Section 1.01          The Continuation. The Company shall, subject to Section 5.05(f) and in cooperation and coordination with Parent, as promptly as practicable make and procure all filings, certifications, consents, approvals, clearances and other authorizations that are required to be made with, or obtained from, any applicable Governmental Authorities, including the Luxembourg Trade and Companies Register (Registre de commerce et des sociétés) (the “Luxembourg Register”) and all publications that are required to be made with the Luxembourg Electronic Compendium of Companies and Associations (Recueil électronique des sociétés et associations) and the Registrar of Companies of the Cayman Islands (the “Cayman Registrar”) to effectuate the Continuation (it being understood that the obligations under this Section 1.01 shall not include any obligation to actually effectuate the Continuation in advance of the satisfaction or, to the extent permissible under applicable Law, waiver of the conditions set forth in Section 6.01).

 

              Section 1.02          Continuation Closing. Unless this Agreement shall have been terminated pursuant to Article VII and unless otherwise mutually agreed in writing by the parties hereto, the closing of the Continuation (the “Continuation Closing”) shall be conducted remotely via the electronic exchange of documents and signatures on the fifth Business Day following the satisfaction or waiver (to the extent such waiver is permitted by applicable Law) of the conditions set forth in Section 6.01. On the anticipated Continuation Closing Date, the Company shall, in cooperation and coordination with Parent, take all actions necessary or advisable to cause the Continuation Effective Time to occur as promptly as practicable in accordance with the applicable provisions of the Luxembourg Company Law and the Cayman Companies Act. The Continuation shall become effective on the date and at such time at which the Cayman Registrar has issued a certificate of continuation for the Company (such date and time the “Continuation Effective Time”). The date on which the Continuation Effective Time actually occurs shall be the “Continuation Closing Date”.

 

                            Section 1.03          Effects of the Continuation.

 

(a)          The Company. The Continuation shall have the effects set forth in this Agreement and the applicable provisions of the Cayman Companies Act. From and after the Continuation Effective Time, the Company shall be a Cayman Islands exempted company in accordance with the applicable provisions of the Cayman Companies Act with all rights, privileges, immunities, powers and franchises possessed by the Company prior to the consummation of the Continuation continuing unaffected and unchanged following the Continuation Effective Time in accordance with Cayman Islands Law.

 

(b)          Share Capital. From and after the Continuation Effective Time until the Effective Time, by virtue of the Continuation and without any further action on the part of Parent, Merger Sub, the Company or any holder of any security of the Company:

 

(i)               each issued and outstanding share of the Company without par value prior to the Continuation Effective Time (a “Share”) will become and be deemed converted automatically, on a one-for-one basis, into an ordinary share without par value of the Company following the Continuation Effective Time (a “Continuation Share”), and (i) each certificate previously representing any such Shares (a “Certificate”) shall thereafter represent, without the requirement of any exchange thereof, that number of Continuation Shares into which such Shares represented by such Certificate have become and been deemed converted pursuant to this Section 1.03(b)(i), and (ii) each book-entry account formerly representing any uncertificated Shares shall thereafter represent, without any further action, that number of Continuation Shares into which such Shares have become and been deemed converted pursuant to this Section 1.03(b)(i), and thereafter, the holders thereof shall cease to have any rights with respect to such Shares;

(ii)              each issued and outstanding Company Option prior to the Continuation Effective Time will become and be deemed converted automatically, on a one-for-one basis, and in accordance with the terms of the Company Equity Plans and/or option agreement by which it is evidenced, into an option to acquire Continuation Shares, subject to the same terms and conditions as were applicable under such Company Option immediately prior to the Continuation Effective Time (including the per-share exercise price, vesting schedule and any vesting acceleration) (each, a “Continuation Option”); and

(iii)               each issued and outstanding Company RSU prior to the Continuation Effective Time will become and be deemed converted automatically, on a one-for-one basis, and in accordance with the terms of the Company Equity Plans and/or restricted share unit agreement by which it is evidenced, into a restricted share unit with respect to Continuation Shares (or cash, if so provided under the terms of such Company RSU), subject to the same terms and conditions as were applicable under such Company RSU immediately prior to the Continuation Effective Time (including the vesting schedule and any vesting acceleration) (each, a “Continuation RSU”).

(c)          Transfers. From and after the Continuation Effective Time, there shall be no transfers on the register of members of the Company of any Shares that were outstanding immediately prior to the Continuation Effective Time or any Continuation Shares.

 

                            Section 1.04          Memorandum and Articles of Association. At the Continuation Effective Time, the memorandum and articles of association of the Company shall be in substantially the form attached hereto as Exhibit 1 (the “Memorandum and Articles of Association”), as adopted pursuant to the Luxembourg Shareholder Approval contingent upon the Continuation, until thereafter changed or amended in accordance with this Agreement or as provided therein or pursuant to applicable Law.

 

                            Section 1.05          Board of Directors and Officers of the Company following the Continuation. The directors and officers of the Company in office as of immediately prior to the Continuation Effective Time shall remain the directors and officers of the Company from and after the Continuation Effective Time, until the earlier of their death, resignation, removal or until their respective successors are duly elected and qualified, as the case may be.

 

                            Section 1.06          Necessary Further Actions; Re-Continuation.

 

(a)          The Company Board (or, if appropriate, any duly-authorized committee thereof administering the Company Equity Plans) shall, prior to the Continuation Effective Time, take all actions necessary to effectuate the provisions of Section 1.03(b)(ii) and Section 1.03(b)(iii) (including the giving of any notices and obtaining any required consents), such that, following the Continuation Effective Time, (x) there shall be no outstanding Company Equity Awards (whether vested or unvested) (and the only outstanding equity awards with respect to the Company shall be Continuation Options and Continuation RSUs) and (y) no participant in any Company Equity Plans will have any right thereunder to acquire any Continuation Shares. Subject to Section 1.06(b), if, at any time before or after the Continuation Effective Time, any further action is necessary or advisable to carry out the purposes of the Continuation and the other Transactions, and to vest in the Company after the Continuation with full right, title and possession to all assets, property, rights, privileges, powers and franchises of the Company prior to the Continuation, then the Company will, in good faith consultation and cooperation with Parent, use reasonable best efforts to take all such lawful, necessary and advisable action.

 

(b)          Unless otherwise agreed between the parties in writing, in the event that, within three (3) Business Days following the Continuation Effective Time, the Statutory Plan of Merger has not been submitted to the Cayman Registrar in accordance with Section 2.02(b)(iii) due to the failure of any condition set forth in Section 6.02, Section 6.03 and/or Section 6.04 to be satisfied or waived (to the extent such waiver is permitted by applicable Law)  (a “Closing Failure”), then (i) the Company, shall effectuate the transfer of the Company’s statutory seat, registered office and seat of central administration from the Cayman Islands to Luxembourg in accordance with the Cayman Companies Act and Luxembourg Company Law (the “Re-Continuation”), (ii) in good faith consultation with Parent, the Company shall take all actions necessary to unwind the effects of the Continuation pursuant to this Agreement, including making and procuring all required filings, certifications, consents, approvals, clearances and other authorizations that are required to be made with, or obtained from, any applicable Governmental Authority, including the Luxembourg Register, all publications that are required to be made with the Luxembourg Electronic Compendium of Companies and Associations (Recueil électronique des sociétés et associations) and the Cayman Registrar and (iii), until the earlier of the Effective Time and the termination of this Agreement in accordance with Article VII, all terms and conditions set forth in this Agreement shall remain in full force and effect following the Re-Continuation as if the completion of the Continuation prior to such Closing Failure had never occurred (and the conditions set forth in Section 6.01 had never been satisfied or waived), with the respective obligations of the parties continuing to apply, including, for the avoidance of doubt, the obligations of the Company, on and subject to the terms and conditions of Article V, to convene and hold a new Luxembourg Shareholder Meeting and/or Cayman Shareholder Meeting to obtain a new Luxembourg Shareholder Approval and/or Cayman Shareholder Approval (if required or advisable under the Cayman Companies Act or Luxembourg Company Law) and the obligation to proceed with, on and subject to terms and conditions of this Article I and Article II, the Transactions, including the Continuation and the Merger.

 

 

                            Section 2.01          The Merger. Upon the terms and subject to the conditions set forth in this Agreement and the Statutory Plan of Merger, (a) on the Closing Date and as promptly as practicable following the completion of the Continuation, each of the Company and Merger Sub will, and Parent shall cause Merger Sub Parent to, as applicable, execute and deliver the Statutory Plan of Merger and the other documentation required pursuant to Section 233 of the Cayman Companies Act and file the same with the Cayman Registrar in accordance with the Cayman Companies Act to consummate the Merger and (b) at the Effective Time, Merger Sub will be merged with and into the Company and in accordance with Part XVI of the Cayman Companies Act, with the separate corporate existence of Merger Sub thereupon ceasing and the Company being the Surviving Company in the Merger and a wholly owned Subsidiary of Parent. At and after the Effective Time, the Surviving Company shall thereupon and thereafter possess all rights, privileges, immunities, powers and franchises of the Company and Merger Sub continuing unaffected by the Merger in accordance with the Cayman Companies Act.

 

                            Section 2.02          Closing.

 

(a)          Closing Date. Unless this Agreement shall have been terminated pursuant to Article VII and unless otherwise mutually agreed in writing by the parties hereto, the closing of the Merger (the “Closing”) shall be conducted remotely via the electronic exchange of documents and signatures as promptly as practicable following the Continuation Effective Time and the satisfaction or waiver (to the extent such waiver is permitted by applicable Law) at such time of the conditions set forth in Section 6.02, Section 6.03 and Section 6.04 (and in any event within two (2) Business Days following the fulfillment of said conditions). The date on which the Closing actually occurs shall be the “Closing Date”.

 

(b)          Unless otherwise mutually agreed in writing by the parties hereto, as promptly as practicable following the Continuation Effective Time:

 

                            Section 2.03          Effective Time. The Merger shall become effective at the time of the registration of the Statutory Plan of Merger by the Cayman Registrar or at such other time as may be specified in such Statutory Plan of Merger mutually agreed in writing between Parent and the Company (such time, the “Effective Time”).

 

                            Section 2.04          Memorandum and Articles of Association of the Surviving Company. At the Effective Time, the memorandum and articles of association of the Surviving Company appended to the Statutory Plan of Merger, which shall read as the memorandum and articles of association of Merger Sub in effect immediately prior to the Effective Time shall be the memorandum and articles of association of the Surviving Company, except that references to the name of Merger Sub shall be replaced by the name of the Surviving Company, until thereafter changed or amended as provided therein or pursuant to applicable Law.

 

                            Section 2.05          Board of Directors and Officers of Surviving Company. The directors and officers of Merger Sub immediately prior to the Effective Time shall be the directors and officers of the Surviving Company until the earlier of their death, resignation or removal or until their respective successors are duly elected and qualified, as the case may be.

 

                            Section 2.06          Effect of the Merger on the Share Capital. Upon the terms and subject to the conditions set forth in this Agreement:

 

(a)          At the Effective Time, by virtue of the Merger, and without any action on the part of any holder of any security of the Company, Parent or Merger Sub:

 

(b)          Merger Sub. At the Effective Time, each ordinary share without par value of Merger Sub issued and outstanding immediately prior to the Effective Time shall become one ordinary share without par value of the Surviving Company.

 

                            Section 2.07          Exchange and Payment.

 

(a)          Paying Agent. At or immediately prior to the Effective Time, Parent shall cause Merger Sub to deposit with one or more paying agents selected by Parent and reasonably acceptable to the Company (collectively, the “Paying Agent”), for payment to the holders of Continuation Shares, cash in immediately available funds in an amount sufficient to pay the aggregate Merger Consideration in connection with the Merger in accordance with this Article II (such aggregate amount of cash being hereinafter referred to as the “Exchange Fund”) for the sole benefit of the holders of Continuation Shares. The Paying Agent shall invest the Exchange Fund as directed by Parent; provided, that no such investment (or losses thereon) shall affect the amount of Merger Consideration payable to the holders of Continuation Shares pursuant to Section 2.06(a)(i) or relieve Parent or the Paying Agent from making the payments required by this Agreement, including the obligation to deposit additional funds with the Paying Agent to cover any deficiency in the Exchange Fund. To the extent that there are losses with respect to such investments, or the Exchange Fund diminishes for any other reason below the level required to make prompt cash payment of such Merger Consideration as contemplated hereby, Parent shall promptly replace or restore the cash in the Exchange Fund lost through such investments or other events so as to ensure that the Exchange Fund is at all times maintained at a level sufficient to make all cash payments required pursuant to Section 2.06(a)(i). Prior to the Closing Date, Parent shall enter into an agreement with the Paying Agent, in form and substance reasonably satisfactory to the Company, to effect the applicable terms of this Agreement.

 

(b)          Exchange Procedures. Promptly after the Effective Time (and in any event within three (3) Business Days thereafter), Parent shall cause the Paying Agent to mail to each holder of record of a Certificate representing Continuation Shares outstanding immediately prior to the Effective Time (other than Excluded Shares and Dissenting Shares): (i) a letter of transmittal in customary form advising such holder of the effectiveness of the Merger and the conversion of its Continuation Shares into the right to receive the Merger Consideration, and specifying that delivery shall be effected, and risk of loss and title to the Certificates shall pass, only upon delivery of the Certificates (or affidavits of loss in lieu of the Certificates as provided in Section 2.07(e)) and (ii) instructions for use in effecting the surrender of such Certificates (or affidavits of loss in lieu of such Certificates as provided in Section 2.07(e)). Upon the surrender of a Certificate (or affidavit of loss in lieu thereof as provided in Section 2.07(e)) to the Paying Agent in accordance with the terms of such transmittal materials, the holder of such Certificate shall be entitled to receive in exchange therefor an amount in immediately available funds (or, if no wire transfer instructions are provided, a check, and in each case, after giving effect to any required Tax withholding as provided in Section 2.07(g)) equal to the cash amount that such holder is entitled to receive pursuant to Section 2.06(a)(i), and the Certificate so surrendered shall forthwith be cancelled. No interest will be paid or accrued on any amount payable to holders of Certificates. In the event of a transfer of ownership of Continuation Shares represented by a Certificate that is not registered in the register of members of the Company, the Merger Consideration to be paid upon due surrender of the Certificate may be paid to such a transferee if the Certificate formerly representing such Continuation Shares is presented to the Paying Agent, accompanied by all documents required to evidence and effect such transfer and to evidence that any applicable share transfer Taxes have been paid or are not applicable, in each case, reasonably acceptable to the Paying Agent and Parent.

 

(c)          Uncertificated Shares. Promptly after the Effective Time (and in any event within three (3) Business Days thereafter), Parent shall cause the Paying Agent to (i) mail to each registered holder of Uncertificated Shares (other than in respect of Excluded Shares and Dissenting Shares) materials advising such holder of the effectiveness of the Merger and the conversion of its Continuation Shares into the right to receive the Merger Consideration and (ii) deliver the Merger Consideration that such holder is entitled to receive in respect of its Continuation Shares pursuant to Section 2.06(a)(i) (after giving effect to any Tax withholdings as provided in Section 2.07(g)), without interest thereon.

 

(d)          Transfers; No Further Ownership Rights. From and after the Effective Time, there shall be no transfers on the register of members of the Company or the Surviving Company of any Continuation Shares that were outstanding immediately prior to the Effective Time, other than to reflect the Surviving Company as a direct wholly owned Subsidiary of Merger Sub Parent as of the Effective Time. If, after the Effective Time, Certificates or Uncertificated Shares are presented to the Surviving Company for any reason, they will (subject to compliance with the exchange procedures of Section 2.07(b) be cancelled and exchanged as provided in this Article II. From and after the Effective Time, (a) all Continuation Shares will no longer be outstanding and will automatically be cancelled, retired and cease to exist; and (b) each holder of a Certificate or Uncertificated Shares theretofore representing any Continuation Shares will cease to have any rights with respect thereto, except the right to receive the Merger Consideration payable therefor in accordance with Section 2.06, or in the case of Dissenting Shares, the rights set forth in Section 2.10. The Merger Consideration paid in accordance with the terms of this Article II will be deemed to have been paid in full satisfaction of all rights pertaining to such Continuation Shares.

 

(e)          Lost, Stolen or Destroyed Certificates. In the event any Certificate shall have been lost, stolen or destroyed, upon the making of an affidavit of that fact by the Person claiming such Certificate to be lost, stolen or destroyed to the Paying Agent or the Surviving Company, the Paying Agent will issue in exchange for such lost, stolen or destroyed Certificate the cash that would have been issuable or payable pursuant to the provisions of this Article II (after giving effect to any Tax withholdings as provided in Section 2.07(g)) had such lost, stolen or destroyed Certificate been surrendered. Parent or the Paying Agent, in its reasonable discretion and as a condition precedent to the payment of the Merger Consideration, may require the owners of such lost, stolen or destroyed Certificates to deliver a bond in such amount as the Paying Agent may direct, in accordance with the Paying Agent’s policies and practices, as indemnity against any claim that may be made against Parent, the Surviving Company or the Paying Agent with respect to the Certificates alleged to have been lost, stolen or destroyed.

 

(f)          Termination of Exchange Fund. Any portion of the Exchange Fund (including the proceeds of any investments of the Exchange Fund) that remains unclaimed by the shareholders of the Company for twelve (12) months after the Effective Time shall be delivered, at Parent’s option, to Parent. Any holder of Continuation Shares (other than Excluded Shares and Dissenting Shares) who has not theretofore complied with this Article II shall thereafter look only to the Surviving Company for delivery of any payment of cash (after giving effect to any required Tax withholdings as provided in Section 2.07(g)) upon due surrender of its Certificates (or affidavits of loss in lieu of the Certificates as provided in Section 2.07(e)), without any interest thereon. Notwithstanding the foregoing, none of the Surviving Company, Parent, the Paying Agent or any other Person shall be liable to any former holder of Continuation Shares for any amount properly delivered to a public official pursuant to applicable abandoned property, escheat or similar Laws. To the fullest extent permitted by Law, immediately prior to the date any Merger Consideration would otherwise escheat to or become the property of any Governmental Authority, such Merger Consideration shall become the property of the Surviving Company, free and clear of all claims or interests of any Person previously entitled thereto.

 

(g)          Withholding Rights.

                            Section 2.08          Continuation Equity Awards. Unless otherwise agreed to by the parties hereto, or Parent and the holder of such Continuation Equity Award, and without any action on the part of any holder of any security of the Company, Parent or Merger Sub, at the Effective Time and upon the terms and subject to the conditions set forth in this Agreement:

 

(a)          Continuation Options.

 

(b)          Continuation RSUs.

 

(c)          Board Actions. The Company Board (or, if appropriate, any duly-authorized committee thereof administering the Company Equity Plans) shall, as promptly as practicable (but no less than five (5) Business Days prior to the Effective Time), take all actions necessary to effectuate the provisions of this Section 2.08, Section 1.03 and Section 1.06 (including the giving of any notices and obtaining any required consents) and to terminate the Company Equity Plans effective as of the Effective Time; such that, following the Effective Time, (i) there shall be no outstanding Company Equity Awards or Continuation Equity Awards (whether vested or unvested) and (ii) no participant in any Company Equity Plans will have any right thereunder to acquire any equity securities of the Company, the Surviving Company or any of their respective Subsidiaries. For the avoidance of doubt, no Company Equity Award (or portion thereof) or Continuation Equity Award (or portion thereof) will be, and the Company (including the Company Board or any duly authorized committee thereof administering the Company Equity Plans) shall not permit any Company Equity Award (or portion thereof) or Continuation Equity Award (or portion thereof) to be, accelerated in connection with the consummation of the Transactions, except for any Company Equity Award or Continuation Equity Award that, by its express contractual terms (including the applicable terms of any Company Equity Plan and any award agreement thereunder) as in effect on the date hereof, will automatically (without any action on the part of the Company (including the Company Board or any duly authorized committee thereof administering the Company Equity Plans)) accelerate in connection with the Transactions.

 

                            Section 2.09          Payments with Respect to Company Equity Awards.

 

(a)          Vested Non-102 Trustee Continuation Equity Awards. As promptly as practicable following the Effective Time (but in any event, no later than the second payroll date after the Effective Time), the Surviving Company shall pay, or procure that an Affiliate thereof shall pay, through its payroll systems the amounts due pursuant to Section 2.08 to the holders of Vested Non-102 Trustee Continuation Equity Awards, less any applicable payroll, income or other withholding Taxes; provided, that with respect to any Vested Continuation RSU that constitutes nonqualified deferred compensation subject to Section 409A of the Code, the amounts will be paid no earlier than the earliest time permitted under the applicable Company Plan or award agreement that will not trigger a Tax or penalty under Section 409A of the Code.

 

(b)          Vested 102 Trustee Continuation Equity Awards. As promptly as practicable following the Effective Time, the amounts due pursuant to Section 2.08 to the holders of Vested 102 Trustee Continuation Equity Awards shall be transferred to the 102 Trustee, which amounts shall be held and released in accordance with applicable Law and the Options Tax Ruling or the Interim Options Tax Ruling, as applicable. For the avoidance of doubt, the 102 Trustee shall be required to withhold any amounts required in accordance with applicable Law (including the provisions of Section 102, including the completion of any required 102 Trust Period). If the Options Tax Ruling or the Interim Options Tax Ruling are not obtained prior to the Closing, any payments made to holders of Vested 102 Trustee Continuation Equity Awards will be subject to deduction or withholding of Tax under the ITO on the fifteenth (15th) day of the calendar month following the month during which the Closing occurs, unless the Options Tax Ruling (or Interim Options Tax Ruling) is obtained prior to the fifteenth (15th) day of the calendar month following the month during which the Closing occurs.

 

                            Section 2.10          Appraisal Rights.

 

(a)          Notwithstanding any provision of this Agreement to the contrary, Continuation Shares that are outstanding immediately prior to the Effective Time and which are held by shareholders who have validly indicated by way of written objection (pursuant to Section 238(2) of the Cayman Companies Act) the desire to dissent with respect to such Continuation Shares (collectively, the “Dissenting Shares”) shall not be converted into or represent the right to receive the Merger Consideration attributable to such Dissenting Shares. Such shareholders shall be entitled to receive payment of the fair value of such Dissenting Shares held by them in accordance with the Cayman Companies Act, unless and until such shareholders fail to elect to dissent by way of a written notice (pursuant to Section 238(5) of the Cayman Companies Act) or effectively withdraw or otherwise lose their appraisal rights under the Cayman Companies Act. All Dissenting Shares held by shareholders who shall have failed to elect to dissent by way of a written notice (pursuant to Section 238(5) of the Cayman Companies Act) or who effectively shall have withdrawn or lost their right to appraisal of such Continuation Shares under the Cayman Companies Act shall thereupon be deemed to be converted into and to have become exchangeable for, as of the Effective Time, the right to receive the Merger Consideration attributable to such Dissenting Shares upon their surrender and otherwise subject to the terms of this Article II applicable to Continuation Shares. The Dissenting Shares held by holders who have not validly or effectively withdrawn or lost their rights to dissent pursuant to Section 238 of the Cayman Companies Act will be cancelled and cease to exist in exchange for the right to receive fair value of such Dissenting Shares in accordance with the Cayman Companies Act.

 

(b)          The Company shall give Parent prompt written notice of any demands by holders of Dissenting Shares received by the Company, withdrawals of such demands and any other instruments served on the Company and any material correspondence received by the Company in connection with such demands or in connection with Section 238 of the Cayman Companies Act, and Parent shall have the right to direct all negotiations and proceedings with respect to such demands (including settlement offers). In the event that any written objections are served by shareholders of Dissenting Shares to the Company pursuant to Section 238(2) of the Cayman Companies Act, the Company shall serve written notice of the authorization of the Merger (in form and substance reasonably acceptable to Parent) to such holders pursuant to Section 238(4) of the Cayman Companies Act within twenty (20) days following the Cayman Shareholder Approval. Within twenty (20) days of receiving the Company’s notice issued pursuant to Section 238(4) of the Cayman Companies Act, any shareholder wishing to dissent must give written notice of its decision to dissent to the Company, at which time, it shall cease to have any rights of a member except the right to be paid fair value for its shares and the rights referred to in Sections 238(12) and 238(16) of the Cayman Companies Act. Except with the prior written consent of Parent, the Company shall not make any payment with respect to, or offer to settle or settle, any such demands, or agree to do any of the foregoing.

 

                            Section 2.11          No Dividends or Distributions. No dividends or other distributions with respect to the issued and outstanding share capital of the Surviving Company with a record date on or after the Effective Time will be paid to the holder of any unsurrendered Certificates or Uncertificated Shares.

 

                            Section 2.12          Adjustments to Prevent Dilution. Without limiting the Company’s obligations under Section 5.01, in the event that the Company changes the number of Shares, Continuation Shares or securities convertible or exchangeable into or exercisable for any such Shares, Continuation Shares or other security, in each case issued and outstanding prior to the Effective Time as a result of a distribution, reclassification, share split (including reverse share split), share dividend or distribution, recapitalization, subdivision or other similar transaction, the Merger Consideration shall be equitably adjusted to provide the holders of Shares, Continuation Shares and Company Equity Awards, as applicable, the same economic effect as contemplated by this Agreement prior to such event.

 

                            Section 2.13          Necessary Further Actions. If, at any time after the Effective Time, any further action is necessary or desirable to carry out the purposes of this Agreement and to vest the Surviving Company with full right, title and possession to all assets, property, rights, privileges, powers and franchises of the Company and Merger Sub, then the directors and officers of the Company and Merger Sub as of immediately prior to the Effective Time will use reasonable best efforts to take all such lawful, necessary and advisable action.

 

 

ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY

 

Except as (A) set forth in the disclosure schedule delivered by the Company to Parent at the time of entering into this Agreement (the “Company Disclosure Schedule”) (it being understood that any disclosure set forth on one section or subsection of the Company Disclosure Schedule shall be deemed to be disclosed and qualify the section or subsection of this Agreement to which it corresponds in number and each other section or subsection of this Agreement to the extent that it is reasonably apparent on the face thereof that such disclosure is relevant to such other section or subsection) or (B) disclosed in any Company SEC Document filed with, or furnished to, the U.S. Securities and Exchange Commission (the “SEC”) by the Company and publicly available on or after January 1, 2021 and before the date of this Agreement, other than disclosure contained in the “Risk Factors” or “Forward-Looking Statements” sections in such Company SEC Documents, in each case, to the extent that such statements are predictive, cautionary, protective or forward-looking in nature (it being acknowledged that nothing disclosed in the Company SEC Documents will be deemed to modify or qualify the representations and warranties set forth in Section 3.02(a), Section 3.02(b), Section 3.02(d), Section 3.06(a), Section 3.14, Section 3.20 and Section 3.21), the Company hereby represents and warrants to Parent and Merger Sub as follows:

 

                            Section 3.01          Organization; Standing. The Company is a public limited liability company (société anonyme) governed by the laws of Luxembourg and, from and after the Continuation Effective Time, the Company will be a Cayman Islands exempted company existing under the laws of the Cayman Islands. Each of the Company’s Subsidiaries is duly organized, validly existing and in good standing (where such concept is recognized under applicable Law) under the Laws of the jurisdiction of its organization, except where the failure to be so organized, existing and in good standing has not had and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect. Each of the Company and its Subsidiaries has all requisite power and authority to own, lease and operate its properties and assets and to carry on its business as it is presently conducted, except where the failure to have such power or authority has not had and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect. Each of the Company and its Subsidiaries is duly licensed or qualified to do business and is in good standing (where such concept is recognized under applicable Law) in each jurisdiction in which the nature of the business conducted by it or the character or location of the properties and assets owned or leased by it makes such licensing or qualification necessary, except where the failure to be so licensed, qualified or in good standing has not had and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect. The Company has made available to Parent true, complete and correct copies of the respective extract from the Luxembourg Register, certificate of incorporation, memorandum of association, articles of association, charter, operating agreement, partnership agreement, certificate of formation and bylaws (or other comparable organizational document, instrument or certificate) (each, an “Organizational Document”) of the Company and each “significant subsidiary” (as defined in Rule 1-02(w) of Regulation S-X promulgated by the SEC) of the Company, each as amended to and as in effect on the date of this Agreement and, after the Continuation Effective Time, the Company will have made available to Parent true, complete and correct copies of the search result from the Cayman Register of Companies with respect to the Company, the certificate of continuation of the Company, and the Memorandum and Articles of Association (or comparable organizational documents) of the Company. The Company is not in violation in any material respect of any of the provisions of its Organizational Documents and none of the Company’s Subsidiaries is in violation of any provisions of their Organizational Documents, as applicable, except for any violations that has not had and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

 

                            Section 3.02          Capitalization.

 

(a)          As of the date of this Agreement, the authorized share capital of the Company is set at $174,388.19 represented by a number of shares freely determined by the Company Board, each without par value. As of the Continuation Effective Time, the authorized share capital of the Company will be set at $174,388.19 represented by a number of ordinary shares, each without par value, that is no less than the number of Shares issued and outstanding as of immediately prior to the Continuation Effective Time.  At the close of business on May 12, 2023 (the “Capitalization Date”), (i) 33,561,064 Shares were issued and outstanding, (ii) the authorized share capital of the Company was set at $174,388.19 represented by a number of shares freely determined by the Company Board, each without par value, (iii) no Shares were held by the Company and its Subsidiaries as treasury shares, (iv) 841,817 unissued Shares were subject to outstanding and unexercised Company Options (with a weighted average exercise price of $3.08 per Share) and (v) 353,639 unissued Shares were subject to outstanding Company RSUs. All outstanding Shares have been, and as of the Continuation Effective Time, all outstanding Continuation Shares will be, duly authorized and validly issued and are fully paid, nonassessable and free of preemptive rights.

 

(b)          Since the Capitalization Date, other than (i) as would be expressly contemplated by the Continuation or expressly permitted by this Agreement following the date hereof or (ii) in connection with the vesting, settlement or exercise of Company Equity Awards in accordance with their terms as in effect on the Capitalization Date, neither the Company nor any of its Subsidiaries has (1) issued any Company Securities or incurred any obligation to make any payments based on the price or value of any Company Securities or dividends paid thereon that were not outstanding as of the Capitalization Date or (2) established a record date for, declared, set aside for payment or paid any dividend on, or made any other distribution in respect of, any shares of the Company’s capital stock.

 

(c)          Section 3.02(c) of the Company Disclosure Schedule sets forth, as of the date hereof, a true, correct and complete list of (i) all Company Optionholders and Company RSU Holders and each Company Equity Award, whether or not granted under the Company Equity Plans, including, with respect to each such Company Equity Award, the number of Shares subject thereto, the date of grant, the vesting commencement date, the vesting schedule (including any performance conditions), the exercise price per share (if applicable), the intended Tax status of each such Company Equity Award under any applicable Tax law providing favorable Tax treatment, the expiration date (if applicable), the Company Equity Plan from which such Company Equity Award was granted (if any) and the country of residence (both on the date hereof and the applicable grant date) of each such Company Optionholder and Company RSU Holder.

 

(d)          Except as expressly contemplated by the Continuation and expressly described in Section 3.02(a), there are (i) no outstanding shares of capital stock or share capital of, or other equity or voting interests in, the Company, (ii) no outstanding securities of the Company convertible into or exchangeable for shares of capital stock of, or other equity or voting interests in, the Company, (iii) no outstanding options, warrants, rights or other commitments or agreements to acquire from the Company, or that obligate the Company to issue, any capital stock or share capital of, or other equity or voting interests in, or any securities convertible into or exchangeable for shares of capital stock or share capital of, or other equity or voting interests in, the Company, (iv) no obligations of the Company to grant, extend or enter into any subscription, warrant, right, convertible or exchangeable security or other similar agreement or commitment relating to any capital stock or share capital of, or other equity or voting interests in, the Company (the items in clauses (i), (ii), (iii) and (iv) being referred to collectively as “Company Securities”) and (v) no other obligations by the Company or any of its Subsidiaries to make any payments based on the price or value of any Company Securities or dividends paid thereon. Other than the Company Equity Awards, there are no outstanding agreements of any kind that obligate the Company or any of its Subsidiaries to repurchase, redeem or otherwise acquire any Company Securities (or obligate the Company to grant, extend or enter into any such agreements relating to any Company Securities) or that grant any preemptive rights, subscription rights, anti-dilutive rights, rights of first refusal or similar rights with respect to any Company Securities. Other than the Support Agreement, none of the Company, its Subsidiaries or the Significant Shareholders are party to any shareholders’ agreement, voting trust agreement, registration rights agreement or other similar agreement or understanding relating to any Company Securities or any other agreement relating to the disposition, voting or dividends with respect to any Company Securities.

 

(e)          The Shares constitute the only outstanding securities of the Company or its Subsidiaries registered under the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder (collectively, the “Exchange Act”).

 

(f)          No bonds, debentures, notes or other Indebtedness having the right to vote (or which are exercisable or exchangeable for or convertible or redeemable into securities having the right to vote) on any matters on which shareholders of the Company or any of its Subsidiaries may vote are issued and outstanding.

 

(g)          Section 3.02(g) of the Company Disclosure Schedule sets forth, as of the date of this Agreement, the name and jurisdiction of organization of each Subsidiary of the Company. All of the outstanding shares of capital stock or share capital of, or other equity or voting interests in, each Subsidiary and each Minority Investment (defined below) of the Company are owned, directly or indirectly, beneficially and of record, by the Company free and clear of all Liens and material transfer restrictions, except for transfer restrictions under applicable securities Laws or under the Organizational Documents of the applicable Subsidiary or Minority Investment and Liens granted in connection with the Repaid Indebtedness. No Subsidiary of the Company owns any Shares or, from the Continuation Effective Time, will own any Continuation Shares. Each outstanding share of capital stock or share capital of each Subsidiary and Minority Investment of the Company is duly authorized, validly issued, fully paid, nonassessable and free of preemptive rights, and there are no subscriptions, options, warrants, rights, calls, contracts or other commitments, understandings, restrictions or arrangements relating to the issuance, acquisition, redemption, repurchase or sale of any shares of capital stock or share capital or other equity or voting interests of any Subsidiary of the Company, including any right of conversion or exchange under any outstanding security, instrument or agreement, any agreements granting any preemptive rights, subscription rights, anti-dilutive rights, rights of first refusal or similar rights with respect to any securities of any Subsidiary of the Company. None of the Subsidiaries of the Company has any outstanding equity compensation plans relating to the capital stock or share capital of, or other equity or voting interests in, any Subsidiary of the Company. Neither the Company nor any of its Subsidiaries has any obligation to make any payments based on the price or value of any securities of any Subsidiary or Minority Investment of the Company or dividends paid thereon. Except as set forth in Section 3.02(g) of the Company Disclosure Schedule and other than capital stock, share capital or other equity ownership interests of the Subsidiaries of the Company, the Company does not beneficially own, directly or indirectly, any capital stock or share capital, membership interest, partnership interest, joint venture interest or other equity interest in any Person (any such equity interests in Persons set forth in Section 3.02(g) of the Company Disclosure Schedule, the “Minority Investments”).

 

                            Section 3.03          Authority; Non-contravention; Voting Requirements.

 

(a)          The Company has all necessary power and authority to execute and deliver this Agreement and, subject to obtaining the Luxembourg Shareholder Approval and the Cayman Shareholder Approval, to perform its obligations hereunder and to consummate this Agreement and the Transactions, including the Continuation and the Merger. The execution, delivery and performance by the Company of this Agreement, and the consummation by the Company of this Agreement and the Transactions, including the Continuation and the Merger, have been duly authorized and approved by the Company Board, and, except for obtaining the Luxembourg Shareholder Approval and the Cayman Shareholder Approval, no other corporate or company action, as applicable, on the part of the Company is necessary to authorize the execution, delivery and performance by the Company of this Agreement and the consummation by the Company of the Transactions, including the Continuation and the Merger. This Agreement has been duly executed and delivered by the Company and, assuming due authorization, execution and delivery hereof by Parent and Merger Sub, constitutes a legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, except that such enforcement may be subject to (i) applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and similar Laws, now or hereafter in effect, affecting creditors’ rights and remedies generally and (ii) the remedies of specific performance and injunctive and other forms of equitable relief may be subject to equitable defenses and to the discretion of the court before which any Proceeding therefor may be brought (collectively, the “Enforceability Exceptions”).

 

(b)          The Company Board has unanimously (i) determined that it is fair to, and in the best interests of the Company and its shareholders for the Company to enter into this Agreement and consummate the Transactions, including the Continuation, the Re-Continuation (subject to the occurrence of a Closing Failure) and the Merger, (ii) approved and declared advisable this Agreement and the Support Agreement, and the execution, delivery and performance of this Agreement and the Transactions, including the Continuation, Re-Continuation (subject to the occurrence of a Closing Failure) and the Merger, upon the terms and subject to the conditions set forth in this Agreement, (iii) directed that the Company submit to its shareholders (1) the approval and adoption of this Agreement, the Memorandum and Articles of Association, the Statutory Plan of Merger (including the memorandum and articles of association enclosed therewith) and the Transactions, including the Continuation, the Re-Continuation (subject to the occurrence of a Closing Failure) and the Merger, (2) the approval of waiving any notice requirements under the Company’s Organizational Documents or Law applicable to calling, holding and convening the Cayman Shareholder Meeting (or any adjournment, reconvening or postponement thereof) (3) effective upon the Continuation, the change of the Company’s name to “Neo Group Ltd.” and (4) in the case of any Closing Failure (A) the adoption of the Company Charter (in substantially the form in effect prior to the Continuation Effective Time that preceded such Closing Failure) as the Company’s articles of association in accordance with Luxembourg Company Law and effective from and after the Re-Continuation until a subsequent Continuation occurs in accordance with this Agreement and (B) the approval of the appointment of the members of the Company Board as of the Continuation Effective Time as members of the Company Board effective from and after the completion of the Re-Continuation, until a subsequent Continuation occurs in accordance with this Agreement or the earlier of their death, resignation, removal or until their respective successors are duly elected and qualified, as the case may be, and (iv) subject to Section 5.02(d), resolved to recommend such approvals and adoptions by the Company’s shareholders (such recommendation, the “Company Board Recommendation”), which resolutions have not been subsequently rescinded, modified or withdrawn.

 

(c)          Neither the execution and delivery of this Agreement by the Company, nor the consummation by the Company of this Agreement and the Transactions, nor performance or compliance by the Company with any of the terms or provisions hereof, will (i) conflict with or violate any provision of the Organizational Documents or (ii) assuming (A) compliance with the matters set forth Section 5.05 and assuming the accuracy of the representations and warranties made in such Section 4.03 and Section 4.04(a), (B) the Luxembourg Shareholder Approval and Cayman Shareholder Approval are obtained and (C) receipt of the Governmental Clearances, (x) violate any Law applicable to the Company or any of its Subsidiaries or any of their respective properties, assets, License or Gaming Licenses, (y) with or without any lapse of time or the giving of notice or both, violate, conflict with, constitute a default, breach, termination or modification (or right of termination or modification) under, payment of additional fees, a requirement of any consent, or the creation or acceleration of any obligations under any of the terms, conditions or provisions of any legally or contractually binding loan or credit agreement, debenture, note, bond, mortgage, indenture, deed of trust, lease, sublease, license, contract or other arrangement (each a “Contract”) to which the Company or any of its Subsidiaries is a party  or accelerate the Company’s or, if applicable, any of its Subsidiaries’, obligations under any such Contract or (z) result in the creation of any Lien on any properties, assets, Licenses or Gaming Licenses of the Company or any of its Subsidiaries, except, in the case of clause (ii), for any such violation, conflict, default, breach, termination, modification, payment, requirement, creation, acceleration or Lien that would not have or would not reasonably be expected to have, individually or in the aggregate a Material Adverse Effect.

 

(d)          The affirmative votes of the holders (in person or by proxy) of (i) a majority of not less than sixty six point seven percent (66.7%) of the Shares entitled to vote thereon present (in person or by proxy) or represented at the Luxembourg Shareholders Meeting or any adjournment, reconvening or postponement thereof in favor of (1) the adoption of this Agreement and the approval of the Memorandum and Articles of Association, the Continuation, the Re-Continuation (subject to the occurrence of a Closing Failure), and the Statutory Plan of Merger (including the memorandum and articles of association enclosed therewith), (2) effective upon the Continuation, the change of the Company’s name to “Neo Group Ltd.” and (3) in the case of any Closing Failure (A) the adoption of the Company Charter (in substantially the form in effect prior to the Continuation Effective Time that preceded such Closing Failure) as the Company’s articles of association in accordance with Luxembourg Company Law and effective from and after the Re-Continuation, until thereafter changed or amended in accordance with this Agreement, including the occurrence of a subsequent Continuation and (B) the approval of the appointment of the members of the Company Board as of the Continuation Effective Time as members of the Company Board effective from and after the completion of the Re-Continuation, until thereafter changed or amended in accordance with this Agreement, including the occurrence of a subsequent Continuation, and (ii) a majority of more than fifty percent (50%) of the Shares entitled to vote thereon in favor of the approval of waiving any notice requirements under the Company’s Organizational Documents or Law applicable to calling, holding and convening the Cayman Shareholder Meeting (or any adjournment, reconvening or postponement thereof); provided, that, in each case of the foregoing clauses (i) and (ii), holders of more than fifty percent (50%) of the outstanding Shares are present (in person or by proxy) or represented at the Luxembourg Shareholders Meeting (or any adjournment, reconvening or postponement thereof) (the approvals and adoptions in the foregoing clauses (i) and (ii), collectively, the “Luxembourg Shareholder Approval”), are the only votes, adoptions or approvals of the holders of any class or series of capital stock of the Company that are necessary to approve and adopt this Agreement and the Transactions, including the Continuation and the Merger (except, in the case of the consummation of the Merger, the Cayman Shareholder Approval).

 

(e)          The affirmative votes of the holders (in person or by proxy) of (i) a majority of not less than sixty six point seven percent (66.7%) of the Continuation Shares entitled to vote thereon present (in person or by proxy) or represented at the Cayman Shareholders Meeting or any adjournment, reconvening or postponement thereof in favor of the adoption of the Statutory Plan of Merger (including the memorandum and articles of association enclosed therewith) and the approval of the Merger (or, where a poll is taken in accordance with the Memorandum and Articles of Association, regard shall be had in computing a majority to the number of votes to which each shareholder is entitled) and (ii) a majority of more than fifty percent (50%) of the Continuation Shares entitled to vote thereon in favor of the approval of waiving any notice requirements under the Company’s Organizational Documents or Law applicable to calling, holding and convening the Cayman Shareholder Meeting (or any adjournment, reconvening or postponement thereof), provided, that, in each case of the foregoing clauses (i) and (ii), two (2) or more holders of the Continuation Shares entitled to vote are present (in person or by proxy) or represented at the Cayman Shareholders Meeting (or any adjournment, reconvening or postponement thereof) in the manner contemplated by this Agreement (the approvals and adoptions in the foregoing clauses (i) and (ii), collectively, the “Cayman Shareholder Approval”), are the only votes, adoptions or approvals of the holders of any class or series of the share capital of the Company following the Continuation Effective Time that are necessary to approve and adopt this Agreement and the Transactions, including the Continuation, the Re-Continuation (subject to the occurrence of a Closing Failure), the Merger and the Statutory Plan of Merger (including the memorandum and articles of association enclosed therewith).

 

                            Section 3.04          Governmental Clearances. Except for (a) approvals, filings, certifications and registrations expressly contemplated under Article I and Article II, (b) compliance with the applicable requirements of the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder (collectively, the “Securities Act”) and the Exchange Act, (c) compliance with the rules and regulations of The Nasdaq Global Market (the “NASDAQ”), (d) consents, approvals, filings, authorizations, declarations or registrations as are required to be made or obtained in connection with the Governmental Clearances, (e) compliance with any applicable state securities or blue sky laws and (f) consents, approvals, filings, authorizations, declarations or registrations as are required to be made or obtained under applicable Gaming Laws and, assuming the accuracy of the representations and warranties made by Parent and Merger Sub in Section 4.04(a), no consent or approval of, or waiver from or filing, license, permit or authorization, declaration or registration with, any Governmental Authority is necessary for the execution and delivery of this Agreement by the Company, the performance by the Company of its obligations hereunder and the consummation by the Company of this Agreement and the Transactions, other than such other consents, approvals, waivers, filings, licenses, permits or authorizations, declarations or registrations that, if not obtained, made or given, would not have or would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

 

                            Section 3.05          Company SEC Documents; Undisclosed Liabilities.

 

(a)          The Company has timely filed with the SEC all material reports, schedules, forms, statements and other documents required to be filed by the Company with the SEC pursuant to the Securities Act or the Exchange Act since January 1, 2021 (together with any documents or information furnished during such period by the Company to the SEC on a voluntary basis on Form 6-K and any reports, schedules, forms, registration statements and other documents filed with the SEC subsequent to the date hereof and prior to the Closing Date, collectively, the “Company SEC Documents”). As of their respective effective dates (in the case of Company SEC Documents that are registration statements filed pursuant to the requirements of the Securities Act) and as of their respective SEC filing dates (in the case of all other Company SEC Documents), or, if amended, as of the date of such amendment, each Company SEC Document complied, and each Company SEC Document filed subsequent to the date hereof will comply, as to form in all material respects with the requirements of the Securities Act or the Exchange Act, as the case may be, applicable to such Company SEC Documents, and none of the Company SEC Documents when filed or furnished or, if amended prior to the date of this Agreement, as of the date of such amendment, contained, or with respect to the Company SEC Documents filed subsequent to the date hereof, will contain, any untrue statement of a material fact, omitted or will omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. As of the date hereof, there are no outstanding written comments from the SEC with respect to the Company SEC Documents.

 

(b)          The Company has established and maintains disclosure controls and procedures (as defined in Rule 13a-15 under the Exchange Act). Such disclosure controls and procedures are designed to ensure that material information relating to the Company and other material information required to be disclosed by the Company in the reports and other documents that it files or furnishes under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC, and that all such material information is accumulated and communicated to the Company’s principal executive officer and its principal financial officer as appropriate to allow timely decisions regarding required disclosure and to make the certifications required pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”). The Company maintains systems of internal control over financial reporting that are sufficient to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with IFRS, including policies and procedures sufficient to provide reasonable assurance: (i) the Company maintains records that in reasonable detail accurately and fairly reflect, in all material respects, its transactions and dispositions of assets; (ii) that transactions are recorded as necessary to permit the preparation of financial statements in conformity with IFRS; (iii) that receipts and expenditures are being made only in accordance with authorizations of management and its board of directors; and (iv) regarding prevention or timely detection of unauthorized acquisition, use or disposition of its assets that could have a material effect on its financial statements. Since January 1, 2021, neither the Company, nor to the Knowledge of the Company, the Company’s independent registered public accounting firm, has identified or received any notification of (i) any “significant deficiencies” or “material weaknesses” in the design or operation of its internal controls over financial reporting, (ii) any fraud, whether or not material, that involves management or other employees or independent contractors who have a significant role in the Company’s internal control over financial reporting, or (iii) any complaints regarding a material violation of accounting procedures, internal accounting controls or auditing matters relating to periods since January 1, 2021 that would be reasonably expected to materially and adversely affect the Company’s ability to record, process, summarize and accurately report financial information.

 

(c)          The consolidated financial statements of the Company (including, in each case, any notes thereto) contained in the Company SEC Documents were prepared in accordance with IFRS (applied on a consistent basis) and Regulation S-X and Regulation S-K, each as promulgated by the SEC and as applicable, throughout the periods indicated (except as may be indicated in the notes thereto or, in the case of unaudited financial statements, as permitted by Form 20-F of the SEC) and each fairly presents, in all material respects, the financial position, results of operations, changes in shareholders equity and cash flows of the Company and its Subsidiaries on a consolidated basis as at the respective dates thereof and for the respective periods indicated therein, (subject, in the case of unaudited statements, to normal and recurring year-end adjustments which have not had, and would not reasonably be expected to individually or in the aggregate be material).

 

(d)          Neither the Company nor any of its Subsidiaries is a party to, or has any commitment to become a party to, any joint venture, off-balance sheet partnership or any similar Contract (including any Contract relating to any transaction or relationship between or among the Company and any of its Subsidiaries, on the one hand, and any unconsolidated Affiliate, including any structured finance, special purpose or limited purpose entity, on the other hand, or any “off-balance sheet arrangement” (as defined in Item 303(a) of Regulation S-K promulgated by the SEC)), where the result, purpose or intended effect of such Contract is to avoid disclosure of any material transaction involving, or material liabilities of, the Company or any of its Subsidiaries in the Company SEC Documents.

 

(e)          The Company is in compliance in all material respects with (i) the provisions of the Sarbanes-Oxley Act, as amended and the rules and regulations of the SEC promulgated thereunder that are applicable to the Company, and (ii) the rules and regulations of NASDAQ that are applicable to the Company.

 

(f)          None of the information supplied or to be supplied by or on behalf of the Company for inclusion in the Shareholder Circulars shall, on the date the respective Shareholder Circulars are sent or mailed to shareholders of the Company, or at the time of the Luxembourg Shareholder Meeting and the Cayman Shareholder Meeting, as the case may be, contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they are made, not misleading or omit to state any material fact necessary to correct any statement in any earlier communication with respect to the solicitation of proxies for the Luxembourg Shareholder Meeting and the Cayman Shareholder Meeting, as the case may be, which has become false or misleading. Notwithstanding the foregoing, the Company makes no representation or warranty with respect to information about Parent, Merger Sub or any Affiliates thereof that have been supplied by or on behalf of Parent for inclusion in the Shareholder Circulars.

 

                            Section 3.06          Absence of Certain Changes.

 

(a)          Since January 1, 2023, there has not been any change, effect, circumstance or development which has had or would reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect that is continuing.

 

(b)          Since January 1, 2023 and through the date of this Agreement, the Company and its Subsidiaries have conducted their respective businesses in the ordinary course of such businesses and there has not been any action taken by the Company or any of its Subsidiaries that, if taken by the Company or any of its Subsidiaries during the period from the date of this Agreement through the Effective Time without Parent’s consent would constitute a violation of Section 5.01 (other than Section 5.01(b)(i), Section 5.01(b)(iii) and Section 5.01(b)(vii)).

 

                            Section 3.07          Legal Proceedings. There are no civil, criminal, or administrative actions, suits, demands, claims, hearings, arbitrations, mediations, audits, inquires, examinations, litigations, hearings, notices of violation, investigations, proceedings, demand letters, settlements, or enforcement actions (“Proceedings”), pending or, to the Knowledge of the Company, threatened in writing against the Company or any of its Subsidiaries, or any of their respective present or former officers or directors, except for those that have not been or would not reasonably be expected to be, individually or in the aggregate, material to the Company and its Subsidiaries, taken as a whole, or that, as of the date hereof, relate to the execution, delivery, performance or consummation of this Agreement, the Support Agreement or any of the Transactions, including the Continuation and the Merger. Neither the Company nor any of its Subsidiaries is a party to or subject to any Order that has been or would reasonably be expected to be material to the Company and its Subsidiaries, taken as a whole, or that would prevent, materially delay or materially impair the ability of the Company to consummate the Continuation and the Merger.

 

                            Section 3.08          Compliance with Laws; Permits.

 

(a)          Except as would not reasonably be expected to be material to the Company and its Subsidiaries, taken as a whole, (i) the businesses of each of the Company and its Subsidiaries since January 1, 2020 (the “Applicable Date”) have not been, and are not being, conducted in violation of any applicable Law and (ii) to the Knowledge of the Company, no investigation or review by any Governmental Authority with respect to the Company or any of its Subsidiaries is pending or, as of the date of this Agreement, threatened, nor has any Governmental Authority indicated an intention to conduct the same, nor has the Company or any of its Subsidiaries received any report, allegation, complaint, or any other information from any party related to potential non-compliance with any applicable Law by the Company or any of its Subsidiaries. The Company and its Subsidiaries possess each material permit, license, certification, approval, registration, consent, authorization, franchise, concession, variance, exemption and Order issued, granted or required by a Governmental Authority (each, a “License” and collectively, the “Licenses”) necessary to conduct their respective businesses, in all material respects, as presently conducted. Notwithstanding the foregoing, this Section 3.08 shall not apply with respect to Taxes, which shall be covered exclusively by Section 3.09 or Environmental Laws, which shall be covered exclusively by Section 3.12.

 

(b)          The Company, its Subsidiaries, their respective officers, directors and, to the Knowledge of the Company, their employees, independent contractors, agents, Representatives, intermediaries or other third parties acting on behalf of the Company or its Subsidiaries are in compliance in all material respects with and have, in the last five years, complied in all material respects with: (i) the U.S. Foreign Corrupt Practices Act of 1977, as amended (15 U.S.C. § 78dd-1, et seq.) (“FCPA”) to the extent applicable, (ii) all other applicable Anti-Corruption Laws and (iii) applicable Sanctions and Export Controls. The Company, its Subsidiaries and their respective officers, directors and employees have not, in the last five years, paid, offered or promised to pay, or authorized or ratified the payment, directly or to the Knowledge of the Company indirectly, of any monies or anything of value to any national, provincial, municipal or other Government Official or any political party or candidate for political office for the purpose of influencing any act or decision of such official to obtain or retain business, or to secure any other improper benefit or advantage, in each case in violation of any of the FCPA or any Anti-Corruption Laws.

 

(c)          The Company and its Subsidiaries have instituted and maintain policies and procedures reasonably designed to promote compliance with (i) the FCPA (to the extent applicable) and other applicable Anti-Corruption Laws, and (ii) applicable Sanctions and Export Controls.

 

(d)          Neither the Company nor any of its Subsidiaries nor any director or officer, nor, to the Knowledge of the Company, any employee of the Company or any of its Subsidiaries, is, or in the last five years has been, subject to any actual, pending, or, to the Knowledge of the Company, threatened Proceeding by any Government Authority, or made any voluntary disclosures to any Governmental Authority, involving the Company or any of its Subsidiaries relating to (i) the FCPA (to the extent applicable) or any other applicable Anti-Corruption Laws, or (ii) applicable Sanctions and Export Controls. To the Knowledge of the Company, there are no facts that could lead to any such investigations, allegation, enforcement, or proceeding in the future.

 

(e)          None of the Company, any of its Subsidiaries, nor any of their respective directors or officers, nor, to the Knowledge of the Company, any of their respective employees, independent contractors, agents, or other third-party representatives acting for or on behalf of any of the foregoing (i) is or has been a Sanctioned Person, or (ii) has, in the last five years, entered into any agreement, transaction, or dealing with, for the benefit of or related to any Sanctioned Person (or involving any property thereof) or Sanctioned Territory, in violation of Sanctions.

 

                            Section 3.09          Tax Matters.

 

(a)          The Company and each of its Subsidiaries has prepared (or caused to be prepared) and timely filed (taking into account valid extensions of time within which to file) all material Tax Returns required to be filed, and all such Tax Returns are true, correct and complete in all material respects.

 

(b)          All material Taxes owed by the Company and each of its Subsidiaries that are due (whether or not shown on any Tax Return) have been paid or have been adequately reserved against in accordance with IFRS or the applicable local accounting standard.

 

(c)          There is no claim, audit, action, suit, proceeding, examination or investigation now pending or, to the Knowledge of the Company, threatened against or with respect to the Company or any of its Subsidiaries in respect of any material amount of Tax.

 

(d)          The Company and each of its Subsidiaries is, and at all relevant times has been, in compliance with all terms and conditions of any material Tax ruling, Tax exemption, Tax holiday or Tax reduction agreement or order, in each case, that is not generally available to Persons without specific application therefor.

 

(e)          There are no Liens for Taxes on any of the assets of the Company or any of its Subsidiaries other than Permitted Liens.

 

(f)          None of the Company or any of its Subsidiaries has been a “controlled corporation” or a “distributing corporation” in any distribution occurring during the two-year period ending on the date of this Agreement that was purported or intended to be governed by Section 355 of the Code (or any similar provision of applicable Law).

 

(g)          No deficiency for any material Tax has been asserted or assessed by any Governmental Authority in writing against the Company or any of its Subsidiaries, except for deficiencies that have been satisfied by payment in full, settled or withdrawn or that have been adequately reserved.

 

(h)          Neither the Company nor any of its Subsidiaries has waived any statute of limitations in respect of any material Taxes or agreed to any extension of time with respect to an assessment or deficiency for any material Taxes (other than pursuant to extensions of time to file Tax Returns obtained in the ordinary course).

 

(i)          Neither the Company nor any of its Subsidiaries has participated in any “reportable transaction” within the meaning of Treasury Regulation Section 1.6011-4(b) or comparable provision of any other applicable Tax Law and neither the Company nor any of its Subsidiaries has entered into or been a party to any scheme, arrangement, transaction or series of transactions that is deemed abusive under applicable Law.

 

(j)          The Company and each of its Subsidiaries has reported and withheld all material amounts required to have been reported or withheld in connection with amounts paid or owed to any employee, independent contractor, creditor, shareholder or any other third party. The Company and each of its Subsidiaries has paid such withheld amounts to the appropriate Governmental Authority.

 

(k)          Neither the Company nor any of its Subsidiaries is a party to a Tax allocation, sharing, indemnity or similar agreement (other than any customary commercial agreement entered into in the ordinary course of business, not primarily related to Taxes) that will require any payment by the Company or any of its Subsidiaries of any Tax of another Person (other than the Company or any of its Subsidiaries) after the Closing Date.

 

(l)          Neither the Company nor any of its Subsidiaries has ever been a member of an affiliated, combined, consolidated or unitary Tax group for purposes of filing any Tax Return or has any liability for the Taxes of any Person other than the Company and its Subsidiaries pursuant to Treasury Regulation Section 1.1502-6 (or any similar provision of applicable Law), as a transferee or successor, by Contract.

 

(m)          Neither the Company nor any of its Subsidiaries has agreed to, requested, or is required to include any adjustment under Section 481 of the Code (or any corresponding provision of applicable Law) by reason of a change in accounting method.

 

(n)          None of the Company nor any of its Subsidiaries is (i) now, or has been during the applicable period specified in Section 897(c)(1)(A)(ii) of the Code, a United States real property holding corporation within the meaning of Section 897(c)(2) of the Code or (ii) is subject to any special provision of Tax Law applicable to entities that own over a certain threshold of real estate.

 

(o)          Neither the Company nor any of its Subsidiaries has or has had a permanent establishment in any jurisdiction other than the jurisdiction in which it is organized, formed or incorporated, as applicable. No written claim has been made by a Governmental Authority in a jurisdiction where the Company or any of its Subsidiaries has not paid Taxes or filed Tax Returns asserting that the Company or such Subsidiary is or may be subject to Tax or required to file a Tax Return in such jurisdiction.

 

(p)          Neither the Company nor any of its Subsidiaries will be required to include any material item of income in, or exclude any material item of deduction from, Taxable income for any Taxable period (or portion thereof) ending after the Closing Date as a result of any (i) change in method of accounting for a Taxable period ending on or prior to the Closing Date, (ii) “closing agreement” described in Section 7121 of the Code (or any corresponding or similar provision of applicable Law) executed on or prior to the Closing Date, (iii) intercompany transactions or any excess loss account described in Treasury Regulations under Section 1502 of the Code (or any corresponding or similar provision of applicable Law) in connection with such intercompany transactions entered into on or prior to the Closing Date, (iv) installment sale or open transaction disposition made on or prior to the Closing Date, (v) any prepaid amount received or deferred revenue accrued on or prior to the Closing or (vi) election pursuant to Section 965 of the Code (or any corresponding or similar provision of applicable Law) made on or prior to the Closing Date.

 

(q)          Neither the Company nor any of its Subsidiaries has (i) elected to defer the payment of any “applicable employment taxes” pursuant to Section 2302 of the CARES Act. (ii) claimed any “employee retention credit” pursuant to Section 2301 of the CARES Act; or (iii) otherwise claimed any form or Tax benefit pursuant to any legislation related to COVID-19.

 

(r)          Neither the Company nor any of its Subsidiaries has a permanent establishment or is otherwise a resident for Tax purposes in any jurisdiction other than the jurisdiction of its organization, formation or incorporation, as applicable.

 

(s)          Notwithstanding anything in the Agreement to the contrary, this Section 3.09, Section 3.10 and Section 3.11 (to the extent related to Tax matters) contain the sole and exclusive representations and warranties of the Company and its Subsidiaries regarding Tax matters.

 

                            Section 3.10          Employee Benefits.

 

(a)          Section 3.10 of the Company Disclosure Schedule contains a true, correct and complete list, as of the date of this Agreement, of each material Company Plan, other than individual employment agreements and offer letters that are consistent in all material respects with standard form agreements or letters that have been provided to Parent (each such agreement a “Standard Individual Arrangement”). With respect to each material Company Plan other than Standard Individual Arrangements, the Company has made available to Parent true, correct and complete copies (to the extent applicable) of (i) the plan document, including any amendments thereto, other than any portion of a document that the Company or any of its Subsidiaries is prohibited from making available to Parent as the result of applicable Privacy Requirements, (ii) the most recent summary plan description and summary of material modifications, (iii) each trust, insurance, annuity contract or other funding vehicle, (iv) the most recent financial statements and actuarial or other valuation reports prepared with respect thereto, (v) the three (3) most recently filed annual reports, and (vi) the most recently received IRS determination letter or any tax determination or qualification letter applicable in any jurisdiction outside the United States.

 

(b)          Except as would not reasonably be expected to be material to the Company and its Subsidiaries, taken as a whole, each Company Plan (and related trust or funding vehicle) has been maintained, operated and administered in compliance with its terms and applicable Law and any applicable collective bargaining agreements), and all contributions to each Company Plan have been timely paid or made in full or, to the extent not yet due, properly accrued on the Company’s most recent balance sheet in accordance with the terms of such Company Plan and all applicable Law. No Company Plan or fiduciary or administrator of any such Company Plan has taken any action, or failed to take any action, which action or failure would reasonably be expected to subject the Company or any of its Subsidiaries or any Participant to any material liability for breach of any fiduciary duty, with respect to or in connection with any such Company Plan. There are no pending or, to the Knowledge of the Company, threatened material investigations by any Governmental Authority, proceedings or claims (except for claims for benefits in the ordinary course) against or in relation to such Non-U.S. Company Plan.

 

(c)          Neither the Company nor any ERISA Affiliate maintains, contributes to, or sponsors (or has in the last six years maintained, contributed to, or sponsored) a multiemployer plan as defined in Section 3(37) of ERISA or a plan subject to Title IV or Section 302 of ERISA or Section 412 or 430 of the Code. Other than the Company Plans and for severance, notice pay or other statutory benefits required under applicable law, neither the Company nor any of its Subsidiaries has any material liability (actual or contingent) to pay, secure or enhance, (other than by payment of employers’ contributions to social security and other Taxes) any pension or other benefit payable on retirement, termination of employment or on death to any non-U.S. Participant. None of the employees or former employees of the Company or any of its Subsidiaries in the United Kingdom or the European Union whose employment has transferred to the Company pursuant to the EU Acquired Rights Directive 2001/23/EC and any local regulations implementing that directive has any right to benefits under or in relation to an occupational pension scheme that are not “old-age, invalidity or survivors’ benefits” (as referred to in Article 4(a) of the EU Acquired Rights Directive 2001/23/EC and any local regulations implementing that directive).

 

(d)          Except as required under applicable Law, or where the full cost of such benefits is borne by the current or former employee (or any of their beneficiaries), no Company Plan provides health, medical or other welfare benefits coverage following retirement or other termination of employment other than under an employment agreement or severance agreement requiring the Company to pay or subsidize premiums under the Consolidated Omnibus Budget and Reconciliation Act of 1985 for a terminated employee or the employee’s beneficiaries for a specified period following such employee’s termination of employment.

 

(e)          With respect to each Non-US Company Plan that under applicable law is managed or controlled by the Company or any of its Subsidiaries, except as would not reasonably be expected be material to the Company and its Subsidiaries (taken as a whole), (i) such Non-US Company Plan has obtained from the Governmental Authority having jurisdiction with respect to such Non-US Company Plan any required determinations, or has time remaining to obtain them, and (ii) such Non-US Company Plan is in compliance with the applicable Laws and regulations of the relevant jurisdiction. No Non-U.S. Company Plan is a defined benefit pension plan

 

(f)          The consummation of the Transactions will not, either alone or in combination with another event, (i) accelerate the time of payment or vesting, or increase the amount of compensation due to any director, officer or employee of the Company or any of its Subsidiaries (whether by virtue of any termination, severance, change of control or similar benefit or otherwise), (ii) cause the Company or any of its Subsidiaries to transfer or set aside any assets to fund any benefits under any Company Plan, (iii) limit or restrict the right to amend, terminate or transfer the assets of any Company Plan on or following the Effective Time or (iv) result in the payment of any “excess parachute payment” (as defined in Section 280G(b)(1) of the Code) that will be non-deductible by the Company or its applicable Subsidiary as a result of Section 280G of the Code.

 

(g)          With respect to each grant of a Company Equity Award, (i) each such grant was made in all material respects in accordance with the terms of the applicable Company Equity Plan and applicable Law (including the rules of NASDAQ or any other applicable stock exchange and the terms of any applicable securities listing agreement), (ii) to the extent such Company Equity Award is Tax-advantaged in the applicable jurisdiction, the Company has satisfied all applicable requirements, including, in accordance with applicable Law, to maintain such status and (iii) each such grant was properly accounted for in all material respects in accordance with IFRS or Generally Accepted Accounting Principles in the Company SEC Documents (including financial statements) and all other applicable Laws. Each Company Option granted to any Participant who is a U.S. taxpayer has been granted with an exercise price per share equal to or greater than the fair market value (as such term is used in Section 409A of the Code and the guidance and regulations issued thereunder) per share underlying such Company Option on the grant date thereof.

 

(h)          With respect to each Company Equity Award granted to an Israeli taxpayer, Section 3.10(h) of the Company Disclosure Schedule sets forth whether such Company Equity Award was granted under, and is subject to Tax in Israel pursuant to, Section 3(i) of the ITO or Section 102 (and if subject to Section 102, the specific subsection of Section 102 under which such Company Equity Award was granted under, and is subject to Tax pursuant to) and whether an election was made to treat such Company Equity Award under the “capital gains route” or “ordinary income route”, and if such Company Equity Award was granted under Section 102(b)(2) of the ITO, the date on which each such Company Equity Award was deposited with the 102 Trustee and the date the Board resolution granting such Company Equity Awards was deposited with the 102 Trustee (unless the ITA have provided a tax ruling determining that such documents do not have to be deposited with the 102 Trustee).

 

(i)          True, correct and complete copies of each Company Equity Plan, all sub-plans relating to such Company Equity Plan, forms and agreements adopted under the Company Equity Plans, and executed copies of all award agreements that materially deviate from the terms of the template forms and agreements adopted under the Company Equity Plans, in each case, have been made available to Parent.

 

                            Section 3.11          Labor Matters.

 

(a)          As of the date of this Agreement, neither the Company nor any of its Subsidiaries is a party to, or bound by, any collective bargaining agreement or similar labor-related agreement or arrangement concerning the representation of employees, or any extension order, other than any such agreement or extension order that applies on a nation-wide basis or that is otherwise legally mandated.

 

(b)          As of the date of this Agreement, (i) no labor union, labor organization, works council, trade union, employers’ association, or similar organization represents or, to the Knowledge of the Company, claims to represent, any group of employees of the Company or its Subsidiaries, (ii) no demand for recognition, membership or payment on behalf of any employees of the Company or its Subsidiaries or on behalf of the Company or its Subsidiaries has been made within the last 3 years by or on behalf of any labor union, labor organization, works council, employers’ association, trade union or similar organization and, to the Knowledge of the Company, there are no activities or proceedings of any labor union, labor organization, works council, employers’ association, trade union or similar organization to organize any employees of the Company or any of its Subsidiaries and (iii) there is no pending or, to the Knowledge of the Company, threatened strike, lockout, slowdown, or work stoppage by or with respect to the employees of the Company or any of its Subsidiaries.

 

(c)          Each of the Company and its Subsidiaries is in material compliance with all applicable Laws relating to employment or labor, including those related to hiring, background checks, wages, pay equity, hours, vacation, holiday pay, sick pay, paid time off, leaves of absence, collective bargaining and labor relations, classification of independent contractors, workers and employees, equal opportunity, document retention, notice, plant closing and mass layoff, health and safety, employment eligibility verification, immigration, child labor, discrimination, harassment, retaliation, accommodations, disability rights or benefits, affirmative action, workers’ compensation, unemployment insurance, employment and reemployment rights of members of the uniformed services, secondment, employee leave issues, the payment of social security and other Taxes and the withholding of all amounts payable to Governmental Authorities or private pension funds. There is no material amount due to or in respect of any Participant that is in arrears and unpaid other than remuneration, salary and expenses or fees incurred in the ordinary course of business for the pay period current at the date of this Agreement but not yet due for payment including accrued but unpaid holiday pay.

                           

 

(d)          As of the date of this Agreement, (i) no current executive officer of the Company has given notice of termination of employment or is under notice of dismissal and (ii) the Company and its Subsidiaries have not made any loan or advance of an amount in excess of $10,000 to or for the benefit of any Participant that remains outstanding.

 

(e)          All of the Company’s and its Subsidiaries’ engagements with any Participant, or any engagement with any Participant that ended within the last three years, that have required a special visa, license or governmental authorization, have been in material compliance with applicable Law and such Participants have had all such required special visas, licenses or governmental authorizations for the duration of their engagement with the Company or the relevant Subsidiary.

 

(f)          All obligations of the Company and its Subsidiaries to provide statutory severance pay to their respective employees who reside or work in Israel, or whose employment is otherwise subject to the Laws of Israel (collectively, the “Israeli Employees”) pursuant to the Israeli Severance Pay Law, 5723-1963 are fully funded in accordance with Section 14 under the Severance Pay Law, 5723-1963 (any such fully-funded arrangement, a “Section 14 Arrangement”). Each Section 14 Arrangement has been properly applied to current Israeli Employees, from the commencement date of their employment, and based on their full base salaries. Neither the Company nor any of its Subsidiaries has any further liability or obligation to make payments of statutory or contractual severance pay in the event of termination of any of the Israeli Employees’ employment, for any reason, except for the release of the funds accumulated in accordance with any Section 14 Arrangement. With respect to the Israeli Employees, the Company and its Subsidiaries’ liability for any obligations to pay any amount of severance payment, pension or accrued vacation, is fully funded by deposit of funds in severance funds, pension funds, managers insurance policies or provident funds (and if not required to be so funded, adequate provisions have been made in the financial statements). Other than monthly base salaries, no Israeli Employee is entitled to any payment or benefit that may be reclassified as part of such employee’s salary for any purpose, including for calculating any social contributions.

 

                            Section 3.12          Environmental Matters. Except for such matters that have not had and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, (a) each of the Company and its Subsidiaries is and has been since the Applicable Date in compliance with all Environmental Laws, which compliance includes obtaining, maintaining and complying with all permits, licenses or authorizations required by applicable Environmental Laws, (b) neither the Company nor any of its Subsidiaries is subject to any Proceeding pending or, to the Knowledge of the Company, threatened, alleging non-compliance with or liability under any Environmental Law, (c) neither the Company nor any of its Subsidiaries is subject to any outstanding obligations under any Order concerning liability or obligations relating to any Environmental Law nor has the Company or any of its Subsidiaries assumed any liability of another Person relating to any Environmental Law, which would not otherwise be imposed on the Company or any of its Subsidiaries as a matter of law and (d) there have been no Release of Hazardous Substances by the Company or any of its Subsidiaries, or to the Knowledge of the Company, any other Person, on, at, under or from any property currently or, to the Knowledge of the Company, formerly owned, leased or operated by the Company or any of its Subsidiaries.

 

                            Section 3.13          Intellectual Property.

 

(a)          Section 3.13(a) of the Company Disclosure Schedule sets forth a true, complete and correct list of all Registered Company IP, including for each item (A) the owner(s) of such item, (B) the jurisdictions in which such item has been issued, registered or filed, (C) the issuance, registration or application date, as applicable, for such item and (D) the issuance, registration or application number, as applicable, for such item.

 

(b)          Except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, the Company and its Subsidiaries solely and exclusively own or have the valid right to use, free and clear of all Liens other than Permitted Liens, all Intellectual Property used in, or necessary to conduct, the business of the Company and its Subsidiaries as currently conducted.

 

(c)          Except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, (A) no Registered Company IP is involved in any interference, opposition, reissue, re-examination, revocation or equivalent proceeding and (B) no other Action is pending or, to the Knowledge of the Company, threatened (i) challenging the ownership, enforceability, scope, validity or use by the Company or any of its Subsidiaries of any Company IP, or (ii) alleging that the Company or any of its Subsidiaries is violating, misappropriating or infringing the Intellectual Property of any Person. There are no Orders to which the Company or any of its Subsidiaries is subject that materially restrict their use of or rights under any material Company IP.

 

(d)          To the Knowledge of the Company, no Person is misappropriating, violating or infringing any Company IP in a manner that would reasonably be expected to be material to the Company and its Subsidiaries, taken as a whole. Except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, the operation of the business of the Company and its Subsidiaries as currently conducted does not infringe, misappropriate, or otherwise violate, and as previously conducted since the Applicable Date has not infringed, misappropriated or otherwise violated, the Intellectual Property of any other Person, and, to the Knowledge of the Company, there are no unresolved claims asserted or threatened against the Company or any of its Subsidiaries alleging any such infringement, misappropriation or other violation.

 

(e)          Except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, no Person who is entitled to be indemnified, defended, held harmless or reimbursed by the Company or any of its Subsidiaries for any existing or potential Intellectual Property infringement, misappropriation or similar claim has made any such claims against the Company or any of its Subsidiaries for indemnification, reimbursement, contribution or the advancement of contribution of expenses.

 

(f)          Except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, none of the execution, delivery or performance of this Agreement, nor the consummation of the Transactions, will result in (i) the loss or impairment of or payment of any additional amounts with respect to, rights of the Company or any of its Subsidiaries to own or use the Business IP, or (ii) the Company or any of its Subsidiaries granting to any Person any ownership, license or other interest under or with respect to any Company IP.

 

(g)          Except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, the Company or one of its Subsidiaries has entered into written agreements with each current and former employee, officer, founder, consultant or independent contractor who is or was involved in or has contributed to the invention, creation, or development of any Intellectual Property for or on behalf of the Company or any of its Subsidiaries (each, a “Company Associate”): assigning to the Company (or one of the Company’s Subsidiary’s) any ownership interest of the Company Associate in or to such Intellectual Property. Except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, the Company and its Subsidiaries are current with their obligations, including all mandatory compensation, in the foregoing respect under the arrangements with all Company Associates in relation to all Intellectual Property rights developed on behalf of the Company and its Subsidiaries, and neither the execution, delivery or performance of this Agreement, nor the consummation of the Transaction will result in any further amounts being payable to any current or former Company Associate in relation to any Intellectual Property rights developed on behalf of the Company and its Subsidiaries. To the Knowledge of the Company, no Company Associate has any ownership interest, right or claim in any material Company IP.

 

(h)          The Company and its Subsidiaries have taken commercially reasonable steps to protect and maintain the confidentiality of all confidential Trade Secrets included in the Company IP.

 

(i)          Except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, the Company and its Subsidiaries have not incorporated, embedded or used any Open Source Software in a manner that (i) requires that any Company Software to: (A) be licensed, disclosed or made available to any third party in source code form, (B) be licensed to any third party for the purpose of modification or redistribution, (C) be licensed to any third party at no charge or (D) be licensed under terms that allow reverse engineering, reverse assembly or disassembly of any kind; or (ii) requires the Company or any of its Subsidiaries to grant any patent license or other patent rights, in each case, under Company IP to a third party. Except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, (i) all use and distribution of Software by or through the Company and its Subsidiaries is in material compliance with all Open Source Software licenses applicable thereto and (ii) the Company and its Subsidiaries have not received a notice or request from any third party to disclose, distribute or license any of the Company Software pursuant to an Open Source Software license, or alleging noncompliance with any Open Source Software license.

 

(j)          Except as set forth on Section 3.13(j)(i) of the Company Disclosure Schedule, neither the Company nor any of its Subsidiaries are party to any source code escrow agreement or other agreement requiring the deposit, licensing or other provision of source code of any Company Software for the benefit of any third party. Except as set forth on Section 3.13(j)(ii) of the Company Disclosure Schedule, neither the execution of this Agreement nor the consummation of the Transaction will result in any requirement on the Company or any of its Subsidiaries to (A) disclose or deliver any material source code to any third party (other than updates to existing source code escrow deposits in the ordinary course of business) or (B) release any material source code that is currently deposited in an escrow, except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect. Neither the Company nor any of its Subsidiaries, nor any Person acting on behalf of the Company or any of its Subsidiaries, has otherwise disclosed, delivered or licensed to any third party, or permitted the disclosure, delivery or license of, any source code for Company Software (or agreed under any contract to do any of the foregoing), except for disclosures to employees, contractors or consultants under written agreements that prohibit use or disclosure of such source code other than in the performance of services to the Company or one of its Subsidiaries, except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

 

(k)          To the Knowledge of the Company, except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect (i) none of the Company Software or Company IT Systems under the control of the Company and its Subsidiaries contains any defect, programming design error, virus, “trojan horse”, worm or other malicious code purposely designed to permit unauthorized access, to disable, disrupt, erase or otherwise harm Software, hardware or data of any end user and (ii) none of the Company Software constitutes, contains or is considered “spyware” or “trackware” (as such terms are commonly understood in the software industry).

                            Section 3.14          Anti-Takeover Provisions. No “fair price”, “moratorium”, “control share acquisition”, “interested shareholder” or other similar anti-takeover statute or similar statute or regulation (each, a “Takeover Law”) applies to the Company, the Significant Shareholders, this Agreement, the Support Agreement, the Transactions, the Shares or the Continuation Shares.

 

                            Section 3.15          Real Property.

 

(a)          As of the date of this Agreement, neither the Company nor any of its Subsidiaries own any real property.

 

(b)          Section 3.15(b) of the Company Disclosure Schedule sets forth a true, correct and complete list of all real property subject to a lease, sublease or other occupancy agreement (each a “Real Estate Lease”) by the Company or any of its Subsidiaries as of the date of this Agreement (collectively, including the buildings, structures and other improvements located thereon, the “Leased Real Property”), and for each Leased Real Property, identifies the street address of such Leased Real Property. Except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, the Company or one of its Subsidiaries has a valid leasehold interest in, and enjoys actual, exclusive, peaceful and undisturbed possession of, all Leased Real Property, in each case, free and clear of all Liens other than Permitted Liens. Except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, there are no leases, subleases, licenses, occupancy agreements, options, rights or other agreements or arrangements to which the Company or any of its Subsidiaries is a party, granting to any Person the right to use, occupy or otherwise obtain a real property interest in any of the Leased Real Property.

 

(c)          True, correct and complete copies of each Real Estate Lease have been made available to Parent prior to the date hereof, including any amendments, modifications or changes thereto.

 

                            Section 3.16          Contracts.

 

(a)          Section 3.16(a) of the Company Disclosure Schedule sets forth a list as of the date of this Agreement of each Contract to which either the Company or any of its Subsidiaries is a party or bound other than each Contract solely among the Company and its wholly owned Subsidiaries that:

(b)          A true, correct and complete copy of each Material Contract, as amended as of the date of this Agreement, including all attachments, schedules and exhibits thereto, has been made available to Parent. Except as would not reasonably be expected to be material to the Company and its Subsidiaries, taken as a whole, (i) each of the Material Contracts, is valid and binding on the Company or its Subsidiaries, as the case may be and, to the Knowledge of the Company, each other party thereto, and, to the Knowledge of the Company, is in full force and effect, or (ii) neither the Company nor any of its Subsidiaries has received or delivered written notice of breach of or default under any Material Contract, and neither the Company nor any of its Subsidiaries nor, to the Knowledge of the Company, any other party is in breach of or in default under any Material Contract, and no event has occurred that, with the lapse of time or the giving of notice or both, would constitute a default thereunder by the Company or any of its Subsidiaries or, to the Knowledge of the Company, any other party.

 

                            Section 3.17          Gaming.

 

(a)          Except as set forth on Section 3.17(a) of the Company Disclosure Schedule, neither the Company, nor any of its Subsidiaries, or any of their respective shareholders, owners, officers, directors, or employees (i) has suffered a suspension, denial, non-renewal, condition (other than a Customary Condition), revocation or non-issuance of any Gaming License for any reason whatsoever or (ii) withdrawn any application for any Gaming License for any reason whatsoever.

 

(b)          Neither the Company, nor any of its Subsidiaries, or any of their respective officers, directors or employees (i) has been informed that a Gaming Regulatory Authority does not intend to renew a Gaming License or (ii) are in receipt of any communication, written or otherwise, from a Gaming Regulatory Authority that suggests the Gaming Regulatory Authority is considering whether to, or intends to, revoke, suspend, not renew or materially modify any Gaming License, in whole or in part.

 

(c)          All Gaming Licenses required for the conduct of the respective businesses of the Company and each of its Subsidiaries under applicable Gaming Laws have been obtained by, and are currently held by, the Company and/or relevant Subsidiary, as applicable, and by their respective shareholders, owners, directors, officers, contractors and employees, and such Gaming Licenses are valid and in full force and effect. Such Gaming Licenses are not subject to any unusual conditions or other unusual limitations. All fees and charges due and payable with respect to such Gaming Licenses as of the date hereof have been paid in full.

 

(d)          All matters which are required to be notified to any relevant Gaming Regulatory Authority in accordance with relevant Gaming Law and the terms and conditions of any Gaming License have been so notified. All regulatory returns required to be filed with any Gaming Regulatory Authority have been filed without any material delay or adverse effect and were true and accurate in all material respects.

 

(e)          Neither the Company, its Subsidiaries, nor any of their respective shareholders, owners, officers, directors and employees is currently, nor has been, in material breach or default of the terms of any Gaming License, and no event has occurred which, with or without notice or lapse of time or both or action of a third party, would reasonably be expected to constitute or result in a material breach or default with the terms of any Gaming License.

 

(f)          Neither the Company nor any of its Subsidiaries has received notice of any investigation, review or proceedings relating to the suspension, revocation, cancelation, non-renewal or material adverse modification of any Gaming License that is material in any respect to the Company’s or its Subsidiaries’ business.

 

(g)          Since the Applicable Date, neither the Company, nor any of its Subsidiaries has been, or is currently, in material violation of any Gaming Laws of any jurisdictions either (i) in which it holds a Gaming License or (ii) from which it derives, directly or indirectly, any material revenue.

 

(h)          Except as set forth on Section 3.17(h) of the Company Disclosure Schedule, since the Applicable Date, neither the Company, nor any of its Subsidiaries, or any of their respective shareholders, owners, officers, directors or employees, nor, to the Knowledge of the Company, any B2B customer, has received notice (whether written or otherwise) of any investigation or review (whether actual, pending or threatened) relating to a potential material violation of any relevant Gaming Laws by any Gaming Regulatory Authority or other Governmental Authority, and, to the Knowledge of the Company, no investigation or review relating to a potential material violation of the Gaming Laws is pending or threatened, nor has any Gaming Regulatory Authority or other Governmental Authority indicated to the Company any intention to conduct the same, and there are no facts, matters or circumstances (i) to the Knowledge of the Company or (ii) that first arose at any time since the Applicable Date, which would reasonably give rise to any such investigation, review, inquiry, proceeding or action that (x) may result in the imposition of material sanctions in connection with a Gaming License, (y) may result in the revocation of a Gaming License or (z) has had or would reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

 

(i)          Neither the Company, any of its Subsidiaries, nor any of their respective shareholders, owners, officers, directors or employees has received any claim, demand, notice, report, allegation, complaint, court order or administrative order from any person (including without limitation any Gaming Regulatory Authority or other Governmental Authority) relating to any material violation or possible material violation of, any Gaming Law (a "Violation Claim"). To the Knowledge of the Company, no B2B Customer has received any Violation Claim in connection with its use of the assets or services of the Company and its Subsidiaries.

 

(j)          For purposes of this Section 3.17, a “material violation” is a violation that is contrary to the Gaming Laws, and includes violations which may result in financial penalties, fines, regulatory settlements in lieu of fines, as well as violations which may result in the suspension, denial, revocation, or imposition of a condition, other than a Customary Condition, to any Gaming License by the applicable Gaming Regulatory Authority.

 

(k)          Subject to completion of any regulatory obligations resulting from the Transactions set forth on Section 3.17(k) of the Company Disclosure Schedule, no Gaming License is liable to be varied, suspended or revoked as a result of the Closing.

 

(l)          To the Knowledge of the Company and subject to any change of Gaming Law following after the date hereof, there is no fact or circumstance that is reasonably expected to cause any Gaming License to be lapsed, terminated, invalidated, cancelled, revoked, suspended, subject to a variation or additional conditions during its current term or not to be renewed on terms which are no less advantageous to the Company or its relevant Subsidiary than the current terms of such Gaming License, and each action necessary to be undertaken by the Company and its Subsidiaries and for the renewal or extension of each Gaming License due to expire within twelve months from the date hereof has been duly taken.

 

(m)          Section 3.17(m) of the Company Disclosure Schedule sets forth a complete list of all territories from which the Company and its Subsidiaries derive revenue, including through B2B Customers.

 

(n)          Section 3.17(n) of the Company Disclosure Schedule sets forth a list of all material compliance policies adopted for ensuring compliance with the terms and conditions of the Gaming Licenses and applicable Gaming Laws. Such compliance policies have been designed and are regularly updated in accordance with Good Industry Practice to comply with the terms and conditions of the Gaming Licenses and/or applicable Gaming Laws and/or relevant guidance and standards issued by Gaming Regulatory Authorities from time to time. The Company and each of its Subsidiaries adheres in all material respects with such compliance policies.

 

(o)          To the Knowledge of the Company, all activities conducted by the B2B Customers of the Company and its Subsidiaries are and have been in compliance in all material respects since the Applicable Date with all applicable Gaming Laws and other applicable Laws, and such B2B Customers are and have been operating in all material respects since the Applicable Date in accordance with Good Industry Practice.

 

(p)          The Company and each of its Subsidiaries: (i) regularly monitors legal and regulatory developments which may impact on their respective business(es) in relevant jurisdictions; (ii) maintains a list of excluded and restricted territories (the “Excluded Territories List”); and (iii) has contractual mechanisms and processes in place to require territories or jurisdictions to be blocked if necessary at any time by the B2B Customers of the Company and its Subsidiaries. Such B2B Customers are promptly notified of any changes to the Excluded Territories List, and the Company and its Subsidiaries monitors compliance by such B2B Customers with the terms of the relevant contractual mechanisms and processes. To the Knowledge of the Company, no B2B Customer is using, or permitting the use by others of, the assets or services of the Company and its Subsidiaries in contravention of applicable Gaming Laws or other Laws. The Company and its Subsidiaries require each of the B2B Customers to be regulated by one or more Gaming Regulatory Authority, to the extent required by applicable Law, and, to the Knowledge of the Company, each B2B Customer is regulated by one or more Gaming Regulatory Authority, to the extent required by applicable Law.

 

                            Section 3.18          Customers and Suppliers. Section 3.18 of the Company Disclosure Schedule sets forth true, correct and complete lists of (a) the Company’s ten (10) largest suppliers for the fiscal year ended December 31, 2022, based on the aggregate amount paid or payable to such suppliers (each, a “Significant Supplier”), and the corresponding aggregate amount paid or payable to each Significant Supplier and (b) the Company’s ten (10) largest customers for the fiscal year ended December 31, 2022, based on the aggregate amount paid or payable by such customers to the Company and its Subsidiaries (each, a “Significant Customer”). Except as has not been or would not reasonably be expected to be, individually or in the aggregate, material to the Company and its Subsidiaries, taken as a whole, as of the date of this Agreement, none of the Company or any of its Subsidiaries (i) has any outstanding dispute with any Significant Supplier or Significant Customer or (ii) has, since the Applicable Date, received any written notice from any Significant Supplier or Significant Customer that such counterparty shall not continue, or does not expect to continue, as a supplier or customer (as applicable) of the Company or any of its Subsidiaries, as applicable, or that such supplier or customer intends to materially reduce the scale of the business conducted with the Company or any of its Subsidiaries.

 

                            Section 3.19          Insurance. The Company has made available to Parent true, correct and complete copies of all material insurance policies, bonds and surety arrangements currently in effect which any of the Company or its Subsidiaries is a party, a named insured or otherwise the beneficiary of coverage. The Company and each Company Subsidiary are insured against such losses and risks and in such amounts as are customary in the businesses in which they are engaged and as required by applicable Law, except where the failure to be so insured would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect. Each such insurance policy is in full force and effect and all premiums due with respect to all such policies have been paid when due and the Company is in compliance in all material respects with the terms and conditions of such insurance policies, except as has not had and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

 

                            Section 3.20          Opinion of Financial Advisor. The Company Board has received the opinion of Stifel, Nicolaus & Company, Incorporated (“Stifel”) to the effect that, as of the date of this Agreement and subject to the limitations, qualifications and assumptions set forth therein, the Merger Consideration to be paid to the holders (other than Parent and its Affiliates) of Continuation Shares upon consummation of the Merger is fair from a financial point of view to such holders.

 

                            Section 3.21          Brokers and Other Advisors. Except for Stifel, the fees and expenses of which will be paid by the Company, no broker, investment banker, financial advisor or other Person is entitled to any broker’s, finder’s, financial advisor’s or other similar fee or commission, or the reimbursement of expenses in connection therewith, in connection with the Transactions based upon arrangements made by or on behalf of the Company or any of its Subsidiaries. The Company has provided to Parent a complete and correct copy of the Company’s engagement letter agreement (including all amendments and arrangements related thereto) with Stifel in connection with the Transactions.

 

                            Section 3.22          Affiliate Transactions. Neither the Company nor any of its Subsidiaries is a creditor or debtor to, or party to any Contract or transaction with, any holder of five percent (5%) or more of the Shares or any present or former director, officer, employee or Affiliate of the Company or any of its Subsidiaries, or to any “immediate family member” (within the meaning of Item 404 of Regulation S-K promulgated by the SEC) of any of the foregoing, or has engaged in any transaction with any of the foregoing within the 12 months preceding the date of this Agreement that would be required to be disclosed pursuant to Item 404 of Regulation S-K promulgated by the SEC in the Company SEC Document, except for employment or compensation agreements or arrangements with directors, officers and employees made in the ordinary course, and which has not been so disclosed in the Company SEC Documents prior to the date of this Agreement.

 

 

 

ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB

 

Parent and Merger Sub hereby represent and warrant to the Company as follows:

 

                            Section 4.01          Organization, Good Standing and Qualification. Each of Parent, Merger Sub Parent and Merger Sub is a legal entity duly incorporated and organized, validly existing and in good standing (where such concept is recognized under applicable Law) under the Laws of its respective jurisdiction of its organization or incorporation and has all requisite power and authority to own, lease and operate its properties and assets and to carry on its business as it is presently being conducted and is duly licensed or qualified to do business and is in good standing (where such concept is recognized under applicable Law) in each jurisdiction in which the nature of the business conducted by it or the character or location of the properties or assets owned or leased by it makes such licensing or qualification necessary, except where the failure to be so licensed, qualified or in good standing would not reasonably be expected to have, individually or in the aggregate, a Parent Material Adverse Effect.

 

                            Section 4.02          Ownership of Merger Sub. All of the issued and outstanding share capital of Merger Sub is, and at the Effective Time will be, wholly owned directly by Merger Sub Parent and indirectly by Parent. Merger Sub was formed solely for purposes of engaging in the Transactions and has not conducted any business prior to the date of this Agreement and does not have any liabilities or obligations of any nature other than those incidental to its formation and pursuant to the Transactions, and prior to the Effective Time, will not have engaged in any other business activities other than relating to the Transactions.

 

                            Section 4.03          Authority; Approval.

 

(a)          Each of Parent and Merger Sub have all necessary power and authority to execute and deliver and perform its obligations under this Agreement and, after giving effect to the Merger Sub Parent Approval, to consummate the Merger. Parent has all necessary power and authority to cause Merger Sub Parent to perform its obligations under this Agreement. This Agreement has been duly executed and delivered by Parent and Merger Sub and, assuming due execution and delivery by the Company, constitutes a legal, valid and binding obligation of Parent and Merger Sub, enforceable against each of Parent and Merger Sub in accordance with its terms, except that such enforcement may be subject to the Enforceability Exceptions. The authorization by the boards of directors of Parent and Merger Sub and approval of Merger Sub Parent as the sole shareholder of Merger Sub are the only votes or approvals required in order for Parent and Merger Sub to execute and deliver this Agreement, to perform their obligations under this Agreement, or to consummate the Transactions, in each case, on the terms and subject to the conditions of this Agreement.

 

(b)          The board of directors of Parent has authorized and approved the execution, delivery and performance by Parent of this Agreement, the Support Agreement and the Transactions, including the Merger, which resolutions have not been subsequently rescinded, modified or withdrawn. The board of directors of Merger Sub has (i) determined that it is fair to, and in the best interests of Merger Sub and its sole shareholder for Merger Sub to enter into this Agreement and consummate the Transactions, including the Merger, (ii) approved and declared advisable this Agreement and the Support Agreement, and the execution, delivery and performance of this Agreement and the Transactions, including the Merger, upon the terms and subject to the conditions set forth in this Agreement, (iii) directed that Merger Sub submit to its sole shareholder, for adoption by written consent, the approval and adoption of this Agreement, the Statutory Plan of Merger and the Transactions, including the Merger and (iv) resolved to recommend such approval and adoption by Merger Sub Parent, in its capacity as the sole direct shareholder of Merger Sub, which resolutions have not been subsequently rescinded, modified or withdrawn.

 

                            Section 4.04          Governmental Approvals; Non-contravention.

 

(a)          Except for (a) approvals, filings, certifications and registrations expressly contemplated under Article I and Article II, (b) compliance with the applicable requirements of the Securities Act and the Exchange Act, (c) consents, approvals, filings, authorizations, declarations or registrations as are required to be made or obtained in connection with the Governmental Clearances, (d) compliance with any applicable state securities or blue sky laws, Australian securities Laws and Laws of the Australian Securities Exchange, and (e) the Gaming Consents, no consent or approval of, or waiver from or filing, license, permit or authorization, declaration or registration with any Governmental Authority is necessary for the execution and delivery of this Agreement by Parent or Merger Sub, the performance by Parent or Merger Sub of its obligations hereunder and the consummation by Parent and Merger Sub of this Agreement and the Transactions, other than such other consents, approvals, waivers, filings, licenses, permits or authorizations, declarations or registrations that, if not obtained, made or given, would not reasonably be expected to have, individually or in the aggregate, a Parent Material Adverse Effect.

 

(b)          Neither the execution and delivery of this Agreement by Parent and Merger Sub, nor the consummation by Parent and Merger Sub of the Merger and the other Transactions, nor performance or compliance by Parent and Merger Sub with any of the terms or provisions hereof, will (i) conflict with or violate any provision of the organizational documents of Parent or Merger Sub or (ii) assuming the consents, authorizations, approvals and compliance with the matters set forth in Section 3.03(c) and Section 3.04 (and assuming the accuracy of the representations and warranties made in such Section 3.03(c) and Section 3.04), (x) violate any Law applicable to Parent or Merger Sub or (y) with or without any lapse of time or the giving of notice or both, violate, conflict with, constitute a default, breach, termination or modification (or right of termination or modification) under, payment of additional fees, a requirement of any consent, or the creation or acceleration of any obligations under any of the terms, conditions or provisions of any Contract to which Parent or Merger Sub is a party, except, in the case of clause (ii), as would not reasonably be expected to have, individually or in the aggregate, a Parent Material Adverse Effect.

 

                            Section 4.05          Legal Proceedings. As of the date of this Agreement, there are no Proceedings pending or, to the Knowledge of Parent, threatened in writing against Parent or Merger Sub, or any of their respective present or former officers or directors, that seek to enjoin, or would reasonably be expected to have the effect of preventing or making illegal, any of the Transactions.

 

                            Section 4.06          Financial Ability. Parent has, and will have as of the Effective Time, sufficient cash on hand or access to available funds to enable Parent and Merger Sub to satisfy all of Parent’s and Merger Sub’s payment obligations under this Agreement, including the aggregate Merger Consideration. Parent’s obligation to consummate the Transactions is not in any way contingent upon or otherwise subject to Parent’s (or any of its Affiliates’, including Merger Sub’s) consummation of any financing arrangements, Parent’s obtaining (or any of Parent’s Affiliates, including Merger sub, obtaining) of any financing or the availability, grant, provision or extension of any financing to Parent (or to any of Parent’s Affiliates, including Merger Sub).

 

                            Section 4.07          Solvency. Neither Parent nor Merger Sub is entering into this Agreement with the intent to hinder, delay or defraud either present or future creditors. Immediately after giving effect to all of the Transactions and the making of the payments contemplated by this Agreement, and assuming satisfaction of the conditions to Parent’s obligation to consummate the Merger as set forth herein, the accuracy of the representations and warranties of the Company set forth herein and the performance by the Company of its obligations hereunder in all material respects, the Company will be solvent.

 

                            Section 4.08          Acknowledgement; No Other Representations and Warranties. Except for the representations and warranties made by the Company in Article III, Parent and Merger Sub acknowledge that neither the Company nor any other Person acting on behalf of the Company makes, and Parent and Merger Sub have not relied upon any other express or implied representation or warranty with respect to the Company or any of its Subsidiaries or their respective businesses, operations, assets, liabilities, condition (financial or otherwise) or prospects, notwithstanding the delivery or disclosure to Parent, Merger Sub or any of their respective Representatives of any documentation, forecasts or other information with respect to any one or more of the foregoing (except as and to the extent expressly incorporated or referred to in the representations and warranties set forth in this Article III). Except for the representations and warranties of Parent and Merger Sub contained in this Article IV or elsewhere in this Agreement, neither Parent nor Merger Sub nor any other Person acting on behalf of Parent and Merger Sub, makes any other express or implied representation or warranty in connection with this Agreement or the Transactions; and neither Parent nor Merger Sub nor any other Person acting on behalf of Parent and Merger Sub is making any express or implied representation or warranty with respect to Parent and Merger Sub with respect to any other information made available to the Company in connection with the transactions contemplated by this Agreement.

 

 

                            Section 5.01          Conduct of Business.

 

(a)          Except (1) as required by applicable Law, (2) as Parent may approve in writing (such approval not to be unreasonably withheld, conditioned or delayed), (3) as expressly disclosed in Section 5.01(a) of the Company Disclosure Schedule, or (4) as expressly contemplated by this Agreement, the Company covenants and agrees as to itself and its Subsidiaries that, from and after the execution of this Agreement and prior to the earlier of (x) the Effective Time or (y) termination of this Agreement in accordance with Article VII (the “Pre-Closing Period”), the Company shall conduct its business and the business of its Subsidiaries in the ordinary course of business and, to the extent consistent therewith, and subject to the restrictions contemplated in Section 5.01(b), the Company shall, and shall cause each of its Subsidiaries, to use its and their commercially reasonable efforts to (A) preserve substantially intact its and its Subsidiaries’ business organizations, goodwill, assets, properties, Gaming Licenses and Contracts, (B) maintain its existence in good standing under the Laws of its organization, incorporation or formation, as applicable, (C) keep available the services of its current officers, employees and independent contractors, (D) preserve its existing relationships with its material customers, suppliers, licensors, licensees, distributors, lessors and other Persons with which the Company and its Subsidiaries have business relations and (E) maintain in effect all of its foreign, federal, state and local licenses.

 

(b)          Without limiting the generality of the foregoing, except (1) as required by applicable Law, (2) as Parent may approve in writing (such approval not to be unreasonably withheld, conditioned or delayed), (3) as expressly disclosed in Section 5.01(b) of the Company Disclosure Schedule corresponding to the applicable clause and sub-clause below, or (4) as expressly required by this Agreement, the Company covenants and agrees as to itself and its Subsidiaries that, during the Pre-Closing Period, the Company shall not and will not permit any of its Subsidiaries to:

 

                            Section 5.02          No Solicitation by the Company; Change in Recommendation.

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed and delivered as of the date first above written

 

By:	/s/ Kristy Jo
	Name:	Kristy Jo
	Title:	Secretary

ANAXI INVESTMENTS LIMITED
By:	/s/ Mitchell A. Bowen
	Name:	Mitchell Bowen
	Title:	Director

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed and delivered as of the date first above written.

 

NEOGAMES S.A.

 

 

Exhibit 1           – Memorandum and Articles of Association of the Company

 

Exhibit 2          – Statutory Plan of Merger

Schedule 6.01(b) – Governmental Clearances

 

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