” has the meaning set forth in the recitals above.
“Certificate of Designation” means this Certificate of Designation of Rights, Preferences and Limitations of the Series A-1, A-2 and A-3 Preferred Stock.
“Change of Control” means the occurrence of any of the following events: (a) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act), other than one or more Permitted Holders, shall become the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act) of more than 50% of the total voting power of the Voting Stock of the Company or (b) the direct or indirect sale, assignment, transfer, conveyance or other disposition, in one or a series of related transactions, of all or substantially all of the properties or assets of the Company and its Subsidiaries, taken as a whole, to any “person” or “group” (as such terms are used in sections 13(d) and 14(d) of the Exchange Act) other than one or more Permitted Holder.
“close of business” means 5:00 p.m. (New York City time).
“Common Stock” means the common stock, par value $0.0001 per share, of the Company.
“Company” has the meaning set forth in the recitals above.
“Contractual Obligation” means, as to any Person, any provision of any material security issued by such Person or of any material agreement, instrument or other undertaking to which such Person is a party or by which it or any of its property is bound.
“Controlled Investment Affiliate” means, as to any Person, any other Person that (a) directly or indirectly, is in control of, is controlled by, or is under common control with, such Person and (b) is organized by such Person primarily for the purpose of making equity or debt investments in one or more companies. For purposes of this definition, “control” of a Person means the power, directly or indirectly, to direct or cause the direction of the management and policies of such Person whether by contract or otherwise.
“DGCL” has the meaning set forth in the preamble.
“Disqualified Stock” means, with respect to any Person, any Equity Capital Stock that by its terms (or by the terms of any security into which it is convertible or for which it is exchangeable or exercisable) or upon the happening of any event (other than following the occurrence of a Change of Control or other similar event described under such terms as a “change of control,” or an “asset sale” or other disposition) (i) matures or is mandatorily redeemable pursuant to a sinking fund obligation or otherwise, (ii) is convertible or exchangeable for Indebtedness or Disqualified Stock or (iii) is redeemable at the option of the holder thereof (other than following the occurrence of a Change of Control or other similar event described under such terms as a “change of control,” or an “asset sale” or other disposition), in whole or in part; provided that Equity Capital Stock issued to any employee benefit plan, or by any such plan to any employees of the Company or any Subsidiary thereof, shall not constitute Disqualified
Stock solely because it may be required to be repurchased or otherwise acquired or retired in order to satisfy applicable statutory or regulatory obligations.
“Dividend Payment Date” means March 31, June 30, September 30, and December 31 of each year, commencing on September 30, 2022 (the “Initial Dividend Payment Date”); provided that if any such Dividend Payment Date is not a Business Day, then the applicable Dividend shall be payable on the Business Day immediately preceding such Dividend Payment Date.
“Dividend Payment Period” means the period from and including the applicable Issuance Date to, but excluding, the applicable Initial Dividend Payment Date and, subsequent to such Initial Dividend Payment Date, the period from and including any Dividend Payment Date to, but excluding, the next Dividend Payment Date.
“Dividend Rate” means (i) with respect to the Series A-1 Preferred Stock (x) with respect to a Dividend accrued prior to the second anniversary of the Original Issue Date, SOFR + 7.00% per annum and (y) with respect to a Dividend accrued from and after the second anniversary of the Original Issue Date, SOFR + 10.50% per annum, (ii) with respect to the Series A-2 Preferred Stock and Series A-3 Preferred Stock, except for the Additional Series A-2 Preferred Stock and the Incremental Shares, (x) with respect to a Dividend accrued from the Original Issue Date to, but excluding, the Incremental Closing Date, SOFR + 7.00% per annum, (y) with respect to a Dividend accrued from and after the Incremental Closing Date to, but excluding, the second anniversary of the Original Issue Date, SOFR + 8.50% per annum, and (z) with respect to a Dividend accrued from and after the second anniversary of the Original Issue Date, SOFR + 12.00% per annum, and (iii) with respect to the Additional Series A-2 Preferred Stock and Incremental Shares,(x) with respect to a Dividend accrued from the Original Issue Date to, but excluding, the Additional Incremental Closing Date, SOFR + 7.00% per annum, (y) with respect to a Dividend accrued from and after the Additional Incremental Closing Date to, but excluding, the second anniversary of the Original Issue Date, SOFR + 8.50% per annum, and (z) with respect to a Dividend accrued from and after the second anniversary of the Original Issue Date, SOFR + 12.00% per annum.
“Dividend Record Date” has the meaning set forth in Section 4(d).
“Dividends” has the meaning set forth in Section 4(a).
“Equity Capital Stock” means Capital Stock other than any debt securities convertible into equity interests.
“Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time; provided that for purposes of the definitions of Change of Control and Permitted Holders, “Exchange Act” means the Securities Exchange Act of 1934 as in effect on the Original Issue Date.
“Excluded Holder” means (i) any Affiliate of the Company (and any Affiliates of such Person), and (ii) any Person holding 5% or more of the total voting power of Voting Stock of the Company or of the Company’s Capital Stock (and any Affiliates of such Person), in each case other than the Series A Investor and its Affiliates.
“Financing Agreement” means that certain Financing Agreement, dated as of December 23, 2019, by and among Mondee Holdings, LLC, the lenders from time to time party thereto, TCW Asset Management Company LLC, as administrative agent for the lenders, and other parties thereto (as amended, supplemented, amended and restated or otherwise modified through the date hereof).
“GAAP” means generally accepted accounting principles in the United States of America as in effect from time to time.
“Governmental Authority” means any nation or government, any state or other political subdivision thereof and any entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government, including the European Union.
“Holder” means a Person in whose name the shares of the Series A Preferred Stock are registered, which Person shall be treated by the Company and Transfer Agent as the absolute owner of the shares of Series A Preferred Stock for the purpose of making payment and for all other purposes; provided that, to the fullest extent permitted by Requirements of Law, no Person that has received shares of Series A Preferred Stock in violation of the Share Subscription Agreement or this Certificate of Designation shall be a Holder and the Transfer Agent shall not, unless directed otherwise by the Company, recognize any such Person as a Holder and the Person in whose name the shares of the Series A Preferred Stock were registered immediately prior to such transfer shall remain the Holder of such shares.
“Incremental Closing Date” means October 17, 2023.
“Incremental Shares” has the meaning set forth in Section 8(b).
“Indebtedness” means with respect to any Person on any date of determination (without duplication): (i) the principal of indebtedness of such Person for borrowed money; (ii) the principal of obligations of such Person evidenced by bonds, debentures, notes or other similar instruments or upon which interest payments are customarily made; (iii) all reimbursement obligations of such Person in respect of letters of credit, bankers’ acceptances or other similar instruments (the amount of such obligations being equal at any time to the aggregate then undrawn and unexpired amount of such letters of credit, bankers’ acceptances or other instruments plus the aggregate amount of drawings thereunder that have not then been reimbursed) (except to the extent such reimbursement obligations relate to trade payables and such obligations are expected to be satisfied within 30 days of becoming due and payable); (iv) all Indebtedness of other Persons secured by a lien on any asset of such Person, whether or not such Indebtedness is assumed by such Person; (v) all guarantees by such Person of Indebtedness of other Persons, to the extent so guaranteed by such Person; (vi) monetary obligations under any receivables factoring, receivable sales or similar transactions and all monetary obligations under any synthetic lease, tax ownership/operating lease, off-balance sheet financing or similar financing; and (vii) the redemption, repayment or other repurchase amount of such Person with respect to any Disqualified Stock of such Person or (if such Person is a Subsidiary of the Company) Preferred Stock of such Subsidiary, but excluding, in each case, any accrued dividends (the amount of such obligation to be equal at any time to the maximum fixed involuntary redemption, repayment or repurchase price for such Equity Capital Stock, or if less (or if such Equity Capital Stock has no such fixed price), to the involuntary redemption, repayment or repurchase price therefor calculated in accordance with the terms thereof as if then redeemed, repaid or repurchased, and if such price is based upon or measured by the fair market value of such Equity Capital Stock, such fair market value shall be as determined in good faith by the Company). The Indebtedness of any Person shall include the Indebtedness of any partnership of or joint venture in which such Person is a general partner or a joint venturer.
“Indemnified Person” has the meaning set forth in Section 21(b).
“Issuance Date” means, with respect to any share of Series A Preferred Stock, the date of issuance of such share.
“Junior Stock” has the meaning set forth in Section 2(c).
“Material Adverse Effect” means any circumstance or condition (excluding any matters publicly disclosed prior to July 20, 2022) that would materially adversely affect (1) the business, operations, property or condition (financial or otherwise) of the Company and its Subsidiaries taken as a whole, (2) the validity or enforceability as to the Company of this Certificate of Designation, (3) the ability of the Company to perform its payment obligations under this Certificate of Designation or (4) the material rights or remedies (taken as a whole) of the Holders under this Certificate of Designation.
“MOIC” means, with respect to a share of Series A-1 Preferred Stock and Series A-2 Preferred Stock, a multiple on invested capital equal to the quotient determined by dividing (A) the sum of (w) the aggregate amount of all Dividends made in cash with respect to such share of Series A-1 Preferred Stock and Series A-2 Preferred Stock on or prior to the applicable date of determination (other than any Dividends paid in cash in respect of any Non-Compliance Step-Up) plus (x) 100% of the Stated Value and Accrued Dividends with respect to such share of Series A-1 Preferred Stock and Series A-2 Preferred Stock (other than any portion of the Accrued Dividends attributable to any Non-Compliance Step-Up) plus (y) 100% of the accrued but unpaid dividends as of such date with respect to such share of Series A-1 Preferred Stock and Series A-2 Preferred Stock (other than any portion of accrued but unpaid dividends attributable to any Non-Compliance Step-Up), plus (z) the applicable premium paid in accordance with Section 6(a) with respect to such share of Series A-1 Preferred Stock and Series A-2 Preferred Stock by (B) the Stated Value.
“Non-Compliance Event” shall mean, with respect to all series of Preferred Stock (unless a particular term or covenant is explicitly stated to be for the benefit of one or more particular series, then such Non-Compliance Event shall be deemed to have occurred only with respect to such one or more series):
(i)failure by the Company and its Subsidiaries to comply with Section 8 hereof;
(ii)the Company or any Subsidiary shall default in the observance or performance of any other agreement contained in this Certificate of Designation, and such default shall continue unremedied for a period of 30 days after the date on which written notice thereof shall have been given to the Company by the Preferred Majority Holders;
(iii)any representation or warranty made by the Company or any of its Subsidiaries in the Share Subscription Agreement (or in any amendment, modification or supplement thereto) or which is contained in any certificate furnished at any time by or on behalf of the Company or any of its Subsidiaries pursuant to the Share Subscription Agreement or this Certificate of Designation shall prove to have been incorrect in any material respect on or as of the date made or deemed made and the circumstances giving rise to such misrepresentation, if capable of alteration, are not altered so as to make such representation or warranty correct in all material respects by the date falling 30 days after the date on which written notice thereof shall have been given to the Company by the Preferred Majority Holders;
(iv)(1) the commencement by the Company or any of its Subsidiaries of any case, proceeding or other action (A) under any existing or fixture law of any jurisdiction, domestic or foreign, relating to bankruptcy, insolvency, reorganization or relief of debtors, seeking to have an order for relief entered with respect to it, or seeking to adjudicate it a bankrupt or insolvent, or seeking reorganization, arrangement, adjustment, winding-up, liquidation, dissolution, composition or other relief with respect to it or its debts or (B) seeking appointment of a receiver, interim receiver, receivers,
receiver and manager, trustee, custodian, conservator or other similar official for it or for all or any substantial part of its assets, or the Company, any of its Subsidiaries shall make a general assignment for the benefit of its creditors; or (2) the commencement against the Company or any of its Subsidiaries of any case, proceeding or other action of a nature referred to in clause (1) above which (A) results in the entry of an order for relief or any such adjudication or appointment or (B) remains undismissed, undischarged, unstayed or unbonded for a period of 60 days; or (3) the commencement against the Company or any of its Subsidiaries of any case, proceeding or other action seeking issuance of a warrant of attachment, execution, distraint or similar process against all or any substantial part of its assets which results in the entry of an order for any such relief which shall not have been vacated, discharged, stayed or bonded pending appeal within 60 days from the entry thereof; or (4) the Company or any of its Subsidiaries shall take any corporate or other organizational action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any of the acts set forth in clause (1), (2), or (3) above; or (5) the Company or any of its Subsidiaries shall be generally unable to, or shall admit in writing its general inability to, pay its debts as they become due;
(v)the entry of one or more judgments or decrees against the Company or any of its Subsidiaries involving in the aggregate at any time a liability (net of any insurance or indemnity payments actually received in respect thereof prior to or within 60 days from the entry thereof, or to be received in respect thereof in the event any appeal thereof shall be unsuccessful) in excess of $10,000,000, and all such judgments or decrees shall not have been vacated, discharged, stayed or bonded pending appeal within 60 days from the entry thereof;
(vi)the occurrence of a Change of Control; or
(vii)a breach by any of the parties to that certain voting agreement, dated as of the date hereof, among the Company and certain of its equityholders, of any of their material obligations thereunder, or any amendment, modification, waiver or termination of such agreement in a manner that would adversely affect the Holders.
“Non-Compliance Step-Up” has the meaning set forth in Section 11.
“Notice of Optional Redemption” has the meaning set forth in Section 6(b).
“October 2023 Certificate of Designation” has the meaning set forth in the recitals.
“Optional Redemption” has the meaning set forth in Section 6(a).
“Original Issue Date” means September 29, 2022.
“Parity Stock” has the meaning set forth in Section 2(a).
“Paying Agent” means the paying agent of the Company with respect to the Series A Preferred Stock duly appointed from time to time.
“Permitted Holders” means Prasad Gundumogula or any Controlled Investment Affiliate thereof.
“Person” means an individual, partnership, corporation, limited liability company, business trust, joint stock company, trust, unincorporated association, joint venture, Governmental Authority or other entity of whatever nature.
“Pre-Acquisition Indebtedness” has the meaning set forth in Section 8(b)(x).
“Preferred Majority Holders” means, at any time of determination, the Holders of a majority of outstanding shares of Series A Preferred Stock acting as one class, as modified by Section 8(a).
“Preferred Stock” means, as applied to the Equity Capital Stock of any corporation or company, Equity Capital Stock of any class or classes (however designated) that by its terms is preferred as to the payment of dividends, or as to the distribution of assets upon any voluntary or involuntary liquidation or dissolution of such corporation or company, over shares of Equity Capital Stock of any other class of such corporation or company.
“Prohibited Transferees” means any competitor of the Company and its Subsidiaries that is in the same or a similar line of business as the Company and its Subsidiaries or any controlled Affiliate of such competitor, in each case designated in writing by the Company to the Holders from time to time or that are clearly identifiable as Affiliates solely on the basis of the similarity of their name; provided, that no such update shall apply retroactively to disqualify any Transfer to the extent such Transfer was made to a party (or its Affiliates) that was not a Prohibited Transferee at the time of such Transfer.
“Proceeding” has the meaning set forth in Section 21(b).
“Promissory Note” has the meaning set forth in Section 6(e)(iii).
“Promissory Note Election Notice” has the meaning set forth in Section 6(e)(iii).
“Put Date” means the 48-month anniversary of the Original Issue Date, subject to adjustment in accordance with the terms hereof; provided, however, if the Company fails to have an Adjusted EBITDA of at least $50 million for the 2025 fiscal year, the Put Date shall accelerate to March 31, 2026.
“Put Demand” has the meaning set forth in Section 6(e)(i).
“Put Payment Date” has the meaning set forth in Section 6(e)(ii).
“Put Price” has the meaning set forth in Section 6(e)(i).
“Redemption Date” means with respect to the redemption of shares of Series A Preferred Stock pursuant to this Certificate of Designation, the date set forth in the applicable Notice of Optional Redemption in accordance with Section 6(b).
“Redemption Price” has the meaning set forth in Section 6(a).
“Refinancing Indebtedness” means Indebtedness that is incurred to refinance any Indebtedness (or unutilized commitment in respect of Indebtedness) existing on the Original Issue Date or incurred (or established) in compliance with this Certificate of Designation (including Indebtedness of the Company that refinances Indebtedness of any Subsidiary and Indebtedness of any Subsidiary that refinances Indebtedness of another Subsidiary) including Indebtedness that refinances Refinancing Indebtedness, and Indebtedness incurred pursuant to a commitment that refinances any Indebtedness or unutilized commitment; provided, that such Refinancing Indebtedness is incurred in an aggregate principal amount (or if issued with original issue discount, an aggregate issue price) that is equal to or less than the sum of (x) the aggregate principal amount then outstanding of the Indebtedness being refinanced, plus (y) an amount equal to any unutilized commitment relating to the Indebtedness being refinanced or otherwise
then outstanding under the financing arrangement being refinanced to the extent the unutilized commitment being refinanced could be drawn in compliance with this Certificate of Designation immediately prior to such refinancing plus (z) fees, underwriting discounts, premiums and other costs and expenses (including accrued and unpaid interest) incurred in connection with such Refinancing Indebtedness.
“Requirement of Law” means, as to any Person, the certificate of incorporation and by-laws or other organizational or governing documents of such Person, and any law, statute, ordinance, code, decree, treaty, rule or regulation or determination of an arbitrator or a court or other Governmental Authority, in each case applicable to or binding upon such Person or any of its material property or to which such Person or any of its material property is subject, including laws, ordinances and regulations pertaining to zoning, occupancy and subdivision of real properties; provided that the foregoing shall not apply to any non-binding recommendation of any Governmental Authority.
“Responsible Officer” means, as to any Person, any of the following officers of such Person: (a) the chief executive officer or the president and, with respect to financial matters, the chief financial officer, the treasurer or the controller, (b) any executive vice president or, with respect to financial matters, any treasurer or controller, who has been designated in writing to the Holders as a Responsible Officer by such chief executive officer or president or, with respect to financial matters, such chief financial officer, treasurer or controller, and (c) with respect to Section 12 and without limiting the foregoing, the general counsel.
“SEC” means the Securities and Exchange Commission.
“Senior Stock” has the meaning set forth in Section 2(b).
“September 2022 Certificate of Designation” has the meaning set forth in the recitals.
“Series A Investor” means the Person who, together with its investment funds, separate accounts, and other entities owned (in whole or in part), controlled, managed, and/or advised by it or its Affiliates, held on the Incremental Closing Date the majority of the Series A Preferred Stock issued and outstanding on the Incremental Closing Date, together with such holder’s investment funds, separate accounts, and other entities owned (in whole or in part), controlled, managed, and/or advised by it or its Affiliates.
“Series A Investor Observer” has the meaning set forth in Section 9(a).
“Series A Preferred Stock” means the Series A-1 Preferred Stock, Series A-2 Preferred Stock and Series A-3 Preferred Stock.
“Series A-1 Preferred Stock” a series of Preferred Stock of the Company par value $0.0001 per share, classified as “Series A-1 Preferred Stock.”
“Series A-2 Preferred Stock” a series of Preferred Stock of the Company par value $0.0001 per share, classified as “Series A-2 Preferred Stock.”
“Series A-3 Preferred Stock” a series of Preferred Stock of the Company par value $0.0001 per share, classified as “Series A-3 Preferred Stock.”
“Share Subscription Agreement” means, collectively, those certain (a) Subscription Agreements dated as of September 29, 2022, and (b) Subscription Agreements dated as of the date hereof, in each case among the Company and the investors party thereto.
“SOFR” shall be determined daily and means a rate equal to the secured overnight financing rate as administered by the Federal Reserve Bank of New York (or successor administrator of the secured overnight financing rate) on the Federal Reserve Bank of New York’s website (subject to a 1.00% floor).
“Stated Value” means, with respect to any share of Series A Preferred Stock, as of any date, $1,000 per share (adjusted as appropriate in the event of any shares or securities dividend, shares or securities sub-division, shares or securities distribution, recapitalization or combination).
“Subsidiary” means, as to any Person, any corporation, association, partnership or other business entity of which more than 50% of the total voting power of shares of Equity Capital Stock or other equity interests (including partnership interests) entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time owned or controlled, directly or indirectly, by (i) such Person or (ii) one or more Subsidiaries of such Person.
“Target” has the meaning set forth in Section 8(b)(x).
“Transfer” means a sale, transfer, assignment, pledge, hypothecation or other disposition.
“Transfer Tax” has the meaning set forth in Section 15(b).
“Transfer Agent” means the transfer agent and registrar of the Company with respect to the Series A Preferred Stock duly appointed from time to time.
“Voting Stock” means, in relation to a Person, shares of Equity Capital Stock entitled to vote generally in the election of directors to the board of directors or equivalent governing body of such Person.
“Warrants” means the warrants issued pursuant to that Warrant Agreement, by and between the Company and Continental Stock Transfer & Trust Company, dated the date hereof, and the warrants issued under that certain warrant agreement, dated as of September 29, 2022, between the Company and Continental Stock Transfer & Trust Company.
Section 4. Dividends.
(a)Dividends. Holders shall be entitled to receive dividends of the type and in the amount determined as set forth in this Section 4 (such dividends, “Dividends”).
(b)Accrual of Dividends. Dividends on each share of Series A Preferred Stock shall accrue at a rate equal to the Dividend Rate (determined on a daily basis) on the Stated Value and on any Accrued Dividends, from and including the Issuance Date of such share, whether or not declared and whether or not the Company has assets legally available to make payment thereof, as further specified below, and shall be cumulative. Dividends on the Series A Preferred Stock shall accrue on the basis of a 365-day year based on actual days elapsed. The amount of Dividends payable with respect to any share of Series A Preferred Stock for any Dividend Payment Period shall equal the sum of the daily Dividend amounts accrued in accordance with the prior sentence of this Section 4(b) with respect to such share during such Dividend Payment Period.
(c)Arrearages; Payment of Dividends.
(i)Except as described in this Section 4(c), Dividends shall be payable in cash.
(ii)Dividends shall be payable quarterly in arrears on each Dividend Payment Date, commencing on the first Dividend Payment Date following the Issuance Date of such share, and shall be paid in cash if, as and when authorized by the Board, or any duly authorized committee thereof, and declared by the Company, to the extent not prohibited by Requirements of Law.
(iii)If the Company fails to declare and pay pursuant to this Section 4(c) a full Dividend in cash on the Series A Preferred Stock on any Dividend Payment Date, then the amount of the unpaid portion of such Dividend shall automatically be added to the amount of Accrued Dividends on such share on the applicable Dividend Payment Date without any action on the part of the Company or any other Person.
(d)Record Date. The record date for payment of Dividends on any relevant Dividend Payment Date will be the close of business on the fifteenth (15th) day of the calendar month that contains the relevant Dividend Payment Date (each, a “Dividend Record Date”), whether or not such day is a Business Day.
Section 5. Liquidation Rights.
(a)Liquidation. In the event of any voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Company, the Holders shall be entitled, out of assets legally available therefor, before any distribution or payment out of the assets of the Company may be made to or set aside for the holders of any Junior Stock, and subject to the rights of the holders of any Senior Stock or Parity Stock issued in accordance with this Certificate of Designation and the rights of the Company’s existing and future creditors, to receive in full a liquidating distribution in cash and in the amount per share of Series A Preferred Stock equal to the Redemption Price as of the date of such voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Company. Holders shall not be entitled to any further payments in the event of any such voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Company after receiving in full what is expressly provided for in this Section 5, and will have no right or claim to any of the Company’s remaining assets.
(b)Partial Payment. If in connection with any distribution described in Section 5(a) above, the assets of the Company or proceeds therefrom are not sufficient to pay in full the aggregate liquidating distributions required to be paid pursuant to Section 5(a) to all Holders and the liquidating distributions payable to all holders of any Parity Stock issued in accordance with this Certificate of Designation, the amounts distributed to the Holders and to the holders of all such Parity Stock shall be paid pro rata in proportion to the respective aggregate liquidating distributions to which they would otherwise be entitled if all amounts payable with respect thereto were paid in full.
Section 6. Redemption at the Option of the Company; Put Right; Other Repurchases.
(a)Optional Redemption of Series A-1 Preferred Stock, Series A-2 Preferred Stock and Series A-3 Preferred Stock. Subject to the provisions of this Section 6, the Company, at its option, may redeem for cash all, but not less than all, of the outstanding shares of Series A-1 Preferred Stock, Series A-2 Preferred Stock and Series A-3 Preferred Stock (each, an “Optional Redemption”). The redemption price per share of Series A-1 Preferred Stock and
Series A-2 Preferred Stock shall be equal to the greater of (x) the sum of (A) the Stated Value per share of Series A Preferred Stock to be redeemed plus (B) an amount equal to the Accrued Dividends with respect to such share, calculated in accordance with Section 4, plus (C) accrued and unpaid dividends since the most recent Dividend Payment Date with respect to such share as of the applicable Redemption Date and (y) the amount necessary, if any, to result in, (A) prior to the second anniversary of the Original Issue Date, a MOIC equal to the product of 1.225 times the Stated Value with respect to such share of Series A Preferred Stock and, (B) from and after the second anniversary of the Original Issue Date, a MOIC equal to the product of 1.325 times the Stated Value with respect to such share of Series A Preferred Stock, in each case under this clause (y) exclusive of the value of the Warrants. The redemption price per share of Series A-3 Preferred Stock shall be equal to the sum of (A) the Stated Value per share of Series A Preferred Stock to be redeemed plus (B) an amount equal to the Accrued Dividends with respect to such share, calculated in accordance with Section 4, plus (C) accrued and unpaid dividends since the most recent Dividend Payment Date with respect to such share as of the applicable Redemption Date. Such redemption price for the Series A Preferred Stock of each series shall be referred to herein as the “Redemption Price”. The Company shall not be required to redeem any shares of Series A Preferred Stock at any time other than pursuant to Section 6(d) and Section 6(e).
(b)Exercise of Optional Redemption. If the Company elects to effect an Optional Redemption, the Company shall send to the Holders a written notice in accordance with Section 16 (i) notifying the Holders of the election of the Company to redeem all shares of the Series A Preferred Stock and the Redemption Date, and (ii) stating the place or places at which the shares of such Series A Preferred Stock shall, upon presentation and surrender of the certificates evidencing such shares of Series A Preferred Stock, be redeemed (and other instructions a Holder must follow to receive payment), and the Redemption Price therefor (such notice, a “Notice of Optional Redemption”). The Redemption Date selected by the Company shall be no less than ten (10) Business Days and no more than thirty (30) Business Days after the date on which the Company provides the Notice of Optional Redemption to the Holders. The Notice of Optional Redemption shall state the Redemption Date selected by the Company.
(c)Effect of Redemption. If notice has been mailed in accordance with Section 6(b) above and if on or before the Redemption Date specified in such notice, all funds necessary for such redemption shall have been segregated and irrevocably set apart by the Company and deposited with the Paying Agent in trust for the pro rata benefit of the Holders of the shares of Series A Preferred Stock, so as to be, and to continue to be available therefor, then, on and after the Redemption Date, unless the Company defaults in the payment of the applicable Redemption Price, Dividends on the shares of the Series A Preferred Stock shall cease to accumulate and all rights of the Holders of the Series A Preferred Stock shall terminate except for the right to receive from the Company the Redemption Price, without interest; provided that if a Notice of Optional Redemption shall have been given and the funds necessary for redemption (including an amount in respect of all Dividends that will accrue to the Redemption Date) shall have been segregated and irrevocably set apart by the Company and deposited with the Paying Agent in trust for the pro rata benefit of the Holders of the Series A Preferred Stock, Dividends shall cease to accumulate on the Redemption Date on the Series A Preferred Stock and, at the close of business on the day on which such funds are segregated and set apart, the shares of Series A Preferred Stock shall no longer be deemed to be outstanding and the Holders of the Series A Preferred Stock shall cease to be stockholders of the Company and shall be entitled only to receive the Redemption Price for such shares. Upon surrender, in accordance with said notice, of the certificates, if any, for the Series A Preferred Stock (to the extent applicable, properly endorsed or assigned for transfer, if the Company shall so require and the notice shall so state), such shares shall be redeemed by the Company at the applicable Redemption Price.
(d)Put Right for Series A-1 Preferred Stock. Unless the Company redeems the Series A-1 Preferred Stock in accordance with this Section 6 by the 60-month anniversary of the Original Issue Date, any Holder of Series A-1 Preferred Stock shall have the right to put the shares of Series A-1 Preferred Stock to the Company at any time from and after the 60-month anniversary of the Original Issue Date at a price per share of Series A-1 Preferred Stock equal to (A) the Stated Value per share of Series A-1 Preferred Stock to be subject to the put right plus (B) an amount equal to the Accrued Dividends with respect to such share, calculated in accordance with Section 4, plus (C) accrued and unpaid dividends since the most recent Dividend Payment Date with respect to such share as of the applicable repurchase date by the Company. For the avoidance of doubt, following the exercise of the put right set forth in this Section 6(d), the Company’s failure to purchase the shares of Series A-1 Preferred Stock in cash within ten (10) calendar days thereof shall constitute a “Non-Compliance Event” and shall be subject to the provisions of Section 11.
(e)Put Right for Series A-2 Preferred Stock and Series A-3 Preferred Stock.
(i)Unless the Company redeems the Series A-2 Preferred Stock and the Series A-3 Preferred Stock in accordance with this Section 6 by the Put Date, any Holder of Series A-2 Preferred Stock or Series A-3 Preferred Stock shall have the right to put all (but not less than all) of such Holder’s shares of Series A-2 Preferred Stock and Series A-3 Preferred Stock to the Company (a “Put Demand”) at any time from and after the Put Date at a price per share of Series A Preferred Stock equal to (A) the Stated Value per share of Series A Preferred Stock to be subject to the put right plus (B) an amount equal to the Accrued Dividends with respect to such share, calculated in accordance with Section 4, plus (C) accrued and unpaid dividends since the most recent Dividend Payment Date with respect to such share as of the applicable repurchase date by the Company (the sum of (A), (B), and (C) (including any Non-Compliance Step-Up) multiplied by the total number of shares subject to the Put Demand, the “Put Price”).
(ii)Following the exercise of the put right set forth in this Section 6(e), the Company’s failure to purchase the shares of Series A-2 Preferred Stock and Series A-3 Preferred Stock in cash within ten (10) calendar days thereof (“Put Payment Date”) shall constitute a “Non-Compliance Event” and shall be subject to the provisions of Section 11. If the Company does not, or is unable to, satisfy in-full in-cash the Put Price by the Put Payment Date, the Company shall thereafter (a) use best efforts to maximize the assets legally available for paying the Put Price, including by raising new equity or obtaining additional debt to pay the Put Price, (b) pay out of all such assets legally available therefor on the applicable Put Payment Date or as promptly as practicable thereafter the Put Price for the maximum possible number of shares of Series A-2 Preferred Stock and Series A-3 Preferred Stock as to which a Put Demand has been exercised that it can purchase on such date, pro rata among the Holders of such shares to be purchased in proportion to the aggregate number of shares subject to the Put Demand by each such Holder on the applicable Put Payment Date or as promptly as practicable thereafter, and (c) following the applicable Put Payment Date, at any time and from time to time when additional assets of the Company become legally available to purchase the remaining shares and the Company has satisfied all other outstanding financial and tax obligations and creditor liabilities, the Company shall immediately use such assets to pay the remaining balance of the aggregate Put Price.
(iii)Notwithstanding the provisions of Section 6(e)(i) and (e)(ii) to the contrary, if the Company fails to satisfy in-full in-cash the Put Price for all (but not less than all) shares of a Holder’s Series A-2 Preferred Stock and Series A-3 Preferred Stock for six (6) months following receipt by the Company of a Put Demand or, if earlier, but in no event prior to the date of the Put Demand, the Board of Directors reasonably
determines that there are no legally available funds to satisfy the Put Price, the A-2 and A-3 Majority Holders may elect (the “Promissory Note Election Notice”), in satisfaction of such holders’ rights under this Certificate of Designation, to have the Company deliver the promissory note, in the form attached to this Certificate of Designation as Exhibit A (the “Promissory Note”), payable to the order of each Holder of Series A-2 Preferred Stock and Series A-3 Preferred Stock in the original principal amount equal to the unpaid Put Price (as adjusted for the period elapsed between the date of delivery of the Put Demand and the date of the Promissory Note Election Notice) owed to such Holder, or such lesser amount as determined at the sole discretion of such Holder, on substantially the same terms as set forth in this Section 6.
(f)Repurchases or Other Acquisitions. Except as set forth in Section 6, the Company and its Subsidiaries shall not redeem, repurchase or otherwise acquire any shares of Series A Preferred Stock other than through procedures open to all Holders on a pro rata basis in accordance with customary procedures to be agreed between the Company and the Preferred Majority Holders.
(g)Status of Shares. Shares of Series A Preferred Stock redeemed, repurchased or otherwise acquired in accordance with this Section 6, shall return to the status of and constitute authorized but unissued shares of Preferred Stock, without classification as to series until such shares are once more classified as a particular series by the Board pursuant to the provisions of the Certificate. For the avoidance of doubt, any subsequent classification of Preferred Stock redeemed, repurchased or otherwise acquired pursuant to this Section 6 shall be subject to the limitations set forth in Section 8(b)(iii) hereof.
Section 7. Transfer of Series A Preferred Stock and Promissory Note.
(a)Subject to compliance with applicable U.S. federal and state Requirements of Law governing the Transfer of securities, (i) shares of the Series A Preferred Stock shall be transferable by the Holders to any person other than a Prohibited Transferee and (ii) prior to delivery of the Promissory Note Election Notice pursuant to Section 6(e)(iii), all or any part of the Promissory Note may be transferred by a Holder together with the corresponding proportionate amount of shares of Series A-2 Preferred Stock and Series A-3 Preferred Stock held by such Holder to any person other than a Prohibited Transferee in accordance with the Promissory Note. The Company shall recognize and register any such Transfer contemplated by Section 7(a)(i) and (ii) on its books. The Company shall not recognize any Transfer to a Prohibited Transferee or register any such Transfer on its books (which Transfer shall be void ab initio).
(b)The Company shall use its commercially reasonable efforts to cooperate with the Holders of the Series A Preferred Stock in connection with any Transfer to be consummated in accordance with this Section 7, including providing reasonable and customary information (i) in connection with any such Holder’s marketing efforts or any such potential transferee’s due diligence (subject to customary confidentiality restrictions) or (ii) in order to comply with applicable U.S. federal and state Requirements of Law governing the Transfer of securities.
Section 8. Voting; Protective Provisions; Limited Condition Transactions.
(a)Voting. Except as expressly set forth herein or required by applicable law, the Series A Preferred Stock shall be non-voting. Each Holder of Series A Preferred Stock will have one vote per share on any matter on which Holders of Series A Preferred Stock are entitled to vote; provided, however, the shares of Series A Preferred Stock held by an Excluded Holder shall not be entitled to vote, nor shall such shares of Series A Preferred Stock held by any such
Person be deemed outstanding for purposes of voting on any amendment, waiver or consent, except as explicitly specified set forth in the proviso to Section 18 of this Agreement. On any matter on which holders of Series A Preferred Stock are entitled to vote, the Holders shall vote separately as a single class with respect to the Series A Preferred Stock, in person or by proxy, at a meeting called for such purpose or by written consent without a meeting. The approval of any matter or action shall require the affirmative vote or consent of the Preferred Majority Holders.
(b)Protective Provisions. Notwithstanding anything to the contrary contained herein, the affirmative vote or consent of the Preferred Majority Holders will be necessary for effecting any of the following actions, whether or not such approval is required pursuant to the DGCL:
(i)any amendment, alteration, waiver or repeal of any provision of the Certificate (including this Certificate of Designation), Bylaws or any other governing document of the Company (by merger, consolidation, division or reorganization of the Company, or otherwise) in a manner that adversely affects the rights, preferences or privileges of the Series A Preferred Stock, unless such amendment, alteration or repeal is effectuated at the time of consummation of a transaction, the proceeds of which are to be applied substantially contemporaneously to the redemption in full in cash of the Series A Preferred Stock at the Redemption Price in accordance with the terms hereof such that all shares of Series A Preferred Stock shall be redeemed in connection therewith, and the effectiveness of such amendment, alteration or repeal occurs substantially contemporaneously with such redemption;
(ii)any liquidation, dissolution or winding up of the Company, its Subsidiaries, or the Company’s or any Subsidiary’s business and affairs (other than a liquidation, dissolution or winding up of a direct or indirect wholly-owned Subsidiary of the Company in connection with a bona fide corporate reorganization that does not adversely affects the rights, preferences or privileges of the Series A Preferred Stock);
(iii)any creation, authorization or issuance (by reclassification or otherwise) of additional shares of Series A Preferred Stock, any Parity Stock, any Junior Stock (other than Common Stock), or any Senior Stock or any securities or rights convertible or exchangeable into, or exercisable for the foregoing; provided the Company shall be permitted to issue such Parity Stock, Junior Stock and/or Senior Stock to the extent the proceeds thereof are to be applied substantially contemporaneously to the redemption in full in cash of the Series A Preferred Stock at the Redemption Price in accordance with the terms hereof and provided that all shares of Series A Preferred Stock shall be redeemed in connection therewith; provided further, that Company shall be permitted to issue additional shares of Series A-3 Preferred Stock that are authorized but unissued as of the Incremental Closing Date to Authorized Investors.;
(iv)any declaration or payment of any dividends or distributions to holders of Junior Stock (other than dividends or distributions payable solely in Junior Stock) or any redemption, repayment, defeasance, or repurchase of any Junior Stock (other than (A) from employees, officers, directors, or consultants in connection with termination of services to the Company or its Subsidiaries or (B) otherwise pursuant to an equity-based benefit plan of the Company in connection with customary cashless exercise or fractional share repurchase features);
(v)any acquisition of stock, assets, or the business of any Person in one transaction or series of related transactions for consideration in excess of $50 million;
(vi)any disposition of any assets outside of the ordinary course of business (whether by merger, consolidation or otherwise) in one transaction or series of related transactions with a value in excess of $25 million, except to the extent the proceeds thereof are to be applied substantially contemporaneously to the redemption in full in cash of the Series A Preferred Stock at the Redemption Price in accordance with the terms hereof and provided that all shares of Series A Preferred Stock shall be redeemed in connection therewith;
(vii)adoption or approval of any material amendment to any equity-based benefit plan that provides for the issuance of securities other than Common Stock or options to acquire Common Stock;
(viii)the Company or its Subsidiaries, directly or indirectly, entering into or conducting any transaction or series of related transactions (including entering into any contract, agreement or other arrangement or the purchase, sale, lease or exchange of any property or the rendering of any service) with an Excluded Holder;
(ix)any sale, conveyance or transfer of all or substantially all of the property and/or assets of the Company and its Subsidiaries, taken as a whole, or any merger, consolidation, statutory exchange, share transaction or any other business combination transaction of the Company or its Subsidiaries into or with any other “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act) as a result of which such person or group shall become the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act) of more than 50% of the total voting power of the Voting Stock of the Company unless the proceeds thereof are to be applied substantially contemporaneously to the redemption in full in cash of the Series A Preferred Stock at the Redemption Price in accordance with the terms hereof and provided that all shares of Series A Preferred Stock shall be redeemed in connection therewith (for the avoidance of doubt, other than any internal reorganization among the Company and its Subsidiaries, so long as the Company is the surviving entity in any merger, consolidation, statutory exchange or other business combination transaction involving the Company);
(x)the Company and its Subsidiaries incurring, or suffering to exist, Indebtedness other than (i) amounts outstanding as of the Original Issue Date under the Financing Agreement plus up to $15 million revolving facility permitted to be incurred under and pursuant to the terms of the Financing Agreement, and any Refinancing Indebtedness of the foregoing, in each case under this clause (i) exclusive of any capitalized or pay-in kind interest, plus (ii) additional Indebtedness outstanding at any time by the Company and its Subsidiaries not to exceed $27.5 million; provided that, in connection with any acquisition of any Person that is not an Affiliate (a “Target”, and such acquisition, an “Acquisition”), the foregoing prohibitions shall not apply to any Indebtedness of a Target that is outstanding at the closing of the Acquisition so long as such Indebtedness (A) is non-recourse to the Company and its Subsidiaries (other than the Target) and (B) was not incurred in connection with or in contemplation of the Acquisition (for purposes of the foregoing, “non-recourse to the Company and its Subsidiaries” shall mean that, with respect to such Indebtedness of the Target, (1) neither the Company nor any of its Subsidiaries (other than the Target) (a) provides credit support of any kind (including any undertaking, agreement or instrument that would constitute Indebtedness), (b) is directly or indirectly liable as a guarantor or otherwise, or (c) constitutes the lender; (2) no default under the Target’s Indebtedness would permit upon notice, lapse of time or both any holder of Indebtedness of the Company or any of its Subsidiaries (other than the Target) (such Indebtedness, the “Pre-Acquisition Indebtedness”) to declare a default on the Pre-Acquisition Indebtedness or cause the
payment of the Pre-Acquisition Indebtedness to be accelerated or payable prior to its stated maturity; and (3) as to which the governing documentation provides that the lenders will not have any recourse to the stock or assets of the Company or any of its Subsidiaries (other than the Target));
(xi)the appointment or removal without cause of the chief executive officer of the Company or chief technology officer of the Company; or
(xii)any agreement or commitment to do or take any action described in this Section 8(b).
For purposes of this Section 8(b), the filing in accordance with applicable law of a certificate of designations or any similar document setting forth or changing the designations, preferences, conversion or other rights, voting powers, restrictions, limitations as to dividends and other distributions, qualifications or other terms of any class or series of stock of the Company shall be deemed an amendment to the Certificate. Notwithstanding anything to the contrary in this Section 8(b), the affirmative vote or consent of the Preferred Majority Holders will not be necessary for effecting actions contemplated in clauses (iv), (v) and (vi) of this Section 8(b) among or between the Company and its Subsidiaries.
Subject to the limitations and conditions set forth in this Section 8(b), including, without limitations, the requirement for the consent of the Preferred Majority Holders pursuant to clause (iii) above, the number of shares of Series A Preferred Stock that may be issued after the Incremental Closing Date shall not exceed 15,000 shares (inclusive of the 5,000 shares of Series A-3 Preferred Stock that are authorized but unissued as of the Incremental Closing Date which may only be issued to Authorized Investors), which shares shall be Series A-3 Preferred Stock and shall have identical terms as the shares of Series A-3 Preferred Stock issued on the Incremental Closing Date other than, if applicable, with respect to (A) the date of issuance, (B) the issue price (which issue price, taking into account any cash or non-cash consideration (including in the form of Warrants) forming a part thereof provided to or from the Company, shall not be more favorable to the holders of such additional shares of Series A Preferred Stock (“Additional Holders”) than the issue price of the Series A-3 Preferred Stock issued to the Series A Investor), and (C) the date from which Dividends will accrue thereon (such additional shares of Series A Preferred Stock described in this paragraph, the “Incremental Shares”). The Company and each Additional Holder shall execute and deliver to the Company and the Preferred Majority Holders such documentation as the Company and the Preferred Majority Holders shall reasonably specify to evidence the Incremental Shares of such Additional Holder and the purchase thereof (including, without limitation, a purchase agreement in substantially the same form as the Share Subscription Agreement).
(c)Additional Protective Provisions. Notwithstanding anything to the contrary contained herein, the affirmative vote or consent of the A-2 and A-3 Majority Holders will be necessary for effecting any of the following actions, whether or not such approval is required pursuant to the DGCL:
(i)the appointment or removal without cause of any director designated by the majority holders of the Series A-2 Preferred Stock and Series A-3 Preferred Stock;
(ii)increase the size of the Board of Directors to more than eight (8) directors;
(iii)use the proceeds from the issuance of the Series A-3 Preferred Stock for any purpose other than general corporate purposes; provided that, at least $10
million of such proceeds shall be promptly applied by the Company, in the Company’s commercially reasonable discretion, to repurchase its outstanding Common Stock; provided, further, that (x) no more than $3 million of such proceeds may be used for such purchases of Common Stock in privately negotiated transactions or in the form of block trades and (y) the seller in any such privately negotiated transaction or block trade may not be an Affiliate of the Company; or
(iv)any agreement or commitment to do or take any action described in this Section 8(c).
Section 9. Board Designation Rights.
(a)Without limitation of the rights of the Holders under Section 11 hereof, for so long as the Series A Investor and its Affiliates own at least 50% of the shares of Series A Preferred Stock then outstanding (excluding shares of Series A Preferred Stock held by any Excluded Holder), the Series A Investor shall have the right to appoint one observer (the “Series A Investor Observer”) to the Board and any committee thereof, subject to the execution by the Series A Investor Observer of a customary confidentiality agreement with the Company. The rights of the Series A Investor and its Affiliates pursuant to this Section 9(a) may not be Transferred without the consent of the Company. The Series A Investor Observer shall serve in such capacity until such individual’s earlier death, disability, resignation or removal by the Series A Investor and shall be subject to all obligations, policies and codes of conduct applicable to the directors of the Company.
(b)The Series A Investor Observer shall have the same observation rights afforded to the lenders under the Financing Agreement (as in effect on the Original Issue Date), including (i) being timely notified of the time and place of any such meetings (including regular and special meetings) and attending (in person or, at his/her election, telephonically) all in-person meetings and to listen to the entirety of all telephonic meetings of the Board and any of its committees or sub-committees and those of its Subsidiaries, in each case in a nonvoting observer capacity and (ii) receipt of all information, notices, reports, written consents, meeting minutes and other materials (collectively, the “Board Information”) provided to the members of the Board and any of its committees or sub-committees and those of its Subsidiaries in respect of such meeting (the “Board Members”), in each case, substantially simultaneously with, and in the same manner and to the same extent as, such Board Information is given to such Board Members, including written notice of all proposed actions to be taken at any such meeting (such notice shall describe in reasonable detail the nature and substance of the matters to be discussed and/or voted upon at such meeting (or the proposed actions to be taken by written consent without a meeting)), in addition to copies of the records of the proceedings or minutes of such meeting, when provided to the members thereof. Notwithstanding the foregoing, the Company may withhold any information and exclude the Series A Investor Observer from any meeting or portion thereof, including closed or executive sessions, if the Board determines in good faith, based on the advice of counsel, that such exclusion is reasonably necessary to preserve the attorney-client privilege or under circumstances that present a bona fide conflict of interest with respect to the applicable matter under consideration. The Company shall provide the Series A Investor Observer with reimbursement for reasonable and documented out-of-pocket costs and expenses incurred by the Series A Investor Observer in connection with the exercise of its rights and roles hereunder.
(c)The Series A Investor Observer may be removed at any time without cause by the Series A Investor, and any vacancy with respect to the Series A Investor Observer may be filled by the Series A Investor. In the event that the Series A Investor and its Affiliates no longer own at least 50% of the shares of Series A Preferred Stock then outstanding (excluding
shares of Series A Preferred Stock held by any Excluded Holder), the term of office of the Series A Investor Observer shall immediately terminate, and the Board may remove the Series A Investor Observer from the Board.
(d)If the Company fails to have an Adjusted EBITDA of at least $40 million for the 2024 fiscal year and the Holders of Series A-2 Preferred Stock and Series A-3 Preferred Stock hold Series A-2 Preferred Stock and Series A-3 Preferred Stock representing an aggregate Stated Value of at least $23,976,322.56, the A-2 and A-3 Majority Holders shall be entitled, notwithstanding anything to the contrary herein, the Certificate, the Bylaws, the Share Subscription Agreement or other agreements by or among the stockholders of the Company, to the appointment of one (1) individual of the A-2 and A-3 Majority Holders’ choosing and at such Holders’ sole discretion to the Board of Directors, not later than the date of the immediately upcoming meeting of shareholders for the election of directors. Further, if the Holders of Series A-2 Preferred Stock and Series A-3 Preferred Stock hold Series A-2 Preferred Stock and Series A-3 Preferred Stock representing an aggregate Stated Value of at least $23,976,322.56 (or, to the extent the right in the preceding sentence shall have been triggered, at least $71,928,967.69), as of January 1, 2026, the A-2 and A-3 Majority Holders shall be entitled, notwithstanding anything to the contrary herein, the Certificate, the Bylaws, the Share Subscription Agreement or other agreements by or among the stockholders of the Company, to the appointment of one (1) additional individual of the A-2 and A-3 Majority Holders’ choosing and at such Holders’ sole discretion to the Board of Directors, not later than the date of the immediately upcoming meeting of shareholders for the election of directors. In each case the directors serving immediately prior to such board changes described in this Section 9(d) shall approve the appointment of such additional directors designated by the A-2 and A-3 Majority Holders as the case may be. If the A-2 and A-3 Majority Holders fail to elect a sufficient number of directors to fill all directorships for which they are entitled to elect directors, voting exclusively and as a separate class, under this Section 9(d), then any directorship not so filled shall remain vacant until such time as the A-2 and A-3 Majority Holders elect an individual to fill such directorship by vote or written consent.
Section 10. [Intentionally Omitted]
Section 11. Non-Compliance Events. Following the occurrence and during the continuance of any Non-Compliance Event, the Stated Value and the Accrued Dividends shall each accrete by an additional 0.50% each month during the continuance of such Non-Compliance Event (such rate increasing incrementally by an additional 0.50% on each one-month month anniversary of the occurrence thereof), which accreted amounts shall thereafter constitute “Accrued Dividends” for purposes hereof (a “Non-Compliance Step-Up”).
Section 12. Information Rights and Inspection Rights.
(a)The Company shall provide to the Holders:
(i)not later than the fifth Business Day after the 105th day following the end of each fiscal year of the Company (or such longer period as may be permitted by the SEC for the filing of annual reports on Form 10-K) ending on or after December 31, 2022, a copy of the audited consolidated balance sheet of the Company and its consolidated Subsidiaries as at the end of such year and the related audited consolidated statements of operations, changes in common stockholders’ equity and cash flows for such year, setting forth in each case in comparative form the figures for and as of the end of the previous year, reported on without a “going concern” or like qualification or exception, or qualification arising out of the scope of the audit, by an independent certified public accounting firm of nationally recognized standing (it being agreed that the furnishing of the Company’s annual report on Form 10-K for such year, as filed with the SEC, will satisfy the Company’s obligation under this Section 12(a)(i) with respect to
such year including with respect to the requirement that such financial statements be reported on without a “going concern” or like qualification or exception, or qualification arising out of the scope of the audit, so long as the report included in such Form 10-K does not contain any “going concern” or like qualification or exception) (except to the extent such qualification results solely from (i) the impending maturity of any Indebtedness or (ii) any potential or actual inability to satisfy any financial maintenance covenant under the Financing Agreement or any Refinancing Indebtedness in respect thereof (it being understood, for the avoidance of doubt, that any “emphasis of matter” or explanatory paragraph shall not constitute a breach of this Section));
(ii)not later than the fifth Business Day after the 50th day following the end of each of the first three quarterly periods of each fiscal year of the Company (or such longer period as may be permitted by the SEC for the filing of quarterly reports on Form 10-Q), the unaudited consolidated balance sheet of the Company and its consolidated Subsidiaries as at the end of such quarter and the related unaudited consolidated statements of operations and cash flows of the Company and its consolidated Subsidiaries for such quarter and the portion of the fiscal year through the end of such quarter, setting forth in each case in comparative form the figures for and as of the corresponding periods of the previous year, certified by a Responsible Officer of the Company as fairly presenting in all material respects the financial condition of the Company and its Subsidiaries in conformity with GAAP and prepared in reasonable detail in accordance with GAAP applied consistently throughout the periods reflected therein and with prior periods that began on or after the Original Issue Date (except as disclosed therein, and except for the absence of certain notes) (it being agreed that the furnishing of the Company’s quarterly report on Form 10-Q for such quarter, as filed with the SEC, will satisfy the Company’s obligations under this Section 12(a)(ii) with respect to such quarter);
(iii)within five Business Days after the same are filed, copies of all financial statements and periodic reports which the Company may file with the SEC or any successor or analogous Governmental Authority;
(iv)within five Business Days after the same are filed, copies of all registration statements and any amendments and exhibits thereto, which the Company may file with the SEC or any successor or analogous Governmental Authority;
(v)a copy of any material notice provided to the lenders or any other creditors under the Financing Agreement or any Refinancing Indebtedness in respect thereof at the same time as such lenders or other creditors receive such notice;
(vi)subject to a customary confidentiality agreement, promptly upon request by any Holder, any information regarding the Company provided to the Board;
(vii)as soon as possible after a Responsible Officer of the Company knows thereof, the occurrence of any Non-Compliance Event;
(viii)as soon as possible after a Responsible Officer of the Company knows thereof, any (i) default or event of default under any Contractual Obligation of the Company or any of its Subsidiaries, other than as previously disclosed in writing to the Holders, or (ii) litigation, investigation or proceeding which may exist at any time, in the case of either clause (i) or (ii) that would reasonably be expected to have a Material Adverse Effect; and
(ix)subject to clause (b) below, such additional financial and other information regarding the Company as the Series A Investor may from time to time reasonably request.
(b)The Company shall permit the Series A Investor and its Affiliates (and their respective representatives) to visit and inspect any of its properties and examine and, to the extent reasonable, make abstracts from any of its books and records and to discuss the business, operations, properties and financial and other condition of the Company and its Subsidiaries with officers of such Persons and with the Company’s independent certified public accountants, in each case at any reasonable time, upon reasonable notice, and as often as may reasonably be desired; provided that representatives of the Company may be present during any such visits, discussions and inspections.
(c)Notwithstanding anything to the contrary in this Section 12, neither the Company nor its Subsidiaries will be required by the terms of this Section 12 to disclose or permit the inspection or discussion of, any document, information or other matter (i) that constitutes non-financial trade secrets or non-financial proprietary information, (ii) in respect of which disclosure to the Holders (or their respective representatives) is prohibited by Requirements of Law or any binding agreement or (iii) that is subject to attorney-client or similar privilege or constitutes attorney work product.
(d)Documents required to be delivered pursuant to this Section 12 may at the Company’s option be delivered electronically and, if so delivered, shall be deemed to have been delivered on the date (i) on which the Company posts such documents, or provides a link thereto on the Company’s website on the Internet at the website address specified by written notice to the Holders from time to time; or (ii) on which such documents are posted on the Company’s behalf on an Internet or intranet website to which each Holder has access (whether a commercial or third-party website).
Section 13. Transfer Agent, Registrar and Paying Agent. The Transfer Agent and the Paying Agent shall initially be Continental Stock Transfer & Trust Company, a New York corporation. The Company may, in its sole discretion, appoint any other Person to serve as Transfer Agent or Paying Agent for the Series A Preferred Stock and thereafter may remove or replace such other Person at any time. Upon any such appointment or removal, the Company shall send notice thereof to the Holders.
Section 14. Replacement Certificates. If physical certificates evidencing the Series A Preferred Stock are issued, the Company shall replace any mutilated certificate at the Holder’s expense upon surrender of that certificate to the Transfer Agent. The Company shall replace certificates that become destroyed, stolen or lost at the Holder’s expense upon delivery to the Company and the Transfer Agent of evidence satisfactory to the Company and the Transfer Agent that the certificate has been destroyed, stolen or lost, together with any indemnity that may be required by the Transfer Agent and the Company.
Section 15. Tax Matters.
(a)Withholding. The Company and its Paying Agent shall be entitled to deduct and withhold taxes on all payments and distributions (or deemed distributions) on the Series A Preferred Stock to the extent required by applicable law. To the extent that any amounts are so deducted or withheld, such deducted or withheld amounts shall be treated for all purposes of this Certificate of Designation as having been paid to the Person in respect of which such deduction or withholding was made. In the event the Company previously remitted any amounts to a Governmental Authority on account of taxes required to be deducted or withheld in respect of any payment or distribution (or deemed distribution) with respect to a share of Series
A Preferred Stock, the Company shall be entitled (i) to offset any such amounts against any amounts otherwise payable in respect of such share of Series A Preferred Stock or (ii) to require the Person in respect of whom such deduction or withholding was made to reimburse the Company for such amounts (and such Person shall promptly so reimburse the Company upon demand).
(b)Transfer Taxes. The Company shall pay any and all documentary, stamp and similar issue or transfer tax (“Transfer Tax”) due on the issue of shares of Series A Preferred Stock or certificates representing such shares or securities. However, the Company shall not be required to pay any Transfer Tax that may be payable in respect of the issue or delivery (or any transfer involved in the issue or delivery) of Series A Preferred Stock to a beneficial owner other than the beneficial owner of the Series A Preferred Stock immediately prior to the event pursuant to which such issue or delivery is required, and no such issue or delivery shall be made unless and until the person requesting such issue or delivery has paid to the Company the amount of any such Transfer Tax (to the extent the Company bore such Transfer Tax) or has established to the satisfaction of the Company that such Transfer Tax has been paid or is not payable.
Section 16. Notices. All notices referred to herein shall be in writing and, unless otherwise specified herein, all notices hereunder shall be deemed to have been given upon the earlier of receipt thereof or three (3) Business Days after the mailing thereof if sent by registered or certified mail (unless first class mail shall be specifically permitted for such notice under the terms of this Certificate of Designation) with postage prepaid, addressed: (i) if to the Company, (a) if sent by mail, to its office at Mondee Holdings, Inc., 10800 Pecan Park Blvd., Suite 315, Austin, Texas 78750, Attention: Jesus Portillo (jportillo@mondee.com), or (b) if sent by electronic mail, to such electronic mail address as the Company shall have designated in writing to the Holders, (ii) if to any Holder, to such Holder at the address and electronic mail address of such Holder as listed in the stock record books of the Company (which, for all purposes hereunder, may include the records of the Transfer Agent) or (iii) to such other address as the Company or any such Holder, as the case may be, shall have designated by notice similarly given.
Section 17. Facts Ascertainable. When the terms of this Certificate of Designation refer to a specific agreement or other document to determine the meaning or operation of a provision hereof, the Company shall maintain a copy of such agreement or document at the principal executive offices of the Company and a copy thereof shall be provided free of charge to any Holder who makes a request therefor. The Company shall also maintain a written record of the Issuance Date, the number of shares of Series A Preferred Stock issued to a Holder and the date of each such issuance, the Stated Value and Accrued Dividends per share of Series A Preferred Stock and the Dividend Rate in effect from time to time and shall furnish such written record free of charge to any Holder who makes a request therefor.
Section 18. Amendment; Waiver. Notwithstanding any provision in this Certificate of Designation to the contrary, any provision contained herein and any right of the Holders of Series A Preferred Stock granted hereunder may be amended or waived as to all shares of Series A Preferred Stock (and the Holders thereof) upon the written consent of the Preferred Majority Holders; provided that, (i) any amendment, modification, or waiver that, by its terms, would treat any Holder or Holders (including any Excluded Holder), in its capacity as such, either adversely or less beneficially relative to any other Holder shall require the prior written consent of such adversely or less beneficially affected Holder, and (ii) other than ministerial changes, without the written consent of each Holder adversely affected thereby, no amendment, modification, or waiver shall:
(a)reduce the Dividend Rate, extend any Dividend Payment Date (except in accordance with the proviso to such definition as in effect on the Original Issue Date) or amend Section 4 (including any other defined term used in such section, to the extent relating thereto);
(b)reduce the Stated Value or the Accrued Dividend or amend Section 5 (including any other defined term used in such section, to the extent relating thereto); provided that the Preferred Majority Holders shall be permitted to amend, modify or waive Non-Compliance Events and the effects thereof without the written consent of each adversely affected Holder;
(c)reduce the Redemption Price (other than as a result of any amendment, modification or waiver of the effect of a Non-Compliance Event in accordance with clause (b) above) or amend Section 6 (including any other defined term used in such section, to the extent relating thereto), other than the penultimate and final sentences of Section 6(b) (which may be amended, modified or waived with the consent of the Preferred Majority Holders and will not require the consent of each adversely affected Holder);
(d)amend Section 7(a) (including any defined term used in such section to the extent relating thereto); provided that the definition of “Prohibited Transferee” may be amended, modified or waived with the consent of the Preferred Majority Holders and will not require the consent of each adversely affected Holder;
(e)amend Section 2 (including any defined term used in such section to the extent relating thereto); or
(f)amend either (x) clause (i) of the proviso to this Section 18, or (y) the foregoing clauses (a) through (e) or this clause (f)..
Section 19. Severability. If any term of the Series A Preferred Stock set forth herein is invalid, unlawful or incapable of being enforced by reason of any rule of law or public policy, all other terms set forth herein which can be given effect without the invalid, unlawful or unenforceable term will, nevertheless, remain in full force and effect, and no term herein set forth will be deemed dependent upon any other such term unless so expressed herein.
Section 20. Interpretation. When a reference is made in this Certificate of Designation to an Article, a Section, Exhibit or Schedule, such reference shall be to an Article of, a Section of, or an Exhibit or Schedule to this Certificate of Designation unless otherwise indicated. Whenever the words “include,” “includes” or “including” are used in this Certificate of Designation, they shall be deemed to be followed by the words “without limitation.” The words “hereof,” “herein” and “hereunder” and words of similar import when used in this Certificate of Designation shall refer to this Certificate of Designation as a whole and not to any particular provision of this Certificate of Designation unless the context requires otherwise. The terms “or,” “any” and “either” are not exclusive. The word “extent” in the phrase “to the extent” shall mean the degree to which a subject or other thing extends, and such phrase shall not mean simply “if.” The word “will” shall be construed to have the same meaning and effect as the word “shall.” All terms defined in this Certificate of Designation shall have the defined meanings when used in any document made or delivered pursuant hereto unless otherwise defined therein. The definitions contained in this Certificate of Designation are applicable to the singular as well as the plural forms of such terms and to the masculine as well as to the feminine and neuter genders of such term. Any agreement, instrument or statute defined or referred to herein or in any agreement or instrument that is referred to herein means, unless otherwise specified, such agreement, instrument or statute as from time to time amended, modified or supplemented,
including (in the case of agreements or instruments) by waiver or consent and (in the case of statutes) by succession of comparable successor statutes and references to all attachments thereto and instruments incorporated therein. Unless otherwise specifically indicated, all references to “dollars” or “$” shall refer to the lawful money of the United States. When calculating the period of time between which, within which or following which any act is to be done or step taken pursuant to this Certificate of Designation, the date that is the reference date in calculating such period shall be excluded (unless otherwise required by law or specified herein, if the last day of such period is not a Business Day, the period in question shall end on the next succeeding Business Day).
Section 21. Expenses; Indemnity.
(a)For so long as the Series A Preferred Stock remains outstanding, the Company shall reimburse the Holders for each of their documented reasonable out-of-pocket costs, fees and expenses from time to time in responding to any request for approval under the Certificate (including this Certificate of Designation), enforcing their rights under the Certificate (including this Certificate of Designation), and/or amending the Certificate (including this Certificate of Designation); provided, that, the Company shall not be obligated to reimburse the expenses of more than one single counsel for all Holders taken as a whole (such counsel to be selected by the Preferred Majority Holders in their sole discretion) and to the extent reasonably necessary, regulatory counsel and a single local counsel in each relevant jurisdiction.
(b)The Company shall indemnify and hold harmless the Holders, each of their respective Affiliates and controlling persons and each of their respective directors, officers, employees, partners, agents, advisors and other representatives (each, an “Indemnified Person”) from and against any and all losses, claims, damages and liabilities to which any such Indemnified Person may become subject arising out of or in connection with any claim, litigation, investigation or proceeding relating to the Certificate (including this Certificate of Designation) (a “Proceeding”), regardless of whether any Indemnified Person is a party thereto or whether such Proceeding is brought by the Company, any of its Affiliates or any third party, and to reimburse each Indemnified Person within thirty (30) days following written demand therefor (together with reasonably detailed backup documentation supporting such reimbursement request) for any reasonable and documented legal or other out-of-pocket expenses incurred in connection with investigating or defending any Proceeding; provided, that the foregoing indemnity will not, as to any Indemnified Person, apply to losses, claims, damages, liabilities or related expenses to the extent they arise from the willful misconduct, bad faith or gross negligence of, or material breach of the Certificate (including this Certificate of Designation) or the Share Subscription Agreement by, such Indemnified Person, in each case as determined by a final non-appealable judgment of a court of competent jurisdiction.
[Signature Page Follows]
IN WITNESS WHEREOF, the undersigned has executed this Certificate of Designation this 14 day of December 2023.
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| By: | /s/ Prasad Gundumogula |
| | Name: Prasad Gundumogula Title: Chief Executive Officer |
Exhibit A
Form of Promissory Note
THE RIGHTS REPRESENTED BY THIS NOTE AND THE SECURITIES INTO WHICH THE DEBT MAY BE CONVERTED HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND ARE BEING ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION OF THEREOF. NO SUCH SALE OR DISTRIBUTION MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR UNLESS SUCH REGISTRATION STATEMENT IS NOT REQUIRED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
PROMISSORY NOTE
Dated: _________
FOR VALUE RECEIVED, Mondee Holdings, Inc. (f/k/a ITHAX Acquisition Corp.), a Delaware corporation (the “Company”), hereby unconditionally promises to pay to the order of [Applicable Holder] or its successors and permitted assigns (the “Holder”) the Put Price plus the Accrued Dividends and accrued and unpaid dividends since the most recent Dividend Payment Date for the number of shares of Series A Preferred Stock to which this Note relates, in each case as of the date of delivery of the Promissory Note Election Notice (the “Principal”), together with Interest thereon, which may be waived by the Holder at its sole discretion, from the date of this Promissory Note (this “Note”) until all unpaid Principal and accrued and unpaid Interest thereon and other amounts payable under this Note have been paid in full under this Note. Interest shall accrue on all outstanding Principal at the Interest Rate on a daily basis from the date of delivery of the Promissory Note Election Notice (“Interest”) until all outstanding Principal and accrued and unpaid Interest thereon under this Note are paid in full (all outstanding Principal, accrued and unpaid Interest thereon payable under this Note from time to time are collectively referred to herein as the “Debt”). Interest shall be calculated on the basis of a 365-day year.
This Note is referenced in, and has been issued as of the date hereof pursuant to, that certain Second Amended and Restated Certificate of Designation of Preferences, Rights and Limitations of Series A-1, Series A-2 and Series A-3 Preferred Stock dated as of December 14, 2023 (“Certificate of Designation”). This Note becomes effective upon the Holder delivering the Promissory Note Election Notice pursuant to Section 6(e)(iii) of the Certificate of Designation. Each capitalized term used herein and not otherwise defined herein has the meaning ascribed to such term in the Certificate of Designation.
1.Payment.
(a)Payment on Maturity; Interest Payments. All outstanding Principal and Interest and other amounts payable under this Note shall be due and payable immediately on demand (the date of such demand being the “Maturity Date”). Interest shall be payable quarterly in arrears on March 31, June 30, September 30 and December 31 of each year (each, an “Interest Payment Date”) by no later than 5:00 p.m., New York City time, on each such Interest Payment Date, with the first payment of Interest due and payable on the first such date to occur following the effective date of this Note; provided, however, that if any Interest Payment Date would otherwise occur on a day that is not a Business Day, such Interest Payment Date shall instead be on the immediately succeeding Business Day. For the avoidance of doubt, in no event shall interest accrue at an Interest Rate greater than (i) 20% per annum or (ii) the maximum rate of interest allowed by applicable law. Interest and other amounts payable pursuant to this Note shall accrue
whether or not there are funds legally available for the payment thereof, whether the Company has any earnings or net profits, and whether or not the payment or accrual of Interest or such other amounts is restricted by the terms of any of the Company’s indebtedness outstanding at any time.
(b)Payment Procedure. Payments of Principal, Interest and all other amounts due pursuant to this Note shall be made by wire transfer of immediately available funds to an account designated by the Holder.
(c)Interest Rate Adjustment. If the Company has not paid and does not repay the Debt to the Holder, on or before the date that is one (1) Business Day following (i) the Maturity Date, or (ii) if applicable, an Event of Default beyond the applicable cure periods, if any, provided therefor, interest on the aggregate outstanding Principal and accrued and unpaid Interest shall, subject to the maximum rate of interest allowed by applicable law, accrue in arrears at a rate equal to the Interest Rate, compounded monthly, with such rate increasing by 0.5% per month.
2.Rank. The Debt shall be deemed to rank (a) senior to all classes of Common Stock, Preferred Stock, and to all other classes and series of Capital Stock of the Company established after the Original Issue Date (collectively, the “Securities”), (b) pari passu with (i) all unsecured indebtedness and liabilities of the Company outstanding on the date this Note becomes effective or incurred thereafter and (ii) other promissory note(s) issued pursuant to the Certificate of Designation and (c) junior to all secured indebtedness or liabilities of the Company to the extent of collateral securing such indebtedness or liabilities.
3.Negative Covenants. So long as any amount of Debt remains unpaid under this Note, the Company may not, either directly or indirectly by amendment, merger, consolidation or otherwise, do, take, or cause to be taken, or enter into any contract or arrangement to do, take, or cause to be taken, any of the following actions, without the prior written consent of the Majority Holders, and any such act, contract or arrangement entered into without such consent shall be null and void ab initio, and of no force or effect:
(a)any amendment, alteration, waiver or repeal of any provision of the Certificate (including the Certificate of Designation), Bylaws or any other governing document of the Company (by merger, consolidation, division or reorganization of the Company, or otherwise) in a manner that adversely affects the rights, preferences or privileges of this Note, unless such amendment, alteration or repeal is effectuated at the time of consummation of a transaction, the proceeds of which are to be applied substantially contemporaneously to the repayment in full in cash of all the amounts payable under this Note in accordance with the terms hereof such that this Note shall be fully repaid in connection therewith, and the effectiveness of such amendment, alteration or repeal occurs substantially contemporaneously with such repayment;
(b)any liquidation, dissolution or winding up of the Company, its Subsidiaries, or the Company’s or any Subsidiary’s business and affairs (other than a liquidation, dissolution or winding up of a direct or indirect wholly-owned Subsidiary of the Company in connection with a bona fide corporate reorganization that does not adversely affects the priority, seniority, rights, preferences or privileges of this Note);
(c)any creation, authorization or issuance (by reclassification or otherwise) of additional shares of Series A Preferred Stock, any Parity Stock, any Junior Stock (other than Common Stock), or any Senior Stock or any securities or rights convertible or exchangeable into, or exercisable for the foregoing; provided the Company shall be permitted to issue such Parity Stock, Junior Stock and/or Senior Stock to the extent the proceeds thereof are to be applied
substantially contemporaneously to the repayment in full in cash of this Note in accordance with the terms hereof and provided that this Note shall be repurchased in connection therewith;
(d)any declaration or payment of any dividends or distributions to holders of Senior Stock, Parity Stock or Junior Stock (other than dividends or distributions payable solely in Junior Stock) or any redemption, repayment, defeasance, or repurchase of any Senior Stock, Parity Stock or Junior Stock (other than (A) from employees, officers, directors, or consultants in connection with termination of services to the Company or its Subsidiaries or (B) otherwise pursuant to an equity-based benefit plan of the Company in connection with customary cashless exercise or fractional share repurchase features);
(e)any acquisition of stock, assets, or the business of any Person in one transaction or series of related transactions for consideration in excess of $50 million;
(f)any disposition of any assets outside of the ordinary course of business (whether by merger, consolidation or otherwise) in one transaction or series of related transactions with a value in excess of $25 million, except to the extent the proceeds thereof are to be applied substantially contemporaneously to the repayment in full in cash of all amounts payable under this Note in accordance with the terms hereof and provided that this Note shall be repaid in connection therewith;
(g)adoption or approval of any material amendment to any equity-based benefit plan that provides for the issuance of securities other than Common Stock or options to acquire Common Stock;
(h)the Company or its Subsidiaries, directly or indirectly, entering into or conducting any transaction or series of related transactions (including entering into any contract, agreement or other arrangement or the purchase, sale, lease or exchange of any property or the rendering of any service) with an Excluded Holder;
(i)any sale, conveyance or transfer of all or substantially all of the property and/or assets of the Company and its Subsidiaries, taken as a whole, or any merger, consolidation, statutory exchange, share transaction or any other business combination transaction of the Company or its Subsidiaries into or with any other “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act) as a result of which such person or group shall become the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act) of more than 50% of the total voting power of the Voting Stock of the Company unless the proceeds thereof are to be applied substantially contemporaneously to the repayment in full in cash of all amounts payable under this Note in accordance with the terms hereof and provided that this Note shall be repaid in connection therewith (for the avoidance of doubt, other than any internal reorganization among the Company and its Subsidiaries, so long as the Company is the surviving entity in any merger, consolidation, statutory exchange or other business combination transaction involving the Company);
(j)the Company and its Subsidiaries incurring, or suffering to exist, Indebtedness other than amounts outstanding as of the Original Issue Date under the Financing Agreement plus up to $15 million revolving facility permitted to be incurred under and pursuant to the terms of the Financing Agreement, and any Refinancing Indebtedness of the foregoing, in each case exclusive of any capitalized or pay-in kind interest; provided that, in connection with any acquisition of any Person that is not an Affiliate, the immediately foregoing prohibitions shall not apply to any Indebtedness of a Target that is outstanding at the closing of the Acquisition so long as such Indebtedness (A) is non-recourse to the Company and its Subsidiaries (other than the Target) and (B) was not incurred in connection with or in contemplation of the Acquisition (for purposes of the foregoing, “non-recourse to the Company and its Subsidiaries” shall mean that,
with respect to such Indebtedness of the Target, (1) neither the Company nor any of its Subsidiaries (other than the Target) (a) provides credit support of any kind (including any undertaking, agreement or instrument that would constitute Indebtedness), (b) is directly or indirectly liable as a guarantor or otherwise, or (c) constitutes the lender; (2) no default under the Target’s Indebtedness would permit upon notice, lapse of time or both any holder of Pre-Acquisition Indebtedness to declare a default on the Pre-Acquisition Indebtedness or cause the payment of the Pre-Acquisition Indebtedness to be accelerated or payable prior to its stated maturity; and (3) as to which the governing documentation provides that the lenders will not have any recourse to the stock or assets of the Company or any of its Subsidiaries (other than the Target)); ); provided, further, that the foregoing prohibitions in this Section 3(j) shall not apply to the incurrence of any Indebtedness of the Company or its Subsidiaries so long as the proceeds thereof are to be applied substantially contemporaneously to the repayment in full in cash of all amounts payable under this Note in accordance with the terms hereof and provided that this Note shall be repaid in connection therewith;
(k)the appointment or removal without cause of the chief executive officer of the Company, chief technology officer of the Company, or any director designated by the Series A-2 and A-3 Majority Holders pursuant to the Certificate of Designation;
(l)increase the size of the Board of Directors of the Company to more than eight (8) directors;
(m)use the proceeds from the issuance of the Series A-3 Preferred Stock for any purpose other than general corporate purposes; provided that, at least $10 million of such proceeds shall have been promptly (from the date of the issuance of the Series A-3 Preferred Stock) applied by the Company, in the Company’s commercially reasonable discretion, to repurchase its outstanding Common Stock; provided, further, that (x) no more than $3 million of such proceeds may be used for such purchases of Common Stock in privately negotiated transactions or in the form of block trades, and (y) the seller in any such privately negotiated transaction or block trade may not be an Affiliate of the Company; or
(n)any agreement or commitment to do or take any action described in this Section 3.
4.Events of Default. The following events are referred to herein as “Events of Default”:
(a)The Company fails to make any payment called for by this Note and such failure shall continue unremedied for a period of three (3) Business Days;
(b)the Company’s breach of any covenant under this Note, unless such failure shall be cured to the reasonable satisfaction of the Holder within three (3) Business Days after the notice thereof by the Holder to the Company;
(c)this Note shall cease for any reason (other than termination thereof in accordance with its terms) to be enforceable in accordance with its terms or in full force and effect;
(d)the entry of one or more judgments or decrees against the Company or any of its Subsidiaries involving in the aggregate at any time a liability (net of any insurance or indemnity payments actually received in respect thereof prior to or within 60 days from the entry thereof, or to be received in respect thereof in the event any appeal thereof shall be unsuccessful) in excess of $10,000,000, and all such judgments or decrees shall not have been vacated, discharged, stayed or bonded pending appeal within 60 days from the entry thereof;
(e)the occurrence of a Change of Control;
(f)an involuntary petition being filed against the Company under Title 11 of the U.S. Code, as now constituted or hereafter amended, or any other applicable federal, state or foreign bankruptcy or other similar law (unless such petition is dismissed or discharged within 60 days), or a custodian, receiver, liquidator, assignee, trustee or sequestrator (or similar official) being appointed to take possession, custody or control of any property of the Company; or
(g)the Company (a) files a petition seeking relief under Title 11 of the U.S. Code, as now constituted or hereafter amended, or any other applicable federal, state or foreign bankruptcy or other similar law, or (b) consents to the institution of proceedings thereunder or to the filing of any such petition or to the appointment of or taking possession by a custodian, receiver, liquidator, assignee, trustee or sequestrator (or similar official) of any property of Company.
5.Remedies.
(a)Event of Default. Upon the occurrence and during the continuance of an Event of Default beyond the applicable cure periods, if any, provided therefor, the entire Debt then outstanding will at once become due and payable without presentation, protest or further demand or notice of any kind, all of which are hereby expressly waived, and the Holder may proceed to enforce payment of such balance or part thereof employing all remedies available to it in law or equity until the Debt is satisfied in full.
(b)All Remedies Available. The Holder may proceed to protect and enforce its rights by suit in equity, action at law and/or other appropriate proceeding, either for specific performance of any covenant or condition contained in this Note or in any instrument or assignment delivered to the Holder pursuant to this Note, or in aid of the exercise of any power granted in this Note or any such instrument or assignment.
(c)No Waiver of Remedies. For the avoidance of doubt, the occurrence of an Event of Default does not preclude the Holder from exercising its right to require payment pursuant to provisions of Section 1(a) in the form of setting the Maturity Date by demand. The Holder’s failure to exercise any remedy available to the Holder will not constitute a waiver of the right to exercise the same in the event of any subsequent default.
6.Definitions. As used herein, terms not otherwise defined in this Note shall have the following meanings:
“Company” has the meaning set forth in the Preamble of this Note.
“Debt” has the meaning set forth in the Preamble of this Note.
“Dollar” and “$” mean lawful money of the United States of America from time to time.
“Event of Default” has the meaning set forth in Section 4 of this Note.
“Holder” has the meaning set forth in the Preamble of this Note.
“Interest” has the meaning set forth in the Preamble of this Note.
“Interest Payment Date” has the meaning set forth in Section 1(a) of this Note.
“Interest Rate” means the Dividend Rate unless otherwise waived or lessened at the sole discretion of the Holder.
“Majority Holders” means the holders of a majority of the aggregate principal amount outstanding under this Note and any other comparable notes issued under the Certificate of Designation.
“Principal” has the meaning set forth in the Preamble of this Note.
“Securities” has the meaning set forth in Section 2 of this Note.
For all purposes relevant to this Note: the terms defined in the singular have a comparable meaning when used in the plural and vice versa; whenever the words “include,” “includes,” or “including” are used, they are deemed followed by the words “without limitation;” and all references to number of shares, amounts per share, prices, and the like shall be subject to appropriate proportional adjustment for stock splits, stock combinations, stock dividends and similar events.
7.Notices. All notices and other communications given or made under this Note shall be in writing and shall be deemed effectively given upon the earlier of actual receipt or (a) personal delivery to the party to be notified, (b) when sent, if sent by electronic mail or facsimile during normal business hours of the recipient, and if not sent during normal business hours, then on the recipient’s next Business Day, (c) five (5) days after having been sent by registered or certified mail, return receipt requested, postage prepaid, or (d) one (1) Business Day after deposit with a nationally recognized overnight courier, freight prepaid, specifying next business day delivery, with written verification of receipt. All communications shall be sent to the respective parties at their address as set forth below, as the case may be, or to such email address, facsimile number or address as subsequently modified by written notice given in accordance with this Section :
If to the Company, to:
Mondee Holdings, Inc.
10800 Pecan Park Blvd.
Suite 315
Austin, Texas 78750
Attention: Jesus Portillo (jportillo@mondee.com)
with a copy to (which shall not constitute notice):
ReedSmith LLP
2850 N. Harwood Street | Suite 1500
Dallas, TX 75201
Attn: Lynwood E. Reinhardt, Esq. (lreinhardt@reedsmith.com)
If to the Holder, to:
[Applicable Holder]
with a copy to (which shall not constitute notice):
[Applicable Counsel]
8.Amendments and Waivers. This Note may not be modified, amended, waived, extended, changed, discharged, or terminated orally or by any act or failure to act, but only by an instrument in writing signed by the Company and the Holder.
9.Transfer of Note; Successors and Assigns. Prior to the delivery of the Promissory Note Election Notice, the Holder may assign or otherwise transfer from time to time in
compliance with applicable securities laws, without the consent of the Company, all or any portion of this Note with the corresponding proportionate amount of shares of Series A-2 Preferred Stock and Series A-3 Preferred Stock held by such Holder to any Person (other than a Prohibited Transferee), and the Note shall be in an amount equal to the transferee’s post-transfer, pro rata shares of Series A-2 Preferred Stock and Series A-3 Preferred Stock in proportion to the shares of Series A-2 Preferred Stock and Series A-3 Preferred Stock held by all holders thereof. Following delivery of the Promissory Note Election Notice, this Note may be assigned or otherwise transferred by the Holder from time to time in compliance with applicable securities laws without the consent of the Company. In the event the Holder assigns or otherwise transfers all or any part of this Note, the Company shall, upon the request of the Holder issue new Notes to effectuate such assignment or transfer. In the event of any such assignment or transfer pursuant to this Section 9, the obligations of the Company hereunder shall inure to the benefit of all such assigns and successors. The Company may not assign or delegate its obligations hereunder without the prior written consent of the Holder, and any purported assignment without such consent shall be void and of no effect. This Note applies to, inures to the benefit of, and binds the successors of the parties hereto.
10.Governing Law; Consent to Jurisdiction; Waiver of Jury Trial.
(a)Governing Law. This Note shall be governed by the laws of the State of Delaware without giving effect, to the extent permitted by applicable law, to any conflict of law principles that would result in the application of any other law.
(b)Consent to Jurisdiction. The parties (i) hereby irrevocably and unconditionally submit to the jurisdiction of the state courts of Delaware and to the jurisdiction of the United States District Court for the District of Delaware for the purpose of any suit, action or other proceeding arising out of or based upon this Agreement, (ii) agree not to commence any suit, action or other proceeding arising out of or based upon this Agreement except in the state courts of Delaware or the United States District Court for the District of Delaware, and (iii) hereby waive, and agree not to assert, by way of motion, as a defense, or otherwise, in any such suit, action or proceeding, any claim that it is not subject personally to the jurisdiction of the above-named courts, that its property is exempt or immune from attachment or execution, that the suit, action or proceeding is brought in an inconvenient forum, that the venue of the suit, action or proceeding is improper or that this Agreement or the subject matter hereof may not be enforced in or by such court.
(c)WAIVER OF JURY TRIAL. EACH PARTY WAIVES ITS RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS NOTE, THE SECURITIES OR THE SUBJECT MATTER HEREOF OR THEREOF. THE SCOPE OF THIS WAIVER IS INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT MATTER OF THIS TRANSACTION, INCLUDING, WITHOUT LIMITATION, CONTRACT CLAIMS, TORT CLAIMS (INCLUDING NEGLIGENCE), BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS. THIS SECTION HAS BEEN FULLY DISCUSSED BY EACH OF THE PARTIES AND THESE PROVISIONS WILL NOT BE SUBJECT TO ANY EXCEPTIONS. EACH PARTY FURTHER WARRANTS AND REPRESENTS THAT SUCH PARTY HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL, AND THAT SUCH PARTY KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL.
11.Waiver, No Impairment.
(a)To the extent that such waiver is not prohibited by any Requirement of Law and cannot be waived, the Company hereby expressly waives: (i) all presentments, demands for performance, notices of nonperformance (except to the extent required by this Note), protests, notices of protest and notices of dishonor; (ii) any requirement of diligence or promptness on the part of the Holder in the enforcement of its rights under this Note; (iii) any and all notices of every kind and description which may be required to be given by any Requirement of Law; and (iv) any defense (other than indefeasible payment in full) which it may now or hereafter have with respect to its liability under this Note or with respect to the Debt.
(b)The Company will not, by any voluntary action, avoid or seek to avoid the observance or performance of any of the terms to be observed or performed hereunder by the Company, but will, at all times, in good faith, assist in carrying out of all the provisions of this Note and in the taking of all such action as may be necessary or appropriate in order to protect the rights of the Holder against impairment.
12.No Waiver by Holder. No delay or omission by the Holder in exercising any right under this Note shall operate as a waiver of that or any other right. A waiver or consent given by the Holder on any one occasion shall be effective only in that instance and shall not be construed as a bar or waiver of any right on any other occasion.
13.Expenses. In connection with the occurrence of an Event of Default, the Company shall pay all costs and expenses of every kind incurred in connection with any proceedings to collect any liabilities evidenced by this Note, including reasonable attorneys’ fees.
14.Lost or Stolen Note. Upon receipt by the Company of evidence of the loss, theft, destruction or mutilation of the original Note, and (in the case of loss, theft or destruction) of indemnity or security reasonably satisfactory to the Company, and upon surrender and cancellation of the Note, the Company shall execute and deliver a new Note of like tenor and date.
15.Severability. The invalidity or unenforceability of any provisions of this Note in any jurisdiction shall not affect the validity, legality or enforceability of the remainder of this Note in such jurisdiction or the validity, legality or enforceability of this Note, including any such provision, in any other jurisdiction, it being intended that all rights and obligations of the Company and the Holder hereunder shall be enforceable to the fullest extent permitted by Requirements of Law. Upon such determination that any provision is invalid, illegal or incapable of being enforced, the Company and the Holder will negotiate in good faith to modify this Note so as to effect the original intent of the Company and the Holder as closely as possible in an acceptable manner to the end that the transactions contemplated hereby are fulfilled to the extent possible.
16.Section Headings. The section headings contained in this Note are solely for the purpose of reference, are not part of the agreement of the Company and the Holder and shall not in any way affect the meaning or interpretation of this Note. All references in this Note to Sections are to sections of this Note, unless otherwise indicated.
17.Saturdays, Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right required or granted herein shall not be a Business Day, then such action may be taken or such right may be exercised on the next succeeding Business Day.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the Company has caused this Note to be executed and dated the day and year first written above.
COMPANY
MONDEE HOLDINGS, INC.
By:
Name:
Title:
ACCEPTED AND AGREED:
HOLDER
[Applicable Holder]
AMENDED AND RESTATED WARRANT AGREEMENT
THIS AMENDED AND RESTATED WARRANT AGREEMENT (as amended, supplemented, or otherwise modified from time to time, this “Agreement”), dated as of December 14, 2023, is by and between Mondee Holdings, Inc., a Delaware corporation (the “Company”) and Continental Stock Transfer & Trust Company, a New York corporation, as warrant agent (the “Warrant Agent”, also referred to herein as the “Transfer Agent”).
WHEREAS, on September 29, 2022 (the “Original Issue Date”), the Company entered into those Subscription Agreements (collectively, the “Original Subscription Agreement”) with the investors named therein (the “Original Investors”) pursuant to which the Original Investors purchased shares of preferred stock of the Company;
WHEREAS, in connection with the Original Subscription Agreement, the Company and the Warrant Agent entered into that certain warrant agreement, dated as of September 29, 2022, by and between the Company and the Warrant Agent and the Company issued and delivered 1,275,000 whole warrants to certain of the Original Investors (the “Original Warrants”);
WHEREAS, on each of October 17, 2023 and December 14, 2023, the Company entered into those Subscription Agreements (collectively, the “Incremental Subscription Agreement”, and together with the Original Subscription Agreement, the “Subscription Agreement”) with the investors named therein (the “Incremental Investors”), pursuant to which the Incremental Investors agreed to purchase shares of preferred stock of the Company, and in connection therewith, the Incremental Investors surrendered their Original Warrants to the Company and such Original Warrants have been canceled (the “Cancelled Warrants”), and the Company on October 17, 2023 issued and delivered 1,125,000 warrants to replace a portion of the Cancelled Warrants plus an additional 150,000 whole warrants to certain of the Incremental Investors, bearing the restrictive legend set forth in Exhibit B, and the Company will as of the date hereof issue and deliver 150,000 warrants to replace the remainder of the Cancelled Warrants plus an additional 19,500 whole warrants to certain of the Incremental Investors (together with any Penalty Warrants (as defined in the Incremental Subscription Agreement), the “Warrants”); and each whole Warrant entitles the holder thereof to purchase one share of Class A common stock, par value $0.0001 per share, of the Company (the “Common Stock”) for $7.50 per share, subject to adjustment as described herein;
WHEREAS, the Company desires the Warrant Agent to act on behalf of the Company, and the Warrant Agent is willing to so act, in connection with the issuance, registration, transfer, exchange, redemption and exercise of the Warrants; and
WHEREAS, the Company desires to provide for the form and provisions of the Warrants, the terms upon which they shall be issued and exercised, and the respective rights, limitation of rights, and immunities of the Company, the Warrant Agent, and the holders of the Warrants;
WHEREAS, all acts and things have been done and performed which are necessary to make the Warrants, when executed on behalf of the Company and countersigned by or on behalf of the Warrant Agent, as provided herein, the valid, binding and legal obligations of the Company, and to authorize the execution and delivery of this Agreement.
NOW, THEREFORE, in consideration of the mutual agreements herein contained, the parties hereto agree as follows:
1.Appointment of the Warrant Agent. The Company hereby appoints the Warrant Agent to act as agent for the Company for the Warrants, and the Warrant Agent hereby accepts such appointments and agrees to perform the same in accordance with the terms and conditions set forth in this Agreement.
2.Warrants.
1.1Form of Warrant. Each Warrant shall be issued in registered form only, and, if a physical certificate is issued, shall be in substantially the form of Exhibit A hereto, the provisions of which are incorporated herein and shall be signed by, or bear the electronic or facsimile signature of, the Chairman
of the Board of Directors, Chief Executive Officer, Chief Financial Officer, Treasurer or other principal officer of the Company. In the event the person whose electronic or facsimile signature has been placed upon any Warrant shall have ceased to serve in the capacity in which such person signed the Warrant before such Warrant is issued, it may be issued with the same effect as if he or she had not ceased to be such at the date of issuance.
1.2Effect of Countersignature. If a physical certificate is issued, unless and until countersigned by the Warrant Agent pursuant to this Agreement, a Warrant certificate shall be invalid and of no effect and may not be exercised by the holder thereof.
1.3Registration.
1.3.1Warrant Register.
(a)The Warrant Agent shall maintain books (the “Warrant Register”) for the registration of original issuance and the registration of transfer of the Warrants. Upon the initial issuance of the Warrants, the Warrant Agent shall issue and register the Warrants in the names of the respective holders thereof in such denominations and otherwise in accordance with instructions delivered to the Warrant Agent by the Company. All of the Warrants shall initially be represented by one or more book-entry certificates (each, a “Book-Entry Warrant Certificate”) deposited with The Depository Trust Company (the “Depositary”) and registered in the name of Cede & Co., a nominee of the Depositary. Ownership of beneficial interests in the Warrants shall be shown on, and the transfer of such ownership shall be effected through, records maintained by (i) the Depositary or its nominee for each Book-Entry Warrant Certificate, or (ii) institutions that have accounts with the Depositary (each such institution, with respect to a Warrant in its account, a “Participant”) or, to the extent the Warrants are not so eligible as such on the date of issuance, will be issued in book-entry form on the records of the Warrant Agent until so made eligible.
(b)If the Depositary subsequently ceases to make its book-entry settlement system available for the Warrants, the Company may instruct the Warrant Agent regarding making other arrangements for book-entry settlement. In the event that the Warrants are not eligible for, or it is no longer necessary to have the Warrants available in, book-entry form, the Warrant Agent shall provide written instructions to the Depositary to deliver to the Warrant Agent for cancellation each Book-Entry Warrant Certificate, and the Company shall instruct the Warrant Agent to deliver to the Depositary definitive certificates in physical form evidencing such Warrants (“Definitive Warrant Certificate”). Such Definitive Warrant Certificate shall be in the form annexed hereto as Exhibit A, with appropriate insertions, modifications and omissions, as provided above.
1.3.2Registered Holder. Prior to due presentment for registration of transfer of any Warrant, the Company and the Warrant Agent may deem and treat the person in whose name such Warrant is registered in the Warrant Register (the “Registered Holder”) as the absolute owner of such Warrant and of each Warrant represented thereby (notwithstanding any notation of ownership or other writing on a Definitive Warrant Certificate made by anyone other than the Company or the Warrant Agent), for the purpose of any exercise thereof, and for all other purposes, and neither the Company nor the Warrant Agent shall be affected by any notice to the contrary.
1.4No Fractional Warrants. The Company shall not issue fractional Warrants. If a holder of Warrants would be entitled to receive a fractional Warrant, the Company shall round down to the nearest whole number the number of Warrants to be issued to such holder.
3. Terms and Exercise of Warrants.
1.1Warrant Price. Each Warrant, when countersigned by the Warrant Agent, shall entitle the Registered Holder thereof, subject to the provisions of such Warrant and of this Agreement, to purchase from the Company the number of shares of Common Stock stated therein, at the price of $7.50 per share, subject to the adjustments provided in Section 4 hereof and in the last sentence of this Section 3.1. The term “Warrant Price” as used in this Agreement shall mean the price per share at which shares of Common Stock may be purchased at the time a Warrant is exercised. The Company (i) in its sole
discretion may lower the Warrant Price at any time prior to the Expiration Date (as defined below), and (ii) to the extent it lowers the exercise price of the Company’s warrants subject to that certain Amended and Restated Warrant Agreement, dated as of July 18, 2022 (as amended or restated from time to time) (the “DeSPAC Warrants”), the Company shall lower the Warrant Price proportionately and in the same manner, in each case for a period of not less than 20 days on which banks in New York City are generally open for normal business (a “Business Day”), provided, that the Company shall provide at least 20 days’ prior written notice of such reduction to Registered Holders of the Warrants and, provided further that any such reduction shall be identical among all of the Warrants.
1.2Duration of Warrants. A Warrant may be exercised only during the period (the “Exercise Period”) commencing on the date hereof, and terminating at 5:00 p.m., New York City time on the earlier to occur of: (x) the date that is five years from the Original Issue Date or (y) the liquidation of the Company in accordance with the Company’s amended and restated certificate of incorporation, as amended from time to time (the “Amended and Restated Certificate of Incorporation”) (the “Expiration Date”). Each outstanding Warrant not exercised on or before the Expiration Date shall become void, and all rights thereunder and all rights in respect thereof under this Agreement shall cease at 5:00 p.m. New York City time on the Expiration Date. The Company (i) in its sole discretion may extend the duration of the Warrants by delaying the Expiration Date and (ii) to the extent it extends the expiration date of the DeSPAC Warrants, the Company shall extend the Expiration Date of the Warrants accordingly; provided, in each case, that the Company shall provide at least 20 days’ prior written notice of any such extension to Registered Holders of the Warrants and, provided further that any such extension shall be identical in duration among all the Warrants.
1.3Exercise of Warrants.
1.3.1Payment. Subject to the provisions of the Warrant and this Agreement, a Warrant may be exercised by the Registered Holder thereof by delivering to the Warrant Agent at its corporate trust department (i) the Definitive Warrant Certificate evidencing the Warrants to be exercised, or, in the case of a Book-Entry Warrant Certificate, the Warrants to be exercised (the “Book-Entry Warrants”) on the records of the Depositary to an account of the Warrant Agent at the Depositary designated for such purposes in writing by the Warrant Agent to the Depositary from time to time, (ii) an election to purchase (“Election to Purchase”) shares of Common Stock pursuant to the exercise of a Warrant, properly completed and executed by the Registered Holder on the reverse of the Definitive Warrant Certificate or, in the case of a Book-Entry Warrant Certificate, properly delivered by the Participant in accordance with the Depositary’s procedures, and (iii) payment in full of the Warrant Price for each full share of Common Stock as to which the Warrant is exercised and any and all applicable taxes due in connection with the exercise of the Warrant, the exchange of the Warrant for the shares of Common Stock and the issuance of such shares of Common Stock, as follows:
(a)in lawful money of the United States, in good certified check or good bank draft payable to the order of the Warrant Agent or by wire transfer;
(b)[Reserved]; or
(c)by surrendering the Warrants for that number of shares of Common Stock equal to the quotient obtained by dividing (x) the product of the number of shares of Common Stock underlying the Warrants, multiplied by the excess of the “Fair Market Value”, as defined in this Section 3.3.1(c), over the Warrant Price by (y) the Fair Market Value. Solely for purposes of this Section 3.3.1(c), the “Fair Market Value” shall mean the average reported last sale price of the shares of Common Stock for the 10 trading days ending on the third trading day prior to the date on which notice of exercise of the Warrant is sent to the Warrant Agent.
1.3.2Issuance of Shares of Common Stock on Exercise. As soon as practicable after the exercise of any Warrant and the clearance of the funds in payment of the Warrant Price (if payment is pursuant to Section 3.3.1(a)), the Company shall issue to the Registered Holder of such Warrant a book-entry position or certificate, as applicable, for the number of full shares of Common Stock to which such Registered Holder is entitled, registered in such name or names as may be directed by such Registered Holder, and if such Warrant shall not have been exercised in full, a new book-entry position or
countersigned Warrant, as applicable, for the number of shares of Common Stock as to which such Warrant shall not have been exercised. If fewer than all the Warrants evidenced by a Book Entry Warrant Certificate are exercised, a notation shall be made to the records maintained by the Depositary, its nominee for each Book Entry Warrant Certificate, or a Participant, as appropriate, evidencing the balance of the Warrants remaining after such exercise. If, by reason of any exercise of Warrants on a “cashless basis”, the holder of any Warrant would be entitled, upon the exercise of such Warrant, to receive a fractional interest in a share of Common Stock, the Company shall round down to the nearest whole number, the number of shares of Common Stock to be issued to such holder.
1.3.3Valid Issuance. All shares of Common Stock issued upon the proper exercise of a Warrant in conformity with this Agreement and the Amended and Restated Certificate of Incorporation shall be validly issued, fully paid and non-assessable.
1.3.4Date of Issuance. Upon proper exercise of a Warrant, the Company shall instruct the Warrant Agent, in writing, to make the necessary entries in the register of members of the Company in respect of the shares of Common Stock and to issue a certificate if requested by the holder of such Warrant. Each person in whose name any book-entry position in the register of members of the Company or certificate, as applicable, for shares of Common Stock is issued shall for all purposes be deemed to have become the holder of record of such shares of Common Stock on the date on which the Warrant, or book-entry position in the register of members of the Company representing such Warrant, was surrendered and payment of the Warrant Price was made, irrespective of the date of delivery of such certificate in the case of a certificated Warrant, except that, if the date of such surrender and payment is a date when the register of members or share transfer books of the Company or book-entry system of the Warrant Agent are closed, such person shall be deemed to have become the holder of such shares of Common Stock at the close of business on the next succeeding date on which the register of members, share transfer books or book-entry system are open.
1.3.5 Maximum Percentage. A holder of a Warrant may notify the Company in writing in the event it elects to be subject to the provisions contained in this Section 3.3.5; however, no holder of a Warrant shall be subject to this Section 3.3.5 unless he, she or it makes such election. If the election is made by a holder, the Warrant Agent shall not effect the exercise of the holder’s Warrant, and such holder shall not have the right to exercise such Warrant, to the extent that after giving effect to such exercise, such person (together with such person’s affiliates), to the Warrant Agent’s actual knowledge, would beneficially own in excess of 9.9% (or such other amount as a holder may specify) (the “Maximum Percentage”) of the shares of Common Stock issued and outstanding immediately after giving effect to such exercise. For purposes of the foregoing sentence, the aggregate number of shares of Common Stock beneficially owned by such person and its affiliates shall include the number of shares of Common Stock issuable upon exercise of the Warrant with respect to which the determination of such sentence is being made, but shall exclude shares of Common Stock that would be issuable upon (x) exercise of the remaining, unexercised portion of the Warrant beneficially owned by such person and its affiliates and (y) exercise or conversion of the unexercised or unconverted portion of any other securities of the Company beneficially owned by such person and its affiliates (including, without limitation, any convertible notes or convertible preference shares or Warrants) subject to a limitation on conversion or exercise analogous to the limitation contained herein. Except as set forth in the preceding sentence, for purposes of this paragraph, beneficial ownership shall be calculated in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). For purposes of the Warrant, in determining the number of issued and outstanding shares of Common Stock, the holder of a Warrant may rely on the number of issued and outstanding shares of Common Stock as reflected in (1) the Company’s most recent annual report on Form 10-K, quarterly report on Form 10-Q, current report on Form 8-K or other public filing with the Securities and Exchange Commission (the “Commission”) as the case may be, (2) a more recent public announcement by the Company or (3) any other notice by the Company or the Transfer Agent setting forth the number of shares of Common Stock issued and outstanding. For any reason at any time, upon the written request of the holder of the Warrant, the Company shall, within two Business Days, confirm orally and in writing to such holder the number of shares of Common Stock then issued and outstanding. In any case, the number of issued and outstanding shares of Common Stock shall be determined after giving effect to the conversion or exercise of equity securities of the Company by the holder and its affiliates since the date as of which such number of issued and outstanding shares of Common Stock was reported. By written notice to the Company, the holder of a Warrant may from time
to time increase or decrease the Maximum Percentage applicable to such holder to any other percentage specified in such notice; provided, however, that any such increase shall not be effective until the 61st day after such notice is delivered to the Company.
4.Adjustments.
1.1Share Capitalizations.
1.1.1Subdivision. If after the Original Issue Date, and subject to the provisions of Section 4.6 below, the number of issued and outstanding shares of Common Stock is increased by a capitalization of shares of Common Stock, or by a subdivision of shares of Common Stock or other similar event, then, on the effective date of such share capitalization, subdivision or similar event, the number of shares of Common Stock issuable on exercise of each Warrant shall be increased in proportion to such increase in the issued and outstanding shares of Common Stock. A rights offering to holders of the shares of Common Stock entitling holders to purchase shares of Common Stock at a price less than the “Fair Market Value” (as defined below) shall be deemed a capitalization of a number of shares of Common Stock equal to the product of (i) the number of shares of Common Stock actually sold in such rights offering (or issuable under any other equity securities sold in such rights offering that are convertible into or exercisable for Common Stock) and (ii) one minus the quotient of (x) the price per share of Common Stock paid in such rights offering divided by (y) the Fair Market Value. For purposes of this Section 4.1.1, (i) if the rights offering is for securities convertible into or exercisable for the shares of Common Stock, in determining the price payable for shares of Common Stock, there shall be taken into account any consideration received for such rights, as well as any additional amount payable upon exercise or conversion and (ii) “Fair Market Value” means the volume weighted average price of the shares of Common Stock as reported during the 10 trading day period ending on the trading day prior to the first date on which the shares of Common Stock trade on the applicable exchange or in the applicable market, regular way, without the right to receive such rights.
1.1.2Issuances Below Warrant Price. (a) If on or after the Original Issue Date, the Company issues or sells any shares of Common Stock, any debt or equity securities that are directly or indirectly convertible into or exercisable or exchangeable for shares of Common Stock (“Convertible Securities”), or any rights, warrants or options to subscribe for or purchase any of the foregoing (“Options”) (including, in each case, the issuance or sale of shares of Common Stock owned or held by or for the account of the Company, but excluding shares of Common Stock issued by the Company upon exercise of the Warrants or the DeSPAC Warrants or in connection with the exercise, conversion or exchange of any Convertible Securities or Options for which an adjustment was already made pursuant to this Section 4.1.2) for a consideration per share (including upon exercise, exchange or conversion) of less than the Warrant Price then in effect (the “Applicable Price”, and any such issuance a “Dilutive Issuance”), then, immediately after such Dilutive Issuance, the Warrant Price immediately after such Dilutive Issuance shall be equal to the quotient of (A) the sum of (x) the product of (I) the Warrant Price in effect immediately prior to such Dilutive Issuance, multiplied by (II) the aggregate number of shares of Common Stock outstanding immediately prior to such Dilutive Issuance, calculated on a Fully-Diluted Basis, plus (y) the consideration, if any, received by the Company upon such issuance or sale (or, with respect to any Convertible Securities or Options, the exercise price or conversion price, as applicable, of such securities as of the date of such issuance or sale), divided by (B) the aggregate number of shares of Common Stock outstanding immediately after such Dilutive Issuance, calculated on a Fully-Diluted Basis. Upon each such adjustment of the Warrant Price hereunder, the number of shares of Common Stock purchasable upon the exercise of this Warrant shall be equal to the quotient of (A) the Warrant Price in effect immediately prior to such Dilutive Issuance multiplied by the number of shares of Common Stock that the holder of the Warrants would have been entitled to purchase upon exercise of this Warrant (assuming an exercise for cash pursuant to Section 3.3.1(a) and without regard to any restriction or limitation on exercise) immediately prior to such adjustment, divided by (B) the Warrant Price resulting from such adjustment (such additional amount of shares after giving effect to this sentence, the “Additional Warrant Shares”). For purposes hereof, “Fully-Diluted Basis” means, when calculating the aggregate number of shares of Common Stock deemed outstanding as of the time of any applicable determination time, a basis that includes an aggregate number of shares of Common Stock equal to the sum of (without duplication) (x) the aggregate number of shares of Common Stock outstanding as of such determination time, (y) the aggregate number of shares of Common Stock that would be outstanding
assuming the conversion, exchange and exercise of all outstanding Convertible Securities and Options as of such determination time and (z) the aggregate number of shares of Common Stock underlying any outstanding Convertible Securities and Options as of such determination time.
(b) Change in Option Price or Rate of Conversion. On or after the Original Issue Date, and without duplication for any adjustment pursuant to Sections 4.1.1 or 4.4 hereof, if the purchase price provided for in any Options, the additional consideration, if any, payable upon the issue, conversion, exercise or exchange of any Convertible Securities, or the rate at which any Convertible Securities or are convertible into or exercisable or exchangeable for shares of Common Stock increases or decreases at any time, then the Warrant Price in effect at the time of such increase or decrease shall be adjusted to the Warrant Price which would have been in effect at such time had such Options or Convertible Securities provided for such increased or decreased purchase price, additional consideration or increased or decreased conversion rate, as the case may be, at the time initially granted, issued or sold; provided that for the avoidance of doubt, no Additional Warrant Shares will be issued in connection with any such increase or decrease pursuant to the currently existing terms of the DeSPAC Warrants. No adjustment pursuant to this Section 4.1.2(b) shall be made if such adjustment would result in an increase of the Warrant Price then in effect or a decrease in the number of shares of Common Stock then issuable under a Warrant.
1.1.3Distributions, Purchase Rights. (a) In addition to any adjustments pursuant to this Section 4, if, on or after the Original Issue Date and on or prior to the Expiration Date, the Company shall declare or make any dividend or other distribution of its assets (or rights to acquire its assets) to holders of shares of Common Stock, by way of return of capital or otherwise (including, without limitation, any distribution of cash, stock or other securities, property, options, evidence of indebtedness or any other asset by way of a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a “Distribution”), then, in each such case, each holder of the Warrants shall be entitled to participate in such Distribution to the same extent that such holder would have participated therein if such holder had held the number of shares of Common Stock acquirable upon complete exercise of this Warrant (assuming an exercise for cash pursuant to Section 3.3.1(a) and without regard to any restriction or limitation on exercise) immediately before the date of which a record is taken for such Distribution, or, if no such record is taken, the date as of which the record holders of shares of Common Stock are to be determined for the participation in such Distribution. (b) In addition to any adjustments pursuant to this Section 4, if at any time on or after the Original Issue Date and on or prior to the Expiration Date the Company (i) grants, issues or sells any Options, Convertible Securities or rights to purchase stock, warrants, securities or other property pro rata to the record holders of any class of Common Stock (the “Purchase Rights”), then each holder of Warrants 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 shares of Common Stock acquirable upon complete exercise of its Warrants (assuming an exercise for cash pursuant to Section 3.3.1(a) and without regard to any restriction or limitation on exercise) immediately before 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 Common Stock are to be determined for the grant, issuance or sale of such Purchase Rights, or (ii) conducts any Pro Rata Repurchase Offer, a holder of the Warrants shall be permitted to (but shall not be obligated to) participate, in whole or in part, on an as-converted basis, provided that, notwithstanding any other provision hereof, such participation may at the election of such holder be conditioned upon the consummation of such transaction, in which case such participation shall not be deemed to be effective until immediately prior to the consummation of such transaction. For purposes hereof, “Pro Rata Repurchase Offer” means any offer to purchase shares of Common Stock by the Company or any affiliate thereof pursuant to (i) any tender offer or exchange offer subject to Section 13(e) or 14(e) of the Exchange Act or Regulation 14E promulgated thereunder or (ii) any other offer available to substantially all holders of Common Stock (subject to satisfaction of any conditions to participation therein such as those relating to minimum holding percentages or accredited status) to purchase or exchange their shares of Common Stock, in the case of both clauses (i) and (ii), whether for cash, shares of capital stock of the Company, other securities of the Company, evidences of indebtedness of the Company or any other Person, or any other property (including, without limitation, shares of capital stock, other securities or evidences of indebtedness of a subsidiary of the Company), or any combination thereof, effected while the Warrants are outstanding. The “effective date” of a Pro Rata Repurchase Offer shall mean the date of acceptance of shares for purchase or exchange by the Company under any tender or
exchange offer which is a Pro Rata Repurchase Offer or the date of purchase with respect to any Pro Rata Repurchase Offer that is not a tender or exchange offer.
1.2Aggregation of Shares. If after the Original Issue Date, and subject to the provisions of Section 4.6 hereof, the number of issued and outstanding shares of Common Stock is decreased by a consolidation, combination or reclassification of shares of Common Stock or other similar event, then, on the effective date of such consolidation, combination, reverse share split, redesignation, reclassification or similar event, the number of shares of Common Stock issuable on exercise of each Warrant shall be decreased in proportion to such decrease in issued and outstanding shares of Common Stock.
1.3Adjustments in Warrant Price. Whenever the number of shares of Common Stock purchasable upon the exercise of the Warrants is adjusted, as provided in Section 4.1.1 or Section 4.2 above, the Warrant Price shall be adjusted (to the nearest cent) by multiplying such Warrant Price immediately prior to such adjustment by a fraction (x) the numerator of which shall be the number of shares of Common Stock purchasable upon the exercise of the Warrants immediately prior to such adjustment, and (y) the denominator of which shall be the number of shares of Common Stock so purchasable immediately thereafter.
1.4Replacement of Securities upon Reorganization, etc. In case of any redesignation or reorganization of the issued and outstanding shares of Common Stock (other than a change under Sections 4.1.1 or Section 4.2 hereof or that solely affects the par value of such shares of Common Stock), or in the case of any merger or consolidation of the Company with or into another entity or conversion of the Company as another entity (other than a consolidation or merger in which the Company is the continuing corporation and is not a subsidiary of another entity whose shareholders did not own all or substantially all of the shares of Common Stock of the Company in substantially the same proportions immediately before such transaction and that does not result in any redesignation or reorganization of the issued and outstanding shares of Common Stock), or in the case of any sale or conveyance to another entity of the assets or other property of the Company as an entirety or substantially as an entirety in connection with which the Company is liquidated or dissolved, the holders of the Warrants shall thereafter have the right to purchase and receive, upon the basis and upon the terms and conditions specified in the Warrants and in lieu of the shares of Common Stock of the Company immediately theretofore purchasable and receivable upon the exercise of the rights represented thereby, the kind and amount of shares or other securities or property (including cash) receivable upon such redesignation, reorganization, merger or consolidation, or upon a dissolution following any such sale or transfer, that the holder of the Warrants would have received if such holder had exercised his, her or its Warrant(s) immediately prior to such event (the “Alternative Issuance”); provided, however, that in connection with the closing of any such consolidation, merger, sale or conveyance, the successor or purchasing entity shall execute an amendment hereto with the Warrant Agent providing for delivery of such Alternative Issuance; provided, further, that (i) if the holders of the shares of Common Stock were entitled to exercise a right of election as to the kind or amount of securities, cash or other assets receivable upon such consolidation or merger, then the kind and amount of securities, cash or other assets constituting the Alternative Issuance for which each Warrant shall become exercisable shall be deemed to be the weighted average of the kind and amount received per share by the holders of the shares of Common Stock in such consolidation or merger that affirmatively make such election, and (ii) if a tender, exchange or redemption offer shall have been made to and accepted by the holders of the shares of Common Stock under circumstances in which, upon completion of such tender or exchange offer, the maker thereof, together with members of any group (within the meaning of Rule 13d-5(b)(1) under the Exchange Act (or any successor rule)) of which such maker is a part, and together with any affiliate or associate of such maker (within the meaning of Rule 12b-2 under the Exchange Act (or any successor rule)) and any members of any such group of which any such affiliate or associate is a part, own beneficially (within the meaning of Rule 13d-3 under the Exchange Act (or any successor rule)) more than 50% of the issued and outstanding shares of Common Stock, the holder of a Warrant shall be entitled to receive as the Alternative Issuance, the highest amount of cash, securities or other property to which such holder would actually have been entitled as a shareholder if such Warrant holder had exercised the Warrant prior to the expiration of such tender or exchange offer, accepted such offer and all of the shares of Common Stock held by such holder had been purchased pursuant to such tender or exchange offer, subject to adjustments (from and after the consummation of such tender or exchange offer) as nearly equivalent as possible to the adjustments provided for in this Section 4; provided, further, that if less than 70% of the consideration
receivable by the holders of the shares of Common Stock in the applicable event is payable in the form of shares in the successor entity that is listed for trading on a national securities exchange or is quoted in an established over-the-counter market, or is to be so listed for trading or quoted immediately following such event, and if the Registered Holder properly exercises the Warrant within 30 days following the public disclosure of the consummation of such applicable event by the Company pursuant to a Current Report on Form 8-K filed with the Commission, the Warrant Price shall be reduced by an amount (in dollars) equal to the difference of (but in no event less than zero) (i) the Warrant Price in effect prior to such reduction minus (ii) (A) the Per Share Consideration (as defined below) minus (B) the Black-Scholes Warrant Value (as defined below). The “Black-Scholes Warrant Value” means the value of a Warrant immediately prior to the consummation of the applicable event based on the Black-Scholes Warrant Model for a Capped American Call on Bloomberg Financial Markets (“Bloomberg”). For purposes of calculating such amount, (1) the price of each share of Common Stock shall be the volume weighted average price of the shares of Common Stock as reported during the 10 trading-day period ending on the trading day prior to the effective date of the applicable event, (2) the assumed volatility shall be the 90-day volatility obtained from the HVT function on Bloomberg determined as of the trading day immediately prior to the day of the announcement of the applicable event, and (3) the assumed risk-free interest rate shall correspond to the U.S. Treasury rate for a period equal to the remaining term of the Warrant. “Per Share Consideration” means (i) if the consideration paid to holders of the shares of Common Stock consists exclusively of cash, the amount of such cash per share of Common Stock, and (ii) in all other cases, the amount of cash per share of Common Stock, if any, plus the volume weighted average price of the shares of Common Stock as reported during the 10 trading-day period ending on the trading day prior to the effective date of the applicable event. If any reclassification or reorganization also results in a change in shares of Common Stock covered by any other provision of this Section 4, then such adjustment shall be made pursuant to such other applicable provision of this Section 4 and this Section 4.4. The provisions of this Section 4.4 shall similarly apply to successive reclassification, reorganizations, mergers or consolidations, sales or other transfers. In no event will the Warrant Price be reduced to less than the par value per share issuable upon exercise of the Warrant. Notwithstanding anything in this Agreement to the contrary, in connection with any of the foregoing events described in this Section 4.4, a holder of Warrants electing to exercise its Warrants may, at the election of such holder, condition such exercise upon the consummation of such event.
1.5Notices of Changes in Warrant. Upon every adjustment of the Warrant Price or the number of shares of Common Stock issuable upon exercise of a Warrant, the Company shall give written notice thereof to the Warrant Agent, which notice shall state the Warrant Price resulting from such adjustment and the increase or decrease, if any, in the number of shares of Common Stock purchasable at such price upon the exercise of a Warrant, setting forth in reasonable detail the method of calculation and the facts upon which such calculation is based. Upon the occurrence of any event specified in Sections 4.1, Sections 4.2, Section 4.3 or Section 4.4, the Company shall give written notice of the occurrence of such event to each holder of a Warrant, at the last address set forth for such holder in the Warrant Register, of the record date or the effective date of the event. Failure to give such notice, or any defect therein, shall not affect the legality or validity of such event.
1.6No Fractional Shares. Notwithstanding any provision contained in this Agreement to the contrary, the Company shall not issue fractional shares of Common Stock upon the exercise of Warrants. If, by reason of any adjustment made pursuant to this Section 4, the holder of any Warrant would be entitled, upon the exercise of such Warrant, to receive a fractional interest in a share, the Company shall, upon such exercise, round down to the nearest whole number, the number of shares of Common Stock to be issued to such holder.
1.7Form of Warrant. The form of Warrant need not be changed because of any adjustment pursuant to this Section 4, and Warrants issued after such adjustment may state the same Warrant Price and the same number of shares of Common Stock as is stated in the Warrants initially issued pursuant to this Agreement; provided, however, that the Company may at any time in its sole discretion make any change in the form of Warrant that the Company may deem appropriate and that does not affect the substance thereof, and any Warrant thereafter issued or countersigned, whether in exchange or substitution for an outstanding Warrant or otherwise, may be in the form as so changed.
1.8Other Events. In case any event shall occur affecting the Company as to which none of the provisions of preceding subsections of this Section 4 are strictly applicable, but which would require an adjustment to the terms of the Warrants in order to (i) avoid an adverse impact on the Warrants and (ii) effectuate the intent and purpose of this Section 4, then, in each such case, the Company shall appoint a firm of independent public accountants, investment banking or other appraisal firm of recognized national standing, which shall give its opinion as to whether or not any adjustment to the rights represented by the Warrants is necessary to effectuate the intent and purpose of this Section 4 and, if they determine that an adjustment is necessary, the terms of such adjustment. The Company shall adjust the terms of the Warrants in a manner that is consistent with any adjustment recommended in such opinion.
5.Transfer and Exchange of Warrants.
1.1Registration of Transfer. The Warrant Agent shall register the transfer, from time to time, of any outstanding Warrant upon the Warrant Register, upon surrender of such Warrant for transfer, in the case of certificated Warrants, properly endorsed with signatures properly guaranteed and accompanied by appropriate instructions for transfer. Upon any such transfer, a new Warrant representing an equal aggregate number of Warrants shall be issued and the old Warrant shall be cancelled by the Warrant Agent. In the case of certificated Warrants, the Warrants so cancelled shall be delivered by the Warrant Agent to the Company from time to time upon request.
1.2Procedure for Surrender of Warrants. Warrants may be surrendered to the Warrant Agent, together with a written request for exchange or transfer, and thereupon the Warrant Agent shall issue in exchange therefor one or more new Warrants as requested by the Registered Holder of the Warrants so surrendered, representing an equal aggregate number of Warrants; provided, however, that except as otherwise provided herein or in any Book Entry Warrant Certificate or Definitive Warrant Certificate, each Book Entry Warrant Certificate and Definitive Warrant Certificate may be transferred only in whole and only to the Depositary, to another nominee of the Depositary, to a successor depository, or to a nominee of a successor depository; provided further, however, that in the event that a Warrant surrendered for transfer bears a restrictive legend, the Warrant Agent shall not cancel such Warrant and issue new Warrants in exchange thereof until the Warrant Agent has received an opinion of counsel for the Company stating that such transfer may be made and indicating whether the new Warrants must also bear a restrictive legend. The Company agrees to cooperate with holders of the Warrants from time to time to cause its counsel to provide any such opinions of counsel reasonably requested in connection with any such transfers. In addition, the Company agrees to cause the Warrant Agent or the transfer agent for the Common Stock, as applicable, to remove the restrictive legends on the Warrants and/or the shares of Common Stock issuable upon exercise thereof, as applicable, when such securities are sold pursuant to Rule 144 under the Securities Act of 1933, as amended (the “Securities Act”) or an effective registration statement or may be sold without restriction under Rule 144 under the Securities Act. In connection therewith, if required by the Warrant Agent or the Company’s transfer agent, the Company will promptly cause an opinion of counsel to be delivered to and maintained with the Warrant Agent or such transfer agent, together with any other authorizations, certificates and directions required by the Warrant Agent or such transfer agent that authorize and direct the Warrant Agent or such transfer agent, as applicable, to transfer such securities without any such legends.
1.3Fractional Warrants. The Warrant Agent shall not be required to effect any registration of transfer or exchange that shall result in the issuance of a Warrant certificate or book-entry position for a fraction of a Warrant.
1.4Service Charges. No service charge shall be made for any exchange or registration of transfer of Warrants.
1.5Warrant Execution and Countersignature. The Warrant Agent is hereby authorized to countersign and to deliver, in accordance with the terms of this Agreement, the Warrants required to be issued pursuant to the provisions of this Section 5, and the Company, whenever required by the Warrant Agent, shall supply the Warrant Agent with Warrants duly executed on behalf of the Company for such purpose.
1.6Instrument of Transfer. The instrument of transfer of any Warrant may be executed for and on behalf of the transferor by any party designated by, or pursuant to resolutions of, the Board of the Company for such purpose, and the Company or any other party designated by, or pursuant to resolutions of, the Board of the Company for such purpose shall be deemed to have been irrevocably appointed agent for the transferor of such Warrant or Warrants with full power to execute, complete and deliver in the name of and on behalf of the transferor of such Warrant or Warrants all such transfers of Warrants held by the Warrant holders.
1.7Transfers Generally. Notwithstanding anything in this Agreement to the contrary, (i) except as may be required by applicable law, the Warrants and the shares of Common Stock issuable upon exercise thereof shall not be subject to any restrictions on transfers, and (ii) each holder of Warrants shall be permitted to transfer the Warrants (and the shares of Common Stock issuable upon exercise thereof) to any of its affiliates in compliance with applicable law.
6.No Redemption. The Warrants shall not be redeemable at the option of the Company.
7.Other Provisions Relating to Rights of Holders of Warrants.
1.1No Rights as Shareholder. Except as otherwise set forth herein, a Warrant does not entitle the Registered Holder thereof to any of the rights of a shareholder of the Company, including, without limitation, the right to receive dividends, or other distributions, exercise any preemptive rights to vote or to consent or to receive notice as shareholders in respect of general meetings or the appointment of directors of the Company or any other matter.
1.2Lost, Stolen, Mutilated, or Destroyed Warrants. If any Warrant is lost, stolen, mutilated, or destroyed, the Company and the Warrant Agent may on such terms as to indemnity or otherwise as they may in their discretion impose (which shall, in the case of a mutilated Warrant, include the surrender thereof), issue a new Warrant of like denomination, tenor, and date as the Warrant so lost, stolen, mutilated, or destroyed. Any such new Warrant shall constitute a substitute contractual obligation of the Company, whether or not the allegedly lost, stolen, mutilated, or destroyed Warrant shall be at any time enforceable by anyone.
1.3Reservation of Shares of Common Stock. The Company shall at all times reserve and keep available a number of its authorized but unissued shares of Common Stock that shall be sufficient to permit the exercise in full of all outstanding Warrants subject to the terms and conditions of this Agreement.
1.4Registration of Shares of Common Stock.
1.4.1Registration Rights. Holders of the Warrants and the shares of Common Stock issuable upon the exercise thereof (together with their applicable assignees and transferees) shall be entitled to the benefits of that certain second amended and restated registration rights agreement, dated the date hereof, between the Company and the holders or the Warrants.
8.Concerning the Warrant Agent and Other Matters.
1.1Payment of Taxes. The Company shall from time to time promptly pay all taxes (including any interest and penalties) and charges that may be imposed upon the Company or the Warrant Agent in respect of the issuance or delivery of shares of Common Stock upon the exercise of the Warrants, but the Company shall not be obligated to pay any transfer taxes in respect of the Warrants or such Common Stock other than in respect of the issuance or delivery of shares of Common Stock upon the exercise of the Warrants by the initial holder hereof.
1.2Resignation, Consolidation, or Merger of Warrant Agent.
1.2.1Appointment of Successor Warrant Agent. The Warrant Agent, or any successor to it hereafter appointed, may resign its duties and be discharged from all further duties and liabilities
hereunder after giving 60 days’ notice in writing to the Company. If the office of the Warrant Agent becomes vacant by resignation or incapacity to act or otherwise, the Company shall appoint in writing a successor Warrant Agent in place of the Warrant Agent. If the Company shall fail to make such appointment within a period of 30 days after it has been notified in writing of such resignation or incapacity by the Warrant Agent or by the holder of a Warrant (who shall, with such notice, submit his Warrant for inspection by the Company), then the holder of any Warrant may apply to the Supreme Court of the State of New York for the County of New York for the appointment of a successor Warrant Agent at the Company’s cost. Any successor Warrant Agent, whether appointed by the Company or by such court, shall be a corporation organized and existing under the laws of the State of New York, in good standing and having its principal office in the Borough of Manhattan, City and State of New York, and authorized under such laws to exercise corporate trust powers and subject to supervision or examination by federal or state authority. After appointment, any successor Warrant Agent shall be vested with all the authority, powers, rights, immunities, duties, and obligations of its predecessor Warrant Agent with like effect as if originally named as Warrant Agent hereunder, without any further act or deed; but if for any reason it becomes necessary or appropriate, the predecessor Warrant Agent shall execute and deliver, at the expense of the Company, an instrument transferring to such successor Warrant Agent all the authority, powers, and rights of such predecessor Warrant Agent hereunder; and upon request of any successor Warrant Agent the Company shall make, execute, acknowledge, and deliver any and all instruments in writing for more fully and effectually vesting in and confirming to such successor Warrant Agent all such authority, powers, rights, immunities, duties, and obligations.
1.2.2Notice of Successor Warrant Agent. In the event a successor Warrant Agent shall be appointed, the Company shall give notice thereof to the predecessor Warrant Agent and the Transfer Agent for the Common Stock not later than the effective date of any such appointment.
1.2.3Merger or Consolidation of Warrant Agent. Any corporation into which the Warrant Agent may be merged or with which it may be consolidated or any corporation resulting from any merger or consolidation to which the Warrant Agent shall be a party shall be the successor Warrant Agent under this Agreement without any further act.
1.3Fees and Expenses of Warrant Agent.
1.3.1Remuneration. The Company agrees to pay the Warrant Agent reasonable remuneration for its services as such Warrant Agent hereunder and shall, pursuant to its obligations under this Agreement, reimburse the Warrant Agent upon demand for all expenditures that the Warrant Agent may reasonably incur in the execution of its duties hereunder.
1.3.2Further Assurances. The Company agrees to perform, execute, acknowledge, and deliver or cause to be performed, executed, acknowledged, and delivered all such further and other acts, instruments, and assurances as may reasonably be required by the Warrant Agent for the carrying out or performing of the provisions of this Agreement.
1.4Liability of Warrant Agent.
1.4.1Reliance on Company Statement. Whenever in the performance of its duties under this Agreement, the Warrant Agent shall deem it necessary or desirable that any fact or matter be proved or established by the Company prior to taking or suffering any action hereunder, such fact or matter (unless other evidence in respect thereof be herein specifically prescribed) may be deemed to be conclusively proved and established by a statement signed by the Chief Executive Officer, Chief Financial Officer, Treasurer, or Chairman of the Board of the Company and delivered to the Warrant Agent. The Warrant Agent may rely upon such statement for any action taken or suffered in good faith by it pursuant to the provisions of this Agreement.
1.4.2Indemnity. The Warrant Agent shall be liable hereunder only for its own gross negligence, willful misconduct or bad faith. The Company agrees to indemnify the Warrant Agent and save it harmless against any and all liabilities, including judgments, costs and reasonable counsel fees, for anything done or omitted by the Warrant Agent in the execution of this Agreement, except as a result of the Warrant Agent’s gross negligence, willful misconduct or bad faith.
1.4.3Exclusions. The Warrant Agent shall have no responsibility with respect to the validity of this Agreement or with respect to the validity or execution of any Warrant (except its countersignature thereof). The Warrant Agent shall not be responsible for any breach by the Company of any covenant or condition contained in this Agreement or in any Warrant. The Warrant Agent shall not be responsible to make any adjustments required under the provisions of Section 4 hereof or responsible for the manner, method, or amount of any such adjustment or the ascertaining of the existence of facts that would require any such adjustment; nor shall it by any act hereunder be deemed to make any representation or warranty as to the authorization or reservation of any shares of Common Stock to be issued pursuant to this Agreement or any Warrant or as to whether any shares of Common Stock shall, when issued, be valid and fully paid and non-assessable.
1.5Acceptance of Agency. The Warrant Agent hereby accepts the agency established by this Agreement and agrees to perform the same upon the terms and conditions herein set forth and among other things, shall account promptly to the Company with respect to Warrants exercised and concurrently account for, and pay to the Company, all monies received by the Warrant Agent for the purchase of shares of Common Stock through the exercise of the Warrants.
9.Company Covenants.
1.1During the period the Warrants are outstanding, the Company will reserve from its authorized and unissued Common Stock a sufficient number of shares to provide for the issuance of the shares of Common Stock upon the exercise of any purchase rights represented by the Warrants. The Company further covenants that its issuance of the Warrants shall constitute full authority to its officers who are charged with the duty of executing stock certificates and issuing shares of Common Stock to execute and issue the necessary shares of Common Stock upon the exercise of the purchase rights under the Warrants. The Company shall take all such action as may be reasonably necessary or appropriate to assure that such shares of Common Stock issuable upon exercise of the Warrants may be issued as provided herein and in the Warrants without violation of any applicable law or regulation, any requirements of the principal securities exchange upon which the shares of Common Stock may be listed at the time of such exercise or any preemptive or similar rights of any equity holder of the Company.
1.2For the avoidance of doubt, the Company will not, by amendment of its governing documents or through any consolidation, merger, reorganization, distribution or dividend, transfer of assets, dissolution, issue, sale or exchange of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Agreement or the Warrants.
1.3Before taking any action which would result in an adjustment in the number of shares of Common Stock for which the Warrants are exercisable or in the Warrant Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary in order that the Company may validly and legally issue fully paid and non-assessable shares of Common Stock at the Warrant Price as so adjusted.
10.Miscellaneous Provisions.
1.1Successors. All the covenants and provisions of this Agreement by or for the benefit of the Company or the Warrant Agent shall bind and inure to the benefit of their respective successors and assigns.
1.2Notices. Any notice, statement or demand authorized by this Agreement to be given or made by the Warrant Agent or by the holder of any Warrant to or on the Company shall be sufficiently given when so delivered if by hand or overnight delivery or if sent by certified mail or private courier service within five days after deposit of such notice, postage prepaid, addressed (until another address is filed in writing by the Company with the Warrant Agent), as follows:
Mondee Holdings, Inc.
10800 Pecan Park Blvd.
Suite 315
Austin, Texas 78750
Attention: Jesus Portillo
Email: jportillo@mondee.com
Any notice, statement or demand authorized by this Agreement to be given or made by the holder of any Warrant or by the Company to or on the Warrant Agent shall be sufficiently given when so delivered if by hand or overnight delivery or if sent by certified mail or private courier service within five days after deposit of such notice, postage prepaid, addressed (until another address is filed in writing by the Warrant Agent with the Company), as follows:
Continental Stock Transfer & Trust Company
1 State Street, 30th Floor
New York, NY 10004
Attention: Compliance Department
in each case, with a copy to:
Reed Smith LLP
599 Lexington Avenue, 22nd Floor
New York, NY 10022
Attention: Michael S. Lee, Lynwood Reinhardt, and Panos Katsambas
1.3Applicable Law. The validity, interpretation, and performance of this Agreement and of the Warrants shall be governed in all respects by the laws of the State of New York, without giving effect to conflicts of law principles that would result in the application of the substantive laws of another jurisdiction.
1.4[Reserved]
1.5Persons Having Rights under this Agreement. Nothing in this Agreement shall be construed to confer upon, or give to, any person or corporation other than the parties hereto and the Registered Holders of the Warrants, any right, remedy, or claim under or by reason of this Agreement or of any covenant, condition, stipulation, promise, or agreement hereof. All covenants, conditions, stipulations, promises, and agreements contained in this Agreement shall be for the sole and exclusive benefit of the parties hereto and their successors and assigns and of the Registered Holders of the Warrants.
1.6Examination of the Warrant Agreement. A copy of this Agreement shall be available at all reasonable times at the office of the Warrant Agent in the Borough of Manhattan, City and State of New York, for inspection by the Registered Holder of any Warrant. The Warrant Agent may require any such holder to submit such holder’s Warrant for inspection by the Warrant Agent.
1.7Counterparts. This Agreement may be executed in any number of original or facsimile counterparts and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument.
1.8Effect of Headings. The section headings herein are for convenience only and are not part of this Agreement and shall not affect the interpretation thereof.
1.9Amendments. This Agreement may be amended by the parties hereto without the consent of any Registered Holder (i) for the purpose of curing any ambiguity, or curing, correcting or supplementing any defective provision contained herein or adding or changing any other provisions with respect to matters or questions arising under this Agreement as the parties may deem necessary or desirable and that the parties deem shall not adversely affect the interest of the Registered Holders, and (ii) to provide for the delivery of Alternative Issuance pursuant to Section 4.4. All other modifications or amendments, including any amendment to increase the Warrant Price or shorten the Exercise Period, shall require the vote or written consent of the Registered Holders of a majority of the then outstanding Warrants. Notwithstanding the foregoing, the Company may lower the Warrant Price or extend the
duration of the Exercise Period pursuant to Sections 3.1 and Section 3.2, respectively, without the consent of the Registered Holders.
1.10Severability. This Agreement shall be deemed severable, and the invalidity or unenforceability of any term or provision hereof shall not affect the validity or enforceability of this Agreement or of any other term or provision hereof. Furthermore, in lieu of any such invalid or unenforceable term or provision, the parties hereto intend that there shall be added as a part of this Agreement a provision as similar in terms to such invalid or unenforceable provision as may be possible and be valid and enforceable.
1.11Limitation of Liability. No provision hereof, in the absence of any affirmative action by the holder of a Warrant to exercise such Warrant to purchase shares of Common Stock, and no enumeration herein of the rights or privileges of the holders of the Warrants, shall give rise to any liability of any such holder for the purchase price of any Common Stock or as a stockholder of the Company, whether such liability is asserted by the Company or by creditors of the Company.
1.12Remedies. The holders of the Warrants, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will be entitled to specific performance of the rights under this Agreement and the Warrants. The Company agrees that monetary damages would not be adequate compensation for any loss incurred by reason of a breach by it of the provisions of this Agreement and the Warrants and hereby agrees to waive and not to assert the defense in any action for specific performance that a remedy at law would be adequate.
[Signature Page Follows]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first above written.
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| MONDEE HOLDINGS, INC.
as the Company |
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| By: | /s/ Prasad Gundumogula |
| Name: | Prasad Gundumogula |
| Title: | Chief Executive Officer |
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| CONTINENTAL STOCK TRANSFER & TRUST COMPANY, as Warrant Agent |
| | |
| By: | /s/ Erika Young |
| Name: | Erika Young |
| Title: | Vice President |
| MONDEE HOLDINGS, INC.
as the Company |
| | |
| |
| |
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| | |
[Signature Page to the Warrant Agreement]
EXHIBIT A
[Form of Warrant Certificate]
[FACE]
THE SECURITY EVIDENCED HEREBY HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER JURISDICTION AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, ANY PERSON EXCEPT AS SET FORTH BELOW. EACH PURCHASER OF THE SECURITY EVIDENCED HEREBY IS HEREBY NOTIFIED THAT THE SELLER MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER (“RULE 144A”) OR ANOTHER EXEMPTION UNDER THE SECURITIES ACT.
BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER:
(1) REPRESENTS FOR THE BENEFIT OF THE COMPANY THAT: (A) IT IS (I) A “QUALIFIED INSTITUTIONAL BUYER” (AS DEFINED IN RULE 144A) (A “QIB”) AND (II) ACQUIRING THIS SECURITY FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB; OR (B) IT IS AN INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE MEANING OF RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT,
(2) AGREES FOR THE BENEFIT OF THE COMPANY THAT IT WILL OFFER, SELL, PLEDGE OR OTHERWISE TRANSFER THIS SECURITY, PRIOR TO THE EXPIRATION OF THE APPLICABLE HOLDING PERIOD WITH RESPECT TO RESTRICTED SECURITIES SET FORTH IN RULE 144 UNDER THE SECURITIES ACT (AS IN EFFECT ON THE DATE OF THE TRANSFER OF THIS SECURITY), ONLY: (A)(I) FOR SO LONG AS THE SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A QIB THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (II) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT (PROVIDED THAT PRIOR TO SUCH TRANSFER, THE COMPANY MAY REQUIRE AN OPINION OF COUNSEL THAT SUCH TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT), (III) TO AN INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE MEANING OF RULE 501(a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
(3) AGREES FOR THE BENEFIT OF THE COMPANY THAT IT WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER FROM IT OF THE SECURITY EVIDENCED HEREBY OF THE RESALE RESTRICTIONS SET FORTH IN CLAUSE (2) ABOVE.
NO REPRESENTATION CAN BE MADE AS TO THE AVAILABILITY OF THE EXEMPTION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT FOR RESALE OF THE SECURITY EVIDENCED HEREBY.
THE FOREGOING RESTRICTIVE LEGEND MAY BE REMOVED BY THE COMPANY OR AT THE REQUEST OF A HOLDER OF THE SECURITY IF SUCH SECURITY NO LONGER CONSTITUTES A “RESTRICTED SECURITY” WITHIN THE MEANING OF RULE 144 OR IN CONNECTION WITH A TRANSFER FOLLOWING WHICH SUCH SECURITY WOULD NO LONGER CONSTITUTE A “RESTRICTED SECURITY”.
Number
Warrants
THIS WARRANT SHALL BE VOID IF NOT EXERCISED PRIOR TO
THE EXPIRATION OF THE EXERCISE PERIOD PROVIDED FOR
IN THE WARRANT AGREEMENT DESCRIBED BELOW
MONDEE HOLDINGS, INC.
Incorporated Under the Laws of Delaware
CUSIP [●]
Warrant Certificate
This warrant certificate (this “Warrant Certificate”) certifies that [●], or registered assigns, is the registered holder of warrant(s) evidenced hereby (the “Warrants” and each, a “Warrant”) to purchase one share of Class A common stock, of $0.0001 par value per share (“Common Stock”), of Mondee Holdings, Inc., a Delaware corporation (the “Company”). Each Warrant entitles the holder, upon exercise during the period set forth in the Warrant Agreement referred to below, to receive from the Company that number of fully paid and non-assessable shares of Common Stock as set forth below, at the exercise price (the “Warrant Price”) as determined pursuant to the Warrant Agreement, payable in lawful money (or through “cashless exercise” as provided for in the Warrant Agreement) of the United States of America upon surrender of this Warrant Certificate and payment of the Warrant Price at the office or agency of the Warrant Agent referred to below, subject to the conditions set forth herein and in the Warrant Agreement. Defined terms used in this Warrant Certificate but not defined herein shall have the meanings given to them in the Warrant Agreement.
Each whole Warrant is initially exercisable for one fully paid and non-assessable share of Common Stock. No fractional shares will be issued upon exercise of any Warrant. If, upon the exercise of Warrants, a holder would be entitled to receive a fractional interest in a share of Common Stock, the Company will, upon exercise, round down to the nearest whole number of shares of Common Stock to be issued to the Warrant holder. The number of shares of Common Stock issuable upon exercise of the Warrants is subject to adjustment upon the occurrence of certain events set forth in the Warrant Agreement.
The initial Warrant Price per share of Common Stock for any Warrant is equal to $7.50 per share. The Warrant Price is subject to adjustment upon the occurrence of certain events set forth in the Warrant Agreement.
Reference is hereby made to the further provisions of this Warrant Certificate set forth on the reverse hereof and such further provisions shall for all purposes have the same effect as though fully set forth at this place.
This Warrant Certificate shall not be valid unless countersigned by the Warrant Agent, as such term is used in the Warrant Agreement.
This Warrant Certificate shall be governed by and construed in accordance with the internal laws of the State of New York, without regard to conflicts of laws principles thereof.
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| MONDEE HOLDINGS, INC.,
as the Company |
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| By: | |
| Name: | |
| Title: | |
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CONTINENTAL STOCK TRANSFER & TRUST COMPANY,
as Warrant Agent |
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[Form of Warrant Certificate]
[Reverse]
The Warrants evidenced by this Warrant Certificate are part of a duly authorized issue of Warrants entitling the holder on exercise to receive shares of Common Stock and are issued or to be issued pursuant to an Amended and Restated Warrant Agreement dated as of December 14, 2023 (the “Warrant Agreement”), duly executed and delivered by the Company, Mondee Holdings, Inc., a Delaware corporation, to Continental Stock Transfer & Trust Company, a New York corporation, as Warrant agent (the “Warrant Agent”), which Warrant Agreement is hereby incorporated by reference in and made a part of this instrument and is hereby referred to for a description of the rights, limitation of rights, obligations, duties and immunities thereunder of the Warrant Agent, the Company and the holders (the words “holders” or “holder” meaning the Registered Holders or Registered Holder, respectively) of the Warrants. A copy of the Warrant Agreement may be obtained by the holder hereof upon written request to the Company. Defined terms used in this Warrant Certificate but not defined herein shall have the meanings given to them in the Warrant Agreement.
Warrants may be exercised at any time during the Exercise Period set forth in the Warrant Agreement. The holder of Warrants evidenced by this Warrant Certificate may exercise them by surrendering this Warrant Certificate, with the form of election to purchase set forth hereon properly completed and executed, together with payment of the Warrant Price as specified in the Warrant Agreement (or through “cashless exercise” as provided for in the Warrant Agreement) at the principal corporate trust office of the Warrant Agent. In the event that upon any exercise of Warrants evidenced hereby the number of Warrants exercised shall be less than the total number of Warrants evidenced hereby, there shall be issued to the holder hereof or his, her or its assignee, a new Warrant Certificate evidencing the number of Warrants not exercised.
The Warrant Agreement provides that upon the occurrence of certain events the number of shares of Common Stock issuable upon exercise of the Warrants set forth on the face hereof may, subject to certain conditions, be adjusted. If, upon exercise of a Warrant, the holder thereof would be entitled to receive a fractional interest in a share of Common Stock, the Company shall, upon exercise, round down to the nearest whole number of shares of Common Stock to be issued to the holder of the Warrant.
Warrant Certificates, when surrendered at the principal corporate trust office of the Warrant Agent by the Registered Holder thereof in person or by legal representative or attorney duly authorized in writing, may be exchanged, in the manner and subject to the limitations provided in the Warrant Agreement, but without payment of any service charge, for another Warrant Certificate or Warrant Certificates of like tenor evidencing in the aggregate a like number of Warrants.
Upon due presentation for registration of transfer of this Warrant Certificate at the office of the Warrant Agent a new Warrant Certificate or Warrant Certificates of like tenor and evidencing in the aggregate a like number of Warrants shall be issued to the transferee(s) in exchange for this Warrant Certificate, subject to the limitations provided in the Warrant Agreement, without charge except for any tax or other governmental charge imposed in connection therewith.
The Company and the Warrant Agent may deem and treat the Registered Holder(s) hereof as the absolute owner(s) of this Warrant Certificate (notwithstanding any notation of ownership or other writing hereon made by anyone), for the purpose of any exercise hereof, of any distribution to the holder(s) hereof, and for all other purposes, and neither the Company nor the Warrant Agent shall be affected by any notice to the contrary. Neither the Warrants nor this Warrant Certificate entitles any holder hereof to any rights of a shareholder of the Company, except as otherwise specified in the Warrant Agreement.
Election to Purchase
(To Be Executed Upon Exercise of Warrant)
The undersigned hereby [irrevocably elects to]/[elects to conditionally] exercise the right, represented by this Warrant Certificate[, subject to the consummation of [________]], to receive shares of Common Stock and herewith tenders payment for such shares of Common Stock to the order of Mondee Holdings, Inc., a Delaware corporation (the “Company”), in the amount of $[●] in accordance with the terms hereof. The undersigned requests that a certificate for such shares of Common Stock be registered in the name of [●], whose address is [●], and that such shares of Common Stock be delivered to [●], whose address is [●]. If said number of shares of Common Stock is less than all of the shares of Common Stock purchasable hereunder, the undersigned requests that a new Warrant Certificate representing the remaining balance of such shares of Common Stock be registered in the name of [●], whose address is [●], and that such Warrant Certificate be delivered to [●], whose address is [●].
In the event that the Warrant is to be exercised through cashless exercise (i) the number of shares of Common Stock that this Warrant is exercisable for would be determined in accordance with the section 3.3.1(c) of the Warrant Agreement and (ii) the holder hereof shall complete the following: The undersigned hereby [irrevocably/conditionally, subject to the consummation of [ ],] elects to exercise the right, represented by this Warrant Certificate, through the cashless exercise provisions of the Warrant Agreement, to receive shares of Common Stock. If said number of shares of Common Stock is less than all of the shares of Common Stock purchasable hereunder (after giving effect to the cashless exercise), the undersigned requests that a new Warrant Certificate representing the remaining balance of such shares of Common Stock be registered in the name of [●], whose address is [●], and that such Warrant Certificate be delivered to [●], whose address is [●].
[Signature Page Follows]
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THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM, PURSUANT TO S.E.C. RULE 17Ad-15 UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED (OR ANY SUCCESSOR RULE)).
Exhibit 10.1
Certain identified information
marked with “[***]” has been
omitted from this document
because it is both (i) not material
and (ii) the type that the registrant
treats as private or confidential.
SUBSCRIPTION AGREEMENT AND PLAN OF REORGANIZATION
Mondee Holdings, Inc.
10800 Pecan Park Blvd.
Suite 315
Austin, Texas 78750
Ladies and Gentlemen:
WHEREAS, Mondee Holdings, Inc. (the “Company”) is currently seeking to raise up to $1.3 million from the sale of its Series A-3 Preferred Stock (the “Shares”) at a purchase price of $1,000 per share. The offering of the Shares (the “Offering”) is being made by the Company. The undersigned (“Subscriber”), as an Accredited Investor (as defined below), desires to purchase the number of Shares set forth at the foot of this Subscription Agreement and Plan of Reorganization (this “Agreement”). This Offering is solely to “accredited investors” (each, an “Accredited Investor,” and collectively the “Accredited Investors”) as that term is defined under Rule 501 of Regulation D promulgated under the Securities Act of 1933, as amended (the “Securities Act”);
WHEREAS, the Company desires to (a) amend and restate that certain Amended and Restated Certificate of Designation of Preferences, Rights and Limitations of Preferred Stock, approved by the Board of Directors of the Company as of October 17, 2023 (the “October 2023 Certificate of Designation”), which will reflect the terms of the Shares issued to Subscriber hereunder and reflect amended terms for and a reclassification of the Series A-1 Preferred Stock previously issued to Subscriber under the October 2023 Certificate of Designation (the “Original Shares”) to Series A-2 Preferred Stock under the Certificate of Designation (as defined below), and (b) to induce Subscriber to enter into this Agreement, enter into an amended and restated warrant agreement, dated as of the date hereof (the “Warrant Agreement”), by and between the Company and Continental Stock Transfer & Trust Company, as warrant agent (the “Agent”), pursuant to which the Company will issue and deliver to Subscriber (i) 150,000 warrants (the “Replacement Warrants”) to replace the warrants issued to Subscriber under the warrant agreement, dated as of September 29, 2022, which were surrendered to the Company and cancelled (the “Original Warrants”), plus (ii) an additional 19,500 whole warrants (the “Incremental Warrants” and together with the Replacement Warrants, the “New Warrants”) (the transactions described in this sentence, the “Reorganization Transactions”); and
WHEREAS, the Company hereby approves the Reorganization Transactions and shall amend and restate the October 2023 Certificate of Designation, issue the number of Shares set forth on the Signature Page (as hereinafter defined), cancel the Original Warrants held by Subscriber and issue the New Warrants pursuant to the execution of this Agreement;
Subscriber and the Company hereby agree as follows:
1.Definitions. The terms defined in this Section 1 shall, for all purposes of this Agreement, have the respective meanings set forth below:
“Accredited Investor” has the meaning set forth in the preamble.
“Affiliate” means, with respect to any specified Person, any other Person directly or indirectly controlling, controlled by, or under direct or indirect common control with such specified Person. For purposes of the foregoing, (a) a Person shall be deemed to control a specified Person if such Person (or a Family Member of such Person) possesses, directly or indirectly, the power to direct or cause the direction of the management and policies of such specified Person or (b) if such other Person is at such time a direct or indirect beneficial holder of at least 10% of any class of the Equity Interests of such specified Person.
“Agent” has the meaning set forth in the preamble.
“Agreement” has the meaning set forth in the preamble.
“Anti-Corruption Laws” has the meaning set forth in Section 4.13.
“Blocked Person” has the meaning set forth in Section 4.13.
“Certificate of Designation” means that certain Second Amended and Restated Certificate of Designation of Preferences, Rights and Limitations of Preferred Stock approved by the Board of Directors of the Company as of December 14, 2023 pursuant to the Amended and Restated Certificate of Designation of Preferences, Rights and Limitations of Preferred Stock, dated October 17, 2023.
“Closing” has the meaning set forth in Section 3.
“Code” has the meaning set forth in Section 19.
“Company” has the meaning set forth in Section 19.
“Common Stock” has the meaning set forth in Section 5.2.
“Company” has the meaning set forth in the preamble.
“Company’s Knowledge” means the actual knowledge after reasonable investigation of the Company executive officers with respect to an item, fact or matter, unless defined otherwise with respect to a particular section or subsection of this Agreement.
“Disclosure Time” has the meaning set forth in Section 18.
“Eligibility Deadline” has the meaning set forth in Section 21.
“Family Member” means, with respect to any individual, (a) such Person’s spouse, (b) each parent, brother, sister or child of such Person or such Person’s spouse, (c) the spouse of any Person described in clause (b) above, (d) each child of any Person described in clauses (a), (b) or (c) above, (e) each trust created for the benefit of one or more of the Persons described in clauses (a) through (d) above and (f) each custodian or guardian of any property of one or more of the
Persons described in clauses (a) through (e) above in his or her capacity as such custodian or guardian.
“Financial Statements” has the meaning set forth in Section 5.15.
“GAAP” means generally accepted accounting principles in the United States as in effect from time to time.
“Governmental Authority” means any federal, state or local or foreign government, or political subdivision thereof, or any multinational organization or authority or any authority, agency or commission entitled to exercise any administrative, executive, judicial, legislative, police, regulatory or taxing authority or power, any court or tribunal (or any department, bureau or division thereof), or any mediator, arbitrator or arbitral body.
“Government Official” means any: (a) employee or official of any Governmental Authority; or (b) political party or party official.
“Government Order” means any order, writ, judgment, injunction, decree, stipulation, ruling, determination or award entered by or with any Governmental Authority.
“Intellectual Property” means (a) trademarks, service marks, brand names, corporate names, domain names, logos, trade dress, trade names and other indicia of origin, and all goodwill associated therewith and symbolized thereby; (b) patents and patent applications; (c) trade secrets, including data, inventions, concepts, formulae, research and development information, discoveries and improvements, processes and techniques, know-how, analytical models, specifications, designs, plans, drawings, financial, marketing and business plans and data, and customer and supplier lists, in each case, to the extent protectable by applicable trade secret Laws; (d) copyrights (including copyrights in software and databases), (e) computer software programs (including all information systems, data files and databases, libraries, binaries, source and object codes and user interfaces) and (f) all other proprietary rights and intellectual property rights.
“Intended Tax Treatment” has the meaning set forth in the Section 19.
“Law” means any constitution, law (including common law), statute, standard, ordinance, code, rule, regulation, resolution or promulgation enacted by any Governmental Authority, or any Government Order.
“Material Adverse Effect” has the meaning set forth in Section 5.1.
“Material Contract” means each contract, lease, license, permit or other agreement that (a) the termination or breach of which could reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect, (b) on which the business of the Company and its subsidiaries is substantially dependent, or (c) (i) requires, or is reasonably expected (in the good faith judgment of the Company) to require, aggregate payments by or to any or all of the Company and its subsidiaries in any fiscal year in excess of 5% of the gross revenue of the Company and its subsidiaries in such fiscal year, or (ii) the Company and its subsidiaries
received or made aggregate payments with respect thereto in the most recently ended fiscal year in excess of 5% of the gross revenue of the Company and its subsidiaries in such fiscal year.
“Money Laundering Laws” has the meaning set forth in Section 4.13.
“October 2023 Certificate of Designation” has the meaning set forth in the recitals.
“OFAC” has the meaning set forth in Section 4.13.
“Offering” has the meaning set forth in the preamble.
“Ordinary Course of Business” means an action taken by any Person in the ordinary course of such Person’s business that is consistent with the past customs and practices of such Person (including past practice with respect to quantity, amount, magnitude and frequency, standard employment and payroll policies and past practice with respect to management of working capital and the making of capital expenditures) and that is taken in the ordinary course of the normal day-to-day operations of such Person.
“Original Certificate of Designation” has the meaning set forth in the preamble.
“Original Shares” has the meaning set forth in the preamble.
“Original Warrants” has the meaning set forth in the preamble.
“Penalty Warrants” has the meaning set forth in Section 21.
“Permitted Liens” means any liens securing the obligations under the Pledge and Security Agreement, dated as of December 23, 2019, among the Company, the subsidiaries of the Company party thereto, TCW Asset Management Company LLC, as agent, and the various lenders from time to time party thereto (as amended, supplemented, or amended and restated through the date hereof).
“Person” means any individual, partnership, corporation, company, association, trust, joint venture, limited liability company, unincorporated organization, entity or division, or any government, governmental department or agency or political subdivision thereof.
“Preferred Stock” has the meaning set forth in Section 5.2.
“Registration Rights Agreement” has the meaning set forth in Section 5.1.
“Reorganization Transactions” has the meaning set forth in the preamble.
“Replacement Warrants” has the meaning set forth in the preamble.
“Sarbanes-Oxley Act” has the meaning set forth in Section 5.18.
“SEC Reports” has the meaning set forth in Section 5.14.
“Second Amended and Restated Registration Rights Agreement” has the meaning set forth in Section 5.1.
“Securities Act” has the meaning set forth in the preamble.
“Shares” has the meaning set forth in the preamble.
“Signature Page” has the meaning set forth in Section 2.
“Subscriber” has the meaning set forth in the preamble.
“Subscriber’s Knowledge” means the actual knowledge after reasonable investigation of Subscriber’s executive officers with respect to an item, fact or matter, unless defined otherwise with respect to a particular section or subsection of this Agreement.
“Warrant Agreement” has the meaning set forth in Section 2.
“Warrants” has the meaning set forth in Section 2.
“USRPHC” has the meaning set forth in Section 20.4.
2.Subscription. Subscriber hereby subscribes for, and agrees to purchase from, the Company the number of Shares set forth on the signature page to this Agreement (the “Signature Page”) and the Company hereby agrees to issue such Shares to Subscriber. In order to replace the Original Warrants that were canceled, and to induce Subscriber to enter into this Agreement, the Company agrees that it will, concurrently with and contingent upon the occurrence of the Closing (as defined below), issue to Subscriber such number of New Warrants set forth on the Signature Page (together with any Penalty Warrants, the “Warrants”), which shall be issued under the Warrant Agreement.
3.Purchase Procedure. Subscriber acknowledges that, in order to subscribe for the Shares, it must, and does hereby, deliver to the Company an executed counterpart of the Signature Page attached to this Agreement and a check or wire representing the total amount of the investment as set forth on the Signature Page made payable to “Mondee Holdings, Inc.”. Before consummation of the purchase of the Shares (the “Closing”), the Company shall deliver to each Subscriber a certificate representing the Shares being purchased by such Subscriber, together with evidence of the issuance to Subscriber of the Warrants being issued thereto pursuant to the terms hereof.
4.Representations of Subscriber. By executing this Agreement, Subscriber represents, warrants, acknowledges and agrees as follows:
1.1.Subscriber is duly organized or formed, validly existing and in good standing under the laws of its jurisdiction of organization or formation, and has all requisite power and authority to enter into this Agreement and to carry out the transactions contemplated hereby.
1.2.The execution, delivery and performance by Subscriber of this Agreement have been duly authorized by all necessary action of Subscriber and do not and will not (a) violate any
of the organizational documents of Subscriber, (b) violate any provision of any law or any governmental rule or regulation applicable to Subscriber, or any order, judgment or decree of any court or other governmental authority binding on Subscriber; or (c) conflict with, result in a breach of or constitute (with due notice or lapse of time or both) a default under any instrument, agreement, contract or other obligation of Subscriber, except, in the case of any such violation, conflict, breach or default under clauses (b) and (c), as would result be reasonably expected to result in a material adverse effect on Subscriber’s ability to consummate the transactions contemplated hereby.
1.3.This Agreement has been duly executed and delivered by Subscriber, has been duly authorized and approved by all necessary action, and, assuming the due execution and delivery by the Company, constitutes a legally valid and binding obligation of Subscriber, enforceable against Subscriber in accordance with its terms, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or limiting creditors’ rights generally or by equitable principles relating to enforceability and except for the public policy limitations on the enforceability of indemnification provisions for violations of the federal securities laws.
1.4.In making its decision to purchase the Shares, Subscriber represents that is has conducted and completed its own due diligence and has independently made its own analysis and decision with respect to the Offering. Subscriber acknowledges that it believes it has received all the information it considers necessary or appropriate for deciding whether to purchase the Shares. Subscriber further represents that through its representatives it has had an opportunity to ask questions and receive answers from the Company regarding the terms and conditions of the offering of the Shares and the business, properties, prospects and financial condition of the Company and to obtain additional information (to the extent the Company possessed such information or could acquire it without unreasonable effort or expense) necessary to verify the accuracy of any information furnished to it or to which it had access. The foregoing, however, does not limit or modify the representations and warranties of the Company in Section 5 of this Agreement or the right of Subscriber to rely thereon.
1.5.Subscriber understands that: (a) the Shares being purchased hereunder have not been registered under the Securities Act, and any applicable state securities laws, or the laws of any foreign jurisdiction; (b) Subscriber cannot sell the Shares unless they are registered under the Securities Act and any applicable state securities laws or unless exemptions from such registration requirements are available; and (c) a legend will be placed on any certificate or certificates evidencing the Shares, stating that such Shares have not been registered under the Securities Act and setting forth or referring to the restrictions on transferability and sales of the Shares. Subscriber agrees not to resell the Shares without compliance with the Securities Act and any applicable state or foreign securities laws.
1.6.Subscriber: (a) is acquiring the Shares solely for Subscriber’s own account for investment purposes only and not with a view toward resale or distribution, either in whole or in part; (b) has no contract, undertaking, agreement or other arrangement, in existence or contemplated, to sell, pledge, assign or otherwise transfer the Shares to any other person; and (c) agrees not to sell or otherwise transfer Subscriber’s Shares unless they are subsequently registered under the Securities Act and any applicable state securities laws or unless an exemption from any such registration is available. The undersigned is familiar with Rule 144
which imposes a holding period on Subscriber’s Shares before sales are potentially eligible to be made under Rule 144.
1.7.Subscriber understands that an investment in the Shares involves substantial risks, and Subscriber recognizes and understands the risks relating to the purchase of the Shares, including the fact that Subscriber could lose the entire amount of Subscriber’s investment in the Shares.
1.8.Subscriber has substantial investment expertise in private placements, venture capital offerings and start-up businesses, is familiar with the Company’s business as outlined in the SEC Reports (as defined below) and is knowledgeable about the risks associated with the business in which the Company is engaged and has such knowledge and experience in financial and business matters that Subscriber is capable of evaluating the merits and risks of an investment in the Company.
1.9.Subscriber is an Accredited Investor.
1.10.Subscriber represents and acknowledges that, alone, or together with any professional advisor(s), Subscriber has analyzed and considered the risks of an investment in the Shares and determined that the Shares are a suitable investment for Subscriber and that Subscriber’s investment in the Company is reasonable in relation to Subscriber’s net worth and financial needs and Subscriber is able to bear the economic risk of losing Subscriber’s entire investment in the Shares.
1.11.Subscriber understands that: (a) the Offering contemplated hereby has not been reviewed by any federal, state or other Governmental Authority or agency; (b) if required by the laws or regulations of said state(s) the Offering contemplated hereby will be submitted to the appropriate authorities of such state(s) for registration or exemption therefrom; and (c) documents used in connection with this Offering have not been reviewed or approved by any regulatory agency or Governmental Authority, nor has any such agency or Governmental Authority made any finding or determination as to the fairness of the Shares for investment.
1.12.Subscriber is aware that the Shares have not been registered under the Securities Act and that, except for a limited public market in shares of the Company’s Common Stock (as defined below), no established public market currently exists for the Shares and there can be no assurance that an established market will develop therefor.
1.13.Subscriber is not, and, to Subscriber’s Knowledge, no director, officer, agent, employee or Affiliate of Subscriber is (a) currently subject to, nor conducting business with the subject of, any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Department of Treasury (“OFAC”), or (b) listed, nor conducting business with any person or entity listed, on any sanctions list administered by OFAC (a “Blocked Person”).
Neither Subscriber nor any of its Affiliates or representatives, have taken any act that would cause Subscriber, as of the Closing, to be in violation of the United States Foreign Corrupt Practices Act of 1977, as amended, the United Kingdom Bribery Act 2010, as amended, or any other anti-corruption or anti-bribery laws or regulations applicable to Subscriber as of the date hereof (collectively, the “Anti-Corruption Laws”). Without limiting the generality of the
foregoing, neither Subscriber nor any of its Affiliates or representatives have taken any act in violation of Anti-Corruption Laws in furtherance of a payment, an offer, a promise to pay, or an authorization or ratification of a payment of any gift, money or anything of value (a) to a Government Official or any person or entity while knowing or having reasonable grounds to believe that all or a portion of that payment will be passed on to a Government Official to obtain or retain business, or (b) to secure an improper advantage. To Subscriber’s Knowledge there is no investigation of, or request for information from, Subscriber by law enforcement officials regarding a violation or potential violation of the Anti-Corruption Laws. Subscriber and its Affiliates have received no written allegation and conducted no internal investigation related to a violation or potential violation of the Anti-Corruption Laws. Subscriber has established and continues to maintain reasonable internal controls and procedures intended to ensure compliance with the Anti-Corruption Laws, including an anti-corruption compliance policy. To Subscriber’s Knowledge, none of the officers, directors, employees, agents or members of Subscriber are or were Government Officials. No Government Official, Governmental Authority, or Blocked Person owns an interest, whether direct or, to Subscriber’s Knowledge, indirect, legal or beneficial, in Subscriber or has or will receive any legal or beneficial interest in payments made to the Company pursuant to this Agreement. Subscriber further represents and warrants that, to the extent required, it maintains policies and procedures reasonably designed to ensure that the funds held by Subscriber and used to purchase the Shares were legally derived.
Subscriber is in material compliance with, and in the past have complied with, all applicable laws and regulations relating to the prevention of money laundering of any governmental entity applicable to them or their property or in respect of their operations (“Money Laundering Laws”), including all applicable financial recordkeeping, know-your-customer and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended. No action, suit or proceeding by or before any Governmental Authority or any arbitrator involving Subscriber with respect to Money Laundering Laws is pending or, to Subscriber’s knowledge threatened.
1.14.The certificates evidencing the Shares will contain a legend substantially as follows:
THE SECURITIES WHICH ARE REPRESENTED HEREBY HAVE NOT BEEN THE SUBJECT OF REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED, PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT OR AN APPLICABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF SUCH ACT.
1.15.Subscriber expressly acknowledges and understands that, in connection with the offer and sale of the Shares described herein to Subscriber, the Company is relying upon Subscriber’s representations and warranties as contained in this Agreement.
5.Representations of Company. The Company represents, warrants, acknowledges and agrees as follows:
1.1.The Company (a) is duly organized or formed, validly existing and in good standing under the laws of its jurisdiction of organization or formation, (b) has all requisite power and authority to own and operate its properties, to carry on its business as now conducted and as proposed to be conducted, to enter into this Agreement, the Warrant Agreement, and the second amended and restated registration rights agreement, dated the date hereof, between the Company and the other parties thereto, related to the Warrants and the shares of Common Stock issuable upon the exercise thereof (the “Second Amended and Restated Registration Rights Agreement”) and to carry out the transactions contemplated hereby and thereby, and (c) is qualified to do business and in good standing in every jurisdiction where it is necessary to carry out its business and operations as now conducted, except in jurisdictions where the failure to be so qualified or in good standing has not had, and would not be expected to result in, an adverse and material effect on its business, assets, operations, financial condition, or its ability to consummate the transactions contemplated hereunder and thereunder and perform its obligations hereunder and thereunder (a “Material Adverse Effect”).
1.2.The authorized capital stock of the Company consists of 750,000,000 shares of common stock (the “Common Stock”), and 250,000,000 shares of preferred stock (the “Preferred Stock”), each having a par value of $0.0001 per share. At the close of business on June 30, 2023, (i) 84,242,767 shares of Common Stock were issued and outstanding; (ii) 85,000 shares of Preferred Stock were issued and outstanding; (iii) 97,449 shares of Common Stock were reserved and issuable upon vesting of outstanding and promised restricted stock units pursuant to the Company’s existing 2022 Equity Incentive Plan; (iv) 0 shares of Common Stock were issuable upon exercise of vested and unvested outstanding options; (v) 1,507,500 shares of Common Stock were reserved and issuable upon exercise of outstanding warrants (none of which the Company intends to repurchase); and (vi) 8,629,065 shares were reserved for issuance for future awards under the Company existing 2022 Equity Incentive Plan. The outstanding shares of Common Stock and Preferred Stock of the Company are, and all shares of Common Stock which may be issued pursuant to the Company’s existing 2022 Equity Incentive Plan will, when issued, be, duly authorized, validly issued, fully paid and non-assessable and there are no other classes of interests of the Company outstanding. There are no preemptive rights or other outstanding rights, options, warrants, conversion rights or agreements or commitments of any character relating to the Company’s authorized and issued equity interests. There are not any bonds, debentures, notes or other indebtedness or debt securities of the Company having the right to vote on any matters on which stockholders of the Company may vote. Except as described in this Section 5.2 or as required under this Agreement, the Second Amended and Restated Registration Rights Agreement, that certain amended and restated registration rights agreement by and among the Company and the other parties thereto, dated as of October 17, 2023, that certain registration rights agreement by and among the Company and the other parties thereto, dated September 29, 2022 or that certain registration rights agreement by and among the Company and the other parties thereto, dated July 18, 2022, there are no securities, options, warrants, calls, rights, commitments, agreements, arrangements or undertakings of any kind to which the Company or any of its subsidiaries is a party or by which any of them is bound obligating the Company or any of its subsidiaries to issue, deliver or sell, or cause to be issued, delivered or sold, additional shares of capital stock or other equity or voting securities of the Company or of any of its subsidiaries or obligating the Company or any of its subsidiaries to issue, grant, extend or enter into any such security, option, warrant, call, right, commitment, agreement, arrangement or undertaking. There are no outstanding rights, commitments, agreements, arrangements or undertakings of any kind obligating the Company or any of its subsidiaries to repurchase, redeem
or otherwise acquire or dispose of any shares of capital stock or other equity or voting securities of the Company or any of its subsidiaries or any securities of the type described in the two immediately preceding sentences, except under employment arrangements entered into prior to the date hereof.
1.3.The execution, delivery and performance by the Company of this Agreement, the Warrant Agreement, that certain Promissory Note, dated the date hereof, issued by the Company to Subscriber, and the Second Amended and Restated Registration Rights Agreement and the consummation of the transactions contemplated hereby and thereby have been duly authorized by all necessary action of the Company and do not and will not (a) violate any of the organizational documents of the Company, (b) violate any provision of any law or any governmental rule or regulation applicable to the Company, or any order, judgment or decree of any court or other Governmental Authority binding on the Company; (c) conflict with, result in a breach of or constitute (with due notice or lapse of time or both) a default under any instrument, agreement, contract or other obligation of the Company; (d) result in or require the creation or imposition of any lien, charge or encumbrance upon any of the properties or assets of the Company; or (e) require any approval of stockholders of the Company, except, in the case of (b), (c) and (d) above, for such violations, conflicts, breaches, defaults, liens, charges or encumbrances as would not reasonably be expected to result in a Material Adverse Effect, and in the case of (e) above, for such approvals or consents which have been obtained.
1.4.Each of this Agreement, the Warrant Agreement and the Second Amended and Restated Registration Rights Agreement has been duly executed and delivered by the Company, and, assuming the due execution and delivery by the other parties thereto, as applicable, constitutes the legally valid and binding obligations of the Company, enforceable against the Company in accordance with its terms, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or limiting creditors’ rights generally or by equitable principles relating to enforceability and except for the public policy limitations on the enforceability of indemnification provisions for violations of the federal securities laws.
1.5.The execution, delivery and performance by the Company of this Agreement, the Warrant Agreement and the Second Amended and Restated Registration Rights Agreement and the consummation of the transactions contemplated hereby and thereby do not and will not require any registration with, consent or approval of, or notice to, or other action to, with or by, any governmental authority except for the filing of a Form D, if applicable, with the Securities and Exchange Commission and any state securities commission, and the filing of a registration statement with the Securities and Exchange Commission pursuant to the Second Amended and Restated Registration Rights Agreement.
1.6.The Shares being purchased by Subscriber hereunder, when issued, sold, and delivered in accordance with the terms of this Agreement for the consideration expressed herein, will be duly and validly issued, fully paid, and nonassessable, and will be free of taxes, liens, charges and restrictions on transfer other than liens or charges created by the holder thereof and other than restrictions under applicable state and federal securities laws, and subject to, and governed by, the Certificate of Designation. The Warrants have been duly authorized and validly issued, and constitute a legal, valid and binding obligation of the Company, enforceable against the Company in accordance with their terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or limiting
creditors’ rights generally or by equitable principles relating to enforceability and except for the public policy limitations on the enforceability of indemnification provisions for violations of the federal securities laws, and are subject to, and governed by, the terms of the Warrant Agreement. All shares of Common Stock which may be issued upon the exercise of the Warrants shall, upon exercise of the Warrants and payment for such shares in accordance therewith, be duly authorized, validly issued, fully paid and nonassessable and free from all taxes, liens, charges and restrictions on transfer other than liens or charges created by the holder thereof and other than restrictions under applicable state and federal securities laws. The shares of Series A Preferred Stock issued by the Company on September 29, 2022 owned by Subscriber are subject to, and governed by, the Original Certificate of Designation, and, upon consummation of the transactions contemplated hereby, will have been reclassified to Series A-2 Preferred Stock (as defined in the Certificate of Designation) pursuant to the Certificate of Designation and will be subject to, and governed by, the terms of the Certificate of Designation.
1.7.Each of the Company and its subsidiaries has good and marketable title to its property that is real property and good and valid title to all of its other property, free and clear of all liens, charges and encumbrances except for Permitted Liens or as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect on the ability of the Company and its subsidiaries, taken as a whole, to conduct their businesses in the Ordinary Course of Business consistent with past practices.
1.8.To the Company’s Knowledge, the Company owns or possesses, or can acquire on commercially reasonable terms, sufficient legal rights to all Intellectual Property, technology, products, processes and know-how employed, manufactured or sold by the Company in the conduct of the Company’s business as now conducted, without any known conflict with, or infringement of, the rights of others. To the Company’s Knowledge, the Company owns or possesses, or believes it can acquire on commercially reasonable terms, sufficient legal rights to all Intellectual Property, technology, products, processes and knowhow as is necessary to the conduct of the Company’s business as presently proposed to be conducted, without any known conflict with, or infringement of, the rights of others. To the Company’s Knowledge, no product or service marketed or sold (or proposed to be marketed or sold) by the Company violates or will violate any license or infringes or will infringe any intellectual property rights of any other party. To the Company’s Knowledge, other than with respect to generally commercially available software products under standard end-user object code license agreements, there are no outstanding options, licenses, agreements, claims, encumbrances or shared ownership interests of any kind relating to the Company’s Intellectual Property, nor is the Company bound by or a party to any options, licenses or agreements of any kind with respect to the patents, trademarks, service marks, trade names, copyrights, trade secrets, licenses, information, proprietary rights and processes of any other Person. The Company has not received any written communications alleging that the Company has violated or, by conducting its business, would violate any of the patents, trademarks, service marks, trade names, copyrights, trade secrets, mask works or other proprietary rights or processes of any other Person. To the Company’s Knowledge, the Company has obtained and possesses valid licenses to use all of the software programs present on the computers and other software-enabled electronic devices that it owns or leases or that it has otherwise provided to its employees for their use in connection with the Company’s business. To the Company’s Knowledge, it will not be necessary to use any inventions of any of its employees or consultants (or Persons it currently intends to hire) made prior to their employment by the Company. Each employee and consultant has assigned to the Company all intellectual property
rights he or she has developed, invented or authored, or is yet to develop, invent or author, in the course of his or her employment or engagement by the Company that are related to the Company’s business as now conducted and as presently proposed to be conducted. To the Company’s Knowledge, any and all Intellectual Property that each employee or consultant of the Company has developed, invented or authored in the course of his or her employment or engagement by the Company that are related to the Company’s business as now conducted and as presently proposed to be conducted, were not so developed, invented, or authored jointly with another person unless the other person has also assigned such Intellectual Property to the Company. The Company has not embedded any open source, copyleft or community source code in any of its software that is distributed by the Company (i.e., source code that is licensed under any “open source” license agreement (i.e., license agreements listed or on http://www.opensonrce.org/licenses/alphabetical)). For purposes of this Section 5.8, the Company’s Knowledge means the actual knowledge of the Company’s executive officers with respect to an item, fact or matter. To the Company’s Knowledge, no action has been made or is pending or threatened, nor has the Company received any written notice of investigation from any Person or Governmental Authority, regarding the Company’s data security or data privacy policies or their collection, use, storage, processing, transfer or disclosure of personally identifiable information.
1.9.To the Company’s Knowledge, there has been no theft, breach of security, or unauthorized use, disclosure, or access of any personally identifiable information collected, maintained or stored by or on behalf of the Company (or any loss, destruction, compromise or unauthorized disclosure thereof), or any written allegation regarding the same.
1.10.To the Company’s Knowledge, none of its employees are obligated under any contract (including licenses, covenants or commitments of any nature) or other agreement, or subject to any judgment, decree or order of any court or administrative agency, that would materially interfere with such employee’s ability to promote the interest of the Company or that would conflict with the Company’s business. Neither the consummation of the transactions contemplated hereby, nor the carrying on of the Company’s business by the employees of the Company, nor the conduct of the Company’s business as presently conducted, will, to the Company’s Knowledge, conflict with or result in a breach of the terms, conditions, or provisions of, or constitute a default under, any contract, covenant or instrument under which any such employee is now obligated. The Company has not made any representations regarding equity incentives to any officer, employees, director or consultant that are inconsistent with the share amounts and terms set forth in the minutes of meetings of the Company’s Board of Directors. The Company is not bound by or subject to (and none of its assets or properties is bound by or subject to) any written or oral, express or implied, contract, commitment or arrangement with any labor union, and no labor union has requested or, to the Company’s Knowledge, has sought to represent any of the employees, representatives or agents of the Company. There is no strike or other labor dispute involving the Company pending, or to the Company’s Knowledge, threatened, which would not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect, nor is the Company aware of any labor organization activity involving its employees.
1.11.The Company and each of its subsidiaries possess all permits and licenses of governmental authorities that are required to conduct its business, except for such permits or licenses the absence of which would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect on the ability of the Company and its subsidiaries taken as a
whole, to conduct their businesses in the Ordinary Course of Business consistent with past practices.
1.12.No current officer or director (or equivalent) of the Company or any of its subsidiaries (or, to the Company’s Knowledge, any Family Member of any such Person who is an individual or any entity in which any such Person or any such Family Member thereof owns a material interest): (a) has any interest in any material asset owned or leased by the Company or used in connection with the Business or (b) has engaged in any material transaction, arrangement or understanding with the Company since January 1, 2021 (other than payments made to, and other compensation provided to, officers and directors (or equivalent) in the Ordinary Course of Business or as otherwise disclosed in the SEC Reports).
1.13.Neither the Company nor any of its subsidiaries will be, at the time of the sale of the Shares to Subscriber, in default in the payment of any material indebtedness or in default under any agreement relating to its material indebtedness or under any mortgage, deed of trust, security agreement or lease to which it is a party.
1.14.The Company’s recent filings under the Securities Act and Exchange Act, including, without limitation, all such filings during calendar year 2023 (the “SEC Reports”) do not contain any misstatement of material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances in which they are made, not misleading.
1.15.Since January 1, 2023, the Company has filed all reports, schedules, forms, statements and other documents (including exhibits and all other information incorporated by reference therein) required to be filed by the Company with the SEC. The financial statements included in the SEC Reports (the “Financial Statements”) were prepared in conformity with generally accepted accounting principles and fairly present, in all material respects, the consolidated financial position of the Company as at the respective dates thereof and the consolidated results of operations and cash flows of the Company for each of the periods then ended, subject, in the case of any such unaudited financial statements, to changes resulting from audit and normal year-end adjustments none of which would reasonably be expected to be material to the Company. The Company has no disagreements with its outside independent public accountants which has had or would reasonably be expected to have a Material Adverse Effect.
1.16.The Company has no liabilities, obligations or commitments of any nature whatsoever, contingent or otherwise, that would be required to be reflected on a consolidated balance sheet of the Company that is prepared in accordance with GAAP, except (a) those which are reflected or reserved against in the Financial Statements, and (b) those which have been incurred in the Ordinary Course of Business.
1.17.Since the date of the latest balance sheet included in the SEC Reports, no event, circumstance or change has occurred that has caused, either in any case or in the aggregate, a Material Adverse Effect.
1.18.Each of the principal executive officer and the principal financial officer of the Company (or each former principal executive officer and former principal financial officer of the
Company, as applicable) has made all certifications required under Sections 302 and 906 of the Sarbanes-Oxley Act of 2002, as amended (the “Sarbanes-Oxley Act”), with respect to the SEC Reports, and the Company has delivered to Subscriber a summary of any disclosure made by the Company’s management to the Company’s auditors and audit committee referred to in such certifications. For purposes of the preceding sentence, “principal executive officer” and “principal financial officer” shall have the meanings ascribed to such terms in the Sarbanes-Oxley Act.
1.19.The Company has: (a) designed disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) to ensure that material information relating to the Company, including its consolidated subsidiaries, is made known to its principal executive officer and principal financial officer; (b) designed internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP; (c) evaluated the effectiveness of the Company’s disclosure controls and procedures and, to the extent required by applicable Law, presented in any applicable SEC Report that is a report on Form 10-K or Form 10-Q or any amendment thereto its conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by such report or amendment based on such evaluation; and (d) to the extent required by applicable Law, disclosed in such report or amendment any change in the Company’s internal control over financial reporting that occurred during the period covered by such report or amendment that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.
1.20.The Company has previously filed with the SEC Reports or otherwise provided to Subscriber true, correct and complete copies of each contract or agreement which is a “material contract” within the meaning of Item 601(b)(10) of Regulation S-K to be performed in whole or in part after the date of this Agreement.
1.21.There are no legal proceedings pending against the Company or, to the Company’s Knowledge, threatened against the Company, that challenge the Company’s right or power to enter into or perform any of its obligations under this Agreement, the Warrant Agreement or the Second Amended and Restated Registration Rights Agreement or that individually or in the aggregate are material to the Company. The Company is not (a) in violation of any applicable laws in any material respect, or (b) subject to or in default with respect to any judgments, writs, injunctions, decrees, rules or regulations of any court or any federal, state, municipal or other governmental authority. During the past three years there has been no claim, suit, action, audit, investigation, inquiry or other proceeding pending or, to the Company’s Knowledge threatened against or affecting the Company, any of its subsidiaries or any Person that the Company or any such subsidiary has agreed to indemnify in respect thereof.
1.22.The Company is not, and, to the Company’s Knowledge, no director, officer, agent, employee or Affiliate of the Company is (a) currently subject to, nor conducting business with the subject of, OFAC, or (b) listed, nor conducting business with any Blocked Person.
Neither the Company nor any of its Affiliates or representatives, have taken any act that would cause the Company, as of the Closing, to be in violation of Anti-Corruption Laws. Without limiting the generality of the foregoing, neither the Company nor any of its Affiliates or
representatives have taken any act in violation of Anti-Corruption Laws in furtherance of a payment, an offer, a promise to pay, or an authorization or ratification of a payment of any gift, money or anything of value (a) to a Government Official or any person or entity while knowing or having reasonable grounds to believe that all or a portion of that payment will be passed on to a Government Official to obtain or retain business, or (b) to secure an improper advantage. To the Company’s Knowledge there is no investigation of, or request for information from, the Company by law enforcement officials regarding a violation or potential violation of the Anti-Corruption Laws. The Company and its Affiliates have received no written allegation and conducted no internal investigation related to a violation or potential violation of the Anti-Corruption Laws. The Company has established and continues to maintain reasonable internal controls and procedures intended to ensure compliance with the Anti-Corruption Laws, including an anti-corruption compliance policy. To the Company’s Knowledge, none of the officers, directors, employees, agents or members of the Company are or were Government Officials. No Government Official, Governmental Authority, or Blocked Person owns an interest, whether direct or, to the Company’s Knowledge, indirect, legal or beneficial, in the Company or has or will receive any legal or beneficial interest in payments made to the Company pursuant to this Agreement.
The Company is in material compliance with, and in the past have complied with, all Money Laundering Laws, including all applicable financial recordkeeping, know-your-customer and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended. No action, suit or proceeding by or before any Governmental Authority or any arbitrator involving the Company with respect to the Money Laundering Laws is pending or, to the Company’s knowledge threatened.
1.23.All material tax returns and reports of the Company required to be filed by it have been timely filed (taking into account any valid extensions), and all material taxes shown on such tax returns) to be due and payable and all material assessments, fees and other governmental charges upon the Company and upon its properties, assets, income, businesses and franchises which are due and payable have been paid prior to the time that any interest, penalties or additions to tax accrue or are assesable, except in each case those which are being contested in good faith by appropriate proceedings diligently conducted and for which adequate reserves have been provided in accordance with generally accepted accounting principles.
1.24.Except as would not, individually or in the aggregate, have a Material Adverse Effect, (a) the assets, properties and businesses of the Company and its subsidiaries are subject to reasonable and customary insurance policies, (b) all material insurance policies of the Company and its subsidiaries are in full force and effect (except for policies that have expired in accordance with the terms in the ordinary course), and (c) no notice of cancellation or termination has been received with respect to any such policy.
1.25.Neither the Company nor any of its subsidiaries is an investment company within the meaning of the Investment Company Act of 1940, as amended, or, directly or indirectly, controlled by or acting on behalf of any person which is an investment company, within the meaning of said act.
1.26.All projections provided by the Company to Subscriber were reasonably prepared and based upon the good faith judgment of management of the Company. Notwithstanding the
foregoing, Subscriber acknowledges and agrees that any such projections are inherently speculative and there can be no assurances that the Company will be able to meet the projections or that actual results will not be significantly lower than projected.
1.27.Neither the Company nor any of its subsidiaries nor any of their respective officers or directors has employed any broker or finder or incurred any liability for any financial advisory fees, brokerage fees, commissions or finder’s fees, and no broker or finder has acted directly or indirectly for the Company or any of its subsidiaries in connection with this Agreement or the Warrant Agreement or the transactions contemplated hereby or thereby.
1.28.The terms and rights set forth in this Agreement are as favorable to Subscriber as the terms and rights granted to all other investors entering into a similar agreement to purchase Shares. The Company has not entered into any subscription agreement, side letter or other agreement with any such other investor relating to such other investor’s direct or indirect investment in the Company’s Shares on terms and conditions (economic or otherwise) that are more advantageous to such other investor than Subscriber.
1.29.All of the Company’s Material Contracts are in writing and, to the Company’s Knowledge, are binding and enforceable against the parties thereto according to their terms except as may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or limiting creditors’ rights generally or by equitable principles relating to enforceability, and, except as disclosed in the SEC Reports, none of the Company nor any of its subsidiaries is in default in any material respect in the performance, observance or fulfillment or any of the obligations, covenants or conditions contained in any Material Contract.
6.Indemnification.
1.1.Subscriber hereby agrees to indemnify and hold harmless the Company and the Company’s officers, directors, employees, agents, counsel and affiliates from and against any and all damages, losses, costs, liabilities and expenses (including, without limitation, reasonable attorneys’ fees) which they, or any of them, may incur by reason of Subscriber’s failure to fulfill any of the terms and conditions of this Agreement or by reason of Subscriber’s breach of any of his representations and warranties contained herein. This Agreement and the representations and warranties contained herein shall be binding upon Subscriber’s heirs, executors, administrators, representatives, successors and assigns.
1.2.The Company hereby agrees to indemnify and hold harmless Subscriber and Subscriber’s officers, directors, employees, agents, counsel and affiliates from and against any and all damages, losses, costs, liabilities and expenses (including, without limitation, reasonable attorneys’ fees) which they, or any of them, may incur by reason of the Company’s failure to fulfill any of the terms and conditions of this Agreement or by reason of the Company’s breach of any of its representations and warranties contained herein. This Agreement and the representations and warranties contained herein shall be binding upon the Company’s heirs, executors, administrators, representatives, successors and assigns.
7.Consent to Jurisdiction: Waiver of Jury Trial.
1.1.EACH OF THE PARTIES TO THIS AGREEMENT HEREBY AGREES THAT JURISDICTION AND VENUE IN ANY SUIT, ACTION OR PROCEEDING BROUGHT BY ANY PARTY ARISING OUT OF OR RELATING TO THIS AGREEMENT (INCLUDING ANY SUIT, ACTION OR PROCEEDING SEEKING EQUITABLE RELIEF) SHALL PROPERLY AND EXCLUSIVELY LIE IN THE COURT OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY OR, TO THE EXTENT THE COURTS OF NEW YORK DO NOT HAVE SUBJECT MATTER JURISDICTION, THE UNITED STATES DISTRICT COURT LOCATED IN NEW YORK CITY. EACH PARTY HERETO FURTHER AGREES NOT TO BRING ANY SUCH SUIT, ACTION OR PROCEEDING IN ANY COURT OTHER THAN THE COURTS IDENTIFIED IN THE FOREGOING SENTENCE. BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH PARTY IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE COURTS IN NEW YORK CITY FOR ITSELF AND IN RESPECT OF ITS PROPERTY WITH RESPECT TO SUCH SUIT, ACTION OR PROCEEDING. THE PARTIES HERETO IRREVOCABLY AGREE THAT VENUE WOULD BE PROPER IN EACH OF THE FOREGOING COURTS, AND HEREBY WAIVE ANY OBJECTION THAT ANY SUCH COURT IS AN IMPROPER OR INCONVENIENT FORUM FOR THE RESOLUTION OF SUCH SUIT, ACTION OR PROCEEDING.
1.2.TO THE EXTENT NOT PROHIBITED BY APPLICABLE LAW WHICH CANNOT BE WAIVED, EACH PARTY HERETO HEREBY WAIVES AND COVENANTS THAT IT WILL NOT ASSERT (WHETHER AS PLAINTIFF, DEFENDANT OR OTHERWISE) ANY RIGHT TO TRIAL BY JURY IN ANY FORUM IN RESPECT OF ANY ISSUE OR ACTION, CLAIM, CAUSE OF ACTION OR SUIT (IN CONTRACT, TORT OR OTHERWISE), INQUIRY, PROCEEDING OR INVESTIGATION ARISING OUT OF OR BASED UPON THIS AGREEMENT OR THE SUBJECT MATTER HEREOF OR IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE TRANSACTIONS CONTEMPLATED HEREBY, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING. EACH PARTY HERETO ACKNOWLEDGES THAT IT HAS BEEN INFORMED BY THE OTHER PARTIES HERETO THAT THIS SECTION 7.2 CONSTITUTES A MATERIAL INDUCEMENT UPON WHICH THEY ARE RELYING AND WILL RELY IN ENTERING INTO THIS AGREEMENT. ANY PARTY HERETO MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION 7.2 WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF EACH SUCH PARTY TO THE WAIVER OF ITS RIGHT TO TRIAL BY JURY.
1.3.This Section 7 is intended to benefit the security holders, agents, affiliates, associates, employees and controlling persons of the Company and Subscriber, each of whom shall be deemed to be a third party beneficiary of this Section 7, and each of whom may enforce this Section 7 to the full extent that the Company or Subscriber, as applicable, could do so if a controversy or claim were brought against it.
8.Applicable Law. This Agreement shall be construed in accordance with and governed by the laws applicable to contracts made and wholly performed in the State of New York.
9.Execution in Counterparts. This Agreement may be executed in one or more original or facsimile counterparts and each such counterpart shall for all purposes be deemed to
be an original, and all such counterparts shall together constitute but one and the same instrument.
10.Persons Bound. This Agreement shall, except as otherwise provided herein, inure to the benefit of and be binding on the Company and its successors and assigns and on each Subscriber and his respective heirs, executors, administrators, successors and assigns.
11.No Third-Party Beneficiaries. This Agreement shall be binding upon and inure to the benefit of each party hereto and to their respective successors and permitted assigns, and, except as provided in Section 6 and Section 7, nothing in this Agreement, express or implied, is intended to or shall confer upon any other Person any other right, benefit or remedy of any nature whatsoever under or by reason of this Agreement.
12.Legend Removal. The Company covenants that the legend on Shares described in Section 4.14 will be removed when the Shares are freely tradable as to volume and manner of sale under Rule 144.
13.Entire Agreement. This Agreement, when accepted by the Company, will constitute the entire agreement among the parties hereto with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements and understandings, inducements or conditions, express or implied, oral or written, except as herein contained. This Agreement may not be modified, changed, waived or terminated other than by a writing executed by all the parties hereto. No course of conduct or dealing shall be construed to modify, amend or otherwise affect any of the provisions hereof.
14.Assignability. Subscriber acknowledges that he may not assign any of his rights to or interest in or under this Agreement without the prior written consent of the Company, and any attempted assignment without such consent shall be void and without force or effect. Notwithstanding the foregoing, Subscriber may assign its rights, interests and obligations under this Agreement to any of its affiliated or managed funds.
15.Notices. Any notice or other communication required or permitted hereunder shall be in writing and shall be delivered personally, sent by electronic mail or sent by certified, registered or express mail, postage prepaid, to the address of each party set forth herein. Any such notice shall be deemed given when delivered personally, sent by electronic mail or, if mailed, three days after the date of deposit in the United States mail.
16.Interpretation.
1.1.When the context in which words are used in this Agreement indicates that such is the intent, singular words shall include the plural, and vice versa, and masculine words shall include the feminine and neuter genders, and vice versa.
1.2.Captions are inserted for convenience only, are not a part of this Agreement, and shall not be used in the interpretation of this Agreement.
17.Notwithstanding anything herein to the contrary, you and each other party to the Offering (and each affiliate and person acting on behalf of any such party) agree that
each party (and each employee, representative, and other agent of such party) may disclose to any and all persons, without limitation of any kind, the tax treatment and tax structure of the transaction and all materials of any kind (including opinions or other tax analyses) that are provided to such party or such person relating to such tax treatment and tax structure, except to the extent necessary to comply with any applicable federal or state securities laws. This authorization is not intended to permit disclosure of any other information including (without limitation) (i) any portion of any materials to the extent not related to the tax treatment or tax structure of the Offering, (ii) the identities of participants or potential participants in the Offering, (iii) the existence or status of any negotiations, (iv) any pricing or financial information (except to the extent such pricing or financial information is related to the tax treatment or tax structure of the Offering), or (v) any other term or detail not relevant to the tax treatment or the tax structure of the Offering.
18.Disclosure; Filings. The Company shall, by 9:30 a.m., New York City time, on the second (2nd) business day immediately following the date of this Agreement (the “Disclosure Time”), issue a press release that has been presented to and reviewed and approved by Subscriber announcing the execution of this Agreement and file a copy of such press release with the Securities and Exchange Commission on a Current Report on Form 8-K that has been presented to and reviewed and approved by Subscriber disclosing all material terms of the transactions contemplated hereby. From and after the Disclosure Time, the Company represents to Subscriber that the Company shall have publicly disclosed all material, non-public information regarding the Company delivered to Subscriber by the Company or any of its officers, directors, employees or agents in connection with the transactions contemplated by this Agreement, and Subscriber shall no longer be subject to any confidentiality or similar obligations under any current agreement, whether written or oral with the Company or any of its affiliates in connection with the transactions contemplated hereby. For the avoidance of doubt, no such press release or Form 8-K shall identify the identity of Subscriber except as required by federal securities laws. To the extent a Form D is required to be filed, the Company shall furnish a copy thereof to Subscriber for review two business days prior to filing, and shall incorporate in good faith any comments thereto reasonably received from Subscriber.
19.Plan of Reorganization. The Parties intend that (i) this Agreement shall be a “plan of reorganization” pursuant to Section 368(a)(1)(E) of the Internal Revenue Code of 1986, as amended (the “Code”) and Treasury Regulations Section 1.368-2(g) based on which the Reorganization Transactions occur and (ii) the Reorganization Transactions constitute a tax-free reorganization pursuant to Section 368(a)(1)(E) of the Code and any similar or analogous provisions of state and local law (the “Intended Tax Treatment”). Each of the Parties hereto will, execute and deliver such additional documents, instruments, conveyances and assurances, and take such further actions as may be required to carry out and give effect to the Reorganization Transactions. Each of the Parties will report the Reorganization Transaction on their applicable tax returns consistent with the Intended Tax Treatment and not take any inconsistent position in a tax proceeding or tax return, unless otherwise required pursuant to a final “determination” as defined under Section 1313(a) of the Code.
20.Taxes.
1.1.Notwithstanding anything to the contrary contained herein, the Company and Subscriber will agree upon an allocation of the purchase price between the Shares and the Warrants within sixty (60) days after the date hereof and to use such purchase price allocations for all income tax and financial accounting purposes with respect to this transaction; provided that, if they do not reach a final agreement, a mutually agreed upon independent accounting firm (the cost of which will be split equally between the Company and Subscriber) shall determine such allocation which shall be set forth in writing and shall be final and binding on the Company and Subscriber.
1.2.Unless otherwise required pursuant to a final “determination” as defined under Section 1313(a) of the Code or unless there is a change in law or additional guidance issued by the Internal Revenue Service, in each case applicable to the Shares and the Original Shares, each of the Company, Subscriber, and their respective affiliates (i) shall not treat any Accrued Dividend or the accrual of any Dividend, as defined in the Certificate of Designation, as well as any redemption premium attributable thereto or the Reorganization Transactions, as resulting in taxable dividend income to the holder of such Shares or Original Shares for U.S. federal income tax purposes under Section 305 of the Code or otherwise without a corresponding receipt of cash and also (ii) shall treat any amounts received in respect of the Warrants pursuant to Section 4.1.3 of the Warrant Agreement as a distribution of property made by a corporation to a shareholder with respect of its stock pursuant to Section 301 of the Code, and each of the Company and Subscriber shall take all actions consistent therewith, including the filing of any tax returns and in connection with any tax proceeding. The Company, Subscriber and their respective affiliates shall reasonably cooperate with each other in the structuring of any sale or redemption of Shares or the Original Shares so as not to treat any portion of the proceeds received by Subscriber from the sale or redemption as a dividend for U.S. federal income tax purposes under Section 302 of the Code or otherwise.
1.3.The Company and Subscriber agree that for U.S. federal income tax purposes, it is intended that an exercise of the Warrants on a “cashless basis” pursuant to Section 3.3.1(c) of the Warrant Agreement will be treated as a recapitalization within the meaning of Section 368(a)(1)(E) of the Code.
1.4.The Company covenants and agrees to use commercially reasonable efforts to avoid becoming a “United States real property holding corporation” (a “USRPHC”) within the meaning of Section 897(c)(2) of the Code. The Company further covenants and agrees to use commercially reasonable efforts to monitor whether it is reasonably likely to become a USRPHC and provide a written notice to Subscriber at least twenty (20) business days prior to any event, as a result of which, the Company reasonably expects to be determined as a USRPHC.
1.5.The Company covenants and agrees to not, either directly or indirectly by amendment, merger, consolidation or otherwise, change the entity classification of the Company such that the Shares or Common Stock constitute equity ownership in an entity taxable as a partnership for U.S. federal income tax purposes.
21.DTC Eligibility. The Company covenants and agrees that it shall use its commercially reasonable efforts to make the Warrants eligible for clearance and for trading in
book-entry form on the records of The Depository Trust Company as soon as practicable after the Closing, and in any event not later than 10 business days after the date of the Closing (the “Eligibility Deadline”). Until the Warrants are so eligible, the Company covenants and agrees to (i) use its commercially reasonable efforts to facilitate any proposed transfer of the Warrants by Subscriber that complies with applicable law, including through the provision of any legal opinions, certifications or other documents requested by the Agent and customarily provided by issuers of securities in connection with any such transfers, and (ii) on the business day immediately following the Eligibility Deadline, and on each 10th business day anniversary of the Eligibility Deadline, the Company shall issue to Subscriber (or, if other than Subscriber, the then holder of the Warrants) a number of additional Warrants (the “Penalty Warrants”) equal to 10% of the number of Warrants then held by Subscriber or such other holder, which Penalty Warrants shall be deemed to be fully earned and non-refundable in each case upon issuance in accordance with the terms hereof.
SUBSCRIBER SIGNATURE PAGE
The undersigned, desiring to subscribe for shares of Series A Preferred Stock of the Company, as set forth below, acknowledges that the undersigned has received and understands the terms and conditions of the Agreement attached hereto and that the undersigned does hereby agree to all the terms and conditions contained therein.
IN WITNESS WHEREOF, the undersigned has hereby executed the Agreement as of the date written below.
Total Dollar Amount of Investment: $1,300,000
Number of Shares of Series A-3 Preferred Stock Subscribed for at $1,000 per share: 1,300 (together with 169,500 Warrants)
Date of Investment: December 14, 2023
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| Exact name(s) of Subscriber(s) (please print): | NH Credit Partner III Holdings L.P. |
| [***] |
| (Signature) |
| Residence or Mailing Address: | [***] |
| [***] |
| [***] |
| [***] |
Mailing Address for Correspondence
from the Company (if different from above): | N/A |
| |
[Signature Page to Agreement]
IN WITNESS WHEREOF, the undersigned has hereby executed the Agreement and accepted the subscription set forth herein for the certain number of above specified Shares and Warrants, as of this 14 day of December, 2023.
MONDEE HOLDINGS, INC.
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|
By: /s/ Prasad Gundumogula |
| Name: Prasad Gundumogula Title: Chief Executive Officer |
[Signature Page to Agreement]
Exhibit 10.2
Certain identified information
marked with “[***]” has been
omitted from this document
because it is both (i) not material
and (ii) the type that the registrant
treats as private or confidential.
SECOND AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT
THIS SECOND AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT (this “Agreement”), dated as of December 14, 2023, is made and entered into by and among Mondee Holdings, Inc., a Delaware corporation (the “Company”) (formerly known as ITHAX Acquisition Corp., an exempted company incorporated in the Cayman Islands with limited liability), each person listed on the signature pages under the caption “Holders” or who execute a Joinder hereto pursuant to Section 5.2 hereof (collectively, the “Holders” and each, an “Holder”) and the holder of a majority of the Registrable Securities (as defined in the Amended and Restated Rights Agreement (as defined below)) (the “Required Holder”), which amends and restates that certain amended and restated registration rights agreement, dated as of October 17, 2023, by and among the Company and the investors party thereto (the “Amended and Restated Registration Rights Agreement”).
RECITALS
WHEREAS, on September 29, 2022 (the “Original Issue Date”), the Company and certain investors (such investors, collectively, the “Original Third-Party Investors”) entered into those Subscription Agreements (collectively, the “Original Subscription Agreement”) whereby the Original Third-Party Investors purchased an aggregate of 85,000 shares of preferred stock, par value $0.0001 per share, of the Company (the “Original Investor Shares”) in a transaction exempt from registration under the Securities Act;
WHEREAS, in connection with the sale of the Original Investor Shares, on the Original Issue Date, the Company entered into that certain warrant agreement, between the Company and Continental Stock Transfer & Trust Company, as warrant agent (the “Original Warrant Agreement”), pursuant to which the Company issued to the Original Third-Party Investors 1,275,000 Company warrants (the “Original Warrants”), which Original Warrants are exercisable into shares of Common Stock (the “Original Conversion Shares”);
WHEREAS, on each of October 17, 2023 and the date hereof, certain investors (such investors, the “Incremental Third-Party Investors” and, together with the Original Third-Party Investors, the “Third-Party Investors”) purchased an aggregate of 11,300 shares of Series A-3 preferred stock, par value $0.0001 per share, of the Company (the “Incremental Investor Shares”) in a transaction exempt from registration under the Securities Act pursuant to those certain Subscription Agreements, dated as of October 17, 2023 and the date hereof, entered into by and between the Company and the Incremental Third-Party Investors (the “Incremental Subscription Agreements” and, together with the Original Subscription Agreement, the “Subscription Agreements”);
WHEREAS, in connection with the sale of the Incremental Investor Shares, on the date hereof, the Company entered into that certain amended and restated warrant agreement, between the Company and Continental Stock Transfer & Trust Company, as warrant agent (the “Warrant Agreement”), pursuant to which the Company issued to the Incremental Third-Party Investors 1,275,000 warrants thereunder in exchange for surrendering their respective Original Warrants (the “Replacement Warrants”) and an additional 150,000 Company warrants plus an additional 19,500 whole warrants (the “Incremental Warrants” and, together with the Replacement Warrants, the “New Warrants”, and the New Warrants, together with the Original Warrants, the “Warrants”), which New Warrants are exercisable into shares of Common Stock (the “Incremental Conversion Shares” and, together with the Original Conversion Shares, the “Conversion Shares”);
WHEREAS, (i) the Company previously filed with the Commission (as defined hereinafter) a Registration Statement (File No. 333-271532) on Form S-1, which registered the resale of an aggregate of up to 79,019,171 shares of Common Stock (as defined hereinafter) (including certain shares of Common Stock held by the Original Third-Party Investors) and was declared effective by the Commission as of May 10, 2023, as supplemented thereafter with one or more final prospectuses, and (ii) pursuant to the Original Registration Rights Agreement, the Company filed with the Commission a Registration Statement (File No. 333- 268198) on Form S-1, which registered the resale of the Original Conversion Shares and was declared effective by the Commission as of December 9, 2022, which registration statements were amended by the post-effective amendment to Form S-1 on Form S-3 filed on August 14, 2023 and declared effective by the Commission on August 22, 2023 (such registration statements, collectively the “Existing Registration Statement” and such final prospectuses, collectively the “Initial Prospectus”); and, for the avoidance of doubt, the Existing Registration Statement and the Initial Prospectus constitute, solely to the extent of any portion of the Registrable Securities covered thereby, a Registration Statement and Prospectus (each as defined in this Agreement), respectively, under this Agreement.
WHEREAS, the parties desire to amend and restate the Amended and Restated Registration Rights Agreement hereby superseding and replacing the terms of the Amended and Restated Registration Rights Agreement, and the undersigned Required Holder has agreed to such amendments and modifications; and
NOW, THEREFORE, in consideration of the representations, covenants and agreements contained herein, and certain other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound, hereby agree as follows:
Article I
DEFINITIONS
Section 1.1Definitions. The terms defined in this Article I shall, for all purposes of this Agreement, have the respective meanings set forth below:
“Adverse Disclosure” shall mean any public disclosure of material non-public information, which disclosure, in the good faith judgment of the Chief Executive Officer or the Chief Financial Officer of the Company, after consultation with counsel to the Company, (i) would be required to be made in any Registration Statement or Prospectus in order for the applicable Registration Statement or Prospectus not to contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements contained therein (in the case of any prospectus and any preliminary prospectus, in the light of the circumstances under which they were made) not misleading, (ii) would not be required to be made at such time if the Registration Statement were not being filed, declared effective or used, as the case may be and (iii) the Company has a bona fide business purpose for not making such information public.
“Agreement” shall have the meaning given in the Preamble hereto.
“Amended and Restated Registration Rights Agreement” shall have the meaning given in the Preamble hereto.
“Block Trade” shall have the meaning given in Section 2.4.1.
“Board” shall mean the Board of Directors of the Company.
“Business Combination Agreement” shall mean that certain Business Combination Agreement, dated December 20, 2021, by and among ITHAX Acquisition Corp., a Cayman Islands exempted company and
predecessor to the Company, Mondee Holdings II, Inc., a Delaware corporation, and the other parties thereto.
“Closing Date” shall be the date hereof.
“Commission” shall mean the Securities and Exchange Commission.
“Common Stock” shall mean shares of Class A Common Stock, par value $0.0001, of the Company.
“Company” shall have the meaning given in the Preamble hereto and includes the Company’s successors by recapitalization, merger, consolidation, spin-off, reorganization or similar transaction.
“Conversion Shares” shall have the meaning set forth in the Recitals hereto.
“Demanding Holder” shall have the meaning given in Section 2.1.4.
“Exchange Act” shall mean the Securities Exchange Act of 1934, as it may be amended from time to time.
“Existing Registration Statement” shall have the meaning given in the Recitals hereto.
“Form S-1 Shelf” shall have the meaning given in Section 2.1.1.
“Form S-3 Shelf” shall have the meaning given in Section 2.1.1.
“Holder Information” shall have the meaning given in Section 4.1.2.
“Holders” shall have the meaning given in the Preamble hereto, for so long as such person or entity holds any Registrable Securities.
“Incremental Conversion Shares” shall have the meaning given in the Recitals hereto.
“Incremental Investor Shares” shall have the meaning given in the Recitals hereto.
“Incremental Subscription Agreements” shall have the meaning given in the Recitals hereto.
“Incremental Third-Party Investors” shall have the meaning given in the Recitals hereto.
“Incremental Warrants” shall have the meaning given in the Recitals hereto.
“Initial Prospectus” shall have the meaning given in the Recitals hereto.
“Investor Shares” shall have the meaning given in the Recitals hereto.
“Joinder” shall have the meaning given in Section 5.2.5.
“Maximum Number of Securities” shall have the meaning given in Section 2.1.5.
“Minimum Takedown Threshold” shall have the meaning given in Section 2.1.4.
“Misstatement” shall mean an untrue statement of a material fact or an omission to state a material fact required to be stated in a Registration Statement or Prospectus or necessary to make the statements in a Registration Statement or Prospectus (in the case of a Prospectus, in the light of the circumstances under which they were made) not misleading.
“New Warrants” shall have the meaning given in the Recitals hereto.
“Original Conversion Shares” shall have the meaning given in the Recitals hereto.
“Original Investor Shares” shall have the meaning given in the Recitals hereto.
“Original Issue Date” shall have the meaning given in the Recitals hereto.
“Original Registration Rights Agreement” shall mean that certain registration rights agreement, dated as of September 29, 2022, by and among the Company and the investors party thereto.
“Original Subscription Agreement” shall have the meaning given in the Recitals hereto.
“Original Third-Party Investors” shall have the meaning given in the Recitals hereto.
“Original Warrant Agreement” shall have the meaning given in the Recitals hereto.
“Original Warrants” shall have the meaning given in the Recitals hereto.
“Other Coordinated Offering” shall have the meaning given in Section 2.4.1.
“Permitted Transferees” shall mean any person or entity to whom such Holder is not prohibited from transferring such Registrable Securities in accordance with applicable law.
“Piggyback Registration” shall have the meaning given in Section 2.2.1.
“Prospectus” shall mean the prospectus included in any Registration Statement, as supplemented by any and all prospectus supplements and as amended by any and all post-effective amendments and including all material incorporated by reference in such prospectus.
“Registrable Security” shall mean (a) any outstanding shares of Common Stock or any other equity security (including warrants to purchase shares of Common Stock (including the Warrants) and shares of Common Stock issued or issuable upon the exercise of any such warrants (including the Warrants) or other equity security) of the Company held by a Holder immediately following the Closing Date; and (b) any other equity security of the Company or any of its subsidiaries issued or issuable with respect to any securities referenced in clause (a) above, including any Penalty Warrants (as defined in the Incremental Subscription Agreements) or by way of a stock dividend or stock split or in connection with a recapitalization, merger, consolidation, spin-off, reorganization or similar transaction; provided, however, that, as to any particular Registrable Security, such securities shall cease to be Registrable Securities upon the earliest to occur of: (A) a Registration Statement with respect to the sale of such securities shall have become effective under the Securities Act and such securities shall have been sold, transferred, disposed of or exchanged in accordance with such Registration Statement by the applicable Holder; (B) (i) such securities shall have been otherwise transferred, (ii) new certificates for such securities not bearing (or book entry positions not subject to) a legend restricting further Transfer shall have been delivered by the Company and (iii) subsequent public distribution of such securities shall not require registration under the Securities Act; (C) such securities shall have ceased to be outstanding; (D) such securities may be sold
without registration pursuant to Rule 144 or any successor rule promulgated under the Securities Act (but with no volume or other restrictions or limitations including as to manner or timing of sale); and (E) such securities have been sold to, or through, a broker, dealer or Underwriter in a public distribution or other public securities transaction.
“Registration” shall mean a registration, including any related Shelf Takedown, effected by preparing and filing a registration statement, Prospectus or similar document in compliance with the requirements of the Securities Act, and the applicable rules and regulations promulgated thereunder, and such registration statement becoming effective.
“Registration Expenses” shall mean the documented, out-of-pocket expenses of a Registration, including, without limitation, the following:
(A)all registration and filing fees (including fees with respect to filings required to be made with the Financial Industry Regulatory Authority, Inc.) and any national securities exchange on which the Common Stock is then listed;
(B)fees and expenses of compliance with securities or blue sky laws (including reasonable fees and disbursements of outside counsel for the Underwriters in connection with blue sky qualifications of Registrable Securities);
(C)printing, messenger, telephone and delivery expenses;
(D)fees and disbursements of counsel for the Company;
(E)fees and disbursements of all independent registered public accountants of the Company incurred specifically in connection with such Registration including the expenses of any special audits and/or “cold comfort” letters required by or incident to such performance and compliance;
(F)reasonable and documented fees and disbursements of counsel (including local and special counsel, to the extent necessary) incurred in connection with any registration statement or registered offering (including any Registration) covering Registrable Securities;
(G)in an Underwritten Offering or Other Coordinated Offering, reasonable and documented fees and expenses not to exceed $50,000 in the aggregate for each Registration of one (1) legal counsel selected by the majority-in-interest of the Demanding Holders; and
(H)any Underwriter marketing costs in connection with a Piggyback Registration.
“Registration Statement” shall mean any registration statement that covers Registrable Securities pursuant to the provisions of this Agreement (including the Existing Registration Statement, solely to the extent of any portion of the Registrable Securities covered thereby), including the Prospectus included in such registration statement (including the Initial Prospectus, solely to the extent of any portion of the Registrable Securities covered thereby), amendments (including post-effective amendments) and supplements to such registration statement, and all exhibits to and all material incorporated by reference in such registration statement.
“Replacement Warrants” shall have the meaning given in the Recitals hereto.
“Required Holder” shall have the meaning given in the Preamble hereto.
“Securities Act” shall mean the Securities Act of 1933, as amended from time to time.
“Shelf” shall mean the Form S-1 Shelf, the Form S-3 Shelf or any Subsequent Shelf Registration Statement, as the case may be.
“Shelf Registration” shall mean a registration of securities pursuant to a registration statement filed with the Commission in accordance with and pursuant to Rule 415 promulgated under the Securities Act (or any successor rule then in effect).
“Shelf Takedown” shall mean an Underwritten Shelf Takedown or any proposed Transfer or sale using a Registration Statement, including a Piggyback Registration.
“Subscription Agreements” shall have the meaning set forth in the Recitals hereto.
“Subsequent Shelf Registration Statement” shall have the meaning given in Section 2.1.2.
“Third-Party Investors” shall have the meaning set forth in the Recitals hereto.
“Transfer” shall mean the (a) sale or assignment of, offer to sell, contract or agreement to sell, hypothecate, pledge, grant of any option to purchase or otherwise dispose of or agreement to dispose of, directly or indirectly, or establishment or increase of a put equivalent position or liquidation with respect to or decrease of a call equivalent position within the meaning of Section 16 of the Exchange Act with respect to, any security, (b) entry into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any security, whether any such transaction is to be settled by delivery of such securities, in cash or otherwise, or (c) public announcement of any intention to effect any transaction specified in clause (a) or (b).
“Underwriter” shall mean a securities dealer who purchases any Registrable Securities as principal in an Underwritten Offering and not as part of such dealer’s market-making activities.
“Underwritten Offering” shall mean a Registration in which securities of the Company are sold to an Underwriter in a firm commitment underwriting for distribution to the public.
“Underwritten Shelf Takedown” shall have the meaning given in Section 2.1.4.
“Warrant Agreement” shall have the meaning set forth in the Recitals hereto.
“Warrants” shall have the meaning set forth in the Recitals hereto.
“Withdrawal Notice” shall have the meaning given in Section 2.1.6.
Article II
REGISTRATIONS AND OFFERINGS
Section 1.1Shelf Registration.
1.1.1Filing. Within thirty (30) calendar days following the Closing Date, the Company shall submit to or file with the Commission a Registration Statement for a Shelf Registration on Form S-1 (the “Form S-1 Shelf”) or a Registration Statement for a Shelf Registration on Form S-3 (the “Form S-3 Shelf”), if the Company is then eligible to use a Form S-3 Shelf, in each case, covering the resale of all the Registrable Securities that are not at that time covered by the Existing Registration Statement (as then
in effect and available for resale of the Registrable Securities covered thereby) (determined as of two (2) business days prior to such submission or filing) on a delayed or continuous basis and shall use its commercially reasonable efforts to have such Shelf declared effective as soon as practicable after the filing thereof, but no later than the earlier of (a) the ninetieth (90th) calendar day (or 120th calendar day if the Commission notifies the Company that it will “review” the Registration Statement) following the Closing Date, and (b) the tenth (10th) business day after the date the Company 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. Such Shelf shall provide for the resale of the Registrable Securities included therein pursuant to any method or combination of methods legally available to, and requested by, any Holder named therein. The Company shall maintain a Shelf in accordance with the terms hereof, and shall prepare and file with the Commission such amendments, including post-effective amendments, and supplements as may be necessary to keep a Shelf continuously effective, available for use to permit the Holders named therein to sell their Registrable Securities included therein and in compliance with the provisions of the Securities Act until such time as there are no longer any Registrable Securities. In the event the Company files a Form S-1 Shelf, the Company shall use its commercially reasonable efforts to (i) convert the Form S-1 Shelf (and any Subsequent Shelf Registration Statement) to a Form S-3 Shelf or (ii) file a Form S-3 Shelf, as the case may be, in each case, as soon as practicable after the Company is eligible to use Form S-3. The Company’s obligation under this Section 2.1.1, shall, for the avoidance of doubt, be subject to Section 3.4.
1.1.2Subsequent Shelf Registration. If any Shelf ceases to be effective under the Securities Act for any reason at any time while Registrable Securities are still outstanding, the Company shall, subject to Section 3.4, use its commercially reasonable efforts to as promptly as is reasonably practicable cause such Shelf to again become effective under the Securities Act (including using its commercially reasonable efforts to obtain the prompt withdrawal of any order suspending the effectiveness of such Shelf), and shall use its commercially reasonable efforts to as promptly as is reasonably practicable amend such Shelf in a manner reasonably expected to result in the withdrawal of any order suspending the effectiveness of such Shelf or file an additional registration statement as a Shelf Registration (a “Subsequent Shelf Registration Statement”) registering the resale of all Registrable Securities (determined as of two (2) business days prior to such filing), and pursuant to any method or combination of methods legally available to, and requested by, any Holder named therein. If a Subsequent Shelf Registration Statement is filed, the Company shall use its commercially reasonable efforts to (i) cause such Subsequent Shelf Registration Statement to become effective under the Securities Act as promptly as is reasonably practicable after the filing thereof (it being agreed that the Subsequent Shelf Registration Statement shall be an automatic shelf registration statement (as defined in Rule 405 promulgated under the Securities Act) if the Company is a well-known seasoned issuer (as defined in Rule 405 promulgated under the Securities Act) at the most recent applicable eligibility determination date) and (ii) keep such Subsequent Shelf Registration Statement continuously effective, available for use to permit the Holders named therein to sell their Registrable Securities included therein and in compliance with the provisions of the Securities Act until such time as there are no longer any Registrable Securities. Any such Subsequent Shelf Registration Statement shall be on Form S-3 to the extent that the Company is eligible to use such form. Otherwise, such Subsequent Shelf Registration Statement shall be on another appropriate form. The Company’s obligation under this Section 2.1.2, shall, for the avoidance of doubt, be subject to Section 3.4.
1.1.3Additional Registrable Securities. Subject to Section 3.4, in the event that any Holder holds Registrable Securities that are not registered for resale on a delayed or continuous basis, the Company, upon written request of a Holder, shall promptly use its commercially reasonable efforts to cause the resale of such Registrable Securities to be covered by either, at the Company’s option, any then available Shelf (including by means of a post-effective amendment) or by filing a Subsequent Shelf Registration Statement and cause the same to become effective as soon as practicable after such filing and such Shelf or Subsequent Shelf Registration Statement shall be subject to the terms hereof; provided,
however, that the Company shall only be required to cause such Registrable Securities to be so covered twice per calendar year for each of the Holders.
1.1.4Requests for Underwritten Shelf Takedowns. Subject to Section 3.4, at any time and from time to time when an effective Shelf is on file with the Commission, a Holder (any of the Holders being in such case, a “Demanding Holder”) may request to sell all or any portion of its Registrable Securities in an Underwritten Offering that is registered pursuant to the Shelf (each, an “Underwritten Shelf Takedown”); provided that the Company shall only be obligated to effect an Underwritten Shelf Takedown if such offering shall include Registrable Securities proposed to be sold by the Demanding Holder, either individually or together with other Demanding Holders, with an anticipated gross aggregate offering price of at least $10 million (the “Minimum Takedown Threshold”). All requests for Underwritten Shelf Takedowns shall be made by giving written notice to the Company, which shall specify the approximate number of Registrable Securities proposed to be sold in the Underwritten Shelf Takedown. Subject to Section 2.4.4, the Company shall have the right to select the Underwriters for such offering (which shall consist of one or more reputable nationally recognized investment banks), subject to the initial Demanding Holder’s prior approval (which shall not be unreasonably withheld, conditioned or delayed). The Holders may demand not more than two (2) Underwritten Shelf Takedowns pursuant to this Section 2.1.4 in any twelve (12) month period (such rights, in each such case, a “Demand”). Notwithstanding anything to the contrary in this Agreement, the Company may effect any Underwritten Offering pursuant to any then effective Registration Statement, including a Form S-3, which is then available for such offering.
1.1.5Reduction of Underwritten Offering. If the Underwriter in an Underwritten Shelf Takedown advises the Demanding Holders in writing that marketing factors require a limitation of the number of shares to be underwritten, then the Demanding Holders shall so advise all Holders of Registrable Securities that would otherwise be underwritten pursuant hereto, and the number of shares of Registrable Securities that may be included in the underwriting (such maximum number of such securities, the “Maximum Number of Securities”) shall be allocated among all participating Holders thereof, including the Demanding Holders, in proportion (as nearly as practicable) to the amount of Registrable Securities of the Company owned by each participating Holder; provided, however, that the number of shares of Registrable Securities to be included in such underwriting shall not be reduced unless all other securities are first entirely excluded from the underwriting.
1.1.6Withdrawal. Prior to the filing of the applicable “red herring” prospectus or prospectus supplement used for marketing such Underwritten Shelf Takedown, a majority-in-interest of the Demanding Holders initiating an Underwritten Shelf Takedown shall have the right to withdraw from such Underwritten Shelf Takedown for any or no reason whatsoever upon written notification (a “Withdrawal Notice”) to the Company and the Underwriter or Underwriters (if any) of their intention to withdraw from such Underwritten Shelf Takedown; provided that the Holders may elect to have the Company continue an Underwritten Shelf Takedown if the Minimum Takedown Threshold would still be satisfied by the Registrable Securities proposed to be sold in the Underwritten Shelf Takedown by the Holders or any of their respective Permitted Transferees, as applicable. If withdrawn, a Demand for an Underwritten Shelf Takedown shall constitute a Demand for an Underwritten Shelf Takedown by the withdrawing Demanding Holder for purposes of Section 2.1.4, unless either (i) such Demanding Holder has not previously withdrawn any Underwritten Shelf Takedown or (ii) such Demanding Holder reimburses the Company for all Registration Expenses with respect to such Underwritten Shelf Takedown (or, if there is more than one Demanding Holder, a pro rata portion of such Registration Expenses based on the respective number of Registrable Securities that each Demanding Holder has requested be included in such Underwritten Shelf Takedown); provided that, if the Holders elect to continue an Underwritten Shelf Takedown pursuant to the proviso in the immediately preceding sentence, such Underwritten Shelf Takedown shall instead count as an Underwritten Shelf Takedown demanded by the Holders for purposes of Section 2.1.4. Following the receipt of any Withdrawal Notice, the Company shall promptly forward
such Withdrawal Notice to any other Holders that had elected to participate in such Shelf Takedown. Notwithstanding anything to the contrary in this Agreement, the Company shall be responsible for the Registration Expenses incurred in connection with a Shelf Takedown prior to its withdrawal under this Section 2.1.6, other than if a Demanding Holder elects to pay such Registration Expenses pursuant to clause (ii) of the second sentence of this Section 2.1.6.
Section 1.2Piggyback Registration.
1.1.1Piggyback Rights. If (but without any obligation to do so) the Company proposes to register (including for this purpose a registration effected by the Company for holders of capital stock other than the Holders) any of its Common Stock under the Securities Act in connection with the public offering of such securities solely for cash (other than (i) the registration statement on Form S-1 (File No. 333-266277) and any post-effective amendments thereto (except to the extent such registration statement is amended or supplemented after the Original Issue Date to include additional shares of Common Stock or warrants of the Company, any shares of Common Stock or warrants of the Company to be sold for the account of the Company, or any additional selling stockholders not already named therein, but excluding any amendment or supplement to reflect transactions arising out of or in connection with the Business Combination Agreement), (ii) a registration relating solely to the sale of securities to participants in a Company stock or other benefit plan, (iii) a transaction covered by Rule 145 under the Securities Act, (iv) a registration in which the only stock being registered is Common Stock issuable upon conversion of debt securities which are also being registered, (v) for a dividend reinvestment plan or (vi) any registration on any form which does not include substantially the same information as would be required to be included in a registration statement covering the sale of the Registrable Securities), then the Company shall give written notice of such proposed offering to all of the Holders of Registrable Securities as soon as practicable but not less than ten (10) days before the anticipated filing date of such Registration Statement or, in the case of an Underwritten Offering pursuant to a Shelf Registration, the applicable “red herring” prospectus or prospectus supplement used for marketing such offering, which notice shall (A) describe the amount and type of securities to be included in such offering, the intended method(s) of distribution, and the name of the proposed managing Underwriter or Underwriters, if any, in such offering, and (B) offer to all of the Holders of Registrable Securities the opportunity to include in such registered offering such number of Registrable Securities as such Holders may request in writing within five (5) days after receipt of such written notice (such registered offering, a “Piggyback Registration”). Subject to Section 2.2.2, the Company shall cause such Registrable Securities to be included in such Piggyback Registration and, if applicable, shall use its commercially reasonable efforts to cause the managing Underwriter or Underwriters of such Piggyback Registration to permit the Registrable Securities requested by the Holders pursuant to this Section 2.2.1 to be included therein on the same terms and conditions as any similar securities of the Company included in such registered offering and to permit the sale or other disposition of such Registrable Securities in accordance with the intended method(s) of distribution thereof. The inclusion of any Holder’s Registrable Securities in a Piggyback Registration shall be subject to such Holder agreement to enter into an underwriting agreement in customary form with the Underwriter(s) selected for such Underwritten Offering.
1.1.2Reduction of Piggyback Registration. If the total amount of securities, including Registrable Securities, requested by Holders of Registrable Securities to be included in such offering exceeds the amount of securities sold other than by the Company that the Underwriters determine in their reasonable discretion is compatible with the success of the offering, then the Company shall be required to include in the offering only that number of such securities, including Registrable Securities, which the Underwriters determine in their reasonable discretion will not jeopardize the success of the offering (the securities so included to be apportioned pro rata among the selling security holders according to the total amount of securities entitled to be included therein owned by each selling security holder or in such other proportions as shall mutually be agreed to by such selling security holders). For purposes of the preceding parenthetical concerning apportionment, for any selling security holder which is a Holder of Registrable
Securities and which is a partnership or corporation, the partners, retired partners and holders of capital stock of such Holder, or the estates and family members of any such partners and retired partners and any trusts for the benefit of any of the foregoing persons shall be deemed to be a single “selling security holder,” and any pro-rata reduction with respect to such “selling security holder” shall be based upon the aggregate number of Registrable Securities owned by all entities and individuals included in such “selling security holder,” as defined in this sentence.
1.1.3Piggyback Registration Withdrawal. Any Holder of Registrable Securities (other than a Demanding Holder, whose right to withdraw from an Underwritten Shelf Takedown, and related obligations, shall be governed by Section 2.1.6) shall have the right to withdraw from a Piggyback Registration for any or no reason whatsoever upon written notification to the Company and the Underwriter or Underwriters (if any) of his, her or its intention to withdraw from such Piggyback Registration prior to the effectiveness of the Registration Statement filed with the Commission with respect to such Piggyback Registration or, in the case of a Piggyback Registration pursuant to a Shelf Registration, the filing of the applicable “red herring” prospectus or prospectus supplement with respect to such Piggyback Registration used for marketing such transaction. The Company (whether on its own good faith determination or as the result of a request for withdrawal by persons or entities pursuant to separate written contractual obligations) may withdraw a Registration Statement filed with the Commission in connection with a Piggyback Registration (which, in no circumstance, shall include a Shelf) at any time prior to the effectiveness of such Registration Statement. Notwithstanding anything to the contrary in this Agreement (other than Section 2.1.6), the Company shall be responsible for the Registration Expenses incurred in connection with the Piggyback Registration prior to its withdrawal under this Section 2.2.3.
1.1.4Unlimited Piggyback Registration Rights. For purposes of clarity, subject to Section 2.1.6, any Piggyback Registration effected pursuant to Section 2.2 hereof shall not be counted as a Demand for an Underwritten Shelf Takedown under Section 2.1.4 hereof.
Section 1.3Market Stand-off. In connection with any Underwritten Offering of equity securities of the Company (other than a Block Trade or Other Coordinated Offering), if requested by the managing Underwriters, each Holder that is an executive officer, director or Holder in excess of five percent (5 %) of the outstanding Common Stock (and for which it is customary for such a Holder to agree to a lock-up) agrees that it shall not Transfer any shares of Common Stock or other equity securities of the Company (other than those included in such offering pursuant to this Agreement), without the prior written consent of the Company, during the forty-five (45)-day period (or such shorter time agreed to by the managing Underwriters) beginning on the date of pricing of such offering, except as expressly permitted by such lock-up agreement or in the event the managing Underwriters otherwise agree by written consent; provided, however, with respect to the first Underwritten Offering following the Original Issue Date, if the managing Underwriters, in their reasonable discretion, advise the Company in writing that a lock-up restriction of a period of forty-five (45) or fewer days would have a material adverse impact on such Underwritten Offering, then such lock-up restrictions shall be for the number of days such managing Underwriters so advise, not to exceed a period of ninety (90) days from the date of the pricing of any such Underwritten Offering. Each such Holder agrees to execute a customary lock-up agreement in favor of the Underwriters to such effect (in each case on substantially the same terms and conditions as all such Holders).
Section 1.4Block Trades; Other Coordinated Offerings.
1.1.1Notwithstanding any other provision of this Article II, but subject to Section 3.4, at any time and from time to time when an effective Shelf is on file with the Commission, if a Demanding Holder wishes to engage in (a) an underwritten registered offering not involving a “roadshow,” an offer commonly known as a “block trade” (a “Block Trade”) or (b) an “at the market” or similar registered
offering through a broker, sales agent or distribution agent, whether as agent or principal, (an “Other Coordinated Offering”), in each case, with an anticipated aggregate offering price of, either (x) at least $5 million or (y) all remaining Registrable Securities held by the Demanding Holder, then such Demanding Holder only needs to notify the Company of the Block Trade or Other Coordinated Offering at least five (5) business days prior to the day such offering is to commence and the Company shall as expeditiously as possible use its commercially reasonable efforts to facilitate such Block Trade or Other Coordinated Offering; provided that the Demanding Holders representing a majority of the Registrable Securities wishing to engage in the Block Trade or Other Coordinated Offering shall use commercially reasonable efforts to work with the Company and any Underwriters, brokers, sales agents or placement agents prior to making such request in order to facilitate preparation of the registration statement, prospectus and other offering documentation related to the Block Trade or Other Coordinated Offering.
1.1.2Prior to the filing of the applicable “red herring” prospectus or prospectus supplement used in connection with a Block Trade or Other Coordinated Offering, a majority-in-interest of the Demanding Holders initiating such Block Trade or Other Coordinated Offering shall have the right to submit a Withdrawal Notice to the Company, the Underwriter or Underwriters (if any) and any brokers, sale agents or placement agents (if any) of their intention to withdraw from such Block Trade or Other Coordinated Offering. Notwithstanding anything to the contrary in this Agreement, the Company shall be responsible for the Registration Expenses incurred in connection with a Block Trade or Other Coordinated Offering prior to its withdrawal under this Section 2.4.2.
1.1.3Notwithstanding anything to the contrary in this Agreement, Section 2.2 shall not apply to a Block Trade or Other Coordinated Offering initiated by a Demanding Holder pursuant to this Agreement.
1.1.4The Demanding Holder in a Block Trade or Other Coordinated Offering shall have the right to select the Underwriters and any brokers, sale agents or placement agents (if any) for such Block Trade or Other Coordinated Offering (in each case, which shall consist of one or more reputable nationally recognized investment banks).
1.1.5A Holder may demand no more than two (2) Block Trades or Other Coordinated Offerings pursuant to this Section 2.4 in any twelve (12) month period. For the avoidance of doubt, any Block Trade or Other Coordinated Offering effected pursuant to this Section 2.4 shall not be counted as a demand for an Underwritten Shelf Takedown pursuant to Section 2.1.4 hereof.
Article III
COMPANY PROCEDURES
Section 1.1General Procedures. In connection with any Shelf and/or Shelf Takedown, the Company shall use its commercially reasonable efforts to effect such Registration to permit the sale of such Registrable Securities in accordance with the intended plan of distribution thereof (and including all manners of distribution in such Registration Statement as Holders may reasonably request in connection with the filing of such Registration Statement and as permitted by law, including distribution of Registrable Securities to a Holder’s members, security holders or partners), and pursuant thereto the Company shall, as expeditiously as possible:
1.1.1prepare and file with the Commission as soon as practicable a Registration Statement with respect to such Registrable Securities and use its commercially reasonable efforts to cause such Registration Statement to become effective and remain effective until all Registrable Securities have ceased to be Registrable Securities, in each case, in accordance with Section 2.1.1;
1.1.2prepare and file with the Commission such amendments and post-effective amendments to the Registration Statement, and such supplements to the Prospectus, as may be reasonably requested by any Holder that holds at least five percent (5%) of the Registrable Securities registered on such Registration Statement or any Underwriter of Registrable Securities or as may be required by the rules, regulations or instructions applicable to the registration form used by the Company or by the Securities Act or rules and regulations thereunder to keep the Registration Statement effective until all Registrable Securities covered by such Registration Statement are sold;
1.1.3prior to filing a Registration Statement or Prospectus, or any amendment or supplement thereto, furnish without charge to the Underwriters, if any, and the Holders of Registrable Securities included in such Registration, and such Holders’ legal counsel, copies of such Registration Statement as proposed to be filed, each amendment and supplement to such Registration Statement (in each case including all exhibits thereto and documents incorporated by reference therein), the Prospectus included in such Registration Statement (including each preliminary Prospectus), and such other documents as the Underwriters and the Holders of Registrable Securities included in such Registration or the legal counsel for any such Holders may request in order to facilitate the disposition of the Registrable Securities owned by such Holders;
1.1.4prior to any public offering of Registrable Securities, use its commercially reasonable efforts to (i) register or qualify the Registrable Securities covered by the Registration Statement under such securities or “blue sky” laws of such jurisdictions in the United States as the Holders of Registrable Securities included in such Registration Statement (in light of their intended plan of distribution) may request (or provide evidence satisfactory to such Holders that the Registrable Securities are exempt from such registration or qualification) and (ii) take such action necessary to cause such Registrable Securities covered by the Registration Statement to be registered with or approved by such other governmental authorities as may be necessary by virtue of the business and operations of the Company and do any and all other acts and things that may be necessary or advisable to enable the Holders of Registrable Securities included in such Registration Statement to consummate the disposition of such Registrable Securities in such jurisdictions; provided, however, that the Company shall not be required to qualify generally to do business in any jurisdiction where it would not otherwise be required to qualify or take any action to which it would be subject to general service of process or taxation in any such jurisdiction where it is not then otherwise so subject;
1.1.5cause all such Registrable Securities to be listed on each national securities exchange on which similar securities issued by the Company are then listed;
1.1.6provide a transfer agent or warrant agent, as applicable, and registrar for all such Registrable Securities no later than the effective date of such Registration Statement;
1.1.7advise each seller of such Registrable Securities, promptly after it shall receive notice or obtain knowledge thereof, of the issuance of any stop order by the Commission suspending the effectiveness of such Registration Statement or the initiation or threatening of any proceeding for such purpose and promptly use its commercially reasonable efforts to prevent the issuance of any stop order or to obtain its withdrawal if such stop order should be issued;
1.1.8at least five (5) days prior to the filing of any Registration Statement or Prospectus or any amendment or supplement to such Registration Statement or Prospectus (or such shorter period of time as may be (a) necessary in order to comply with the Securities Act, the Exchange Act, and the rules and regulations promulgated under the Securities Act or Exchange Act, as applicable or (b) advisable in order to reduce the number of days that sales are suspended pursuant to Section 3.4),
furnish a copy thereof to each seller of such Registrable Securities or its counsel (excluding any exhibits thereto and any filing made under the Exchange Act that is to be incorporated by reference therein);
1.1.9promptly notify the Holders in writing at any time when a Prospectus relating to such Registration Statement is required to be delivered under the Securities Act, of the happening of any event as a result of which the Prospectus included in such Registration Statement, as then in effect, includes a Misstatement, and then to correct such Misstatement as set forth in Section 3.4;
1.1.10in the event of an Underwritten Offering, a Block Trade, an Other Coordinated Offering, or sale by a broker, placement agent or sales agent pursuant to such Registration, permit a representative of the Holders, the Underwriters or other financial institutions facilitating such Underwritten Offering, Block Trade, Other Coordinated Offering or other sale pursuant to such Registration, if any, and any attorney, consultant or accountant retained by such Holders or Underwriter to participate, at each such person’s or entity’s own expense, in the preparation of the Registration Statement, and cause the Company’s officers, directors and employees to supply all information reasonably requested by any such representative, Underwriter, financial institution, attorney, consultant or accountant in connection with the Registration; provided, however, that such representatives, Underwriters or financial institutions agree to confidentiality arrangements in form and substance reasonably satisfactory to the Company, prior to the release or disclosure of any such information;
1.1.11obtain a “cold comfort” letter from the Company’s independent registered public accountants in the event of an Underwritten Offering, a Block Trade, an Other Coordinated Offering or sale by a broker, placement agent or sales agent pursuant to such Registration (subject to such broker, placement agent or sales agent providing such certification or representation reasonably requested by the Company’s independent registered public accountants and the Company’s counsel) in customary form and covering such matters of the type customarily covered by “cold comfort” letters as the managing Underwriter may reasonably request, and reasonably satisfactory to a majority-in-interest of the participating Holders;
1.1.12in the event of an Underwritten Offering, a Block Trade, an Other Coordinated Offering or sale by a broker, placement agent or sales agent pursuant to such Registration, on the date the Registrable Securities are delivered for sale pursuant to such Registration, obtain an opinion, dated such date, of counsel representing the Company for the purposes of such Registration, addressed to the participating Holders, the broker, placement agents or sales agent, if any and the Underwriters, if any, covering such legal matters with respect to the Registration in respect of which such opinion is being given as the participating Holders, broker, placement agent, sales agent or Underwriter may reasonably request and as are customarily included in such opinions and negative assurance letters, as applicable;
1.1.13in the event of any Underwritten Offering, a Block Trade, an Other Coordinated Offering or sale by a broker, placement agent or sales agent pursuant to such Registration, enter into and perform its obligations under an underwriting or other purchase or sales agreement, in usual and customary form, with the managing Underwriter or the broker, placement agent or sales agent of such offering or sale;
1.1.14make available to its security holders, as soon as reasonably practicable, an earnings statement covering the period of at least twelve (12) months beginning with the first day of the Company’s first full calendar quarter after the effective date of the Registration Statement which satisfies the provisions of Section 11(a) of the Securities Act and Rule 158 thereunder (or any successor rule then in effect);
1.1.15with respect to an Underwritten Offering pursuant to Section 2.1.4, use its commercially reasonable efforts to make available senior executives of the Company to participate in customary “road show” presentations that may be reasonably requested by the Underwriter in such Underwritten Offering; and
1.1.16otherwise, in good faith, cooperate reasonably with, and take such customary actions as may reasonably be requested by the participating Holders, consistent with the terms of this Agreement, in connection with such Registration.
Notwithstanding the foregoing, the Company shall not be required to provide any documents or information to an Underwriter or broker, sales agent or placement agent if such Underwriter or broker, sales agent or placement agent has not then been named with respect to the applicable Underwritten Offering or other offering involving a registration as an Underwriter or broker, sales agent or placement agent, as applicable.
Section 1.2Registration Expenses. The Registration Expenses of all Registrations shall be borne by the Company. It is acknowledged by the Holders that the Holders shall bear all incremental selling expenses relating to the sale of Registrable Securities, such as Underwriters’ commissions and discounts, brokerage fees, Underwriter marketing costs (except in connection with a Piggyback Registration) and, other than as set forth in the definition of “Registration Expenses,” all fees and expenses of any legal counsel representing the Holders.
Section 1.3Requirements for Participation in Registration Statement in Offerings. Notwithstanding anything in this Agreement to the contrary, if any Holder does not provide the Company with its requested Holder Information, the Company may exclude such Holder’s Registrable Securities from the applicable Registration Statement or Prospectus if the Company determines, based on the advice of counsel, that such information is necessary to effect the registration of the applicable Registration Statement or Prospectus and such Holder continues thereafter to withhold such information. No person or entity may participate in any Underwritten Offering or other offering for equity securities of the Company pursuant to a Registration initiated by the Company hereunder unless such person or entity (i) agrees to sell such person’s or entity’s securities on the basis provided in any underwriting, sales, distribution or placement arrangements approved by the Company and (ii) completes and executes all customary questionnaires, powers of attorney, indemnities, lock-up agreements, underwriting or other agreements and other customary documents as may be reasonably required under the terms of such underwriting, sales, distribution or placement arrangements. The exclusion of a Holder’s Registrable Securities as a result of this Section 3.3 shall not affect the registration of the other Registrable Securities to be included in such Registration.
Section 1.4Suspension of Sales; Adverse Disclosure; Restrictions on Registration Rights.
1.1.1Upon receipt of written notice from the Company that a Registration Statement or Prospectus contains a Misstatement, each of the Holders shall forthwith discontinue disposition of Registrable Securities until it has received copies of a supplemented or amended Prospectus correcting the Misstatement (it being understood that the Company hereby covenants to prepare and file such supplement or amendment as soon as practicable after the time of such notice), or until it is advised in writing by the Company that the use of the Prospectus may be resumed (which the Company undertakes to provide as promptly as practicable once such Misstatement is corrected or otherwise no longer exists).
1.1.2If the filing, initial effectiveness or continued use of a Registration Statement in respect of any Registration at any time would (a) require the Company to make an Adverse Disclosure, (b) require the inclusion in such Registration Statement of financial statements that are unavailable to the
Company for reasons beyond the Company’s control or (c) in the good faith judgment of the Board, be seriously detrimental to the Company and its holders of capital stock and it is therefore essential to defer such filing, initial effectiveness or continued use at such time, the Company shall have the right, upon giving prompt written notice of such action to the Holders (which notice shall not specify the nature of the event giving rise to such delay or suspension), delay the filing or initial effectiveness of, or suspend use of, such Registration Statement for the shortest period of time determined in good faith by the Company to be necessary for such purpose. In the event the Company exercises its rights under this Section 3.4.2, the Holders agree to suspend, immediately upon their receipt of the notice referred to above, their use of the Prospectus relating to any Registration in connection with any sale or offer to sell Registrable Securities until such Holder receives written notice from the Company that such sales or offers of Registrable Securities may be resumed, and in each case maintain the confidentiality of such notice and its contents.
1.1.3(a) During the period starting with the date ninety (90) days prior to the Company’s good faith estimate of the date of the filing of, and ending on a date ninety (90) days after the effective date of, a Company-initiated Registration and provided that the Company continues to actively employ, in good faith, all reasonable efforts to maintain the effectiveness of the applicable Shelf Registration Statement, or (b) if, pursuant to Section 2.1.4, Holders have requested an Underwritten Shelf Takedown and the Company and Holders are unable to obtain the commitment of Underwriters to firmly underwrite such offering, the Company may, upon giving prompt written notice of such action to the Holders, delay any other registered offering pursuant to Section 2.1.4 or Section 2.4 for not more than ninety (90) consecutive calendar days or more than one hundred twenty (120) total calendar days in each case during any twelve (12)-month period.
Section 1.5Reporting Obligations. As long as any Holder shall own Registrable Securities, the Company, at all times while it shall be a reporting company under the Exchange Act, covenants to file timely (or obtain extensions in respect thereof and file within the applicable grace period) all reports required to be filed by the Company after the Original Issue Date pursuant to Sections 13(a) or 15(d) of the Exchange Act and to promptly furnish the Holders with true and complete copies of all such filings; provided that any documents publicly filed or furnished with the Commission pursuant to the Electronic Data Gathering, Analysis and Retrieval System shall be deemed to have been furnished or delivered to the Holders pursuant to this Section 3.5. The Company further covenants that it shall take such further action as any Holder may reasonably request, all to the extent required from time to time to enable such Holder to sell the Registrable Securities held by such Holder without registration under the Securities Act within the limitation of the exemptions provided by Rule 144 promulgated under the Securities Act (or any successor rule then in effect). Upon the request of any Holder, the Company shall deliver to such Holder a written certification of a duly authorized officer as to whether it has complied with such requirements.
Article IV
INDEMNIFICATION AND CONTRIBUTION
Section 1.1Indemnification.
1.1.1The Company agrees to indemnify, to the extent permitted by law, each Holder of Registrable Securities, its officers, managers, directors, affiliates, and agents and each person or entity who controls such Holder (within the meaning of the Securities Act), against all losses, claims, damages, liabilities and out-of-pocket expenses (including, without limitation, reasonable outside attorneys’ fees) caused by, resulting from, arising out of or based upon any untrue or alleged untrue statement of material fact contained in or incorporated by reference in any Registration Statement, Prospectus 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, in the case of the Prospectus or preliminary Prospectus in the light of the circumstances under which they were made, not
misleading, except insofar as the same are caused by or contained in any information or affidavit so furnished in writing to the Company by or on behalf of such Holder expressly for use therein. The Company shall indemnify the Underwriters, their officers and directors and each person or entity who controls such Underwriters (within the meaning of the Securities Act) to the same extent as provided in the foregoing with respect to the indemnification of the Holder.
1.1.2In connection with any Registration Statement in which a Holder of Registrable Securities is participating, such Holder shall furnish (or cause to be furnished) to the Company in writing such information and affidavits as the Company reasonably requests for use in connection with any such Registration Statement, Prospectus or preliminary Prospectus (the “Holder Information”) and, to the extent permitted by law, shall indemnify the Company, its officers, managers, directors, affiliates and agents and each person or entity who controls the Company (within the meaning of the Securities Act) against all losses, claims, damages, liabilities and out-of-pocket expenses (including, without limitation, reasonable outside attorneys’ fees) resulting from any untrue or alleged untrue statement of material fact contained or incorporated by reference in any Registration Statement, Prospectus 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, in the case of the Prospectus or preliminary Prospectus in the light of the circumstances under which they were made, not misleading, but only to the extent that such untrue statement or omission is contained in (or not contained in, in the case of an omission) any information or affidavit so furnished in writing by or on behalf of such Holder expressly for use therein; provided, however, that the obligation to indemnify shall be several, not joint and several, among such Holders of Registrable Securities, and the liability of each such Holder of Registrable Securities shall be in proportion to and limited to the net proceeds received by such Holder from the sale of Registrable Securities pursuant to such Registration Statement. The Holders of Registrable Securities shall indemnify the Underwriters, their officers, directors and each person or entity who controls such Underwriters (within the meaning of the Securities Act) to the same extent as provided in the foregoing with respect to indemnification of the Company.
1.1.3Any person or entity 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 or entity’s right to indemnification hereunder to the extent such failure has not materially prejudiced the indemnifying party) and (ii) unless in such indemnified party’s reasonable judgment 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 (but such consent shall not be unreasonably withheld). An indemnifying party who is not entitled to, or 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 any indemnified party a conflict of interest may exist 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) or which settlement includes a statement or admission of fault and culpability on the part of such indemnified party or which settlement does not 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.
1.1.4The 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 or controlling person or entity of such indemnified party and shall survive the Transfer of
securities. The Company and each Holder of Registrable Securities participating in an offering also agrees to make such provisions as are reasonably requested by any indemnified party for contribution to such party in the event the Company’s or such Holder’s indemnification is unavailable for any reason.
1.1.5If the indemnification provided under Section 4.1 from the indemnifying party is unavailable or insufficient to hold harmless an indemnified party in respect of any losses, claims, damages, liabilities and out-of-pocket expenses referred to herein, then the indemnifying party, in lieu of indemnifying the indemnified party, shall contribute to the amount paid or payable by the indemnified party as a result of such losses, claims, damages, liabilities and out-of-pocket 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 not made by, in the case of an omission), or relates to information supplied by (or not supplied by in the case of an omission), 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; provided, however, that the liability of any Holder under this Section 4.1.5 shall be limited to the amount of the net proceeds received by such Holder in such offering giving rise to such liability. 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 in Section 4.1.1, Section 4.1.2 and Section 4.1.3 above, any legal or other fees, charges or out-of-pocket expenses reasonably incurred by such party in connection with any investigation or proceeding. The parties hereto agree that it would not be just and equitable if contribution pursuant to this Section 4.1.5 were determined by pro rata allocation or by any other method of allocation, which does not take account of the equitable considerations referred to in this Section 4.1.5. No person or entity guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution pursuant to this Section 4.1.5 from any person or entity who was not guilty of such fraudulent misrepresentation.
Article V
MISCELLANEOUS
Section 1.1Notices. Any notice or communication under this Agreement must be in writing and given by (i) deposit in the United States mail, addressed to the party to be notified, postage prepaid and registered or certified with return receipt requested, (ii) delivery in person or by courier service providing evidence of delivery, or (iii) transmission by hand delivery, electronic mail or facsimile. Each notice or communication that is mailed, delivered, or transmitted in the manner described above shall be deemed sufficiently given, served, sent, and received, in the case of mailed notices, on the third business day following the date on which it is mailed and, in the case of notices delivered by courier service, hand delivery, electronic mail or facsimile, at such time as it is delivered to the addressee (with the delivery receipt or the affidavit of messenger) or at such time as delivery is refused by the addressee upon presentation. Any notice or communication under this Agreement must be addressed, if to the Company, to: Mondee Holdings, Inc., 10800 Pecan Park Blvd., Suite 315, Austin, Texas 78750 Attn: Jesus Portillo, and, if to any Holder, at such Holder’s address, electronic mail address or facsimile number as set forth in the Company’s books and records. Any party may change its address for notice at any time and from time to time by written notice to the other parties hereto, and such change of address shall become effective thirty (30) days after delivery of such notice as provided in this Section 5.1.
Section 1.2Assignment; No Third-Party Beneficiaries.
1.1.1This Agreement and the rights, duties and obligations of the Company hereunder may not be assigned or delegated by the Company in whole or in part.
1.1.2Subject to Section 5.2.4 and Section 5.2.5, this Agreement and the rights, duties and obligations of a Holder hereunder may be assigned in whole or in part to such Holder’s Permitted Transferees; provided, that each of the Holders shall be permitted to transfer its rights hereunder as such Holders to one or more affiliates or any direct or indirect partners, members or equity holders of such Holder (it being understood that no such transfer shall reduce any rights of such Holder or such transferees).
1.1.3This Agreement and the provisions hereof shall be binding upon and shall inure to the benefit of each of the parties and its successors and the permitted assigns of the Holders, which shall include Permitted Transferees.
1.1.4This Agreement shall not confer any rights or benefits on any persons or entities that are not parties hereto, other than as expressly set forth in this Agreement and Section 5.2.
1.1.5No assignment by any party hereto of such party’s rights, duties and obligations hereunder shall be binding upon or obligate the Company unless and until the Company shall have received (i) written notice of such assignment as provided in Section 5.1 hereof and (ii) an executed joinder to this Agreement from such assignee in the form of Exhibit A attached hereto (a “Joinder”). Any transfer or assignment made other than as provided in this Section 5.2 shall be null and void.
Section 1.3Counterparts. This Agreement may be executed in multiple counterparts (including facsimile or PDF counterparts), each of which shall be deemed an original, and all of which together shall constitute the same instrument, but only one of which need be produced. The words “execution,” “signed,” “signature,” “delivery,” and words of like import in or relating to this Agreement or any document to be signed in connection with this Agreement shall be deemed to include electronic signatures, deliveries or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature, physical delivery thereof or the use of a paper-based recordkeeping system, as the case may be, and the parties hereto consent to conduct the transactions contemplated hereunder by electronic means.
Section 1.4Governing Law; Venue. NOTWITHSTANDING THE PLACE WHERE THIS AGREEMENT MAY BE EXECUTED BY ANY OF THE PARTIES HERETO, THE PARTIES EXPRESSLY AGREE THAT (1) THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED UNDER THE LAWS OF THE STATE OF NEW YORK AND (2) THE VENUE FOR ANY ACTION TAKEN WITH RESPECT TO THIS AGREEMENT SHALL BE ANY STATE OR FEDERAL COURTS SITTING IN NEW YORK COUNTY IN THE STATE OF NEW YORK.
Section 1.5TRIAL BY JURY. EACH PARTY HERETO ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY THAT MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND, THEREFORE, EACH SUCH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT TO ANY ACTION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT. EACH OF THE PARTIES (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT, OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THAT FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREBY, BY AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 5.5.
Section 1.6Amendments and Modifications. Upon the written consent of (a) the Company and (b) the Holders of a majority of the total Registrable Securities, compliance with any of the provisions, covenants and conditions set forth in this Agreement may be waived, or any of such provisions, covenants or conditions may be amended or modified; provided, however, that notwithstanding the foregoing, any amendment hereto or waiver hereof that adversely affects one Holder, solely in its capacity as a holder of the shares of capital stock of the Company, in a manner that is materially different from the other Holders (in such capacity) shall require the consent of the Holder so affected. No course of dealing between any Holder or the Company and any other party hereto or any failure or delay on the part of a Holder or the Company in exercising any rights or remedies under this Agreement shall operate as a waiver of any rights or remedies of any Holder or the Company. No single or partial exercise of any rights or remedies under this Agreement by a party shall operate as a waiver or preclude the exercise of any other rights or remedies hereunder or thereunder by such party.
Section 1.7Other Registration Rights. The Company represents and warrants that, except as already disclosed by the Company in its public filings with the Commission, no person or entity, other than a Holder of Registrable Securities, has any right to require the Company to register any securities of the Company for sale or to include such securities of the Company in any Registration Statement filed by the Company for the sale of securities for its own account or for the account of any other person or entity. For so long as any Holder and such Holder’s affiliates hold, in the aggregate, at least fifty percent (50%) of the Warrants (including the form of Conversion Shares) originally issued to such Holder pursuant to the Subscription Agreements, the Company hereby agrees and covenants that it will not grant rights to register any Common Stock (or securities convertible into, or exchangeable or exercisable for, Common Stock) under the Securities Act pursuant to which such grantee would have more favorable Demands or treatment with respect to pro rata reduction than those granted to the Holders hereunder without the prior written consent of Holders of a majority of the total Registrable Securities.
Section 1.8Term. This Agreement shall terminate on the earlier of (a) the fifth anniversary of the Original Issue Date (b) with respect to any Holder, on the date that such Holder no longer holds any Registrable Securities. The provisions of Section 3.5 and Article IV shall survive any termination.
Section 1.9Holder Information. Each Holder agrees, if requested in writing, to represent to the Company the total number of Registrable Securities held by such Holder in order for the Company to make determinations hereunder.
Section 1.10Existing Registration Statements. Notwithstanding anything herein to the contrary and subject to applicable law and regulation, the Company may satisfy any obligation (in whole or in part) hereunder to file a Registration Statement or to have a Registration Statement become effective by a specified date by designating, by notice to the Holders, a registration statement that previously has been filed with the Commission or become effective, as the case may be, as the relevant Registration Statement for purposes of satisfying such obligation, and all references to any such obligation shall be construed accordingly; provided, that such previously filed registration statement may be amended to add the number of Registrable Securities, and, to the extent necessary, to identify as selling stockholders those Holders demanding or entitled to the filing of a Registration Statement pursuant to the terms of this Agreement. To the extent this Agreement refers to the filing or effectiveness of other registration statements by or at a specified time and the Company has, in lieu of then filing such registration statements or having such registration statements become effective, designated a previously filed or effective registration statement as the relevant registration statement for such purposes in accordance with the preceding sentence, such references shall be construed to refer to such designated registration statement, solely with respect to any Registrable Securities covered thereby.
Section 1.11Severability. It is the desire and intent of the parties that the provisions of this Agreement be enforced to the fullest extent permissible under the laws and public policies applied in each
jurisdiction in which enforcement is sought. Accordingly, if any particular provision of this Agreement shall be adjudicated by a court of competent jurisdiction to be invalid, prohibited or unenforceable for any reason, such provision, as to such jurisdiction, shall be ineffective, without invalidating the remaining provisions of this Agreement or affecting the validity or enforceability of this Agreement or affecting the validity or enforceability of such provision in any other jurisdiction. Notwithstanding the foregoing, if such provision could be more narrowly drawn so as not to be invalid, prohibited or unenforceable in such jurisdiction, it shall, as to such jurisdiction, be so narrowly drawn, without invalidating the remaining provisions of this Agreement or affecting the validity or enforceability of such provision in any other jurisdiction.
Section 1.12Entire Agreement. This Agreement constitutes the full and entire agreement and understanding between the parties with respect to the subject matter hereof and supersedes all prior agreements and understandings relating to such subject matter.
[SIGNATURE PAGES FOLLOW]
IN WITNESS WHEREOF, the undersigned have caused this Agreement to be executed as of the date first written above.
COMPANY:
Mondee Holdings, Inc.
a Delaware corporation
By: /s/ Prasad Gundumogula
Name: Prasad Gundumogula
Title: Chief Executive Officer
HOLDERS:
Tuesday Investor LLC
By: [***]
Name: [***]
Title: [***]
NH Credit Partners III Holdings L.P.
By: [***]
Name: [***]
Title: [***]
Exhibit A
REGISTRATION RIGHTS AGREEMENT JOINDER
The undersigned is executing and delivering this joinder (this “Joinder”) pursuant to the Second Amended and Restated Registration Rights Agreement, dated as of December 14, 2023 (as the same may hereafter be amended, the “Registration Rights Agreement”), among Mondee Holdings, Inc., a Delaware corporation (the “Company”), and the other persons or entities named as parties therein. Capitalized terms used but not otherwise defined herein shall have the meanings provided in the Registration Rights Agreement.
By executing and delivering this Joinder to the Company, the undersigned hereby agrees to become a party to, to be bound by, and to comply with the Registration Rights Agreement as a Holder of Registrable Securities in the same manner as if the undersigned were an original signatory to the Registration Rights Agreement, and the undersigned’s Warrants and shares of Common Stock with respect to which this Joinder is being entered into shall be included as Registrable Securities under the Registration Rights Agreement to the extent provided therein.
Accordingly, the undersigned has executed and delivered this Joinder as of the __________ day of _____________.
Signature of Stockholder
Print Name of Stockholder
Its:
Address:
Acknowledged as of
____________, 20__
Mondee Holdings, Inc.
By:
Name:
Its:
v3.23.4
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Dec. 14, 2023 |
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Dec. 14, 2023
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Mondee Holdings, Inc.
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DE
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10800 Pecan Park Blvd
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Suite 315
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Austin
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TX
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Class A common stock, $0.0001 par value per share
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MOND
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NASDAQ
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