For the transition period from |
|
to |
|
|
Not applicable
|
Ireland
|
|
(Translation of Registrant’s name into English)
|
(Jurisdiction of incorporation or organization)
|
Title of each class
|
|
Trading Symbol(s)
|
|
Name of each exchange on which registered
|
Ordinary Shares, par value $0.0001 per share
|
|
CREV
|
|
The Nasdaq Stock Market LLC
|
Warrants, each whole warrant exercisable for one-tenth of an Ordinary Share, each at an exercise price of $11.50 per one-tenth of a share
($115.00 per whole Ordinary Share)
|
|
CREVW
|
|
The Nasdaq Stock Market LLC
|
Large accelerated filer ☐
|
Accelerated filer ☐
|
Non-accelerated filer ☒
|
Emerging growth company ☒
|
U.S. GAAP ☐
|
International Financial Reporting Standards as issued by the International Accounting Standards Board ☒
|
Other ☐
|
|
Page
|
1
|
|
2
|
|
|
|
3
|
|
4
|
|
4
|
|
7
|
|
7
|
|
53
|
|
62
|
|
62 |
|
80 |
|
85
|
|
87
|
|
88 |
|
89 |
|
111 |
|
112
|
|
112
|
|
112 | |
112 | |
112 | |
112 | |
113
|
|
113
|
|
113 |
|
166
|
|
• |
changes in domestic and foreign business, market, financial, political and legal conditions;
|
|
• |
inability to obtain financing, equity, debt, or convertible debt financings to fund our operations on favorable terms or at all (including where such inability results in additional costs being incurred, and/or additional funding not be
available, under existing financing arrangements);
|
•
|
our failure to meet financial covenants and other key covenants under existing financing arrangements;
|
•
|
our failure to meet operational targets required to be achieved in order to qualify for additional funding under the OIC Financing (defined below);
|
|
• |
growth in demand for our wheels being lower than expected, or eventuating later than expected (including but not limited to delay in commencement of wheel programs);
|
|
• |
increase in prices of labor or materials, or adverse movements in foreign exchange;
|
|
• |
disruption to global supply chains;
|
•
|
disruption to customer business as a result of industrial action by workers involved in automotive supply chains;
|
|
• |
our relationships with suppliers and technical partners may deteriorate;
|
|
• |
risks relating to our bespoke equipment and production process to create a highly complex and innovative product;
|
|
• |
downward pricing pressure from customers;
|
|
• |
changes in our competitive position or market share;
|
|
• |
the inability to maintain the listing of the Company’s securities on a U.S. securities exchange;
|
|
• |
the inability to complete any private placement financing, the amount of any private placement financing or the completion of any private placement financing with terms unfavorable to us;
|
•
|
holders of Preferred Shares (as defined below) gaining certain governance and control rights, in the event of certain triggers under the Company’s Amended and Restated Memorandum and Articles of
Association;
|
• |
obligations and restrictions that restrict our ability to engage in some business activities under the terms of the OIC Financing, which may restrict our ability to do business and take advantage of
certain opportunities;
|
|
• |
the failure to realize the anticipated benefits of the Business Combination and related transactions;
|
|
• |
risks related to the rollout of our business strategy and the timing of expected business milestones;
|
|
• |
the effects of competition on our future business and our ability to grow and manage growth, establish and maintain relationships with customers, and retain management and key employees;
|
|
• |
risks related to domestic and international political and macroeconomic uncertainty, including the Israel-Hamas and Russia-Ukraine conflicts;
|
|
• |
the outcome of any legal proceedings that may be instituted against us or any of our respective directors or officers;
|
|
• |
the impact of any pandemic or other public health crisis, such as the COVID-19 pandemic, and governmental responses;
|
|
• |
risks related to Carbon Revolution’s industry;
|
|
• |
changes in laws and regulations; and
|
|
• |
other risks and uncertainties described in the section of this Report entitled “Risk Factors.”
|
ITEM 1. |
IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS
|
|
A. |
Directors and Senior Management
|
Name
|
|
Age
|
|
Position and Class
|
Directors
|
|
|
||
Mark Bernhard
|
|
59
|
|
Class II Director
|
Lucia Cade
|
|
56
|
|
Class II Director
|
Jacqueline A. Dedo
|
|
62
|
|
Class I Director
|
Jacob Dingle
|
|
52
|
|
Class III Director
|
James Douglas
|
|
56
|
|
Class III Director
|
Burt Jordan
|
|
56
|
|
Class II Director
|
Robert A. Lutz
|
|
91
|
|
Class III Director
|
Matti Masanovich
|
|
51
|
|
Class I Director
|
Dale McKee
|
|
63
|
|
Class I Director
|
|
|
|||
Executive Officers
|
|
|
||
Jacob Dingle
|
|
52
|
|
Chief Executive Officer and Director
|
Gerard Buckle
|
|
54
|
|
Chief Financial Officer
|
David French
|
|
61
|
|
Vice President Operations
|
Ashley Denmead
|
|
41
|
|
Chief Technology Officer
|
Jesse Kalkman
|
|
55
|
|
Director of Sales and Business Development
|
David Nock
|
|
50
|
|
General Counsel and Company Secretary
|
|
B. |
Advisers
|
|
C. |
Auditors
|
ITEM 2. |
OFFER STATISTICS AND EXPECTED TIMETABLE
|
ITEM 3. |
KEY INFORMATION
|
A. |
[Reserved]
|
B. |
Capitalization and Indebtedness
|
As of June 30, 2023
|
Carbon Revolution
(A$ in thousand)
|
Notes
|
Pro
Forma Combined
(A$ in
thousand)
|
||||||||
Cash and cash equivalents
|
19,582
|
1
|
29,757
|
||||||||
Restricted Trust Fund
|
14,677
|
2
|
67,467 | ||||||||
34,259
|
|
|
97,224
|
||||||||
Carbon Revolution common stock
|
386,432
|
3 |
436,835
|
||||||||
Share based payment reserves
|
- |
3 |
24,757
|
||||||||
Carbon Revolution reserves
|
7,166
|
3 |
7,166
|
||||||||
Accumulated losses
|
(377,867
|
) |
3 |
(483,568
|
)
|
||||||
Total stockholders’ equity
|
15,731
|
(14,810
|
) |
||||||||
|
|||||||||||
Debt:
|
|
||||||||||
Borrowings (current)
|
13,829
|
3 |
13,829
|
||||||||
Borrowings (non-current)
|
70,833
|
3 |
70,833
|
||||||||
OIC preferred shares (unsecured)
|
- |
4
|
42,834
|
||||||||
OIC Reserve Fund Obligation (unsecured) | - | 5 |
52,790 |
||||||||
|
84,662
|
|
180,236
|
||||||||
Total Capitalization and Indebtedness
|
100,393
|
165,476
|
C. |
Reasons for the Offer and Use of Proceeds
|
D. |
Risk Factors
|
|
• |
there may be a delay in the availability of the Committed Equity Facility (the Committed Equity Facility will not be available until after the Company’s resale registration statement has been declared
effective by the Securities and Exchange Commission (“SEC”)) and there is no guarantee that the Company will satisfy the applicable conditions precedent for closing further tranches of funding under the OIC Financing (discussed below);
|
|
• |
as the terms of the Committed Equity Facility will require Yorkville Advisors to purchase additional shares under the Committed Equity Facility beyond an overall ownership of 9.99%, the Company may have
access to materially less than the US$60 million headline figure of the Equity Purchase Agreement entered into in connection with the Committed Equity Facility (the “Equity Purchase Agreement”);
|
|
• |
the Company may not be able to raise further equity funds from sources other than the Committed Equity Facility or the OIC Financing (assuming the Company is able to close further tranches of funding under
the OIC Financing, which is not guaranteed) in the amounts and within the timeframes necessary for the Company to remain solvent and to comply with its liquidity covenants, on satisfactory terms, or at all;
|
|
• |
customers and suppliers may not agree to provide the support sought from them; and
|
|
• |
the 12 Month Cash Flow Projections are subject to achievement by the Company of its financial and operational targets.
|
|
• |
agreed threshold for revenue, assessed monthly on a rolling trailing six month basis with specific agreed targets for each testing period, with the first testing period being the 6 months expiring June 30,
2023;
|
|
• |
agreed threshold for Adjusted EBITDA, assessed monthly on a rolling trailing six month basis with specific agreed targets for each testing period, with the first testing period being the 6 months expiring
June 30, 2023;
|
|
• |
maximum capital expenditure (capex) limits, initially assessed on a rolling trailing six months with specific agreed maximum capex for each testing period with the first testing period being the 6 months
expiring June 30, 2023, and moving to a rolling trailing 12 months basis in January 2024; and
|
|
• |
minimum cash available requirements for each month until the average monthly EBITDA (based on the previous consecutive three months) of the Company becomes positive, following which the measure will be
based on a current amount.
|
|
• |
failure to make a payment due under the agreement by the due date;
|
|
• |
existence of circumstances which could result in a material adverse effect;
|
|
• |
a change in control of the Carbon Revolution Group, which would include the departure of our Chief Technology Officer, Ashley Denmead, if a reasonably acceptable replacement has not been appointed within 90 days or 120 days;
|
|
• |
events of insolvency, judgment debt, asset seizure and impairment of security;
|
|
• |
material misrepresentation; and
|
|
• |
if any portion of the guaranty ceases to be in full force and effect.
|
|
• |
manual labor hours required to produce wheels being higher than anticipated, higher materials or supply chain costs than anticipated, wheel programs may experience delays in development or production, or
wheel production volume increases may not be as expected or may not materialize;
|
|
• |
the Company may not be able to achieve its manufacturing quality, volume and cost targets (including targets relating to reduction in labor cost per wheel and materials cost per wheel);
|
|
• |
the Company may not be able to increase its capacity to service customer demand or the cost to increase capacity may be more than expected, or it may otherwise be unable to execute its industrialization
plans, including the Mega-line project, as planned;
|
|
• |
the Company may be exposed to volatility in demand, resulting in disruption to the Company’s operations and supply chain and increased costs;
|
|
• |
the Company may be manufacturing lower volumes than expected when production for the relevant wheel commences which would result in the benefits of scale being lower than expected, and the costs per wheel
being higher than expected;
|
|
• |
the Company may not have the flexibility to adjust its raw material supply orders on short notice based on the fluctuations in its customer’s orders, which may adversely affect the Company’s profitability,
cash flow and operations; or
|
|
• |
the Company’s equipment not performing to the level expected, or product quality not being to the level expected.
|
|
• |
geopolitical and economic instability in and impacting the localities where we have foreign operations;
|
|
• |
rising inflation impacting the stability of our workforce and foreign operations;
|
|
• |
military conflicts impacting the localities where we have foreign operations;
|
|
• |
limited protection for, and vulnerability to unauthorized access to, reproduction, dissemination or theft of, our intellectual property rights, including our trade secrets;
|
|
• |
compliance with local laws and regulations, and unanticipated changes in local laws and regulations, including tax laws and regulations;
|
|
• |
trade and foreign exchange restrictions and higher tariffs;
|
|
• |
the complexity of managing international trade sanctions and export restrictions from the jurisdictions in which we have foreign operations;
|
|
• |
fluctuations in foreign currency exchange rates which may increase our expenses for employee compensation and other operating expenses that are paid in currencies other than U.S. dollars;
|
|
• |
restrictions imposed by the United States government against other countries, or foreign governments’ restrictions imposed on the United States, impacting our ability to do business with certain companies or in certain countries and the
complexity of complying with those restrictions;
|
|
• |
power outages, natural disasters, and other local events that could affect the availability of the internet and the consequences of disruptions, such as large-scale outages or interruptions of service from utilities or telecommunications
providers;
|
|
• |
difficulties in staffing international operations;
|
|
• |
changes in immigration policies which may impact our ability to hire personnel;
|
|
• |
differing employment practices, laws, and labor relations;
|
|
• |
regional health issues and the impact of public health epidemics and pandemics on employees and the global economy, such as the COVID-19 pandemic; and
|
|
• |
disruptions posed by the COVID-19 pandemic and related government restrictions or other government responses.
|
|
• |
Lack of appropriately designed, implemented and documented procedures and controls at both entity- and process-level to allow for the Company to achieve complete, accurate and timely financial reporting. This
is pervasive across the entity-level and each of the key business processes, including controls over the preparation and review of account reconciliations and journal entries, and controls over information technology to ensure access to
financial data is adequately restricted to appropriate personnel.
|
|
• |
Segregation of duties has not been sufficiently established across the key business and financial processes. Given the size, nature of the organization and the current structure of the finance function, a
lack of segregation of duties applied to the key business and financial processes across the organization has been identified. A consequence of the lack of segregation of duties is the heightened risk of fraud or material misstatement when
no appropriate mitigating controls are in place.
|
|
• |
Lack of personnel with appropriate knowledge and experience relating to SEC reporting requirements to enable the entity to design and maintain an effective financial reporting process. A lack of knowledge and experience in these areas
may lead to the Company being in breach of SEC financial reporting and other related requirements, especially given that the current finance function has not been designed to include sufficient accounting and financial reporting personnel
with the requisite knowledge and experience in the application of SEC financial reporting rules and regulations.
|
|
• |
require that the Company Board be classified into three classes of directors with staggered three-year terms;
|
|
• |
permit the Company Board to fill any vacancies; and
|
|
• |
prohibit shareholder action by written consent without unanimous approval of all holders of the Ordinary Shares.
|
|
• |
the timing of our entry into contracts with customers;
|
|
• |
our competitors’ products;
|
|
• |
manufacturing or other issues with respect to our products;
|
|
• |
our inability to adequately protect our proprietary rights, including patents, trademarks and trade secrets;
|
|
• |
our inability to raise additional capital and the terms on which we raise it;
|
|
• |
regulatory developments, including actions with respect to our products or our competitors’ products;
|
|
• |
actual or anticipated fluctuations in our financial condition and operating results;
|
|
• |
publication of research reports by securities analysts about us or our competitors or our industry;
|
|
• |
our failure or the failure of our competitors to meet analysts’ projections or guidance that we or our competitors may give to the market;
|
|
• |
additions and departures of key personnel;
|
|
• |
strategic decisions by us or our competitors, such as acquisitions, divestitures, spin-offs, joint ventures, strategic investments or changes in business strategy;
|
|
• |
sales of our securities by us, our insiders or our other shareholders;
|
|
• |
speculation in the press or investment community;
|
|
• |
announcement or expectation of additional financing efforts;
|
|
• |
changes in market conditions for the stock of companies in our industry; and
|
|
• |
changes in general market and economic conditions.
|
ITEM 4. |
INFORMATION ON THE COMPANY
|
A. |
History and Development of the Company
|
B. |
Business Overview
|
|
• |
Action Composites (“Action”): Action (formerly Thyssenkrupp Carbon Components) has developed carbon fiber wheels for Porsche using a braided rim technology. These wheels are reportedly 20% lighter than
Porsche’s regular aluminum wheels for the vehicle;
|
|
• |
Blackstone Tek (“BST”): BST produces single piece carbon fiber wheels for the motorcycle and automotive aftermarkets;
|
|
• |
Bucci Composites (“Bucci”): Bucci has developed a low volume 22-inch single piece carbon fiber wheel for the Bentley Bentayga Mulliner and a 20-inch aftermarket carbon fiber automotive wheel;
|
|
• |
Duqueine Group (“Duqueine”): Duqueine has developed a single piece carbon fiber wheel for the Alpine A110R;
|
|
• |
Dymag Group Limited (“Dymag”): Dymag sells carbon fiber motorcycle wheels and two piece carbon fiber wheels for the automotive aftermarket and niche vehicle manufacturers, and has recently developed a
prototype 21-inch carbon fiber hybrid wheel in collaboration with Hankuk Carbon and Hyundai;
|
|
• |
Lacks Enterprises (“Lacks”): Lacks has developed a two-piece wheel with a carbon fiber rim and a forged aluminum face, including for the Dodge Challenger SRT Demon 170;
|
|
• |
ESE Carbon (“ESE”): ESE has developed a single piece carbon fiber wheel and has a focus on the aftermarket; and
|
|
• |
Mubea Carbo Tech (“Carbo Tech”): Carbo Tech has developed carbon fiber wheels for BMW using a carbon-fiber/aluminum hybrid wheel, with an aluminum hub and spokes and a carbon-fiber rim. The hybrid
wheel option for the vehicle such wheels are made for appears to be approximately equivalent in weight to the forged aluminum wheel option that is also offered for the vehicle. In addition, Carbo Tech’s website refers to a Carbo Tech single
piece carbon fiber wheel consisting or a carbon fiber composite “rim bed and rim spider”.
|
C. |
Organizational Structure
|
|
Name
|
|
Principal Activities
|
|
Country of
Incorporation
|
|
Equity Interest held by Carbon
Revolution
|
|
Carbon Revolution Operations Pty Ltd
|
|
Carbon fiber wheels
|
|
Australia
|
|
100%
|
|
Carbon Revolution Technology Pty Ltd
|
|
Carbon fiber wheels
|
|
Australia
|
|
100%
|
|
Carbon Revolution (USA) LLC
|
|
Carbon fiber wheels
|
|
United States
|
|
100%
|
Carbon Revolution (UK) Limited
|
Carbon fiber wheels |
United Kingdom
|
100% |
D. |
Property, Plants and Equipment
|
ITEM 4A. |
UNRESOLVED STAFF COMMENTS
|
ITEM 5. |
OPERATING AND FINANCIAL REVIEW AND PROSPECTS
|
|
A. |
Operating Results
|
|
Stage of Awarded Program Lifecycle (1)
|
|
|
Programs
|
|
|||||||||
|
Awarded programs in production
|
|
|
6
|
|
|
Ferrari SF90 Stradale
Ferrari 812 Competizione
Ferrari 296 GTB
GM Corvette Z06/Z07/E-Ray JLR Range Rover Sport SV
Ford Mustang Dark Horse
|
|
||||||
|
Awarded Programs
in
development
|
|
|
|
|
|
Electric Vehicles
|
|
|
2
|
|
|
2 SUV / Pickup
|
|
|
Premium ICE Vehicles
|
|
|
5
|
|
|
5 Performance vehicles
|
|
||||||
|
Total Active Awarded Programs
|
|
|
|
|
13
|
|
|
|
|||||
|
Programs in Aftersales
|
|
|
|
|
5
|
|
|
Ford Mustang GT350R
Ford GT500
Ford GT
Ferrari 488 Pista / F8 Tributo
Renault Sport Megane Trophy R
|
|
$ 2023
US ’000
|
$ 2023
AU ’000
|
$ 2022
AU ’000
|
$ 2021
AU ’000
|
|||||||||||||
Sale of wheels
|
24,806
|
37,477
|
38,276
|
32,205
|
||||||||||||
Engineering services
|
351
|
530
|
464
|
2,732
|
||||||||||||
Sale of tooling
|
167
|
253
|
1,596
|
—
|
||||||||||||
Revenue
|
25,324
|
38,260
|
40,336
|
34,937
|
||||||||||||
Cost of goods sold
|
(36,467
|
)
|
(55,094
|
)
|
(57,445
|
) |
(49,232
|
)
|
||||||||
Gross loss
|
(11,143
|
)
|
(16,834
|
)
|
(17,109
|
) |
(14,295
|
)
|
||||||||
Other income
|
2,049
|
3,096
|
4,320
|
10,506
|
||||||||||||
Operational expenses
|
(1,984
|
)
|
(2,997
|
)
|
(2,013
|
) |
(3,366
|
)
|
||||||||
Research and development
|
(10,710
|
)
|
(16,180
|
)
|
(16,933
|
) |
(10,513
|
)
|
||||||||
Administrative expenses
|
(9,641
|
)
|
(14,566
|
)
|
(13,146
|
) |
(15,690
|
)
|
||||||||
Marketing expenses
|
(989
|
)
|
(1,494
|
)
|
(1,550
|
) |
(938
|
)
|
||||||||
Capital raising transaction costs
|
(16,379
|
) |
(24,746
|
) |
—
|
—
|
||||||||||
Finance costs
|
(3,642
|
)
|
(5,502
|
) |
(1,390
|
) |
(1,704
|
)
|
||||||||
Loss before income tax expense
|
(52,439
|
)
|
(79,223
|
)
|
(47,821
|
) |
(36,000
|
)
|
||||||||
Income tax expense
|
—
|
—
|
—
|
—
|
||||||||||||
Loss for the year after income tax
|
(52,439
|
)
|
(79,223
|
)
|
(47,821
|
) |
(36,000
|
)
|
|
B. |
Liquidity and Capital Resources
|
Cash flow
|
2023
AUD $m
|
2022
AUD $m
|
Change
AUD $m
|
|||||||||
Net cash used in operating activities
|
(52.5
|
)
|
(46.0
|
)
|
(6.5
|
)
|
||||||
Capital Expenditure
|
(13.1
|
)
|
(15.6
|
)
|
2.6
|
|||||||
Intangible Expenditure
|
(4.9
|
)
|
(6.0
|
)
|
1.2
|
|||||||
Net cash used in investing activities
|
(18.0
|
)
|
(21.6
|
)
|
3.6
|
|||||||
Net cash from financing activities
|
66.5
|
3.3
|
63.2
|
|||||||||
Net cash outflow
|
(4.0
|
)
|
(64.3
|
)
|
60.2
|
|
|
FY23
$m
|
|
FY22
$m
|
|
Change
$m
|
||||||
Loans and borrowings
|
|
|
|
|||||||||
Current
|
|
13.9
|
|
|
18.7
|
|
|
(4.8
|
)
|
|||
Non-current
|
|
70.8
|
|
|
4.3
|
|
|
66.5
|
||||
Total loans and borrowings
|
|
84.7
|
|
|
23.0
|
|
|
61.7
|
||||
Less: Cash and cash equivalents
|
|
(19.6
|
)
|
|
|
(22.7
|
)
|
|
|
3.1
|
||
Less: Restricted trust fund
|
|
(14.7
|
)
|
|
|
-
|
|
|
(14.7
|
)
|
||
Adjusted debt
|
|
50.4
|
|
|
0.3
|
|
|
50.1
|
Borrowings
|
FY23
A$m
|
FY22
A$m
|
|
Change
A$m
|
||||||||
Current
|
13.9
|
18.7
|
(4.8
|
) | ||||||||
Non-current
|
70.8
|
4.3
|
66.5
|
|||||||||
Total Debt
|
84.7
|
23.0
|
61.7
|
|||||||||
(Less) Cash and cash equivalents
|
(19.6
|
) |
(22.7
|
) |
3.1
|
|||||||
(Less) Restricted trust fund
|
(14.7
|
) |
-
|
(14.7
|
) |
|||||||
Adjusted debt
|
50.4
|
0.3
|
50.1
|
|
• |
Expansion of the production capacity of the Mega-line through both efficiency gains and the introduction of new production assets;
|
•
|
Capturing demand for carbon fiber wheels from current programs, including the Corvette Z06/Z07/E-Ray program;
|
•
|
Successful launches and ramp up of production of new programs including the wheels for the JLR Range Rover Sport SV and Ford Mustang Dark Horse and a number of yet to be named programs;
|
•
|
Development activities for contracted programs and further awards of new programs;
|
•
|
Working collaboratively with existing and new customers to apply its technology to the emerging generation of electric vehicles;
|
•
|
Delivering production cost improvements relating to labor and material costs with the objective of materially improving contribution margin;
|
•
|
Raising sufficient funds to support the growth of the company;
|
•
|
Reducing cash burn by minimizing operating and capital expenditure; and
|
•
|
Introducing the business to the US investment community via investor meetings and investor conferences.
|
|
• |
US$13.1 million (A$19.7 million) was deducted from the proceeds on account of costs (comprising approximately US$8.8 million (A$13.1 million) for the premium on the insurance for the program plus various
other fees and transactional costs relating to the New Debt Program); and
|
|
• |
US$9.9 million (A$14.9 million) was used to repay the amounts owed by Carbon Revolution to previous key lenders (including Export Finance Australia and Timelio).
|
|
• |
US$15.5 million (A$23.2 million) was deposited into certain reserve funds of which US$5.8 million (A$8.6 million) has been released after certain insurance conditions were met. US$5 million (A$7.5 million) is
scheduled to be released after 6 months if not required for covenant cures in that period, US$0.3 million (A$0.5 million) will be used for initial interest payments and the balance of US$4.4 million (A$6.6 million) is held as a payment
reserve; and
|
|
• |
US$7.3 million (A$10.9 million) was used to pay creditors who assisted Carbon Revolution with its liquidity initiatives.
|
•
|
agreed thresholds for revenue, assessed monthly on a rolling trailing six month basis with specific agreed targets for each testing period, with the first testing period being the 6 months expiring June 30,
2023;
|
•
|
agreed thresholds for EBITDA, assessed monthly on a rolling trailing six month basis with specific agreed targets for each testing period, with the first testing period being the 6 months expiring June 30,
2023;
|
•
|
maximum capital expenditure (capex) limits, assessed monthly and initially assessed on a rolling trailing six month basis with specific agreed maximum capex for each testing period with the first testing
period being the 6 months expiring June 30, 2023, and moving to a rolling trailing 12 month basis in January 2024; and
|
•
|
minimum cash available requirements for each month until the average monthly EBITDA (based on the previous consecutive three months) of the Company becomes positive, following which the measure will be based
on a current amount.
|
|
• |
failure to make a payment due under the agreement by the due date;
|
|
• |
existence of circumstances which could result in a material adverse effect;
|
|
• |
a change in control of the Carbon Revolution Group (prior to the Business Combination);
|
|
• |
events of insolvency, judgment debt, asset seizure and impairment of security;
|
|
• |
material misrepresentation; and
|
|
• |
if any portion of the guaranty ceases to be in full force and effect.
|
|
• |
Subject to and on the satisfaction of further conditions (see below), the Company will issue US$5 million of Preferred Shares to OIC and receive US$5 million in funding from the Reserve Funds if, prior to the Second Reserve Release (as
defined below), the Company receives aggregate gross proceeds of at least US$10 million from one or more issuances and sales of the Ordinary Shares to one or more third party persons (other than OIC and its affiliates) (“First Reserve
Release”).
|
|
• |
Subject to and on the satisfaction of further conditions, by December 1, 2024, or if the Company continues to work in good faith to satisfy the relevant condition, January 31, 2025, the Company will issue Preferred Shares to OIC equal in
amount to the remaining Reserve Funds (US$30 million) plus accrued interest and receive the remaining Reserve Funds (“Second Reserve Release”).
|
|
• |
In the 24 months following the Initial Closing, the Company will, to the extent additional financing is necessary for the development, construction and/or tooling associated with any future manufacturing facility or for material upgrades
to Carbon Revolution’s existing Mega-line plant operations in Australia (“Plant Investments”), have the right, subject to meeting certain conditions described below, to request that OIC subscribe for up to US$40 million of further Preferred
Shares less a 2% subsequent structuring premium (“Subsequent Financing”). Completion of any such Subsequent Financing is subject to approval by OIC’s investment committee.
|
|
• |
has a term of up to five years from the Initial Closing and may be redeemed earlier at the election of the Company;
|
|
• |
is entitled to a fixed rate of dividend of 12% per annum, which accrues daily and is payable quarterly in cash or in kind by the issue of additional Preferred Shares at the Company’s election; and
|
|
• |
is expected to be accounted for as borrowings.
|
|
• |
12.49%, on and from the Initial Closing; plus
|
|
• |
5%, following the issue of Preferred Shares to OIC in connection with the Second Reserve Release; plus
|
|
• |
2.5%, subject to OIC not having failed to fund a Subsequent Financing upon the satisfaction of the relevant conditions by the Company, upon the earlier of:
|
− |
completion of a Subsequent Financing; and
|
|
− |
24 months after the Initial Closing.
|
a. |
Reserve Funds
|
b. |
Subsequent Financing
|
• |
certain conditions relating to any future manufacturing facility constructed on or after the date of the OIC Purchase Agreement; and
|
• |
OIC’s investment committee approves in its discretion the subscription for the relevant Preferred Shares.
|
• |
Net cash outflows (excluding costs related to the Transaction) from operating activities of approximately $70.5 million, being cash inflows from customers (and grants), less
operating costs, research and development costs, working capital needs, principal repayments, and capital expenditure;
|
• |
Net cash inflows from financing activities of $33 million, consisting primarily of raising new funding or accessing the Committed Equity Facility of $42.3 million and accessing
US$5 million (A$7.8 million) of the funds of the OIC Financing held in escrow upon satisfaction of the First Reserve Release Condition, offset by $14.1 million of Transaction costs indicated to be payable during the remainder of the
projection period, as well as $3.1 million relating to other financing activities;
|
• |
The Group will meet its covenants, as amended on September 18, 2023, under the New Debt Program except for the Adjusted EBITDA test where management forecasts breaches in
February 2024 and August 2024. If it does not meet a covenant, the Group will seek to utilize the cure rights available to it in accordance with the New Debt Agreement. Refer to Note 6.7, Subsequent Events to the financial statements located elsewhere in this Report. The covenants of
the New Debt Program include the following:
|
|
• |
Minimum Liquidity: From June 30, 2023 and for each month thereafter that the average monthly adjusted EBITDA (based on the previous consecutive three months) of the Group is less
than zero, the Combined Group (as defined in the New Debt Program) must satisfy a minimum available cash requirement covenant, which requires the total cash available to the Group to be greater than or equal to the minimum available cash
requirement. The minimum available cash requirement is an amount not less than the product of the absolute value of the average monthly adjusted EBITDA for the three months most recently ended on such date multiplied by 6.00 for the
fiscal months ending June 30, 2023 to November 30, 2023 (originally June 30, 2023 to October 31, 2023) and 9.00 for the fiscal month ending December 31, 2023 (originally November 30, 2023) and on the last day of each month thereafter.
|
|
• |
The Co-Obligors (as defined in the PDSA) on a consolidated basis shall have revenue (determined in accordance with IFRS) for the period of the six consecutive fiscal months
ending on the last day of each fiscal month set forth in the New Debt Program (each, a “Test Period”) (but excluding the Test Period ending September 30, 2023 (originally no such exclusion)) of not less than the amount set forth opposite
such month under the column “Minimum Trailing Sixth Month Revenue”, as reflected in the applicable Compliance Certificate (as defined in the New Debt Program) (together with calculations evidencing the same).
|
|
• |
The Co-Obligors on a consolidated basis shall have Adjusted EBITDA for each Test Period (but excluding the Test Period ending September 30, 2023 (originally no such exclusion)),
of not less than the amount set forth under the column “Minimum Trailing Sixth Month Adjusted EBITDA” opposite such period in the New Debt Program, as reflected in the applicable Compliance Certificate (together with calculations
evidencing the same).
|
|
• |
Commencing on the Closing Date (as defined in the New Debt Program) until August 31, 2023, and commencing again on November 1, 2023 (originally no such exclusion), the
Co-Obligors shall at all times maintain a reserve in U.S. Dollars in a deposit account at Commonwealth Bank of Australia or such other account bank as may be acceptable to Servicer in an amount of not less than the debt service payments
on the Term Advance (as defined in the New Debt Program) consisting of the sum of (i) the next three (3) months of interest payments, plus (ii) the next three (3) months of principal payments, plus (iii) the next three months (3) of
applicable fees including Loan Monitoring Fees (clauses (i), (ii), and (iii), collectively, the “Debt Service Reserve”).
|
• |
The Company has issued US$35 million ($54.7 million) of Preferred Shares to OIC (“Initial Tranche”) and received US$35 million ($54.7 million) in aggregate gross proceeds, less amounts applied to cover certain transaction costs and an
initial structuring premium payable to an entity associated with OIC of US$1.75 million ($2.7 million) (“Initial Structuring Premium”).
|
• |
US$35 million ($54.7 million) have been deposited into an escrow account controlled by OIC (“Reserve Funds”).
|
• |
Subject to and on the satisfaction of further conditions, the Company will issue US$5 million (A$7.8 million) of Preferred Shares to OIC and receive US$5 million (A$7.8 million) in funding from the Reserve Funds if, prior to the Second
Reserve Release, the Company receives aggregate gross proceeds of at least US$10 million ($15.6 million) from one or more issuances and sales of Ordinary Shares to one or more third party persons (other than OIC and its affiliates) pursuant
to the First Reserve Release. Carbon Revolution projects in its 12 Month Cash Flow Projections that the First Reserve Release will occur by February 2024.
|
• |
Subject to and on the satisfaction of further conditions by December 1, 2024, or if the Company continues to work in good faith to satisfy the relevant condition, January 31, 2025, the Company will issue Preferred Shares to OIC equal in
amount to the remaining Reserve Funds plus accrued interest and receive the remaining Reserve Funds pursuant to the Second Reserve Release. The Second Reserve Release is not included in the 12 Month Cash Flow Projections as management does
not expect the Second Reserve Release to take place within the projection period.
|
• |
In the 24 months following the Initial Closing, the Company will, to the extent additional financing is necessary for Plant Investments, have the right, subject to meeting certain conditions described below, to request a Subsequent
Financing. Completion of any such Subsequent Financing is subject to approval by OIC’s investment committee. The Subsequent Financing is not included in the 12 Month Cash Flow Projections as management does not expect the Subsequent
Financing to take place within the projection period.
|
• |
There are no assurances as to when the closing conditions for the OIC Financing for the Reserve Funds or Subsequent Financing will be satisfied;
|
• |
The Company’s ability to raise further capital is subject to consent from OIC; and
|
• |
The Company Board may not be able to act in the best interests of the Company or the Company shareholders as a result of the terms of the OIC Documents that impose obligations on the Company or restrict the Company’s ability to engage
in some business activities, which could materially adversely affect the Company’s business, results of operations and financial condition.
|
•
|
There is no contractual arrangement with the key customer that requires it to accept the request for the bailment and advance payments;
|
•
|
The customer may not accept the Group’s request for the bailment and advance payments; and
|
•
|
There may be a delay in the customer accepting and making the bailment and advance payments.
|
• |
there may be a delay in the availability of the CEF (the CEF will not be available until after the filing by the Company of its annual report for the year ended June 30, 2023, which has not yet been filed with the SEC, and filing with
the SEC of a registration statement for the resale of Ordinary Shares, and such registration statement being declared effective by the SEC);
|
• |
the Group’s advisors that will be assisting in raising capital through the CEF may be unable to dispose of the shares of the Company on an ongoing basis. As the terms of the CEF will not require the advisor to purchase additional shares
under the CEF beyond an overall ownership of 9.99% (the CEF Ownership Restriction) or US$10 million (A$15.4 million) per week, whichever is lower, the Group may have access to materially less than the US$27.5 million projected to be drawn
under the CEF during the next 12 months;
|
• |
In order for the Company to be able to draw down on the next advance, the CEF provider will be required to sell some or all of its Ordinary Shares issued as part of the first advance on market which, in the absence of significant demand
for the Ordinary Shares, may put significant downward pressure on the trading price. This may cause the 9.99% shareholding cap under the next advance to be reached in conjunction with a lower US$ amount of cash raised under the CEF. This
mechanism may create a downward spiral in the share price of the Company which may prevent CBR from being able to utilize the CEF to create liquidity;
|
• |
When the Company lodges a request to drawdown an amount of equity from the CEF, the CEF Provider is specifically permitted to sell the shares in the Company during the period between lodgement of the request to drawdown and the date the
shares are issued to it so that it may manage its risk should it need to. The agreement for the CEF deems a request to drawdown equity from the CEF to be an unconditional contract that is binding on both parties;
|
• |
The CEF Provider is permitted to sell the shares in the Company for which it is bound to subscribe, before it is issued with them, and before it has paid the subscription price. This might be characterized as short selling of the
Ordinary Shares. Accordingly, there exists the potential for the CEF Provider to place downward pressure on the trading price of the Ordinary Shares on the public market by short selling shares it does not yet own. This effect is more
severe under the CEF than other ordinary short selling arrangements because the CEF Provider will not subsequently re-enter the public market to purchase the shares it has already sold (and by doing so, provide support for the trading
price) but will instead simply deliver, to either the lender of the covered position or the purchaser if the short sale was naked, the shares subscribed for under the CEF when they are issued; and
|
• |
the Group may not be able to raise further equity funds from sources other than the CEF in the amounts and within the timeframes necessary for the Group to remain solvent and to comply with its liquidity covenants, on satisfactory terms,
or at all.
|
• |
The Group reached agreement with certain suppliers to defer total payments of $8.9 million including future invoices during the deferral period. Under the terms of these agreements, the deferred payments are required to be made in
November 2023.
|
• |
The Group reached agreement with certain of its advisers relating to the deferral of $23.7 million of fees owed to them at the closing of the Business Combination, with $10.6 million of these fees projected to be payable during the
next 12 month period.
|
• |
In connection with the OIC Financing, the Group obtained certain amendments to terms of the New Debt Program. Refer to Note 6.7 Subsequent Events to the financial statements included elsewhere in this Report.
|
|
2023
$’000
|
2022
$’000
|
||||||
Right-of-use assets
|
||||||||
Property
|
7,446
|
7,564
|
||||||
Lease liabilities
|
||||||||
Current
|
645
|
579
|
||||||
Non-current
|
7,368
|
7,461
|
||||||
|
8,013
|
8,040
|
Interest rate
%
|
Maturity
|
|
2023
$’000
|
2022
$’000
|
|||||||||
Current borrowings
|
|
||||||||||||
Secured
|
|
||||||||||||
Working capital facility
|
7.44%
|
|
May 2023
|
|
|
-
|
6,843
|
||||||
Term loan
|
6.15%
|
|
May 2023
|
|
|
-
|
2,889
|
||||||
Letter of credit facility
|
|
6.45%
|
|
May 2023
|
|
|
-
|
4,000
|
|||||
|
|
-
|
13,732
|
||||||||||
|
|
||||||||||||
Unsecured
|
|
|
|||||||||||
Term loan with customer
|
10%
|
June 2024
|
|
|
4,523
|
-
|
|||||||
Supplier finance arrangement
|
|
6.00% +
RBA cash rate
|
-
|
|
|
9,306
|
4,954
|
||||||
|
|
13,829
|
18,686
|
||||||||||
Non-current borrowings
|
|
|
|||||||||||
Secured
|
|
|
|||||||||||
Term loan
|
6.15%
|
|
December 2024
|
|
|
-
|
4,333
|
||||||
Term loan (USD)
|
8.50%
|
May 2027
|
|
|
70,833
|
||||||||
|
|
70,833
|
4,333
|
|
C. |
Research and development, patents and licenses, etc.
|
|
D. |
Trend Information
|
|
E. |
Critical Accounting Policies and Estimates
|
|
− |
Post-tax discount rate: 11.5%. The incremental borrowing rate used for the post-tax discount rate does not consider any element of default risk associated with Carbon Revolution, which is not relevant in assessing the return expected
from the assets.
|
|
− |
Terminal value growth rate beyond 5 years: 2.7%
|
|
− |
Compound annual growth rate wheel volume: 14.8%
|
|
− |
Direct Material costs reduce from $1,306 per wheel in FY23 to $832 in the terminal year
|
|
− |
Direct Labor costs reduce from $1,324 per wheel in FY23 to $589 in the terminal year
|
ITEM 6. |
DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES
|
A. |
Directors and Senior Management
|
B. |
Compensation
|
|
|
|
A$
Year
end
|
|
|
Short-term employee benefit
|
|
|
Post-
employment
benefits
|
|
|
Share-based payment
|
|
|||||||||||||
|
|
|
June 30
|
|
|
Cash
|
|
|
Other
Benefits
|
|
|
Leave
Benefits
|
|
|
Super-
annuation
|
|
|
STI
expense(1)
|
|
|
LTI
expense(2)
|
|
|
One-off
equity
award(3)
|
|
|
|
Managing director – Jacob Dingle
|
|
||||||||||||||||||||||||
|
|
|
2023
|
|
|
572,852
|
|
|
—
|
|
|
7,206
|
|
|
27,500
|
|
|
206,484
|
|
|
267,106
|
|
|
—
|
|
|
|
Chief financial officer – Gerard Buckle
|
|
||||||||||||||||||||||||
|
|
|
2023
|
|
|
393,758
|
|
|
—
|
|
|
22,681
|
|
|
25,293
|
|
|
145,518
|
|
|
114,011
|
|
|
9,633
|
|
(1) |
STI expense for FY23 plus amortization of STI relating to prior years grants.
|
(2) |
Employee Stock Ownership Plan and FY21& FY22 LTI grants are expensed over the vesting period at a valuation determined on grant date by a third party detailed below under “—Number of LTI Awards”.
|
(3) |
Total expense of the one-off equity grant made to Mr. Buckle on November 29, 2019 as a sign on award to replace a portion of an incentive from his previous employer which he forfeited on joining Carbon Revolution. The face value of these
shares was A$262,501 and they vested on September 9, 2022.
|
|
• |
for the initial equity grant only (in respect of the 12 months from closing), Mr. James Douglas as Chair of Company will be awarded US$250,000 of Company restricted stock units (“RSUs”) and the other NEDs
will be awarded $200,000 of Company RSUs, which will vest three months from the Closing Date. Such grants will be made under the 2023 Stock Option and Incentive Plan; and
|
|
• |
for each subsequent annual grant, the Chair of Company will be awarded US$150,000 of Company RSUs and the other NEDs will be awarded US$120,000, which vest in four equal tranches at the end of each quarter in
the 12 months from the grant date, subject to the service condition being met.
|
|
• |
A cash retainer schedule as follows:
|
|
• |
Chair base fee: US$60,000 cash
|
|
• |
NED base fee: US$30,000 cash
|
|
• |
Audit and Risk Committee Chair fee: additional US$20,000 cash
|
|
• |
Audit and Risk Committee Member fee: additional US$10,000 cash
|
|
• |
Remuneration and Nomination Committee Chair fee: additional US$15,000 cash
|
|
• |
Remuneration and Nomination Committee Member fee: additional US$7,500 cash
|
Role
|
Annual fee for FY23
(including super guarantee)
(in A$)
|
||
Chair – Carbon Revolution Board (base fees)
|
$180,000
|
||
Other NED (base fees)
|
$90,000
|
||
Chair of the Audit and Risk Committee
|
An additional $10,000
|
||
Chair of the Remuneration and Nomination Committee
|
An additional $10,000
|
||
Committee memberships
|
An additional $5,000 per committee
|
Year ended June 30, 2023
|
Directors’
fees
A$
|
Directors’
Fees
Allocated in
Rights
$
|
Superannuation
A$
|
Total
A$
|
|||||||||||||||
James Douglas (Chair)
|
|
|
FY23
|
171,946
|
—
|
18,054
|
190,000
|
||||||||||||
Lucia Cade
|
|
|
FY23
|
90,498
|
—
|
9,502
|
100,000
|
||||||||||||
Dale McKee
|
|
|
FY23
|
90,498
|
—
|
9,502
|
100,000
|
||||||||||||
Mark Bernhard
|
|
|
FY23
|
90,498
|
—
|
9,502
|
100,000
|
Name of
Beneficiary |
Title of
Options |
Amount of
Securities
Covered
|
Exercise
Price
|
Purchase
Price (if any)
|
Expiration
Date
|
|||||||||||
|
||||||||||||||||
Jacob Dingle
|
FY22 Options
|
1,210,826
|
$
|
1.60
|
-
|
September 20, 2026
|
||||||||||
|
FY21 Rights
|
186,381
|
-
|
-
|
September 20, 2023
|
|||||||||||
|
FY20 ESOP Options
|
1,273,419
|
$
|
2.60
|
-
|
November 29, 2024
|
||||||||||
Gerard Buckle
|
FY22 Options
|
678,062
|
$
|
1.60
|
-
|
September 20, 2026
|
||||||||||
|
FY21 Rights
|
104,373
|
-
|
-
|
September 20, 2023
|
|||||||||||
|
FY20 ESOP Options
|
356,557
|
$
|
2.60
|
-
|
November 29, 2024
|
C. |
Board Practices
|
D. |
Employees
|
E. |
Share Ownership
|
F. |
Disclosure of a registrant’s action to recover erroneously awarded compensation.
|
ITEM 7. |
MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS
|
A. |
Major Shareholders
|
|
• |
each person, or group of affiliated persons, known by us to beneficially own more than 5% of outstanding Ordinary Shares;
|
|
• |
each of our directors;
|
|
• |
each of our directors and executive officers; and
|
|
• |
all of our directors and executive officers as a group.
|
Beneficial Owner
|
Number
of
Ordinary Shares
|
Percentage
of
All Ordinary Shares
|
||||||
Executive Officers, Directors and Director Nominees
|
||||||||
Mark Bernhard
|
1,650 |
|
*
|
|||||
Lucia Cade(1)
|
2,242 |
|
*
|
|||||
Jacqueline A. Dedo
|
--
|
- |
|
|||||
Jacob Dingle(2)
|
30,151
|
|
1.6 |
%
|
||||
James Douglas
|
11,897 |
|
*
|
|||||
Burt Jordan
|
--
|
--
|
||||||
Robert A. Lutz
|
--
|
--
|
||||||
Matti Masanovich
|
--
|
--
|
||||||
Dale McKee(3)
|
801
|
|
*
|
|||||
Gerard Buckle(4)
|
3,236
|
|
*
|
|||||
David French
|
4,780
|
|
*
|
|
||||
Ashley Denmead
|
15,442
|
|
*
|
|
||||
Jesse Kalkman |
--
|
--
|
||||||
David Nock(5)
|
2,217 |
* | ||||||
All executive officers and directors as a group (14 persons)
|
72,416 |
|
3.9 |
%
|
||||
Other 5% Shareholders
|
||||||||
Twin Ridge Capital Sponsor LLC(6)
|
|
|
159,000
|
|
|
8.5 | % | |
Daniel Hennessy |
134,000 |
7.1 |
% |
* |
Indicates beneficial ownership of less than 1% of total outstanding Ordinary Shares.
|
(1)
|
2,147 Ordinary Shares are held by Cade & Associates Pty Ltd.
|
(2)
|
24,036 Ordinary Shares are owned by Point Grey Investments Pty Ltd.
|
(3)
|
684 Ordinary Shares are held by McKee Family Investments Pty Ltd.
|
(4)
|
213 Ordinary Shares are held jointly with his wife.
|
(5) |
90 Ordinary Shares are held by his wife.
|
(6)
|
The Sponsor is the beneficial holder of the shares reported herein. The Sponsor is controlled by Sanjay K. Morey and William P. Russell, Jr. Each of Sanjay K. Morey and William P. Russell Jr. disclaims any beneficial ownership of
the securities held by the Sponsor other than to the extent of any pecuniary interest he may have therein, directly or indirectly.
|
B. |
Related Party Transactions
|
C. |
Interests of Experts and Counsel
|
ITEM 8. |
FINANCIAL INFORMATION
|
A. |
Consolidated Statements and Other Financial Information
|
B. |
Significant Changes
|
ITEM 9. |
THE OFFER AND LISTING
|
A. |
Offer and Listing Details
|
B. |
Plan of Distribution
|
C. |
Markets
|
D. |
Selling Shareholders
|
E. |
Dilution
|
F. |
Expenses of the Issuer
|
ITEM 10. |
ADDITIONAL INFORMATION
|
A. |
Share Capital
|
B.
|
Memorandum and Articles of Association
|
•
|
in whole and not in part;
|
•
|
at a price of $0.01 per warrant;
|
•
|
upon not less than 30 days’ prior written notice of redemption to each warrant holder; and
|
•
|
if, and only if, the closing price of the Ordinary Shares equals or exceeds $180.00 per share (as adjusted for adjustments described under – Anti-dilution Adjustments) for any 20 trading days within a 30-trading day period ending
on the third trading day prior to the date on which notice of the redemption is sent to the warrant holders.
|
|
• |
in whole and not in part;
|
|
• |
at $1.00 per warrant upon a minimum of 30 days’ prior written notice of redemption provided that holders will be able to exercise their warrants on a cashless basis prior to redemption and receive that number
of shares determined by reference to the table below, based on the redemption date and the “fair market value” (as defined below) of the Ordinary Shares, except as otherwise described below;
|
|
• |
if, and only if, the closing price of the Ordinary Shares equals or exceeds $100.00 per public share (as adjusted for adjustments described under – Anti-dilution Adjustments) for any 20 trading days within
the 30-trading day period ending three trading days before we send the notice of redemption to the warrant holders; and
|
|
• |
if the closing price of the Ordinary Shares for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant
holders is less than $180.00 per share (as adjusted for adjustments described under – Anti-dilution Adjustments), the Founder Warrants must also be concurrently called for redemption on the same terms as the outstanding Public Warrants, as
described above.
|
Redemption Date
(period to expiration of warrants)
|
|
Fair Market Value of Ordinary Shares
|
|||||||||||||||||
≤$100.00
|
|
$110.00
|
|
$120.00
|
|
$130.00
|
|
$140.00
|
|
$150.00
|
|
$160.00
|
|
$170.00
|
|
≥$180.00
|
|||
60 months
|
|
0.261
|
|
0.281
|
|
0.297
|
|
0.311
|
|
0.324
|
|
0.337
|
|
0.348
|
|
0.358
|
|
0.361
|
|
57 months
|
|
0.257
|
|
0.277
|
|
0.294
|
|
0.310
|
|
0.324
|
|
0.337
|
|
0.348
|
|
0.358
|
|
0.361
|
|
54 months
|
|
0.252
|
|
0.272
|
|
0.291
|
|
0.307
|
|
0.322
|
|
0.335
|
|
0.347
|
|
0.357
|
|
0.361
|
|
51 months
|
|
0.246
|
|
0.268
|
|
0.287
|
|
0.304
|
|
0.320
|
|
0.333
|
|
0.346
|
|
0.357
|
|
0.361
|
|
48 months
|
|
0.241
|
|
0.263
|
|
0.283
|
|
0.301
|
|
0.317
|
|
0.332
|
|
0.344
|
|
0.356
|
|
0.361
|
|
45 months
|
|
0.235
|
|
0.258
|
|
0.279
|
|
0.298
|
|
0.315
|
|
0.330
|
|
0.343
|
|
0.356
|
|
0.361
|
|
42 months
|
|
0.228
|
|
0.252
|
|
0.274
|
|
0.294
|
|
0.312
|
|
0.328
|
|
0.342
|
|
0.355
|
|
0.361
|
|
39 months
|
|
0.221
|
|
0.246
|
|
0.269
|
|
0.290
|
|
0.309
|
|
0.325
|
|
0.340
|
|
0.354
|
|
0.361
|
|
36 months
|
|
0.213
|
|
0.239
|
|
0.263
|
|
0.285
|
|
0.305
|
|
0.323
|
|
0.339
|
|
0.353
|
|
0.361
|
|
33 months
|
|
0.205
|
|
0.232
|
|
0.257
|
|
0.280
|
|
0.301
|
|
0.320
|
|
0.337
|
|
0.352
|
|
0.361
|
|
30 months
|
|
0.196
|
|
0.224
|
|
0.250
|
|
0.274
|
|
0.297
|
|
0.316
|
|
0.335
|
|
0.351
|
|
0.361
|
|
27 months
|
|
0.185
|
|
0.214
|
|
0.242
|
|
0.268
|
|
0.291
|
|
0.313
|
|
0.332
|
|
0.350
|
|
0.361
|
|
24 months
|
|
0.173
|
|
0.204
|
|
0.233
|
|
0.260
|
|
0.285
|
|
0.308
|
|
0.329
|
|
0.348
|
|
0.361
|
|
21 months
|
|
0.161
|
|
0.193
|
|
0.223
|
|
0.252
|
|
0.279
|
|
0.304
|
|
0.326
|
|
0.347
|
|
0.361
|
|
18 months
|
|
0.146
|
|
0.179
|
|
0.211
|
|
0.242
|
|
0.271
|
|
0.298
|
|
0.322
|
|
0.345
|
|
0.361
|
|
15 months
|
|
0.130
|
|
0.164
|
|
0.197
|
|
0.230
|
|
0.262
|
|
0.291
|
|
0.317
|
|
0.342
|
|
0.361
|
|
12 months
|
|
0.111
|
|
0.146
|
|
0.181
|
|
0.216
|
|
0.250
|
|
0.282
|
|
0.312
|
|
0.339
|
|
0.361
|
|
9 months
|
|
0.090
|
|
0.125
|
|
0.162
|
|
0.199
|
|
0.237
|
|
0.272
|
|
0.305
|
|
0.336
|
|
0.361
|
|
6 months
|
|
0.065
|
|
0.099
|
|
0.137
|
|
0.178
|
|
0.219
|
|
0.259
|
|
0.296
|
|
0.331
|
|
0.361
|
|
3 months
|
|
0.034
|
|
0.065
|
|
0.104
|
|
0.150
|
|
0.197
|
|
0.243
|
|
0.286
|
|
0.326
|
|
0.361
|
|
0 months
|
|
—
|
|
—
|
|
0.042
|
|
0.115
|
|
0.179
|
|
0.233
|
|
0.281
|
|
0.323
|
|
0.361
|
|
• |
require that the Company Board be classified into three classes of directors with staggered three-year terms;
|
|
• |
permit the Company Board to fill any vacancies; and
|
|
• |
prohibit shareholder action by written consent without unanimous approval of all holders of the Ordinary Shares.
|
C. |
Material Contracts
|
D. |
Exchange Controls and Other Limitations Affecting Security Holders
|
E.
|
Taxation
|
|
• |
financial institutions;
|
|
• |
insurance companies;
|
|
• |
mutual funds;
|
|
• |
pension plans;
|
|
• |
S corporations;
|
|
• |
broker-dealers;
|
|
• |
traders in securities that elect mark-to-market treatment;
|
|
• |
regulated investment companies;
|
|
• |
real estate investment trusts;
|
|
• |
trusts and estates;
|
|
• |
tax-exempt organizations (including private foundations);
|
|
• |
investors that hold our Ordinary Shares or Public Warrants as part of a “straddle”, “hedge”, “conversion”, “synthetic security”, “constructive ownership transaction”, “constructive sale” or other integrated
transaction for U.S. federal income tax purposes;
|
|
• |
investors subject to the alternative minimum tax provisions of the Code;
|
|
• |
U.S. Holders that have a functional currency other than the U.S. dollar;
|
|
• |
U.S. expatriates;
|
|
• |
U.S. Holders owning or considered as owning (directly, indirectly, or through attribution) 5 percent (measured by vote or value) or more of our Ordinary Shares;
|
|
• |
persons who received our Ordinary Shares as compensation;
|
|
• |
accrual method taxpayers that file applicable financial statements as described in Section 451(b); and
|
|
• |
persons who are not U.S. Holders, all of whom may be subject to tax rules that differ materially from those summarized below.
|
|
• |
an individual who is a U.S. citizen or resident of the United States;
|
|
• |
a corporation (including an entity treated as a corporation for U.S. federal income tax purposes) created or organized in or under the laws of the United States, any state thereof or the District of
Columbia;
|
|
• |
an estate the income of which is includible in gross income for U.S. federal income tax purposes regardless of its source; or
|
|
• |
a trust (A) the administration of which is subject to the primary supervision of a U.S. court and which has one or more U.S. persons (within the meaning of the Code) who have the authority to control all
substantial decisions of the trust or (B) that has in effect a valid election under applicable Treasury Regulations to be treated as a U.S. person.
|
|
• |
the U.S. Holder’s gain or excess distribution will be allocated ratably over the U.S. Holder’s relevant holding period for the Ordinary Shares or Public Warrants;
|
|
• |
the amount allocated to the U.S. Holder’s taxable year in which the U.S. Holder recognized the gain or received the excess distribution, or to the period in the U.S. Holder’s holding period before the first
day of the First PFIC Holding Year, will be taxed as ordinary income;
|
|
• |
the amount allocated to other taxable years (or portions thereof) of the U.S. Holder and included in its holding period will be taxed at the highest tax rate in effect for that year and applicable to the
U.S. Holder; and
|
|
• |
an additional tax equal to the interest charge generally applicable to underpayments of tax will be imposed on the U.S. Holder with respect to the tax attributable to each such other taxable year of the
U.S. Holder.
|
|
• |
there is no change in the beneficial ownership of such shares as a result of the transfer; and
|
|
• |
the transfer into (or out of) DTC is not effected in contemplation of a sale of such shares or warrants by a beneficial owner to a third party.
|
|
• |
a person (not being a company) resident for tax purposes in a Relevant Territory (including the United States) and is neither resident nor ordinarily resident in Ireland (for a list of Relevant Territories
for DWT purposes, please see Exhibit 15.3 to this Report;
|
|
• |
a company resident for tax purposes in a Relevant Territory, provided such company is not under the control, whether directly or indirectly, of a person or persons who is or are resident in Ireland;
|
|
• |
a company that is controlled, directly or indirectly, by persons resident in a Relevant Territory and who is or are (as the case may be) not controlled by, directly or indirectly, persons who are not
resident in a Relevant Territory;
|
|
• |
a company whose principal class of shares (or those of its 75% direct or indirect parent) is substantially and regularly traded on a stock exchange in Ireland, on a recognized stock exchange either in a
Relevant Territory or on such other stock exchange approved by the Irish Minister for Finance; or
|
|
• |
a company that is wholly-owned, directly or indirectly, by two or more companies where the principal class of shares of each of such companies is substantially and regularly traded on a stock exchange in
Ireland, a recognized stock exchange in a Relevant Territory or on such other stock exchange approved by the Irish Minister for Finance,
|
|
• |
its broker (and the relevant information is further transmitted to any qualifying intermediary appointed by the Company) before the record date for the distribution (or such later date before the
distribution payment date as may be notified to the holder of Ordinary Shares by the broker) if its Ordinary Shares are held through DTC; or
|
|
• |
the Company’s transfer agent before the record date for the distribution if its Ordinary Shares are held outside of DTC.
|
F.
|
Dividends and Paying Agents
|
G.
|
Statement by Experts
|
H.
|
Documents on Display
|
I.
|
Subsidiary Information
|
+/- 5% exchange rate
|
2023
$’000
|
|
2022
$’000
|
|||||
Impact on profit after tax
|
1,618
|
|
90
|
|||||
Impact on equity
|
(1,618
|
)
|
|
(90
|
)
|
ITEM 12. |
DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES
|
Item 13. |
Defaults, Dividend Arrearages and Delinquencies.
|
Item 14. |
Material Modifications to the Rights of Security Holders and Use of Proceeds.
|
Item 15. |
Controls and Procedures.
|
Item 16. |
[Reserved]
|
Item 16A. |
Audit committee financial expert.
|
Item 16B. |
Code of Ethics.
|
Item 16C. |
Principal Accountant Fees and Services.
|
Item 16D. |
Exemptions from the Listing Standards for Audit Committees.
|
Item 16E |
Purchases of Equity Securities by the Issuer and Affiliated Purchasers.
|
Item 16F. |
Change in Registrant’s Certifying Accountant.
|
Item 16G. |
Corporate Governance.
|
Item 16H. |
Mine Safety Disclosure.
|
Item 16I. |
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.
|
Item 16J. |
Insider Trading Policies
|
Item 16K.
|
Cybersecurity.
|
ITEM 17. |
FINANCIAL STATEMENTS
|
ITEM 18. |
FINANCIAL STATEMENTS
|
Note
|
|
2023
US $’0005
|
|
|
2023
AU $’000
|
|
2022
AU $’000
|
|
2021
AU $’000
|
|||||||||||
Sale of wheels
|
24,806
|
37,477
|
38,276
|
32,205
|
||||||||||||||||
Engineering services
|
351
|
530
|
464
|
2,732
|
||||||||||||||||
Sale of tooling
|
167
|
253
|
1,596
|
-
|
||||||||||||||||
Revenue
|
2.1
|
25,324
|
38,260
|
40,336
|
34,937
|
|||||||||||||||
Cost of goods sold
|
3.2.1
|
(36,467
|
)
|
(55,094
|
)
|
(57,445
|
)
|
(49,232
|
)
|
|||||||||||
Gross loss
|
(11,143
|
)
|
(16,834
|
)
|
(17,109
|
)
|
(14,295
|
)
|
||||||||||||
Other income
|
2.2
|
2,049
|
3,096
|
4,320
|
10,506
|
|||||||||||||||
Operational expenses
|
(1,984
|
)
|
(2,997
|
)
|
(2,013
|
)
|
(3,366
|
)
|
||||||||||||
Research and development expenses
|
2.4
|
(10,710
|
)
|
(16,180
|
)
|
(16,933
|
)
|
(10,513
|
)
|
|||||||||||
Administrative expenses
|
(9,641
|
)
|
(14,566
|
)
|
(13,146
|
)
|
(15,690
|
)
|
||||||||||||
Marketing expenses
|
(989
|
)
|
(1,494
|
)
|
(1,550
|
)
|
(938
|
)
|
||||||||||||
Capital raising transaction costs
|
4.7
|
(16,379
|
)
|
(24,746
|
)
|
-
|
-
|
|||||||||||||
Finance costs
|
2.4
|
(3,642
|
)
|
(5,502
|
)
|
(1,390
|
)
|
(1,704
|
)
|
|||||||||||
Loss before income tax expense
|
(52,439
|
)
|
(79,223
|
)
|
(47,821
|
)
|
(36,000
|
)
|
||||||||||||
Income tax expense
|
5
|
-
|
-
|
-
|
-
|
|||||||||||||||
Loss for the year after income tax
|
(52,439
|
)
|
(79,223
|
)
|
(47,821
|
)
|
(36,000
|
)
|
||||||||||||
Other comprehensive loss
|
||||||||||||||||||||
Items that may be reclassified subsequently to profit or loss:
|
||||||||||||||||||||
Foreign currency translation differences – foreign operations
|
(41
|
)
|
(62
|
)
|
(147
|
)
|
150
|
|||||||||||||
Other comprehensive loss
|
(41
|
)
|
(62
|
)
|
(147
|
)
|
150
|
|||||||||||||
Total comprehensive loss for the year, net of tax
|
(52,480
|
)
|
(79,285
|
)
|
(47,968
|
)
|
(35,850
|
)
|
||||||||||||
Earnings per share
|
||||||||||||||||||||
Basic
|
2.5
|
$
|
(0.25
|
)
|
$
|
(0.38
|
)
|
$
|
(0.23
|
)
|
$
|
(0.23
|
)
|
|||||||
Diluted
|
2.5
|
$
|
(0.25
|
)
|
$
|
(0.38
|
)
|
$
|
(0.23
|
)
|
$
|
(0.23
|
)
|
Note
|
June 30,
2023
US $’0007
|
June 30,
2023 AU $’000
|
June 30,
2022
AU $’000
|
|||||||||||||
Current assets
|
||||||||||||||||
Cash and cash equivalents
|
4.1
|
12,961
|
19,582
|
22,693
|
||||||||||||
Restricted trust fund
|
4.1
|
9,715
|
14,677
|
-
|
||||||||||||
Receivables
|
3.1
|
4,256
|
6,430
|
14,483
|
||||||||||||
Contract assets
|
2.1
|
5,453
|
8,239
|
5,909
|
||||||||||||
Inventories
|
3.2
|
14,676
|
22,173
|
20,164
|
||||||||||||
Other current assets
|
249
|
378
|
1,587
|
|||||||||||||
Total current assets
|
47,310
|
71,479
|
64,836
|
|||||||||||||
Non-current assets
|
||||||||||||||||
Property, plant and equipment
|
3.3
|
41,460
|
62,638
|
57,616
|
||||||||||||
Right-of-use assets
|
3.4
|
4,929
|
7,446
|
7,564
|
||||||||||||
Intangible assets
|
3.5
|
11,103
|
16,774
|
14,364
|
||||||||||||
Total non-current assets
|
57,492
|
86,858
|
79,544
|
|||||||||||||
Total assets
|
104,802
|
158,337
|
144,380
|
|||||||||||||
Current liabilities
|
||||||||||||||||
Payables
|
3.6
|
10,242
|
15,474
|
9,502
|
||||||||||||
Borrowings
|
4.2
|
9,153
|
13,829
|
18,686
|
||||||||||||
Lease liability
|
3.4
|
427
|
645
|
579
|
||||||||||||
Contract liability
|
2.1
|
495
|
748
|
458
|
||||||||||||
Deferred income
|
3.7
|
1,270
|
1,919
|
1,028
|
||||||||||||
Provisions
|
3.8
|
8,576
|
12,957
|
4,161
|
||||||||||||
Total current liabilities
|
30,163
|
45,572
|
34,414
|
|||||||||||||
Non-current liabilities
|
||||||||||||||||
Borrowings
|
4.2
|
46,884
|
70,833
|
4,333
|
||||||||||||
Lease liability
|
3.4
|
4,877
|
7,368
|
7,461
|
||||||||||||
Contract liability
|
2.1
|
1,162
|
1,755
|
323
|
||||||||||||
Deferred income
|
3.7
|
10,084
|
15,235
|
5,211
|
||||||||||||
Provisions
|
3.8
|
1,220
|
1,843
|
713
|
||||||||||||
Total non-current liabilities
|
64,227
|
97,034
|
18,041
|
|||||||||||||
Total liabilities
|
94,390
|
142,606
|
52,455
|
|||||||||||||
Net assets
|
10,412
|
15,731
|
91,925
|
|||||||||||||
Equity
|
||||||||||||||||
Contributed equity
|
4.4
|
255,779
|
386,432
|
383,822
|
||||||||||||
Reserves
|
4.6
|
4,743
|
7,166
|
6,747
|
||||||||||||
Accumulated losses
|
(250,110
|
)
|
(377,867
|
)
|
(298,644
|
)
|
||||||||||
Total equity
|
10,412
|
15,731
|
91,925
|
|
Note |
Contributed equity
|
Share
buyback reserve
|
Share
based
payment reserve |
Accumulated losses
|
Foreign currency translation reserve
|
Total
equity
|
||||||||||||||||||
AU $’000
|
AU $’000
|
AU $’000
|
AU $’000
|
AU $’000
|
AU $’000
|
||||||||||||||||||||
Balance as of June 30, 2020
|
291,226
|
(311
|
)
|
1,394
|
(214,823
|
)
|
(159
|
)
|
77,327
|
||||||||||||||||
Net loss after tax for the full year
|
-
|
-
|
-
|
(36,000
|
)
|
-
|
(36,000
|
)
|
|||||||||||||||||
Other comprehensive loss for the full year
|
-
|
-
|
-
|
0
|
150
|
150
|
|||||||||||||||||||
Total comprehensive loss for the full year
|
-
|
-
|
-
|
(36,000
|
)
|
150
|
(35,850
|
)
|
|||||||||||||||||
Transactions with owners in their capacity as owners
|
|||||||||||||||||||||||||
Share-based payments
|
1,138
|
-
|
4,585
|
-
|
-
|
5,723
|
|||||||||||||||||||
Issue of share capital
|
95,047
|
-
|
-
|
-
|
-
|
95,047
|
|||||||||||||||||||
Share issue costs
|
(5,521
|
)
|
-
|
-
|
-
|
-
|
(5,521
|
)
|
|||||||||||||||||
Total transactions with owners in their capacity as owners
|
90,664
|
-
|
4,585
|
-
|
-
|
95,249
|
|||||||||||||||||||
Balance as of June 30, 2021
|
381,890
|
(311
|
)
|
5,979
|
(250,823
|
)
|
(9
|
)
|
136,726
|
||||||||||||||||
Balance as of June 30, 2021
|
381,890
|
(311
|
)
|
5,979
|
(250,823
|
)
|
(9
|
)
|
136,726
|
||||||||||||||||
Net loss after tax for the full year
|
-
|
-
|
-
|
(47,821
|
)
|
-
|
(47,821
|
)
|
|||||||||||||||||
Other comprehensive loss for the full year
|
-
|
-
|
-
|
-
|
(147
|
)
|
(147
|
)
|
|||||||||||||||||
Total comprehensive loss for the full year
|
-
|
-
|
-
|
(47,821
|
)
|
(147
|
)
|
(47,968
|
)
|
||||||||||||||||
Transactions with owners in their capacity as owners
|
|||||||||||||||||||||||||
Share-based payments
|
4.4 |
1,932
|
-
|
1,235
|
-
|
-
|
3,167
|
||||||||||||||||||
Total transactions with owners in their capacity as owners
|
1,932
|
-
|
1,235
|
-
|
-
|
3,167
|
|||||||||||||||||||
Balance as of June 30, 2022
|
383,822
|
(311
|
)
|
7,214
|
(298,644
|
)
|
(156
|
)
|
91,925
|
Balance as of June 30, 2022
|
383,822
|
(311
|
)
|
7,214
|
(298,644
|
)
|
(156
|
)
|
91,925
|
||||||||||||||||
Net loss after tax for the full year
|
-
|
-
|
-
|
(79,223
|
)
|
-
|
(79,223
|
)
|
|||||||||||||||||
Other comprehensive loss for the full year
|
-
|
-
|
-
|
-
|
(62
|
)
|
(62
|
)
|
|||||||||||||||||
Total comprehensive loss for the full year
|
-
|
-
|
-
|
(79,223
|
)
|
(62
|
)
|
(79,285
|
)
|
||||||||||||||||
Transactions with owners in their capacity as owners
|
|||||||||||||||||||||||||
Share-based payments
|
4.4
|
2,610
|
-
|
481
|
-
|
-
|
3,091
|
||||||||||||||||||
Total transactions with owners in their capacity as owners
|
2,610
|
-
|
481
|
-
|
-
|
3,091
|
|||||||||||||||||||
Balance as of June 30, 2023
|
386,432
|
(311
|
)
|
7,695
|
(377,867
|
)
|
(218
|
)
|
15,731
|
Note |
$ |
2023
US ’0007
|
$ |
2023
AU ’000
|
$ |
2022
AU ’000
|
$ |
2021
AU ’000
|
||||||||||||
Cash flow from operating activities
|
||||||||||||||||||||
Receipts from customers
|
30,277
|
45,742
|
33,643
|
30,236
|
||||||||||||||||
Receipt of grants and research and development incentives
|
3.7
|
10,224
|
15,446
|
3,767
|
11,888
|
|||||||||||||||
Payments to suppliers and employees
|
(53,094
|
)
|
(80,215
|
)
|
(81,005
|
)
|
(59,533
|
)
|
||||||||||||
Interest received
|
40
|
61
|
94
|
69
|
||||||||||||||||
Capital raising transaction costs
|
4.7
|
(5,977
|
)
|
(9,030
|
)
|
-
|
-
|
|||||||||||||
Borrowing costs
|
4.2
|
(13,685
|
)
|
(20,676
|
)
|
-
|
-
|
|||||||||||||
Finance costs
|
(2,522
|
)
|
(3,810
|
)
|
(2,475
|
)
|
(1,641
|
)
|
||||||||||||
Net cash used in operating activities
|
4.1.2
|
(34,737
|
)
|
(52,482
|
)
|
(45,976
|
)
|
(18,981
|
)
|
|||||||||||
Cash flow from investing activities
|
||||||||||||||||||||
Payments for property, plant and equipment
|
3.3
|
(8,659
|
)
|
(13,082
|
)
|
(15,634
|
)
|
(12,571
|
)
|
|||||||||||
Payments for intangible assets
|
3.5
|
(3,226
|
)
|
(4,874
|
)
|
(6,007
|
)
|
(3,990
|
)
|
|||||||||||
Sale proceeds from sale of property, plant and equipment
|
3.3
|
2
|
3
|
-
|
-
|
|||||||||||||||
Net cash used in investing activities
|
(11,883
|
)
|
(17,953
|
)
|
(21,641
|
)
|
(16,561
|
)
|
||||||||||||
Cash flow from financing activities
|
||||||||||||||||||||
Proceeds from third party borrowings
|
4.2
|
82,713
|
124,963
|
33,657
|
25,774
|
|||||||||||||||
Repayment of third-party borrowings
|
4.2
|
(28,602
|
)
|
(43,212
|
)
|
(29,370
|
)
|
(12,715
|
)
|
|||||||||||
Repayment of related party borrowings
|
4.2
|
-
|
-
|
-
|
(13,000
|
)
|
||||||||||||||
Proceeds from share issues
|
4.4
|
-
|
-
|
-
|
95,046
|
|||||||||||||||
Reclassification to restricted trust fund
|
4.1
|
(9,715
|
)
|
(14,677
|
)
|
-
|
-
|
|||||||||||||
Capital raising transaction costs
|
-
|
-
|
(422
|
)
|
(5,119
|
)
|
||||||||||||||
Repayment of lease liability
|
(400
|
)
|
(604
|
)
|
(596
|
)
|
(1,040
|
)
|
||||||||||||
Net cash provided by financing activities
|
4.1.3
|
43,996
|
66,470
|
3,269
|
88,946
|
|||||||||||||||
Net (decrease) / increase in cash and cash equivalents held
|
(2,624
|
)
|
(3,965
|
)
|
(64,348
|
)
|
53,404
|
|||||||||||||
Cash and cash equivalents at beginning of financial year
|
15,020
|
22,693
|
87,257
|
33,861
|
||||||||||||||||
Effects of exchange rate changes on cash and cash equivalents
|
565
|
854
|
(216
|
)
|
(8
|
)
|
||||||||||||||
Cash and cash equivalents at end of financial year
|
12,961
|
19,582
|
22,693
|
87,257
|
1. |
Basis of preparation
|
1.1 |
Corporate information
|
|
1.2 |
Basis of preparation
|
|
1.3 |
Going concern
|
|
• |
Carbon Revolution, Twin Ridge, MergeCo, and MergerSub, consummated the business combination pursuant to the terms of a Business Combination Agreement, dated November 29, 2022, as amended or
supplemented from time to time.
|
|
• |
MergeCo issued US$35 million (A$54.7 million) of Preferred Shares to OIC (Initial Subscription Price) (each, as defined below) and received US$32.5 million (A$49.8 million) in net proceeds.
Carbon Revolution received these proceeds from MergeCo as per the loan agreement (defined below) between MergeCo and Carbon Revolution.
|
• |
Net cash outflows (excluding costs related to the Transaction) from operating activities of approximately $70.5 million, being cash inflows from customers (and grants), less operating costs,
research and development costs, working capital needs, principal repayments, and capital expenditure;
|
•
|
Net cash inflows from financing activities of $33 million, consisting primarily of raising new funding or accessing the Committed Equity Facility (“CEF”)
of $42.3 million and accessing US$5 million (A$7.8 million) of the funds of the OIC Financing held in escrow upon satisfaction of the First Reserve Release (as defined below), offset by $14.1 million of Transaction costs indicated to
be payable during the remainder of the projection period, as well as $3.1 million relating to other financing activities;
|
•
|
From November 2023 onwards, the Group projects to meet its covenants, as amended on October 18, 2023, under the USD
term loan (the “New Debt Program”), except for the Adjusted EBITDA test where management forecasts breaches in February 2024 and August 2024.
If it does not meet a covenant, the Group will seek to utilize the cure rights available to it in accordance with the New Debt Program. Refer
to Note 4.2, Borrowings and other financial liabilities, for information on covenants under the USD term loan, and Note 6.7, Subsequent Events for information on waivers received subsequent to the reporting period.
|
• |
US$35 million (A$54.7 million) have been deposited into an escrow account (“Reserve Funds”).
|
• |
Subject to and on the satisfaction of further conditions, MergeCo will issue US$5 million ($7.8 million) of Preferred Shares to OIC and receive US$5 million ($7.8 million) in funding from the
Reserve Funds if, prior to the Second Reserve Release (as defined below), MergeCo receives aggregate gross proceeds of at least US$10 million ($15.6 million) from one or more issuances and sales of Ordinary Shares to one or more third
party persons (other than OIC and its affiliates) (“First Reserve Release”). The Group projects in its Cash Flow Projection that the First Reserve Release will occur by February 2024.
|
• |
Subject to and on the satisfaction of further conditions by December 1, 2024, or if MergeCo continues to work in good faith to satisfy the relevant condition, January 31, 2025, MergeCo will issue
Preferred Shares to OIC equal in amount to the remaining Reserve Funds plus accrued interest and receive the remaining Reserve Funds (“Second Reserve Release”). The Second Reserve Release is not included in the Cash Flow Projection as
management does not expect the Second Reserve Release to take place within the projection period.
|
• |
In the 24 months following the Initial Closing, MergeCo will, to the extent additional financing is necessary for the development, construction and/or tooling associated with any future
manufacturing facility or for material upgrades to Carbon Revolution’s existing Mega-line plant operations in Australia (“Plant Investments”), have the right, subject to meeting certain conditions described below, to request that OIC
subscribe for up to US$40 million of further Preferred Shares less a 2% subsequent structuring premium (“Subsequent Financing”). Completion of any such Subsequent Financing is subject to approval by OIC’s investment committee. The
Subsequent Financing is not included in the Cash Flow Projection as management does not expect the Subsequent Financing to take place within the projection period.
|
• |
There are no assurances as to when the closing conditions for the OIC Financing for the Reserve Funds or Subsequent Financing will be satisfied;
|
• |
MergeCo’s ability to raise further capital from third parties is subject to consent from OIC (subject to certain limited exceptions); and
|
• |
The MergeCo Board may not be able to act in the best interests of MergeCo or MergeCo Shareholders as a result of the terms of the OIC Documents that impose obligations on MergeCo and its
subsidiaries or restrict their ability to engage in some business activities, which could materially adversely affect MergeCo and Carbon Revolution’s business, results of operations and financial condition.
|
• |
There is no contractual arrangement with the key customer that requires it to accept the request for the bailment and advance payments;
|
• |
The customer may not accept the Group’s request for the bailment and advance payments; and
|
• |
There may be a delay in the customer accepting and making the bailment and advance payments.
|
• |
there may be a delay in the availability of the CEF (the CEF will not be available until after the filing by MergeCo of its annual report for the year ended June 30, 2023, which has not yet been
filed with the SEC and filing with the SEC of a registration statement for the resale of the Ordinary Shares, and such registration statement being declared effective by the SEC);
|
• |
the Group’s advisors that will be assisting in raising capital through the CEF may be unable to dispose of the shares of MergeCo on an ongoing basis. As the terms of the CEF will not require the
advisor to purchase additional shares under the CEF beyond an overall ownership of 9.99% (the CEF Ownership Restriction) or US$10 million (A$15.4 million) per week, whichever is lower, the Group may have access to materially less than the
US$27.5 million projected to be drawn under the CEF during the next 12 months;
|
• |
In order for MergeCo to be able to draw down on the next advance, the CEF provider will be required to sell some or all of its Ordinary Shares issued as part of the first advance on market which,
in the absence of significant demand for Ordinary Shares, may put significant downward pressure on the trading price. This may cause the 9.99% shareholding cap under the next advance to be reached in conjunction with a lower US$ amount of
cash raised under the CEF. This mechanism may create a downward spiral in the share price of MergeCo which may prevent CBR from being able to utilize the CEF to create liquidity;
|
• |
When MergeCo lodges a request to drawdown an amount of equity from the CEF, the CEF Provider is specifically permitted to sell the shares in MergeCo during the period between lodgement of the
request to drawdown and the date the shares are issued to it so that it may manage its risk should it need to. The agreement for the CEF deems a request to drawdown equity from the CEF to be an unconditional contract that is binding on
both parties;
|
• |
The CEF Provider is permitted to sell the shares in MergeCo for which it is bound to subscribe, before it is issued with them, and before it has paid the subscription price. This might be
characterized as short selling of the Ordinary Shares. Accordingly, there exists the potential for the CEF Provider to place downward pressure on the trading price of Ordinary Shares on the public market by short selling shares it does
not yet own. This effect is more severe under the CEF than other ordinary short selling arrangements because the CEF Provider will not subsequently re-enter the public market to purchase the shares it has already sold (and by doing so,
provide support for the trading price) but will instead simply deliver, to either the lender of the covered position or the purchaser if the short sale was naked, the shares subscribed for under the CEF when they are issued; and
|
• |
the Group may not be able to raise further equity funds from sources other than the CEF in the amounts and within the timeframes necessary for the Group to remain solvent and to comply with its
liquidity covenants, on satisfactory terms, or at all.
|
• |
As discussed above, the Group received $49.8 million of initial net proceeds through MergeCo’s OIC Financing as per the loan agreement between MergeCo and Carbon Revolution on November 6, 2023;
|
• |
The Group reached agreement with certain suppliers to defer total payments of $8.9 million including future invoices during the deferral period. Under the terms of these agreements, the deferred
payments are required to be made in November 2023;
|
• |
The Group reached agreement with certain of its advisers relating to the deferral of $23.7 million of transaction fees owed to them at Implementation, with $10.6 million of these fees projected
to be payable during the next 12 month period. Refer to Note 6.7 Subsequent Events;
|
• |
In connection with the OIC Financing, the Group obtained certain amendments to terms of the New Debt Program. Refer Note 6.7 Subsequent
Events.
|
|
1.4 |
Basis of consolidation
|
|
• |
assets and liabilities are translated at the closing rate at the reporting date;
|
|
• |
income and expenses are translated at average exchange rates throughout the course of the year (unless this is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case
income and expenses are translated at the rates on the dates of the transactions); and
|
|
• |
all resulting exchange differences are recognized in other comprehensive income and accumulated in the foreign currency translation reserve, a separate component of equity.
|
|
1.5 |
Significant accounting judgements, estimates and assumptions
|
Note 3.2 Inventories
|
Note 3.5 Intangible assets
|
Note 3.3 Property, plant and equipment
|
Note 5.5 Income tax
|
Note 3.7 Deferred income
|
Note 4.7 Transaction costs
|
Note 4.2 Borrowings and other financial liabilities
|
|
1.6 |
Goods and Services Tax (“GST”)
|
1. |
Revenues, expenses and assets are recognized net of the amount of associated GST, unless the GST incurred is not recoverable from the taxation authority;
|
2. |
Receivables and payables are stated inclusive of the amount of GST receivable or payable;
|
3. |
The net amount of GST recoverable from, or payable to, the taxation authority is included with other receivables or payables in the consolidated balance sheet;
|
4. |
Cash flows are presented on a gross basis. The GST components of cash flows arising from investing and financing activities are presented as operating cash flows; and
|
5. |
Commitments are disclosed net of GST.
|
|
1.7
|
Convenience translation into U.S. dollars
|
2 |
Operating performance
|
2.1 |
Revenue from contracts with customers
|
2023
$’000
|
2022
$’000
|
2021
$’000
|
||||||||||
External revenue by product line
|
||||||||||||
Sale of wheels
|
37,477
|
38,276
|
32,205
|
|||||||||
Engineering services
|
530
|
464
|
2,732
|
|||||||||
Sale of tooling
|
253
|
1,596
|
-
|
|||||||||
Total revenue
|
38,260
|
40,336
|
34,937
|
2023
$’000
|
2022
$’000
|
2021
$’000
|
||||||||||
External revenue by timing of revenue
|
||||||||||||
Goods transferred at a point in time
|
18,885
|
15,730
|
9,606
|
|||||||||
Goods transferred over time
|
18,592
|
22,546
|
22,599
|
|||||||||
Services transferred at a point in time
|
253
|
1,277
|
1,422
|
|||||||||
Services transferred over time
|
530
|
783
|
1,310
|
|||||||||
Total revenue
|
38,260
|
40,336
|
34,937
|
2023
$’000
|
2022
$’000
|
|||||||||||
Contract asset
|
||||||||||||
Opening balance
|
5,909
|
-
|
|
|
||||||||
Additions
|
24,821
|
5,909
|
||||||||||
Advance payments
|
(13,064
|
)
|
-
|
|||||||||
Transfer to trade receivables
|
(9,427
|
)
|
-
|
|||||||||
Total contract asset
|
8,239
|
5,909
|
2023
$’000
|
2022
$’000
|
|||||||
Contract liability
|
||||||||
Opening balance
|
781
|
-
|
||||||
Additions
|
2,505
|
781
|
||||||
Revenue recognized
|
(783
|
)
|
-
|
|||||
Total contract liability
|
2,503
|
781
|
||||||
Contract liability – current
|
748
|
458
|
||||||
Contract liability – non current
|
1,755
|
323
|
||||||
Total contract liability
|
2,503
|
781
|
2.2 |
Other income
|
2023
$’000
|
2022
$’000
|
2021
$’000
|
||||||||||
Government grants
|
2,777
|
3,506
|
3,504
|
|||||||||
Jobkeeper
|
-
|
-
|
6,835
|
|||||||||
Interest income
|
61
|
94
|
84
|
|||||||||
Foreign exchange gain
|
-
|
448
|
-
|
|||||||||
Other income
|
258
|
272
|
83
|
|||||||||
Total other income
|
3,096
|
4,320
|
10,506
|
2.2.1 |
Information about revenue and other income
|
|
• |
the customer simultaneously receives and consumes the benefits provided by Carbon Revolution’s performance as Carbon Revolution performs;
|
|
• |
Carbon Revolution’s performance creates or enhances an asset that the customer controls as Carbon Revolution performs; or
|
|
• |
Carbon Revolution’s performance does not create an asset with an alternative use to Carbon Revolution and Carbon Revolution has an enforceable right to payment for performance completed to date.
|
2.3 |
Segments
|
2023
$’000
|
2022
$’000
|
2021
$’000
|
||||||||||
Revenue
|
||||||||||||
International
|
38,260
|
40,336
|
34,937
|
|||||||||
Domestic
|
-
|
-
|
-
|
|||||||||
38,260
|
40,336
|
34,937
|
||||||||||
Non-current assets
|
||||||||||||
International
|
-
|
-
|
||||||||||
Domestic
|
86,858
|
79,544
|
||||||||||
86,858
|
79,544
|
2.4 |
Expenses
|
Finance costs
|
2023
$’000
|
2022
$’000
|
2021
$’000
|
|||||||||
Interest on third party loans
|
2,676
|
552
|
400
|
|||||||||
Interest on lease liabilities
|
297
|
301
|
50
|
|||||||||
Finance costs
|
1,448
|
-
|
-
|
|||||||||
Supplier financing costs
|
446
|
213
|
60
|
|||||||||
Interest other
|
635
|
324
|
91
|
|||||||||
Interest on Ronal AG loan
|
-
|
-
|
668
|
|||||||||
Facility costs
|
-
|
-
|
435
|
|||||||||
5,502
|
1,390
|
1,704
|
Wages and salaries
|
39,023
|
33,370
|
26,034
|
|||||||||
Post-employment benefits (defined contribution plans)
|
3,379
|
2,838
|
2,259
|
|||||||||
Share-based payments expense
|
3,091
|
3,167
|
5,723
|
|||||||||
45,493
|
39,375
|
34,016
|
Property, plant and equipment
|
7,382
|
6,919
|
6,391
|
|||||||||
Right of use assets
|
695
|
656
|
687
|
|||||||||
Capitalized development costs
|
2,376
|
1,307
|
520
|
|||||||||
Patents and trademarks
|
89
|
84
|
85
|
|||||||||
10,542
|
8,966
|
7,683
|
Research and development
|
16,180
|
16,933
|
10,513
|
2.4.1 |
Information about expenses
|
Class of fixed asset
|
Depreciation period
|
Depreciation method
|
Leasehold improvements
|
Shorter of 20 years or the remaining term of the lease
|
Straight line
|
Manufacturing plant and equipment
|
2 to 10 years
|
Diminishing value
|
Tooling
|
3 to 10 years
|
Diminishing value
|
Other equipment
|
3 to 5 years
|
Diminishing value
|
2.5 |
Earnings per share
|
2023
$’000
|
2022
$’000
|
2021
$’000
|
||||||||||
The following reflects the income used in the basic and diluted earnings per share computations:
|
||||||||||||
a) Earnings used in calculating earnings per share
|
||||||||||||
Net loss attributable to ordinary equity holders of the parent
|
(79,223
|
)
|
(47,821
|
)
|
(36,000
|
)
|
||||||
b) Weighted average number of shares
|
||||||||||||
Weighted average number of ordinary shares for the purposes of basic earnings per share
|
208,504
|
205,938
|
155,501
|
|||||||||
Effect of dilution
|
||||||||||||
Share options
|
-
|
-
|
-
|
|||||||||
Weighted average number of ordinary shares adjusted for the effect of dilution
|
208,504
|
205,938
|
155,501
|
|||||||||
Loss per share (basic and diluted in cents)
|
$
|
(0.38
|
)
|
$
|
(0.23
|
)
|
$
|
(0.23
|
)
|
|
2023
No.
|
2022
No.
|
2021
No.
|
|||||||||
ESOP
|
4,945,959
|
4,996,896
|
4,996,896
|
|||||||||
LTIP
|
3,151,950
|
3,334,183
|
-
|
|||||||||
Total
|
8,097,909
|
8,331,079
|
4,996,896
|
|
2023
No.
|
2022
No.
|
2021
No.
|
|||||||||
NED Plan
|
43,033
|
43,033
|
107,518
|
|||||||||
LTIP
|
688,142
|
718,345
|
718,345
|
|||||||||
STI
|
851,613
|
595,363
|
333,017
|
|||||||||
TESP
|
233,248
|
321,803
|
125,647
|
|||||||||
SRS
|
42,298
|
113,780
|
360,614
|
|||||||||
Total
|
1,858,334
|
1,792,324
|
1,645,141
|
3.1 |
Receivables
|
2023
$’000
|
2022
$’000
|
|||||||
Trade receivables
|
||||||||
Not past due
|
4,220
|
7,591
|
||||||
Past due 1 – 30 days
|
623
|
3,433
|
||||||
Past due 31 – 90 days
|
443
|
1,445
|
||||||
Past due 90 days and over
|
216
|
684
|
||||||
5,502
|
13,153
|
|||||||
Allowance for impairment losses
|
(119
|
)
|
-
|
|||||
Trade receivables
|
5,383
|
13,153
|
||||||
Apprenticeship grant funding
|
25
|
479
|
||||||
Other receivables
|
267
|
236
|
||||||
GST recoverable
|
755
|
615
|
||||||
Trade and other receivables
|
6,430
|
14,483
|
3.1.1 |
Information about receivables
|
3.2 |
Inventories
|
2023
$’000
|
2022
$’000
|
|||||||
Current
|
||||||||
Raw materials
|
13,301
|
7,646
|
||||||
Work in progress
|
5,772
|
9,688
|
||||||
Finished goods
|
3,649
|
4,318
|
||||||
Consumables and spare parts
|
2,560
|
3,276
|
||||||
Provision for impaired wheels
|
(3,109
|
)
|
(4,764
|
)
|
||||
Inventories at the lower of cost and net realizable value
|
22,173
|
20,164
|
3.2.1 |
Information about inventories and significant estimates
|
|
• |
Raw materials – recorded at standard cost, reassessed against actual costs quarterly.
|
|
• |
Finished goods and work-in-progress – cost of direct materials, labor, outsourced processing costs and a proportion of manufacturing overheads based on normal operating capacity but excluding finance costs.
|
|
• |
Consumables and spare parts – recorded at purchase price. Consumables and spares are assessed for ongoing usefulness and written off if they are no longer likely to be of use.
|
3.3 |
Property, plant and equipment
|
Capital
works in progress
|
Leasehold improvements
|
Manufacturing equipment
|
Tooling
|
Other equipment
|
Total
|
|||||||||||||||||||
$’000 | $’000 | $’000 | $’000 | $’000 | $’000 | |||||||||||||||||||
Gross cost
|
18,950
|
5,649
|
40,454
|
14,326
|
2,784
|
82,163
|
||||||||||||||||||
Less accumulated depreciation
|
-
|
(1,355
|
)
|
(14,070
|
)
|
(7,618
|
)
|
(1,504
|
)
|
(24,547
|
)
|
|||||||||||||
At June 30, 2022
|
18,950
|
4,294
|
26,384
|
6,708
|
1,280
|
57,616
|
||||||||||||||||||
Gross cost
|
17,095
|
5,839
|
52,640
|
16,034
|
2,960
|
94,568
|
||||||||||||||||||
Less accumulated depreciation
|
-
|
(1,642
|
)
|
(18,467
|
)
|
(9,964
|
)
|
(1,857
|
)
|
(31,930
|
)
|
|||||||||||||
At June 30, 2023
|
17,095
|
4,197
|
34,173
|
6,070
|
1,103
|
62,638
|
||||||||||||||||||
Movement in carrying amounts
|
||||||||||||||||||||||||
Balance at June 30, 2021
|
7,138
|
4,466
|
29,716
|
4,737
|
1,262
|
47,319
|
||||||||||||||||||
Additions
|
17,496
|
-
|
-
|
-
|
-
|
17,496
|
||||||||||||||||||
Transfer into/ (out of) capital WIP
|
(5,684
|
)
|
109
|
947
|
4,231
|
397
|
-
|
|||||||||||||||||
Depreciation expense
|
-
|
(281
|
)
|
(4,089
|
)
|
(2,173
|
)
|
(376
|
)
|
(6,919
|
)
|
|||||||||||||
Disposals/write-offs
|
-
|
-
|
(190
|
)
|
(87
|
)
|
(3
|
)
|
(280
|
)
|
||||||||||||||
Balance at June 30, 2022
|
18,950
|
4,294
|
26,384
|
6,708
|
1,280
|
57,616
|
||||||||||||||||||
Additions
|
11,478
|
-
|
-
|
-
|
-
|
11,478
|
||||||||||||||||||
Transfer of maintenance spares
|
-
|
-
|
953
|
-
|
-
|
953
|
||||||||||||||||||
Transfer into/ (out of) capital WIP
|
(13,306
|
)
|
189
|
11,233
|
1,709
|
175
|
-
|
|||||||||||||||||
Depreciation expense
|
-
|
(286
|
)
|
(4,397
|
)
|
(2,347
|
)
|
(352
|
)
|
(7,382
|
)
|
|||||||||||||
Disposals/write-offs
|
(27
|
)
|
-
|
-
|
-
|
-
|
(27
|
)
|
||||||||||||||||
Balance at June 30, 2023
|
17,095
|
4,197
|
34,173
|
6,070
|
1,103
|
62,638
|
3.3.1 |
Information about how Carbon Revolution accounts for property, plant and equipment
|
3.4 |
Leases
|
2023
|
2022
|
|||||||
Right-of-use assets
|
$
|
’000
|
$
|
’000
|
||||
Cost at start of year
|
9,863
|
9,626
|
||||||
Additions
|
577
|
237
|
||||||
Closing balance at end of year
|
10,440
|
9,863
|
||||||
Accumulated depreciation at start of year
|
(2,299
|
)
|
(1,643
|
)
|
||||
Depreciation charge for the year
|
(695
|
)
|
(656
|
)
|
||||
Closing balance at end of year
|
(2,994
|
)
|
(2,299
|
)
|
||||
Carrying amount
|
7,446
|
7,564
|
||||||
Lease liabilities
|
||||||||
Current
|
645
|
579
|
||||||
Non-current
|
7,368
|
7,461
|
||||||
8,013
|
8,040
|
2023
|
2022
|
|||||||
$
|
’000
|
$
|
’000
|
|||||
Depreciation charge of right of use assets
|
695
|
656
|
||||||
Interest expense
|
297
|
301
|
||||||
Expense relating to short-term leases (included in costs of goods sold and administrative expenses)
|
181
|
246
|
||||||
3.4.1 |
Information about leases and significant estimates
|
3.5 |
Intangible assets
|
Development
costs
|
Patents and trademarks
|
Total
|
||||||||||
$’000
|
$’000
|
$’000
|
||||||||||
Gross cost
|
15,750
|
1,354
|
17,104
|
|||||||||
Less accumulated amortization
|
(2,247
|
)
|
(493
|
)
|
(2,740
|
)
|
||||||
At June 30, 2022
|
13,503
|
861
|
14,364
|
|||||||||
Gross cost
|
20,442
|
1,537
|
21,979
|
|||||||||
Less accumulated amortization
|
(4,623
|
)
|
(582
|
)
|
(5,205
|
)
|
||||||
At June 30, 2023
|
15,819
|
955
|
16,774
|
|||||||||
Movement in carrying amounts
|
||||||||||||
Balance at July 1, 2021
|
8,890
|
859
|
9,749
|
|||||||||
Additions
|
5,920
|
86
|
6,006
|
|||||||||
Amortization
|
(1,307
|
)
|
(84
|
)
|
(1,391
|
)
|
||||||
Balance at June 30, 2022
|
13,503
|
861
|
14,364
|
|||||||||
Additions
|
4,692
|
183
|
4,875
|
|||||||||
Amortization
|
(2,376
|
)
|
(89
|
)
|
(2,465
|
)
|
||||||
Balance at June 30, 2023
|
15,819
|
955
|
16,774
|
3.5.1 |
Information about intangible assets and significant estimates
|
Post-tax
discount rate
|
Terminal
value
growth rate
|
Annual
reduction in
wheel volume
|
Annual
increase in
direct material
costs
|
Annual
increase in
direct labor
costs
|
|
1%
|
(1%)
|
(5%)
|
5%
|
5%
|
|
Change in recoverable amount in $m
|
(21.0)
|
(14.7)
|
(30.6)
|
(23.6)
|
(16.7)
|
Impairment charge
|
-
|
-
|
-
|
-
|
-
|
3.6 |
Payables
|
2023
$’000
|
2022
$’000
|
|||||||
Current
|
||||||||
Unsecured liabilities
|
||||||||
Trade payables
|
3,828
|
5,128
|
||||||
Accruals
|
10,836
|
3,746
|
||||||
Interest accrued
|
427
|
118
|
||||||
Other payables
|
383
|
510
|
||||||
15,474
|
9,502
|
3.6.1 |
Information about payables
|
3.6.2 |
Accruals
|
3.7 |
Deferred income
|
Deferred income – government grants
|
2023
$’000
|
2022
$’000
|
||||||
Balance as of July 1
|
6,239
|
5,842
|
||||||
Received during the year
|
13,000
|
3,202
|
||||||
Released to the statement of profit or loss
|
(2,085
|
)
|
(2,805
|
)
|
||||
Balance as of June 30
|
17,154
|
6,239
|
||||||
Current
|
1,919
|
1,028
|
||||||
Non-current
|
15,235
|
5,211
|
||||||
17,154
|
6,239
|
3.8 |
Provisions
|
Employee benefits
|
Make good provision
|
Warranty claims
|
Transaction costs
|
Total
|
||||||||||||||||
$’000
|
$’000
|
$’000
|
$’000
|
$’000
|
||||||||||||||||
Current
|
2,666
|
-
|
1,495
|
-
|
4,161
|
|||||||||||||||
Non-current
|
479
|
234
|
-
|
-
|
713
|
|||||||||||||||
At June 30, 2022
|
3,145
|
234
|
1,495
|
-
|
4,874
|
Employee benefits
|
Make good provision
|
Warranty claims
|
Transaction costs
|
Total
|
||||||||||||||||
$’000
|
$’000
|
$’000
|
$’000
|
$’000
|
||||||||||||||||
Current
|
2,903
|
-
|
595
|
9,459
|
12,957
|
|||||||||||||||
Non-current
|
531
|
247
|
1,065
|
-
|
1,843
|
|||||||||||||||
At June 30, 2023
|
3,434
|
247
|
1,660
|
9,459
|
14,800
|
Make good provision
|
Warranty claims
|
Total
|
||||||||||
$’000
|
$’000
|
$’000
|
||||||||||
Movement in carrying amounts
|
||||||||||||
Balance at July 1, 2021
|
218
|
1,159
|
1,377
|
|||||||||
Provided for/ (released) during the year
|
16
|
336
|
352
|
|||||||||
Balance at June 30, 2022
|
234
|
1,495
|
1,729
|
|||||||||
Provided for/(released) during the year
|
13
|
165
|
178
|
|||||||||
Balance at June 30, 2023
|
247
|
1,660
|
1,907
|
3.8.1 |
Information about individual provisions and significant estimates
|
4.1 |
Cash and cash equivalents, restricted trust fund
|
2023
$’000
|
2022
$’000
|
2021
$’000
|
||||||||||
Loss after income tax
|
(79,223
|
)
|
(47,821
|
)
|
(36,000
|
)
|
||||||
Non‑cash items from ordinary activities
|
||||||||||||
Depreciation and amortization
|
10,543
|
8,966
|
7,683
|
|||||||||
Share based payment expenses
|
3,091
|
3,167
|
5,723
|
|||||||||
Loss/ (Profit) on sale of plant and equipment
|
2
|
-
|
-
|
|||||||||
Movement in inventory provision
|
(1,656
|
)
|
(4,216
|
)
|
4,563
|
|||||||
Write off of property, plant and equipment
|
-
|
280
|
1,230
|
|||||||||
Financing activity in prior financial year
|
-
|
(422
|
)
|
-
|
||||||||
Reduction of borrowings from achievement of grant milestones
|
-
|
-
|
(2,000
|
)
|
||||||||
Other Borrowing costs
|
(20,676
|
)
|
-
|
-
|
||||||||
Changes in assets and liabilities
|
||||||||||||
(Increase)/decrease in assets:
|
||||||||||||
- Receivables
|
8,053
|
(8,240
|
)
|
(4,272
|
)
|
|||||||
- Contract assets
|
(2,330
|
)
|
-
|
-
|
||||||||
- Inventories
|
(1,306
|
)
|
2,231
|
5,084
|
||||||||
- Other assets
|
1,209
|
(533
|
)
|
(243
|
)
|
|||||||
Increase/(decrease) in liabilities:
|
||||||||||||
- Payables
|
7,247
|
(1,174
|
)
|
(5,270
|
)
|
|||||||
- Contract liabilities
|
1,722
|
781
|
-
|
|||||||||
- Deferred income
|
10,915
|
397
|
3,627
|
|||||||||
- Provisions
|
9,927
|
608
|
894
|
|||||||||
Cash (used in) / provided by operating activities
|
(52,482
|
)
|
(45,976
|
)
|
(18,981
|
)
|
2023
|
Non-cash changes
|
|||||||||||||||||||||||||||
Note
|
July 1, 2022
$’000
|
Financing
cash flows (i)
$’000
|
New
leases
$’000
|
Other
changes (ii)
$’000
|
Interest
paid
$’000
|
June 30, 2023
$’000
|
||||||||||||||||||||||
Current borrowings at amortized cost
|
||||||||||||||||||||||||||||
Secured
|
||||||||||||||||||||||||||||
Working capital facility
|
4.2
|
6,843
|
(6,843
|
)
|
320
|
(320
|
)
|
-
|
||||||||||||||||||||
Term loan
|
4.2
|
2,889
|
(2,889
|
)
|
-
|
830
|
(830
|
)
|
-
|
|||||||||||||||||||
Letter of credit facility
|
4.2
|
4,000
|
(4,000
|
)
|
-
|
64
|
(64
|
)
|
-
|
|||||||||||||||||||
Unsecured
|
||||||||||||||||||||||||||||
Term loan with customer
|
4.2
|
-
|
4,523
|
-
|
111
|
(111
|
)
|
4,523
|
||||||||||||||||||||
Supplier financing arrangement
|
4.2
|
4,954
|
4,352
|
-
|
446
|
(446
|
)
|
9,306
|
||||||||||||||||||||
Non-current borrowings at amortized cost
|
||||||||||||||||||||||||||||
Secured
|
||||||||||||||||||||||||||||
Term loan
|
4.2
|
4,333
|
(4,333
|
)
|
-
|
-
|
-
|
-
|
||||||||||||||||||||
Term loan (USD)(iii)
|
4.2
|
-
|
70,625
|
-
|
2,194
|
(1,626
|
)
|
70,833
|
||||||||||||||||||||
Lease liabilities
|
3.4
|
8,040
|
(604
|
)
|
577
|
297
|
(297
|
)
|
8,013
|
|||||||||||||||||||
31,059
|
60,471
|
577
|
4,262
|
(3,694
|
)
|
92,675
|
2022
|
Non-cash changes
|
|||||||||||||||||||||||||||
Note
|
July 1, 2021
$’000
|
Financing
cash flows (i)
$’000
|
New
leases
$’000
|
Other
changes (ii)
$’000
|
Interest
paid
$’000
|
June 30, 2022
$’000
|
||||||||||||||||||||||
Current borrowings at amortized cost
|
||||||||||||||||||||||||||||
Secured
|
||||||||||||||||||||||||||||
Working capital facility
|
4.2
|
5,525
|
1,318
|
324
|
(324
|
)
|
6,843
|
|||||||||||||||||||||
Term loan
|
4.2
|
4,333
|
(1,444
|
)
|
-
|
552
|
(552
|
)
|
2,889
|
|||||||||||||||||||
Letter of credit facility
|
4.2
|
-
|
4,000
|
-
|
-
|
-
|
4,000
|
|||||||||||||||||||||
Unsecured
|
||||||||||||||||||||||||||||
Supplier financing arrangement
|
4.2
|
2,375
|
2,579
|
-
|
213
|
(213
|
)
|
4,954
|
||||||||||||||||||||
Non-current borrowings at amortized cost
|
||||||||||||||||||||||||||||
Secured
|
||||||||||||||||||||||||||||
Term loan
|
4.2
|
6,529
|
(2,196
|
)
|
-
|
-
|
-
|
4,333
|
||||||||||||||||||||
Lease liabilities
|
3.4
|
8,355
|
(552
|
)
|
237
|
301
|
(301
|
)
|
8,040
|
|||||||||||||||||||
27,117
|
3,705
|
237
|
1,390
|
(1,390
|
)
|
31,059
|
2021
|
Non-cash changes
|
|||||||||||||||||||||||
July 1, 2020
$’000
|
Financing
cash flows (i)
$’000
|
New
leases
$’000
|
Other
changes (ii)
$’000
|
Interest
paid
$’000
|
June 30, 2021
$’000
|
|||||||||||||||||||
Current borrowings at amortized cost
|
||||||||||||||||||||||||
Secured
|
||||||||||||||||||||||||
Working capital facility
|
-
|
5,525
|
-
|
30
|
(30
|
)
|
5,525
|
|||||||||||||||||
Term loan
|
-
|
4,333
|
-
|
371
|
(371
|
)
|
4,333
|
|||||||||||||||||
Unsecured
|
||||||||||||||||||||||||
Supplier financing arrangement
|
-
|
2,375
|
-
|
18
|
(18
|
)
|
2,375
|
|||||||||||||||||
Ronal AG loan facility
|
13,000
|
(13,000
|
)
|
-
|
931
|
(931
|
)
|
-
|
||||||||||||||||
Insurance premium funding
|
174
|
(174
|
)
|
-
|
-
|
-
|
-
|
|||||||||||||||||
State of Victoria loan
|
5,500
|
(5,500
|
)
|
-
|
-
|
-
|
-
|
|||||||||||||||||
Non-current borrowings at amortized cost
|
||||||||||||||||||||||||
Secured
|
||||||||||||||||||||||||
Term loan
|
-
|
6,529
|
-
|
-
|
-
|
6,529
|
||||||||||||||||||
Lease liabilities
|
9,519
|
(1,379
|
)
|
215
|
291
|
(291
|
)
|
8,355
|
||||||||||||||||
28,193
|
(1,291
|
)
|
215
|
1,641
|
(1,641
|
)
|
27,117
|
4.2 |
Borrowings and other financial liabilities
|
Interest rate
%
|
Maturity
|
2023
$’000
|
2022
$’000
|
|||||||||||
Current borrowings at amortized cost
|
||||||||||||||
Secured
|
||||||||||||||
Working capital facility
|
7.44
|
%
|
May 2023
|
-
|
6,843
|
|||||||||
Term loan
|
6.15
|
%
|
May 2023
|
-
|
2,889
|
|||||||||
Letter of credit facility
|
6.45
|
%
|
May 2023
|
-
|
4,000
|
|||||||||
-
|
13,732
|
|||||||||||||
Unsecured
|
||||||||||||||
Term loan with customer
|
10.0
|
%
|
June 2024
|
4,523
|
-
|
|||||||||
Supplier finance arrangement
|
6% + RBA cash rate
|
9,306
|
4,954
|
|||||||||||
13,829
|
18,686
|
|||||||||||||
Non-current borrowings at amortized cost
|
||||||||||||||
Secured
|
||||||||||||||
Term loan
|
6.15
|
%
|
December 2024
|
-
|
4,333
|
|||||||||
Term loan (USD)
|
8.50
|
%
|
May 2027
|
70,833
|
-
|
|||||||||
70,833
|
4,333
|
4.3 |
Financial risk management
|
4.3.1 |
Market risk
|
|
a) |
Foreign currency risk
|
2023
|
EUR
$’000
|
USD
$’000
|
||||||
Cash and cash equivalent
|
632
|
7,422
|
||||||
Restricted trust fund
|
-
|
9,456
|
||||||
Trade receivables
|
2,409
|
400
|
||||||
Trade payables
|
(419
|
)
|
(813
|
)
|
||||
Supplier finance arrangement
|
(4,709
|
)
|
(414
|
)
|
||||
Borrowings
|
-
|
(46,320
|
)
|
|||||
Balance sheet exposure
|
(2,087
|
)
|
(30,269
|
)
|
2022
|
EUR
$’000
|
USD
$’000
|
||||||
Trade receivables
|
5,650
|
-
|
||||||
Trade payables
|
(343
|
)
|
(233
|
)
|
||||
Supplier finance arrangement
|
(3,253
|
)
|
(13
|
)
|
||||
Balance sheet exposure
|
2,054
|
(246
|
)
|
2023
$’000
|
2022
$’000
|
|||||||
Net foreign exchange gain/(loss) included in other income/administration expense
|
(305
|
)
|
448
|
+/- 5% exchange rate
|
2023
$’000
|
2022
$’000
|
||||||
Impact on profit after tax
|
1,618
|
90
|
||||||
Impact on equity
|
(1,618
|
)
|
(90
|
)
|
|
b) |
Interest rate risk
|
Variable interest rate
|
Fixed interest rate
|
Total
|
||||||||||||||||||||||
2023
$’000
|
2022
$’000
|
2023
$’000
|
2022
$’000
|
2023
$’000
|
2022
$’000
|
|||||||||||||||||||
Financial assets
|
||||||||||||||||||||||||
Cash
|
19,582
|
22,301
|
-
|
-
|
19,582
|
22,301
|
||||||||||||||||||
Restricted trust fund
|
14,285
|
-
|
-
|
-
|
14,285
|
-
|
||||||||||||||||||
Short term deposits
|
-
|
-
|
392
|
392
|
392
|
392
|
||||||||||||||||||
Total financial assets
|
33,867
|
22,301
|
392
|
392
|
34,259
|
22,693
|
||||||||||||||||||
Financial liabilities
|
||||||||||||||||||||||||
Working capital facility
|
-
|
6,843
|
-
|
-
|
-
|
6,843
|
||||||||||||||||||
Term loan
|
-
|
-
|
4,523
|
-
|
4,523
|
-
|
||||||||||||||||||
Supplier finance arrangement
|
9,306
|
-
|
-
|
4,954
|
9,306
|
4,954
|
||||||||||||||||||
Letter of credit facility
|
-
|
4,000
|
-
|
-
|
-
|
4,000
|
||||||||||||||||||
Term loan
|
-
|
7,222
|
-
|
-
|
-
|
7,222
|
||||||||||||||||||
Term loan (USD)
|
-
|
-
|
90,645
|
- |
90,645
|
-
|
||||||||||||||||||
Total financial liabilities
|
9,306
|
18,065
|
95,168
|
4,954
|
104,474
|
23,019
|
|
c) |
Price risk
|
4.3.2 |
Credit risk
|
4.3.3 |
Liquidity risk
|
On demand
$’000
|
< 3 months
$’000
|
3-12 months
$’000
|
1-5 years
$’000
|
> 5 years
$’000
|
Total
$’000
|
|||||||||||||||||||
2023
|
||||||||||||||||||||||||
Supplier finance arrangement
|
9,306
|
-
|
-
|
-
|
-
|
9,306
|
||||||||||||||||||
Term loan
|
-
|
-
|
4,523
|
-
|
-
|
4,523
|
||||||||||||||||||
Lease liabilities
|
-
|
158
|
487
|
2,830
|
4,538
|
8,013
|
||||||||||||||||||
Term loan (USD)
|
-
|
-
|
-
|
90,645
|
-
|
90,645
|
||||||||||||||||||
9,306
|
158
|
5,010
|
93,475
|
4,538
|
112,487
|
|||||||||||||||||||
2022
|
||||||||||||||||||||||||
Working capital facility
|
-
|
6,843
|
-
|
-
|
-
|
6,843
|
||||||||||||||||||
Supplier finance arrangement
|
4,954
|
-
|
-
|
-
|
-
|
4,954
|
||||||||||||||||||
Letter of credit facility
|
-
|
-
|
4,000
|
-
|
-
|
4,000
|
||||||||||||||||||
Term loan
|
-
|
-
|
2,889
|
4,333
|
-
|
7,222
|
||||||||||||||||||
Lease liabilities
|
-
|
95
|
483
|
2,541
|
4,921
|
8,040
|
||||||||||||||||||
4,954
|
6,938
|
7,372
|
6,874
|
4,921
|
31,059
|
4.3.4 |
Fair value risk
|
4.4 |
Contributed equity
|
June 30, 2023
# Ordinary shares
|
June 30, 2022
# Ordinary shares
|
June 30, 2023
$’000
|
June 30, 2022
$’000
|
|||||||||||||
Ordinary shares – fully paid
|
211,877,653
|
206,326,138
|
386,432
|
383,822
|
||||||||||||
Ordinary shares – restricted
|
274,852
|
527,889
|
-
|
-
|
||||||||||||
Total share capital
|
212,152,505
|
206,854,027
|
386,432
|
383,822
|
2022
|
Date
|
# Shares
|
|
$’000
|
|||||
Balance
|
July 1, 2021
|
205,421,449
|
381,890
|
||||||
Shares issued under Employee Share Plan
|
904,689
|
1,932
|
|||||||
Balance of fully paid shares
|
June 30, 2022
|
206,326,138
|
383,822
|
2023
|
Date
|
# Shares
|
|
$’000
|
|||||
Balance
|
July 1, 2022
|
206,326,138
|
383,822
|
||||||
Shares issued under Employee Share Plan
|
5,551,515
|
2,610
|
|||||||
Balance of fully paid shares
|
June 30, 2023
|
211,877,653
|
386,432
|
4.4.1 |
Information about contributed equity
|
4.5 |
Share-based payment plan arrangements
|
|
a) |
Elapse of three years from the date of grant; or
|
|
b) |
Listing of Carbon Revolution’s shares on the ASX or earlier release of exercise restrictions by the board.
|
2023
|
2022
|
|||||||
Grant date
|
-
|
Dec 2021
|
||||||
Number of employees granted shares
|
-
|
266
|
||||||
Value of shares granted per employee (on FTE and length of service pro-rata basis)
|
-
|
$
|
279-$1,000
|
|||||
Total number of shares
|
-
|
255,281
|
||||||
Fair value at grant date
|
-
|
$
|
1.01
|
|
• |
Issue date December 23, 2019
|
|
• |
Exercise price $2.60 (IPO price)
|
|
• |
Vesting date – December 23, 2022
|
|
• |
Term of 5 years (exercise window from December 23, 2022 to December 23, 2024)
|
|
• |
Issue date December 20, 2021
|
|
• |
Exercise price $1.60
|
|
• |
Vesting date – October 28, 2024
|
|
• |
Term of 5 years (exercise window from October 28, 2024 to October 28, 2026)
|
4.6 |
Reserves
|
2023
$’000
|
2022
$’000
|
|||||||
Share-based payments
|
7,695
|
7,214
|
||||||
Share buyback
|
(311
|
)
|
(311
|
)
|
||||
Foreign currency translation
|
(218
|
)
|
(156
|
)
|
||||
7,166
|
6,747
|
4.6.1 |
Information about reserves
|
4.7 |
Transaction costs
|
2023
$’000
|
2022
$’000
|
2021
$’000
|
||||||||||
Transaction costs recognized in the statements of profit or loss and other comprehensive income
|
24,746
|
-
|
-
|
|||||||||
Transaction costs recognized in trade payables
|
541
|
-
|
-
|
|||||||||
Transaction costs recognized in accruals
|
5,716
|
-
|
-
|
|||||||||
Transaction costs recognized in provisions
|
9,459
|
-
|
-
|
|||||||||
Transaction costs recognized in the operating cash flow
|
9,030
|
-
|
-
|
2023
$’000
|
2022
$’000
|
2021
$’000
|
||||||||||
Consolidated statements of profit or loss
|
||||||||||||
Current income tax charge/benefit
|
-
|
-
|
-
|
|||||||||
Adjustment for current tax relating to prior periods
|
-
|
-
|
-
|
|||||||||
Deferred income tax relating to the origination and reversal of temporary differences
|
-
|
-
|
-
|
|||||||||
-
|
-
|
-
|
2023
$’000
|
2022
$’000
|
2021
$’000
|
||||||||||
The prima facie tax benefit on loss before tax differs from the income tax expense as follows:
|
||||||||||||
Accounting loss before tax
|
(79,223
|
)
|
(47,821
|
)
|
(36,000
|
)
|
||||||
Benefit at the Australian statutory income tax rate of 30% (2022: 30%)
|
23,767
|
14,346
|
10,800
|
|||||||||
Tax impact of:
|
||||||||||||
Non-deductible expenses
|
(4,859
|
)
|
(5,083
|
)
|
(4,964
|
)
|
||||||
Non-assessable income
|
-
|
-
|
||||||||||
Impact of different tax rates in foreign jurisdictions
|
29
|
54
|
(50
|
)
|
||||||||
Current year taxable loss not recognized
|
(18,937
|
)
|
(9,317
|
)
|
(5,786
|
)
|
||||||
Income tax benefit
|
-
|
-
|
-
|
2023
$’000
|
2022
$’000
|
|||||||
Deferred tax liabilities relating to temporary differences:
|
||||||||
Receivables
|
-
|
(25
|
)
|
|||||
Intangible assets
|
(4,746
|
)
|
(4,050
|
)
|
||||
Property, plant and equipment
|
(12,841
|
)
|
(6,551
|
)
|
||||
(17,587
|
)
|
(10,626
|
)
|
|||||
Deferred tax assets related to temporary differences:
|
||||||||
Provisions and accruals
|
6,981
|
3,785
|
||||||
Capital raising costs
|
7,833
|
1,960
|
||||||
Tax losses
|
2,682
|
-
|
||||||
Other
|
91
|
89
|
||||||
Total |
17,587
|
5,834
|
||||||
Net deferred tax liability
|
-
|
(4,792
|
)
|
|||||
Less: temporary differences not recognized
|
-
|
4,792
|
||||||
Net deferred tax recognized in the statement of financial position
|
-
|
-
|
Country of
|
% equity interest
|
|||
Name
|
Principal activities
|
incorporation
|
2023
|
2022
|
Carbon Revolution Operations Pty Ltd
|
Carbon fiber wheels
|
Australia
|
100
|
100
|
Carbon Revolution Technology Pty Ltd
|
Carbon fiber wheels
|
Australia
|
100
|
100
|
Carbon Revolution (USA) LLC
|
Carbon fiber wheels
|
United States
|
100
|
100
|
Carbon Revolution (UK) Limited | Carbon fiber wheels | United Kingdom | 100 | 100 |
6.2 |
Directors and Key management personnel
|
2023
$
|
2022
$
|
2021
$
|
||||||||||
Compensation by category
|
||||||||||||
Short-term employment benefits
|
2,211,445
|
2,195,825
|
1,037,034
|
|||||||||
Post-employment benefits
|
99,352
|
96,132
|
82,020
|
|||||||||
Share-based payments
|
-
|
-
|
1,251,222
|
|||||||||
2,310,797
|
2,291,957
|
2,370,276
|
6.3 |
Transactions with related parties
|
6.4 |
Unrecognized items
|
6.4.1 |
Guarantees
|
6.4.2 |
Capital commitments
|
6.4.3 |
Contingent liabilities
|
6.5 |
Changes in accounting policies
|
|
• |
Annual Improvements to IFRS Standards 2018–2020
|
|
• |
Onerous Contracts — Cost of Fulfilling a Contract (Amendments to IAS 37)
|
|
• |
Reference to the Conceptual Framework (Amendments to IFRS 3)
|
|
• |
International Tax Reform — Pillar Two Model Rules (Amendments to IAS 12) — Application of the exception and disclosure of that fact
|
6.6 |
Accounting standards issued but not yet effective at June 30, 2023
|
Standard and Interpretation
|
Effective for annual reporting periods beginning on or after
|
Expected to be initially applied in the financial year ending
|
Narrow scope amendments to IAS 1, Practice statement 2 and IAS 8
|
January 1, 2023
|
June 30, 2024
|
Amendment to IAS 12 – deferred tax related to assets and liabilities arising from a single transaction
|
January 1, 2023
|
June 30, 2024
|
Amendment to IFRS 16 – Leases on sale and leaseback
|
January 1, 2024
|
June 30, 2024
|
Amendments to IAS 1 – Non-current liabilities with covenants
|
January 1, 2024
|
June 30, 2024
|
Amendments to IAS 7 and IFRS 7 on Supplier finance arrangements
|
January 1, 2024
|
June 30, 2024
|
Amendments to IAS 8 – Definition of Accounting Estimates
|
January 1, 2023
|
June 30, 2024
|
6.7 |
Subsequent events
|
|
• |
On November 3, 2023 (the “Initial Closing”), MergeCo issued US$35 million of Preferred
Shares to OIC (Initial Tranche) and received US$35 million in aggregate gross proceeds, less amounts applied to cover certain
transaction costs and an initial structuring premium payable to an entity associated with OIC of US$1.75 million (Initial Structuring Premium).
|
•
|
On the Initial Closing, the Reserve Funds were deposited into an escrow account.
|
|
• |
Subject to and on the satisfaction of further conditions (see below), MergeCo will issue
US$5 million of Preferred Shares to OIC and receive US$5 million in funding from the Reserve
Funds if, prior to the Second Reserve Release (as defined below), the Company receives aggregate gross proceeds of at least US$10 million ($15.6 million) from one or more issuances and sales of Ordinary Shares to
one or more third party persons (other than OIC and its affiliates) pursuant to the First Reserve Release.
|
|
• |
Subject to and on the satisfaction of further conditions by December 1, 2024, or if MergeCo
continues to work in good faith to satisfy the relevant condition, January 31, 2025, MergeCo will issue Preferred Shares to OIC
equal in amount to the remaining Reserve Funds plus accrued interest and receive the remaining Reserve Funds pursuant to the Second Reserve Release.
|
|
• |
In the 24 months following the Initial Closing, MergeCo will, to the extent additional
financing is necessary for the development, construction and/or tooling associated with any future manufacturing facility or
for material upgrades to Carbon Revolution’s existing Mega-line plant operations in Australia (Plant Investments), have the right, subject to meeting
certain conditions described below, to request a Subsequent Financing. Completion of any such Subsequent Financing
is subject to approval by OIC’s investment committee.
|
•
|
has a term of up to five years from the Initial Closing and may be redeemed earlier at the election of
MergeCo;
|
|
• |
is entitled to a fixed rate of dividend of 12% per annum, which accrues daily and is payable
quarterly in cash or in kind by the issue of additional Preferred Shares at MergeCo’s election; and
|
•
|
is expected to be accounted for as borrowings.
|
•
|
12.49%, on and from the Initial Closing; plus
|
•
|
5%, following the issue of Preferred Shares to OIC in connection with the Second Reserve Release; plus
|
•
|
2.5%, subject to OIC not having failed to fund a Subsequent Financing upon the satisfaction of the relevant
conditions by MergeCo, upon the earlier of:
|
•
|
for so long as holders of the OIC Warrant beneficially hold 10% of the aggregate number of outstanding Ordinary Shares
calculated on a fully diluted basis:
|
o
|
issue Ordinary Shares
at a price per share less than 75% of the daily volume weighted average price of Ordinary Shares for the trading day immediately
preceding the issuance. OIC is deemed to have waived this consent right if all relevant conditions (excluding approval by OIC’s investment committee) have been satisfied by MergeCo but OIC fails to fund a Subsequent Financing
(Subsequent Commitment Amount less 2% subsequent structuring premium);
|
o
|
issue Ordinary Shares,
if after such an issuance, holders of the OIC Warrant would be diluted to less than 10% of the aggregate number of
outstanding Ordinary Shares calculated on a fully diluted basis (a “Dilutive Issuance”). OIC is deemed to have waived this consent
right if all relevant conditions (excluding approval by OIC’s investment committee) have been satisfied by MergeCo but OIC fails to fund a Subsequent Financing or OIC previously provided their consent to a Dilutive Issuance; or
|
•
|
amend MergeCo’s constitution in a manner that would be materially adverse to OIC as a holder of the OIC Warrant or as a member of MergeCo.
|
Exhibit No.
|
|
Description
|
Amended and Restated Memorandum and Articles of Association of Carbon Revolution Public Limited Company
|
||
Specimen Ordinary Shares Certificate of Carbon Revolution Public Limited Company
|
||
Warrant Certificate of Carbon Revolution Public Limited Company
|
||
|
Business Combination Agreement, dated as of November 29, 2022, by and among Twin Ridge Capital Acquisition Corp., Carbon Revolution Limited, Poppetell Limited and Poppettell Merger Sub (incorporated by reference to Annex A to the
Registration Statement on Form F-4 (333-270047)).
|
|
Amendment to the Business Combination Agreement, dated as of October 5, 2023, by and among Twin Ridge Capital Acquisition Corp., Carbon Revolution Limited, Poppetell Limited and Poppettell Merger Sub (incorporated by reference to Annex
A to Supplement No. 2 to the proxy/statement prospectus dated September 8, 2023 filed on October 5, 2023)).
|
||
|
Scheme Implementation Deed, dated as of November 30, 2022, by and among Carbon Revolution Limited, Twin Ridge Capital Acquisition Corp. and Poppetell Limited (incorporated by reference to Annex B to the Registration Statement on Form
F-4 (333-270047)).
|
|
Scheme Implementation Amendment (incorporated by reference to Annex E to Supplement No. 1 to the proxy/statement prospectus dated September 8, 2023 filed on September 25, 2023)).
|
||
|
Warrant Agreement, dated March 3, 2021, by and among Twin Ridge Capital Acquisition Corp. and Continental Stock Transfer & Trust Company, as warrant agent (incorporated by reference to Exhibit 4.3 to the Registration Statement on
Form F-4 (333-270047)).
|
|
|
Assignment and Assumption Agreement between Twin Ridge Capital Acquisition Corp., Carbon Revolution Public Limited Company (formerly known as Poppetell Limited), Computershare Inc. and Computershare Trust Company, N.A. (included as
Annex D to the Registration Statement on Form F-4 (333-270047)).
|
|
|
Warrant Amendment Agreement between Twin Ridge Capital Acquisition Corp., Continental Stock Transfer & Trust Company, Computershare Inc. and Computershare Trust Company, N.A. (included as Annex E to the Registration Statement on
Form F-4 (333-270047)).
|
|
|
Letter Agreement, dated March 3, 2021, by and among Twin Ridge Capital Acquisition Corp., Barclays Capital Inc. and Evercore Group, LLC (incorporated by reference to Exhibit 10.4 of Twin Ridge Capital Acquisition Corp.’s Form 8-K,
filed with the SEC on March 9, 2021).
|
|
|
Sponsor Side Letter, dated as of November 29, 2022, by and among Twin Ridge Capital Sponsor, LLC, Twin Ridge Capital Sponsor Subsidiary, LLC, the independent directors party thereto, the other insiders party thereto, Twin Ridge Capital
Acquisition Corp., Carbon Revolution Limited, and Poppetell Limited (included as Annex F to the Form F-4).
|
|
|
Proceeds Disbursing and Security Agreement, dated May 23, 2023 by and among UMB Bank, N.A., as trustee and disbursing Agent, Newlight Capital LLC, as servicer, collateral agent and security trustee and Carbon Revolution Operations PTY
LTD.
|
|
|
Equity Incentive Plan of the Company.
|
|
|
Service Agreement with Jacob Dingle, dated March 14, 2017 (incorporated by reference to Exhibit 10.5 to the Registration Statement on Form F-4 (333-270047)).
|
|
|
Service Agreement with Gerard Buckle, dated August 7, 2019 (incorporated by reference to Exhibit 10.6 to the Registration Statement on Form F-4 (333-270047)).
|
|
Form of Voluntary Escrow Deed (incorporated by reference to Annex H to the Registration Statement on Form F-4 (333-270047)).
|
|
Securities Purchase Agreement, by and among the Company, Carbon Revolution Operations Pty Ltd and OIC Investors, dated September 21, 2023 (incorporated by reference to Annex B to Supplement No. 1 to the proxy/statement prospectus dated
September 8, 2023 filed on September 25, 2023)).
|
||
Form of Company OIC Warrant to purchase Ordinary Shares (incorporated by reference to Annex C to Supplement No. 1 to the proxy/statement prospectus dated September 8, 2023 filed on September 25, 2023)).
|
||
Shareholder’s Agreement between the Company and OIC Investors, dated as of September 18, 2023 (incorporated by reference to Annex D to Supplement No. 1 to the proxy/statement prospectus dated September 8, 2023 filed on September 25,
2023)).
|
||
Second Amendment to Proceeds Disbursing and Security Agreement, dated September 18, 2023, between UMB Bank, National Association, Newlight Capital LLC, Carbon Revolution Operations Pty Ltd, Carbon Revolution Technology Pty Ltd and
Carbon Revolution (incorporated by reference to Annex F to Supplement No. 1 to the proxy/statement prospectus dated September 8, 2023 filed on September 25, 2023)).
|
||
|
Form of Indemnification Agreement between Carbon Revolution Public Limited Company and each of its directors and officers (incorporated by reference to Exhibit 10.8 to the Registration Statement on Form F-4 (333-270047)).
|
|
4.20† |
|
Form of Lock Up Agreement
|
4.21† |
|
Registration Rights Agreement, dated as of November 3, 2023, among the Company, Twin Ridge, DDGN Advisors LLC and the individuals listed on the signature pages thereto.
|
|
List of Subsidiaries of the Company
|
|
Insider Trading Policy
|
||
Unaudited Pro Forma Condensed Combined Financial Information of the Company and Twin Ridge.
|
||
15.2† |
Letter dated November 9, 2023 from Deloitte Touche Tohmatsu, pertaining to Item 16F.
|
|
15.3† |
List of Relevant Territories for Irish Tax Purposes.
|
|
Consent of Deloitte Touche Tohmatsu.
|
||
Consent of Marcum LLP.
|
|
Carbon Revolution Public Limited Company
|
||
|
|
|
|
November 9, 2023
|
By:
|
/s/ Jacob Dingle |
|
|
Name:
|
Jacob Dingle |
|
|
Title:
|
Director and Authorized Signatory |
1. |
The name of the Company is CARBON REVOLUTION PUBLIC LIMITED COMPANY.
|
2. |
The Company is a public limited company, registered under Part 17 of the Companies Act 2014.
|
3. |
The objects for which the Company is established are:
|
|
3.1 |
To carry on the business of a holding company and to co-ordinate the administration, finances and activities of any subsidiary companies or associated companies, to do all lawful acts and things
whatever that are necessary or convenient in carrying on the business of such a holding company and in particular to carry on in all its branches the business of a management services company, to act as managers and to direct or coordinate
the management of other companies or of the business, property and estates of any company or person and to undertake and carry out all such services in connection therewith as may be deemed expedient by the Company’s board of directors and to exercise its powers as a shareholder of other companies.
|
|
3.2 |
To carry on the businesses of manufacturer, distributor, wholesaler, retailer, service provider, investor, designer, trader and any other business (except the issuing of policies of insurance) which may seem to the Company’s board of directors capable of being conveniently carried on in connection with these objects or calculated directly or indirectly to enhance the value of or render more profitable any of the Company’s
property.
|
|
3.3 |
To carry on all or any of the businesses as aforesaid either as a separate business or as the principal business of the Company.
|
|
3.4 |
To invest and deal with the property of the Company in such manner as may from time to time be determined by the Company’s board of directors and to dispose of or vary such investments and dealings.
|
|
3.5 |
To borrow or raise money or capital in any manner and on such terms and subject to such conditions and for such purposes as the Company’s board of directors shall think fit or expedient, whether
alone or jointly and/or severally with any other person or company, including, without prejudice to the generality of the foregoing, whether by the issue of debentures or debenture stock (perpetual or otherwise) or otherwise, and to secure,
with or without consideration, the payment or repayment of any money borrowed, raised or owing or any debt, obligation or liability of the Company or of any other person or company whatsoever in such manner and on such terms and conditions
as the Company’s board of directors shall think fit or expedient and, in particular by mortgage, charge, lien, pledge or debenture or any other security of whatsoever nature or howsoever described,
perpetual or otherwise, charged upon all or any of the Company’s property, both present and future, and to purchase, redeem or pay off any such securities or borrowings and also to accept capital contributions from any person or company in
any manner and on such terms and conditions and for such purposes as the Company’s board of directors shall think fit or expedient.
|
|
3.6 |
To lend and advance money or other property or give credit or financial accommodation to any company or person in any manner either with or without security and whether with or without the payment of interest and upon such terms and
conditions as the Company’s board of directors shall think fit or expedient.
|
|
3.7 |
To guarantee, indemnify, grant indemnities in respect of, enter into any suretyship or joint obligation, or otherwise support or secure, whether by personal covenant, indemnity or undertaking or by mortgaging, charging, pledging or
granting a lien or other security over all or any part of the Company’s property (both present and future) or by any one or more of such methods or any other method and whether in support of such guarantee or indemnity or suretyship or
joint obligation or otherwise, on such terms and conditions as the Company’s board of directors shall think fit, the payment of any debts or the performance or discharge of any contract, obligation or
liability of any person or company (including, without prejudice to the generality of the foregoing, the payment of any capital, principal, dividends or interest on any stocks, shares, debentures, debenture stock, notes, bonds or other
securities of any person, authority or company) including, without prejudice to the generality of the foregoing, any company which is for the time being the Company’s holding company or another subsidiary (as defined by the Act) of the Company’s holding company or a subsidiary of the Company or otherwise associated with the Company (including any arrangements of the Company or any of its subsidiaries), in each case
notwithstanding the fact that the Company may not receive any consideration, advantage or benefit, direct or indirect, from entering into any such guarantee or indemnity or suretyship or joint obligation or other arrangement or transaction
contemplated herein.
|
|
3.8 |
To grant, convey, assign, transfer, exchange or otherwise alienate or dispose of any property of the Company of whatever nature or tenure for such price, consideration, sum or other return whether equal to or less than the market value
thereof or for shares, debentures or securities and whether by way of gift or otherwise as the Company’s board of directors shall deem fit or expedient and where the property consists of real property
to grant any fee farm grant or lease or to enter into any agreement for letting or hire of any such property for a rent or return equal to or less than the market or rack rent therefor or at no rent and subject to or free from covenants and
restrictions as the Company’s board of directors shall deem appropriate.
|
|
3.9 |
To purchase, take on, lease, exchange, rent, hire or otherwise acquire any property and to acquire and undertake the whole or any part of the business and property of any company or person.
|
|
3.10 |
To develop and turn to account any land acquired by the Company or in which it is interested and in particular by laying out and preparing the same for building purposes, constructing, altering, pulling down, decorating, maintaining,
fitting out and improving buildings and conveniences and by planting, paving, draining, farming, cultivating, letting and by entering into building leases or building agreements and by advancing money to and entering into contracts and
arrangements of all kinds with builders, contractors, architects, surveyors, purchasers, vendors, tenants and any other person.
|
|
3.11 |
To construct, improve, maintain, develop, work, manage, carry out or control any property which may seem calculated directly or indirectly to advance the Company’s interest and to contribute to, subsidise or otherwise assist or take part
in the construction, improvement, maintenance, working, management, carrying out or control thereof.
|
|
3.12 |
To draw, make, accept, endorse, discount, execute and issue promissory notes, bills of exchange, bills of lading, warrants, debentures and other negotiable or transferable instruments.
|
|
3.13 |
To engage in currency exchange, interest rate and commodity transactions including, but not limited to, dealings in foreign currency, spot and forward rate exchange contracts, futures, options, forward rate agreements, swaps, caps,
floors, collars and any other foreign exchange, interest rate or commodity hedging arrangements and such other instruments as are similar to, or derived from, any of the foregoing whether for the purpose of making a profit or avoiding a
loss or managing a currency, interest rate or commodity exposure or any other exposure or for any other purpose.
|
|
3.14 |
As a pursuit in itself or otherwise and whether for the purpose of making a profit or avoiding a loss or managing a currency, interest rate or commodity exposure or any other exposure or for any other purpose whatsoever, to engage in any
currency exchange transactions, interest rate transactions and commodity transactions, derivative and/or treasury transactions and any other financial or other transactions, including (without prejudice to the generality of the foregoing)
securitisation, treasury and/or structured finance transactions, of whatever nature in any manner and on any terms and for any purposes whatsoever, including, without prejudice to the generality of the foregoing, any transaction entered
into in connection with or for the purpose of, or capable of being for the purposes of, avoiding, reducing, minimising, hedging against or otherwise managing the risk of any loss, cost, expense, or liability arising, or which may arise,
directly or indirectly, from a change or changes in any interest rate or currency exchange rate or in the price or value of any property, asset, commodity, index or liability or from any other risk or factor affecting the Company’s
business, including but not limited to dealings whether involving purchases, sales or otherwise in foreign currency, spot and/or forward rate exchange contracts, futures, options, forward rate agreements, swaps, caps, floors, collars and/or
any such other currency or interest rate or commodity or other hedging, treasury or structured finance arrangements and such other instruments as are similar to, or derived from any of the foregoing.
|
|
3.15 |
To apply for, establish, create, purchase or otherwise acquire, sell or otherwise dispose of and hold any patents, trademarks, copyrights, brevets d’invention, registered designs, licences, concessions and the like conferring any
exclusive or non-exclusive or limited rights to use or any secret or other information and any invention and to use, exercise, develop or grant licences in respect of or otherwise turn to account or exploit the property, rights or
information so held.
|
|
3.16 |
To enter into any arrangements with any governments or authorities, national, local or otherwise and to obtain from any such government or authority any rights, privileges and concessions and to carry out, exercise and comply with any
such arrangements, rights, privileges and concessions.
|
|
3.17 |
To establish, form, register, incorporate or promote any company or companies or person, whether inside or outside of Ireland.
|
|
3.18 |
To procure that the Company be registered or recognised whether as a branch or otherwise in any country or place.
|
|
3.19 |
To enter into partnership or into any arrangement for sharing profits, union of interests, co-operation, joint venture, reciprocal concession or otherwise with any person or company carrying on or engaged in or about to carry on or
engage in any business or transaction and to engage in any transaction in connection with the foregoing.
|
|
3.20 |
To acquire or amalgamate with any other company or person.
|
|
3.21 |
To acquire and undertake the whole or any part of the business, good-will and assets of any person, firm or company carrying on or proposing to carry on any of the businesses which this Company is authorised to carry on, and as part of
the consideration for such acquisition to undertake all or any of the liabilities of such person, firm or company, or to acquire an interest in, amalgamate with, or enter into any arrangement for sharing profits, or for co-operation, or for
mutual assistance with any such person, firm or company and to give or accept by way of consideration for any of the acts or things aforesaid or property acquired, any shares, debentures, debenture stock
or securities that may be agreed upon, and to hold and retain or sell, mortgage or deal with any shares, debentures, debenture stock or securities so received.
|
|
3.22 |
To promote freedom of contract, and to resist, insure against, counteract and discourage interference therewith, to join any lawful federation, union or association, or do any other lawful act or thing
with a view to preventing or resisting directly or indirectly any interruption of or interference with the Company’s or any other trade or business or providing or safeguarding against the same, or resisting or opposing any strike, movement
or organisation which may be thought detrimental to the interests of the Company or its employees and to subscribe to any association or fund for any such purposes.
|
|
3.23 |
To make gifts to any person or company including, without prejudice to the generality of the foregoing, capital contributions and to grant bonuses to the directors or any other persons or companies who are or have been in the employment
of the Company including substitute directors and any other officer or employee.
|
|
3.24 |
To establish and support or aid in the establishment and support of associations, institutions, funds, trusts and conveniences calculated to benefit directors, ex-directors, employees or ex-employees of the Company or any subsidiary of
the Company or the dependants or connections of such persons, and to grant pensions and allowances upon such terms and in such manner as the Company’s board of directors think fit, and to make payments
towards insurance and to subscribe or guarantee money for charitable or benevolent objects or for any exhibition or for any public, general or useful object, or any other object whatsoever which the Company’s board of directors may think advisable.
|
|
3.25 |
To establish and contribute to any scheme for the purchase of shares or subscription for shares in the Company, its holding company or any of its or their respective subsidiaries, to be held for the benefit of the employees or former
employees of the Company or any subsidiary of the Company including any person who is or was a director holding a salaried employment or office in the Company or any subsidiary of the Company and to lend or otherwise provide money to the
trustees of such schemes or the employees or former employees of the Company or any subsidiary of the Company to enable them to purchase shares of the Company, its holding company or any of its or their respective subsidiaries and to
formulate and carry into effect any scheme for sharing the profits of the Company, its holding company or any of its or their respective subsidiaries with its employees and/or the employees of any of its subsidiaries.
|
|
3.26 |
To remunerate any person or company for services rendered or to be rendered in placing or assisting to place or guaranteeing the placing of any of the shares of the Company’s capital or any debentures, debenture stock or other securities
of the Company or in or about the formation or promotion of the Company or the conduct of its business.
|
|
3.27 |
To obtain any Act of the Oireachtas or provisional order for enabling the Company to carry any of its objects into effect or for effecting any modification of the Company’s constitution or for any
other purpose which may seem expedient and to oppose any proceedings or applications which may seem calculated directly or indirectly to prejudice the Company’s interests.
|
|
3.28 |
To adopt such means of making known the products of the Company as may seem expedient and in particular by advertising in the press, by circulars, by purchase and exhibition of works of art or interest, by publication of books and
periodicals and by granting prizes, rewards and donations.
|
|
3.29 |
To undertake and execute the office of trustee and nominee for the purpose of holding and dealing with any property of any kind for or on behalf of any person or company; to act as trustee, nominee, agent, executor, administrator, registrar, secretary, committee or attorney generally for any purpose and either solely or with others for any person or company; to vest any property in any person or
company with or without any declared trust in favour of the Company.
|
|
3.30 |
To pay all costs, charges, fees and expenses incurred or sustained in or about the promotion, establishment, formation and registration of the Company.
|
|
3.31 |
To do all or any of the above things in any part of the world, and as principals, agents, contractors, trustees or otherwise and by or through trustees, agents or otherwise and either alone or in conjunction with any person or company.
|
|
3.32 |
To distribute the property of the Company in specie among the members or, if there is only one, to the sole member of the Company.
|
|
3.33 |
To do all such other things as the Company’s board of directors may think incidental or conducive to the attainment of the above objects or any of them.
|
|
a) |
the word “company”, except where used in reference to this Company, shall be deemed to include a body corporate, whether a company (wherever formed, registered or incorporated), a corporation aggregate, a corporation sole and a national
or local government or other legal entity; and
|
|
b) |
the word “person”, shall be deemed to include any individual, firm, body corporate, association or partnership, government or state or agency of a state, local authority or government body or any joint venture association or partnership
(whether or not having a separate legal personality) and that person’s personal representatives, successors or permitted assigns; and
|
|
c) |
the word “property”, shall be deemed to include, where the context permits, real property, personal property including choses or things in action and all other intangible property and money and all estates, rights, titles and interests
therein and includes the Company’s uncalled capital and future calls and all and every other undertaking and asset; and
|
|
d) |
a word or expression used in this memorandum of association which is not otherwise defined and which is also used in the Companies Act 2014 shall have the same meaning here, as it has in the Companies
Act 2014; and
|
|
e) |
any phrase introduced by the terms “including”, “include” and “in particular” or any similar expression shall be construed as illustrative and shall not limit the sense of the words preceding those terms, whether or not followed by the
phrases “but not limited to”, “without prejudice to the generality of the foregoing” or any similar expression; and
|
|
f) |
words denoting the singular number only shall include the plural number and vice versa and references to one gender includes all genders; and
|
|
g) |
it is intended that the objects specified in each paragraph in this clause shall, except where otherwise expressed in such paragraph, be separate and distinct objects of the Company and shall not be in any way limited or restricted by
reference to or inference from the terms of any other paragraph or the order in which the paragraphs of this clause occur or the name of the Company.
|
4. |
The liability of the members is limited.
|
5. |
The authorised share capital of the Company is US$100,010,000 divided into 800,000,000,000 ordinary shares with a nominal value of US$0.0001 each, 200,000,000,000 preferred shares with a nominal value of US$0.0001 each and 100,000,000
class A preferred shares with a nominal value of US$0.0001 each and €25,000 divided into 25,000 deferred ordinary shares with a nominal value of €1.00 each.
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6. |
The shares forming the capital may be increased or reduced and be divided into such classes and issued with any special rights, privileges and conditions or with such qualifications as regards preference, dividend, capital, voting or
other special incidents, and be held upon such terms as may be attached thereto or as may from time to time be provided by the original or any substituted or amended articles of association and regulations of the Company for the time being, but so that where shares are issued with any preferential or special rights attached
thereto such rights shall not be alterable otherwise than pursuant to the provisions of the Company’s articles of
association for the time being.
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1. |
Sections 83, 84, 117(9) and 165(2) to (6) of the Act shall apply to the Company but, subject to that, the provisions set out in these Articles shall constitute the whole of the regulations applicable to the Company and no other “optional provisions” as
defined by section 1007(2) of the Act shall apply to the Company.
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2. |
In these Articles:
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2.1 |
“Accrual Period” means with respect to each Class A Preferred
Share, the period commencing on its date of issuance and ending the date of the redemption of such Class A Preferred Share;
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2.2 |
“Act” means the Companies Act 2014 and every statutory modification and
re-enactment thereof for the time being in force;
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2.3 |
“Acting in Concert” has the meaning given to it in Rule 2.1(a) and Rule 3.3 of Part A of the Takeover
Rules;
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2.4 |
“Adjourned Meeting” has the meaning given in Article 122.1;
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2.5 |
“Adoption Date” means the effective date of adoption of these Articles;
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2.6 |
“Affiliate” has the meaning given in Article 249;
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2.7 |
“Agent” has the meaning given in Article
19.3;
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2.8 |
“Approved Nominee” means a person appointed under contractual arrangements with the Company to hold shares or rights or interests in shares of the Company on a nominee basis;
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2.9 |
“Article” means an article of these Articles;
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2.10 |
“Articles” means these articles of association as from time to time and for the time being in force;
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2.11 |
“AU$” means Australian dollars;
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2.12 |
“Auditors” means the auditors for the time
being of the Company;
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2.13 |
“Available Profits” means the profits
available for distribution within the meaning of section 117 and Chapter 6 of Part 17 of the Act;
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2.14 |
“Board” means the board of Directors of the Company;
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2.15 |
“Business Day” means a day except a Saturday, Sunday or a legal holiday on which banks in
New York, New York, United States of America or Dublin, Ireland are authorised or obligated by applicable law to close;
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2.16 |
“Chairperson” means the person occupying the position of Chairperson of the Board from time to time;
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2.17 |
“Change of Control Transaction” means any transaction or series of related transactions involving: (i) the sale, lease, exclusive license or other disposition of all or substantially all of the
assets of the Company; (ii) any merger or consolidation of the Company into or with another person or entity or any other corporate reorganisation, in which the shareholders of the Company in their capacity as such immediately prior to such
merger, consolidation or reorganisation, own less than a majority of the Company’s (or the surviving or successor entity’s) outstanding voting power immediately after such merger, consolidation or reorganisation; or (iii) any sale or other
transfer by the shareholders of the Company of shares representing at least a majority of the Company’s then-total outstanding combined voting power;
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2.18 |
“Chief Executive Officer” shall include any equivalent office;
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2.19 |
“Class A Preferred Directors” has the meaning given in Article 163;
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2.20 |
“Class A Preferred Dividend Rate” means an annual rate of twelve percent (12%):
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2.21 |
“Class A Preferred Dividends” has the meaning given in Article 13;
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2.22 |
“Class A Preferred Members” means the holders from time to time of Class A Preferred Shares (including Class A Preferred PIK Shares), provided that, to the
extent a Class A Preferred Member holds other equity interests in the Company, then such member will be treated as a Class A Preferred Member only with respect to the Class A Preferred Shares held thereby;
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2.23 |
“Class A Preferred Majority” means, at the relevant date of determination, the Class A Preferred Members holding of a majority of the Class A Preferred Shares in issue on that date;
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2.24 |
“Class A Preferred Optional Redemption Date” has the meaning given in Article 16;
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2.25 |
“Class A Preferred Payment Date” means a date that is no later than three (3) Business Days following each of March 31, June 30, September 30 and December 31, as applicable, of each year following the Initial Closing Date;
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2.26 |
“Class A Preferred PIK Distribution” has the meaning given in Article 13;
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2.27 |
“Class A Preferred PIK Shares” has the meaning given in Article 13;
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2.28 |
“Class A Preferred Redemption Notice” has the meaning given in Article 16;
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2.29 |
“Class A Preferred Share Return Dispute Notice” has the meaning given in Article 16;
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2.30 |
“Class A Preferred Share Amount” means:
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(a) |
with respect to the Class A Preferred Shares issued (x) on the Initial Closing, and (y) on a Reserve Release Closing (in the case of (y), paid-up from the Reserve Account) (the “Initial and Released Class A Preferred Shares”),
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(i) |
in the period, from the Initial Closing Date until the date of disbursement of the Reserve Funds (plus accrued interest thereon) then remaining in the Reserve Account to the holders of Class A Preferred Shares upon the exercise of the
Draw Right following an OIC Reserve Recovery Event, an amount per Class A Preferred Share equal to the quotient obtained by dividing (A) US$70,000,000 by
(B) the number of Initial and Released Class A Preferred Shares in issue from time to time;
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(ii) |
in the period following the disbursement of the Reserve Funds (plus accrued interest thereon) then remaining in the Reserve Account to the holders of Class A Preferred Shares upon the exercise of the Draw Right following an OIC Reserve
Recovery Event (the principal amount of such Reserve Funds, excluding accrued interest thereon, being the “OIC Reserve Recovery Amount”), an amount per Class A Preferred Share equal to the quotient
obtained by dividing (A) US$70,000,000 less the OIC Reserve Recovery Amount by (B) the number of Initial and Released Class A Preferred Shares in issue from
time to time;
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(b) |
with respect to the Class A Preferred Share issued on a Subsequent Closing, US$100,000 per share; and
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(c) |
with respect to the Class A Preferred PIK Shares, US$100,000 per share,
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2.31 |
“Class A Preferred Share Return” means:
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(a) |
with respect to the Initial and Released Class A Shares, an amount of cash distributions and/or redemption payments made pursuant to these Articles sufficient to cause the holders of such Class A Preferred Shares, to receive, in
aggregate the sum of:
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(i) |
the greater of (A) a MOIC of one and three quarters (1.75) or (B) a twelve percent (12%) IRR with respect to US$70,000,000 less the OIC Reserve Recovery Amount, if any; plus
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(ii) |
a MOIC of one and one quarter (1.25) with respect to the OIC Reserve Recovery Amount),
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(b) |
with respect to each Class A Preferred Share issued on a Subsequent Closing, the greater of (A) a MOIC of one and three quarters (1.75) or (B) a twelve percent (12%) IRR with respect to the Class A Preferred Share Amount attributable
thereto; and
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(c) |
with respect to each Class A Preferred PIK Share issued, the Class A Preferred Share Amount attributable thereto, plus any accrued but unpaid dividends thereon, provided, however, that if the Class A Preferred Share by reference to which
a Class A Preferred PIK Share was issued, is redeemed, such Class A PIK Preferred Share shall also be deemed to be redeemed for no additional consideration;
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2.32 |
“Class A Preferred Shares” means the class A preferred shares with a nominal value of US$0.0001 each in the capital of the Company;
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2.33 |
“Clear Days” means, in relation to a period of notice, that period excluding the day when the notice is given or deemed to be given and excluding the day for which notice is being given or on which
an action or event for which notice is being given is to occur or take effect;
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2.34 |
“committee” has the meaning given in Article 197;
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2.35 |
“Company” means the company whose name
appears in the heading to these Articles;
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2.36 |
“Company Secretary” means the person or persons appointed as company secretary or joint company secretary of the Company from time to time and shall include any assistant or deputy secretary;
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2.37 |
“Concert Party” means, in relation to any person, a party who is deemed or presumed to be Acting in Concert with that person for the purposes of the
Takeover Rules;
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2.38 |
“contested election” has the meaning given in Article 167;
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2.39 |
“Deferred Shares” means the Deferred Ordinary Shares with a nominal value of €1.00 each in the capital of the Company;
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2.40 |
“Designated Valuation Firm” means an independent valuation expert;
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2.41 |
“Designated Valuation Firm Cost Allocations” has the meaning given in Article 16;
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2.42 |
“Directors” means the directors for the time being of the Company or any of them acting as the Board;
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2.43 |
“Director’s Certified Email Address” has the meaning given in Article 200.3;
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2.44 |
“disponee” has the meaning given in Article 53.1;
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2.45 |
“Draw Right” has the meaning given in the Securities Purchase Agreement;
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2.46 |
“Early Company Call Option Election” has the meaning
given in Article 16;
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2.47 |
“elected by a plurality” has the meaning given in Article 167;
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2.48 |
“electronic communication” has the meaning given to that word in the Electronic Commerce Act 2000 and in addition includes in the case of notices or documents issued on behalf of the Company, such documents being made available or displayed on a
website of the Company (or a website designated by the Board);
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2.49 |
“EUR” or “€” means euro;
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2.50 |
“Exchange” means any securities exchange or other system on which the shares of the Company may be listed or otherwise authorised for trading from time to time in circumstances where the Company
has approved such listing or trading;
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2.51 |
“Exchange Act” means the Securities Exchange Act of 1934 of the United States, as amended;
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2.52 |
“Fiscal Quarter” means each calendar quarter ending March 31, June 30, September 30 and December 31, or such other quarterly accounting period as may be
established by the Company;
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2.53 |
“Group” means the Company and its subsidiaries from time to time and for the time being;
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2.54 |
“Independent Directors” has the meaning given in Article 249;
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2.55 |
“Initial Closing” has the meaning given in the Securities Purchase Agreement;
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2.56 |
“Initial Closing Date” has the meaning given in the Securities Purchase Agreement;
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2.57 |
“Interested Person” has the meaning given in Article249;
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2.58 |
“IRR” means, with respect to a Class A Preferred Member in respect of any Class A Preferred Share held by such Class A Preferred Member as of any applicable time of determination, the actual annual
pre-tax rate of return as to the applicable person (but computed after all taxes imposed on the Company and its subsidiaries), accruing daily and compounded quarterly, on the Class A Preferred Share Amount referable to such Class A
Preferred Share since the date on which the Company issued such Class A Preferred Share provided, however, that, for the purpose of calculating the IRR on the Initial and Released Class A Preferred Shares, all such shares shall be deemed to
have been issued on the Initial Closing Date and all cash dividends and redemption payments received by the holders thereof, shall be deemed to have been received pro rata by all such holders.
Calculation of IRR shall take into account only cash dividends and redemption payments received by such Class A Preferred Member and such Class A Preferred Member’s successor(s) in interest with respect to such Class A Preferred Shares in
accordance with the provisions of these Articles (including, for the avoidance of doubt, all cash dividends and redemption payments in respect of any Class A Preferred PIK Share issued by reference to such Class A Preferred Share). In
calculating IRR (i) all applicable cash dividends and redemption payments shall be considered to have been made on the date actually paid and (ii) IRR shall be calculated using the XIRR function in the most recent version of Microsoft Excel
(or if such program is no longer available, such other software program for calculating IRR proposed by the Company and acceptable to the Majority Class A Preferred Holder);
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2.59 |
“Mandatory Class A Redemption Date” has the meaning given in Article 17;
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2.60 |
“Mandatory Class A Redemption Event” has the meaning given in Article 17;
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2.61 |
“member” means, in relation to any share, the member whose name is entered in the Register as the holder of the share or, where the context permits, the members whose names are entered in the
Register as the joint holders of shares and shall include a member’s personal representatives in consequence of his or her death or bankruptcy;
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2.62 |
“Memorandum” means the memorandum of association of the Company;
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2.63 |
“MOIC” means with respect to a Class A Preferred Member in respect of any Class A Preferred Share held by such Class A Preferred Member as of any time of determination, the number obtained by dividing (i) the cumulative amount of cash distributions or redemption payments that such Class A Preferred Member and such Class A Preferred Member’s predecessors in interest have received in respect of
such Class A Preferred Share in accordance with the provisions of these Articles (including, for the avoidance of doubt, all cash dividends and redemption payments in respect of any Class A Preferred PIK Share issued by reference to such
Class A Preferred Share); by (ii) the Class A Preferred Share Amount referable to such Class A Preferred Share, provided, however, that, for the purpose of calculating the MOIC on the Initial and
Released Class A Preferred Shares, all cash dividends and redemption payments received by the holders thereof, shall be deemed to have been received pro rata by all such holders.
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2.64 |
“Order” has the meaning given in the Securities Purchase Agreement;
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2.65 |
“Office” means the registered office for the time being of the Company;
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2.66 |
“OIC Reserve Recovery Event” has the meaning given in the Securities Purchase Agreement;
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2.67 |
“Ordinary Shares” means the Ordinary Shares with a nominal value of US$0.0001 each in the capital of the Company;
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2.68 |
“Permitted Conflict” has the meaning given in Article 212;
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2.69 |
“Preferred Shares” means the Preferred Shares with a nominal value of US$0.0001 each in the capital of the Company (which, for the avoidance of doubt, do not include the Class A Preferred Shares);
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2.70 |
“Proceedings” has the meaning given in Article 264;
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2.71 |
“Redeemable Shares” means redeemable shares
as defined by section 64 of the Act;
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2.72 |
“Re-designation Event” means;
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|
(a) |
the transfer of Restricted Voting Ordinary Shares from a Restricted Shareholder to a Shareholder or other person who is not a Restricted Shareholder;
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|
(b) |
an event whereby a Restricted Shareholder ceases to be restricted from holding securities conferring voting rights in the Company without a Takeover Rules Event occurring by virtue of Rule 9 of the Takeover Rules, except in these
circumstances the number of Restricted Voting Ordinary Shares which shall be re-designated as Ordinary Shares shall be the maximum number of Restricted Voting Ordinary Shares that can be re-designated without the former Restricted
Shareholder becoming or remaining a Restricted Shareholder on the Re-designation Event; or
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(c) |
a Restricted Shareholder of the Company undertaking a Takeover Rules Event and the Takeover Panel consenting to some or all of the Restricted Voting Ordinary Shares being re-designated as Ordinary Shares, in which case only those
Restricted Voting Ordinary Shares the re-designation of which has been consented to by the Takeover Panel shall be re-designated as Ordinary Shares;
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2.73 |
“Register” means the register of members of the Company to be kept as required by the Act;
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2.74 |
“Reserve Account” has the meaning given in the Securities Purchase Agreement;
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2.75 |
“Reserve Funds” has the meaning given in the Securities Purchase Agreement;
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2.76 |
“Reserve Release Closing” has the meaning given in the Securities Purchase Agreement;
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2.77 |
“Restricted Shareholder” means a member of the Company or other person who is restricted from holding securities conferring voting rights in the Company without a Takeover Rules Event occurring by
virtue of Rule 9 of the Takeover Rules or a member or person who would be so restricted but for the limitations on voting rights set out under Article 7, provided that where two or more persons are deemed or presumed (and such presumption
has not been rebutted) to be Acting in Concert for the purpose of Rule 9 of the Takeover Rules, only the person who acquired the securities conferring voting rights which, but for the application of Article 7, would trigger the Takeover Rules
Event shall be deemed to be a Restricted Shareholder in respect only of such number of those securities conferring voting rights which, but for the application of Article 7, would trigger the Takeover Rules Event;
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2.78 |
“Restricted Voting Ordinary Shares” means
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|
(d) |
an interest in securities acquired by a Restricted Shareholder where the Restricted Shareholder has not elected for a Takeover Rules Event to occur; or
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|
(e) |
Ordinary Shares the subject of a notification by a Shareholder by at least 10 Business Days’ notice in writing to the Company that such Shareholder wishes for such Ordinary Shares to be designated as Restricted Voting Ordinary Shares;
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2.79 |
“Rights” has the meaning given in Article 253;
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2.80 |
“Rights Plan” has the meaning given in Article 252;
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2.81 |
“SEC” means the U.S. Securities
and Exchange Commission;
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2.82 |
“securities conferring voting rights” shall be construed in accordance with the definitions of “security” and “interest in a
security” in section 1 of the Irish Takeover Panel Act 1997;
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2.83 |
“Securities Purchase Agreement” means that Securities Purchase Agreement by and among the Company, OIC Structured Equity Fund GPFA Range, LLC, OIC Structured Equity Fund I Range, LLC and solely for
the purposes of certain provisions thereof, Carbon Revolution Operations PTY LTD.; dated as of 21 September 2023;
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2.84 |
“Share Capital Reduction” has the meaning given in the Securities Purchase Agreement;
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2.85 |
“Shareholder” means a holder of shares in the capital of the Company;
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2.86 |
“Springing Rights Event” means (i) a failure by the Company to effect a Mandatory Class A Redemption Event on the Mandatory Class A Redemption Date, (ii) the undertaking by the Company or any of
its subsidiaries of any Structured Voting Rights Matter without the prior written consent of a Class A Preferred Majority or (iii) a failure on the part of the Company to obtain the Share Capital Reduction Order within 60 days of the
Initial Closing, (iv) comply with its obligations under section 5.10 (Further Share Capital Reductions) or (v) comply with its obligations under section 5.11 (Right of First Offer) of the Securities Purchase Agreement, whichever first
occurs;
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|
2.87 |
“Springing Rights Matters” means the matters listed in Schedule 2 of these Articles;
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|
2.88 |
“Structured Voting Rights Matters” means the matters listed in Schedule 1 of these Articles;
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|
2.89 |
“Subsequent Closing” has the meaning given in the Securities Purchase Agreement;
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2.90 |
“subsidiary” has the meaning ascribed to it in section 7 of the Act;
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|
2.91 |
“Takeover Panel” means the Irish Takeover Panel established under the Irish Takeover Panel Act 1997;
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|
2.92 |
“Takeover Rules” means the Takeover Panel Act 1997, Takeover Rules 2022; and
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|
2.93 |
“Takeover Rules Event” means either of the following events:
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|
(a) |
a Restricted Shareholder and/or its Concert Parties (if any) extending an offer to the holders of each class of equity shares of the Company in accordance with Rule 9 of the Takeover Rules; or
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|
(b) |
the Company obtaining approval of the Takeover Panel for a waiver of Rule 9 of the Takeover Rules in respect of a Restricted Shareholder or any of its Concert Parties (as applicable);
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|
2.94 |
“United States of America”, “United States” and “U.S.” means the United
States of America;
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|
2.95 |
“US$” and “dollars” means United States dollars; and
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2.96 |
“Warrant” has the meaning given in the Securities Purchase Agreement.
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|
a) |
the word “company”, except where used in reference to this Company, shall
be deemed to include a body corporate, whether a company (wherever formed, registered or incorporated), a corporation aggregate, a corporation sole and a national or local government or other legal entity; and
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|
b) |
the word “person”, shall be deemed to include any individual, firm, body corporate, association or partnership, government or state or agency of a state, local authority or government body or any joint
venture association or partnership (whether or not having a separate legal personality) and that person’s personal representatives, successors or permitted assigns; and
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|
c) |
the word “property”, shall be deemed to include, where the context permits, real property, personal property including choses or things in action and all other intangible property and money and all estates, rights, titles and interests
therein and includes the Company’s uncalled capital and future calls and all and every other undertaking and asset; and
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d) |
a word or expression used in the Articles which is not otherwise defined and which is also used in the Act shall have the same meaning here, as it has in the Act;
and
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|
e) |
any phrase introduced by the terms “including”, “include” and “in
particular” or any similar expression shall be construed as illustrative and shall not limit the sense of the words preceding those terms, whether or not followed by the phrases “but not limited to”, “without prejudice to the generality of
the foregoing” or any similar expression; and
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|
f) |
words denoting the singular number only shall include the plural number and vice versa and references to one gender includes all genders.
|
3. |
The authorised share capital of the Company is US$100,010,000 divided into 800,000,000,000 ordinary shares with a nominal value of US$0.0001 each 200,000,000,000 preferred shares with a nominal value of US$0.0001 each and 100,000,000
class A preferred shares with a nominal value of US$0.0001 each and €25,000 divided into 25,000 Deferred Ordinary Shares with a nominal value of €1.00 each.
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4. |
The Ordinary Shares shall rank pari passu in all respects and shall:
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|
4.1 |
subject to the right of the Company to set record dates for the purposes of determining the identity of members entitled to notice of and/or to vote at a general meeting and the authority of the Board and chairperson of the meeting to maintain order and security, include the right to attend any general meeting of the Company and to exercise one vote per Ordinary Share held at any general meeting of
the Company;
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4.2 |
include the right to participate pro rata in all dividends declared by the Company; and
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|
4.3 |
include the right, in the event of the Company’s winding up, to participate pro rata in the total assets of the Company.
|
5. |
The rights attaching to the Ordinary Shares are subject to the rights attaching to the Class A Preferred Shares and may be subject to the terms of issue of any series or class of Preferred Shares allotted by the Directors from time to
time in accordance with Article 9.
|
6. |
If a Restricted Shareholder acquires securities conferring voting rights in the Company, unless the Restricted Shareholder elects to acquire such securities with a Takeover Rules Event occurring, the Ordinary Shares referable to such securities conferring voting rights in the Company shall be designated as
Restricted Voting Ordinary Shares having the restrictions set out in Article 7 and any share certificates to be issued in respect of such Ordinary Shares shall bear a legend making reference to such shares as Restricted Voting Ordinary
Shares. A Shareholder may also, by at least 10 Clear Days’ notice in writing to the Company or such shorter time as the Company may agree, request that the Company re-designate some or all of the Ordinary Shares that it holds as Restricted
Voting Ordinary Shares.
|
7. |
The following restrictions shall attach to Restricted Voting Ordinary Shares:
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|
7.1 |
until a Re-designation Event occurs, the rights attaching to such shares shall be restricted as set out in this Article 7;
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|
7.2 |
the Restricted Voting Ordinary Shares shall carry no rights to receive notice of or to attend or vote at any general meeting of the Company;
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|
7.3 |
save as provided herein, the Restricted Voting Ordinary Shares shall rank pari passu at all times and in all respects with all other Ordinary Shares;
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|
7.4 |
forthwith upon a Re-designation Event, each holder of Restricted Voting Ordinary Shares that are to be re-designated shall send to the Company the certificates, if any, in respect of the Restricted Voting Ordinary Shares held immediately
prior to the Re-designation Event and thereupon, but subject to receipt of such certificates, the Company shall issue to such holders respectively replacement certificates for the Ordinary Shares without a legend making reference to the
shares as Restricted Voting Ordinary Shares; and
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|
7.5 |
re-designation of the Restricted Voting Ordinary Shares shall be effected by way of a deemed automatic re-designation of such shares as Ordinary Shares immediately upon and subject to a Re-designation Event, without the requirement of
any approval by the Board or any shareholders of the Company.
|
8. |
Any Restricted Voting Ordinary Shares in issue shall comprise a single class with any other Ordinary Shares in issue.
|
9. |
Subject to the provisions of these Articles, including Article 177, the Board is empowered to cause the Preferred Shares to be issued from time to time as shares of one
or more series of Preferred Shares, and in the resolution or resolutions providing for the issue of Preferred Shares of each particular series, before issuance, the Board is expressly authorised to fix:
|
|
9.1 |
the distinctive designation of such series and the number of shares which shall constitute such series, which number may be increased (except as otherwise
provided by the Board in creating such series) or decreased (but not below the number of shares thereof then in issue) from time to time by resolution of the Board;
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|
9.2 |
the rate of dividends payable on shares of such series, if any, whether or not and upon what conditions dividends on shares of such series shall be cumulative and, if cumulative, the date or dates from which dividends shall accumulate and the preference or relation which such dividends shall bear to the dividends payable on any other class or classes or on any other series of share capital;
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|
9.3 |
the procedures for, and the terms, if any, on which shares of such series may be redeemed, including without limitation, the redemption price or prices for such series, which may consist of a redemption price or scale of redemption
prices applicable only to redemption in connection with a sinking fund (which term as used herein shall include any fund or requirement for the periodic purchase or redemption of shares), and the same or a different redemption price or
scale of redemption prices applicable to any other redemption;
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|
9.4 |
the terms and amount of any sinking fund provided for the purchase or redemption of shares of such series;
|
|
9.5 |
the amount or amounts which shall be paid to the holders of shares of such series in case of liquidation, dissolution or winding up of the Company, whether voluntary or involuntary;
|
|
9.6 |
the terms, if any, upon which the holders of shares of such series may convert shares thereof into shares of any other class or classes or of any one or more series of the same class or of another class or classes;
|
|
9.7 |
the voting rights, full or limited, if any, of the shares of such series; and whether or not and under what conditions the shares of such series (alone or together with the shares of one or more other series having similar provisions)
shall be entitled to vote separately as a single class, for the election of one or more additional Directors in case of dividend arrears or other specified events, or upon other matters;
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|
9.8 |
whether or not the holders of shares of such series, as such, shall have any pre-emptive or preferential rights to subscribe for or purchase shares of any class or series of shares of the Company, now or hereafter authorised, or any
securities convertible into, or warrants or other evidences of optional rights to purchase or subscribe for, shares of any class or series of the Company, now or hereafter authorised;
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9.9 |
the limitations and restrictions, if any, to be effective while any shares of such series are outstanding upon the payment of dividends, or the making of other distributions on, and upon the purchase, redemption or other acquisition by
the Company of, any other class or classes of shares ranking junior to the shares of such series either as to dividends or upon liquidation, dissolution or winding up;
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9.10 |
the conditions or restrictions, if any, upon the creation of indebtedness of the Company or upon the issuance of any additional shares (including additional shares of such series or of any other class) ranking on a parity with or prior
to the shares of such series as to dividends or distribution of assets upon liquidation; and
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9.11 |
such other rights, preferences and limitations as may be permitted to be fixed by the Board of the Company under the laws of Ireland as in effect at the time of the creation of such series.
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10. |
Subject to the provisions of these Articles, including Article 177, the Board is authorised to change the designations, rights, preferences and limitations of
any series of Preferred Shares theretofore established, no shares of which have been issued.
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11. |
The rights conferred upon the member of any pre-existing shares in the share capital of the Company shall be deemed not to be varied by the creation, issue and
allotment of any series of Preferred Shares in accordance with these Articles.
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12. |
Notice, Attendance and Voting Rights. Subject to the right of the Company to set record dates for the purposes of determining the identity of members entitled to notice of a general meeting, each Class A Preferred Members shall
be entitled to receive notice of and attend, and to exercise a number of votes at any general meeting of the Company, calculated in accordance with the following formula:
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13. |
Class A Preferred Dividends. During the Accrual Period, each Class A Preferred Member shall be entitled to receive from the Company, and the Company shall pay dividends on each Class A Preferred Payment Date and prior to any
dividend or other distribution being paid or made with respect to any other
class of share in the capital of the Company (whether pursuant to Article 82, Article 83 or otherwise), with respect to the Fiscal Quarter ended immediately prior to such Class A Preferred Payment Date, in an amount with respect to each
Class A Preferred Share held by such Class A Preferred Member equal to the amount accrued during such Fiscal Quarter at the Class A Preferred Dividend Rate on the Class A Preferred Share Amount of each Class A Preferred Share during such
Fiscal Quarter (the “Class A Preferred Dividends”) as follows:
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13.1 |
Class A Preferred Dividends will be cumulative and will accrue daily during the Accrual Period at the Class A Preferred Dividend Rate from the date of issuance of a Class A Preferred Share,
prorated for partial Fiscal Quarters during the Accrual Period.
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13.2 |
The Class A Preferred Dividends may be paid or satisfied, at the Company’s
discretion, as follows (i) by payment in cash on the Class A Preferred Payment Date (or, if such Class A Preferred Payment Date is not a Business Day, the first Business Day thereafter); and/or (ii) by issuing on the Class A Preferred
Payment Date (or, if such Class A Preferred Payment Date is not a Business Day, the first Business Day thereafter), additional Class A Preferred Shares to the Class A Preferred Members calculated in accordance with the provisions of
Articles 13.4 and 13.5, below (each dividend obligation, or part thereof, which is satisfied by the issue of additional Class A Preferred Shares to the Class A Preferred Members, as opposed to cash, being a “Class
A Preferred PIK Distribution” and such Class A Preferred Shares so issued, being “Class A Preferred PIK Shares”).
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13.3 |
Notwithstanding the provisions of Article 13.2, to the extent that the Company does not have sufficient Available Profits to pay Class A Preferred Dividends in cash on a Class A Preferred Dividend Payment Date, Class A Preferred
Dividends payable on that Class A Preferred Dividend Date shall be satisfied by making a Class A Preferred PIK Distribution.
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13.4 |
The number of Class A Preferred PIK Shares to be issued on a Class A Preferred PIK Distribution shall be determined by dividing: (i) the relevant amount of Class A Preferred Dividends to be satisfied by the issue of Class A Preferred PIK
Shares; by (ii) the Class A Preferred Share Amount, and rounding up the quotient. No fractional shares shall be issued on a Class A Preferred PIK Distribution.
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13.5 |
Class A Preferred PIK Shares may be paid up out of Available Profits or, in the event the Company has insufficient Available Profits, Class A Preferred PIK Shares may be issued as bonus shares fully paid-up to at least their nominal
value. For the purpose of calculating any amount of Class A Preferred Dividends or Class A Preferred Share Return referable to a Class A Preferred PIK Share, each Class A Preferred PIK Share shall, on issue, be deemed to have been paid-up
to the Class A Preferred Share Amount on the relevant Class A Preferred Payment Date (or, if such Class A Preferred Payment Date is not a Business Day, the first Business Day thereafter).
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13.6 |
Save with the prior written consent of a Class A Preferred Majority: (a) the Company may only issue Class A Preferred PIK Shares as expressly provided in this Article 13 and only in connection with the required quarterly dividends thereunder; and (b) the Company shall not issue any Class A
Preferred PIK Shares (or any other Class A Preferred Shares) in connection
with any other distribution made in respect of Class A Preferred Shares.
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14. |
Priority Distributions: No distributions of cash or non-cash property shall be made with respect to any shares in the capital of the Company prior to the Class A Preferred Members having received the Class A Preferred Share
Return with respect to all Class A Preferred Shares as contemplated in Articles 16, 17 and 18, below.
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15. |
Liquidation Preference. On a return of capital on liquidation, a capital reduction or otherwise, the assets of the Company remaining after the payment of its liabilities which are available for distribution to its members, shall
first be applied in paying to the Class A Preferred Members prior, and in preference, to the members holding any other class of shares in the capital of the Company, by reason of their ownership of such shares, with equal priority among the
Class A Preferred Members, an amount in respect of the Class A Preferred Shares, in cash, until each Class A Preferred Member receives payment in respect of each Class A Preferred Share held by that member equal to the applicable Class A
Preferred Share Return with respect to such Class A Preferred Share, provided that, if, upon such return of capital, the assets of the Company available for distribution among the members shall be insufficient to permit payment to the Class
A Preferred Members of an amount in cash such that each Class A Preferred Member receives payment in respect of each Class A Preferred Share held by that member at the applicable Class A Preferred Share Return with respect to each Class A
Preferred Share, then all of the assets of the Company available for distribution among the members shall be distributed to the Class A Preferred Members on a pro rata basis, such that each Class A
Preferred Member receives that portion of the assets available for distribution as the proportion that the aggregate amount required to provide that Class A Preferred Member with the applicable Class A Preferred Share Return on all Class A
Preferred Shares held by that member bears to the aggregate amount required to provide all Class A Preferred Members with the applicable Class A Preferred Share Return on all Class A Preferred Shares held by all such members. The
provisions of this Article 15 shall apply mutatis mutandis to the proceeds of a sale on a Change of Control Transaction, which shall be paid to the Class A Preferred Members as consideration for
their Class A Preferred Shares in priority to any payment to the members holding any other class of shares in the capital of the Company as if the proceeds of such Change of Control Transaction constituted the assets of the Company
available for distribution to the Company’s members.
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16. |
Redemption of Class A Preferred Shares at the Election of the Company
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|
16.1 |
Prior to the fifth anniversary of the Initial Closing Date, the Company may, upon prior written notice (a “Class A Preferred Redemption Notice”) to each applicable Class A Preferred Member, redeem
all or any portion of the issued Class A Preferred Shares at its election, in each case, upon payment in full of the Class A Preferred Share Return of such Class A Preferred Shares, as of the applicable Class A Preferred Optional Redemption
Date, for each Class A Preferred Share redeemed (an “Early Company Call Option Election”). The Class A Preferred Redemption Notice shall specify the number of Class A Preferred Shares that will be
redeemed, the date on which the Class A Preferred Shares will be redeemed pursuant to this Article 16 (which date must be a Business Day and shall be no earlier than thirty (30) days and no later than forty five (45) days, in each case,
following delivery of the Class A Preferred Redemption Notice) (the “Class A Preferred Optional Redemption Date”), and the Class A Preferred Share Return as of the Class A Preferred Optional
Redemption Date with respect to each Class A Preferred Share that the Company will redeem, including details and reasonable supporting documentation with respect to such calculation.
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16.2 |
At any time prior to the Class A Preferred Optional Redemption Date, a Class A Preferred Majority shall have the right to provide notice to the Company of any disagreement regarding the calculation of the Class A Preferred Share Return
as of the Class A Preferred Optional Redemption Date (a “Class A Preferred Share Return Dispute Notice”), which Class A Preferred Share Return Dispute Notice shall include such Class A Preferred
Majority’s calculation of the Class A Preferred Share Return and reasonable supporting documentation regarding the same.
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16.3 |
Following receipt of any such Class A Preferred Share Return Dispute Notice by the Company, the Class A Preferred Majority that provided the Class A Preferred Share Return Dispute Notice and the Company shall negotiate in good faith to
reach agreement regarding the amount of such Class A Preferred Share Return.
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16.4 |
If the Company and the Class A Preferred Majority that provided the Class A Preferred Share Return Dispute Notice are unable to resolve all such disputed items within ten (10) Business Days following the Company’s receipt of the Class A
Preferred Share Return Dispute Notice, then all items that have not been resolved on a mutually agreeable basis shall be submitted to a Designated Valuation Firm mutually acceptable to the Company and such Class A Preferred Majority for
resolution and such Designated Valuation Firm shall be instructed to issue its determination within ten (10) Business Days after the submission of such dispute; provided, however, that if the Company and such Class A Preferred Majority are
unable to agree on a Designated Valuation Firm within five (5) Business Days, the Designated Valuation Firm shall be designated by the Independent Directors. The determination by such Designated Valuation Firm shall be binding on the
Company and all Class A Preferred Members. All costs and expenses relating to the work performed by the Designated Valuation Firm shall be borne by the Class A Preferred Members and the Company based on the inverse of the percentage that
the Designated Valuation Firm’s determination bears to the total amount of the total items in dispute as originally submitted to the Designated Valuation Firm, which proportionate allocations shall also be determined by the Designated
Valuation Firm at the time it renders its determination on the merits of the matters in dispute (such pro rata allocations of costs and expenses of the Designated Valuation Firm, the “Designated Valuation
Firm Cost Allocations”).
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|
16.5 |
If, all such disputed items have not been resolved as of the Class A Preferred Optional Redemption Date, the consummation of such redemption shall be deemed to be tolled until such dispute has been resolved and the Class A Preferred
Share Return shall continue to accrue during such period until the date on which the Company pays such amount; provided, however, that if such redemption is initially contemplated to concur at the closing of a Change of Control Transaction
then the Company may close such Change of Control Transaction and put an amount in escrow equal to the Class A Preferred Share Return amount proposed by the Class A Preferred Majority that provided the Class A Preferred Share Return Dispute
Notice (taking into account the tolling and continued accrual of the Class A Preferred Share Return during the pendency of such dispute), with such amount to be released by such Class A Preferred Majority and the Company jointly, or in
accordance with the determination of the Designated Valuation Firm, upon resolution of such dispute, to the Class A Preferred Members and/or the Company in accordance with the final resolution of such dispute.
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16.6 |
On the Class A Preferred Optional Redemption Date (or such later date as contemplated in the immediately preceding sentence), the Company shall pay in cash to each Class A Preferred Member the applicable Class A Preferred Share Return
with respect to each such Class A Preferred Share redeemed. Any such Redemption by the Company of Class A Preferred Shares shall be pro rata as among the Class A Preferred Members in respect of the
Class A Preferred Shares that are so redeemed as set forth in the applicable Class A Preferred Redemption Notice. Upon payment in full and in cash of the Class A Preferred Share Return with respect to each redeemed Class A Preferred Share,
such redeemed Class A Preferred Share will cease to be outstanding.
|
17. |
Mandatory Redemption of Class A Preferred Shares
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|
17.1 |
The Company shall redeem all, but not less than all, of the outstanding Class A Preferred Shares upon the fifth anniversary of the Initial Closing Date (a “Mandatory Class A Redemption Event”) to
the extent all of the Class A Preferred Shares have not already been redeemed as of such time. The Company shall effect such redemption by paying, by wire transfer of immediately available funds, to each Class A Preferred member in respect
of each Class A Preferred Share held by such member an amount in cash equal to the Class A Preferred Share Return with respect to such Class A Preferred Share on the date when such Mandatory
Class A Redemption Event occurs unless it occurs on a date that is not a Business Day in which case such redemption shall occur on the next Business Day (the date on which the Company is required to effect such redemption, the “Mandatory Class A Redemption Date”); provided that the Company shall provide copies of final documentation in connection therewith, which shall include details and reasonable supporting documentation of
the Company’s calculation of the Class A Preferred Share Return as of the Mandatory Class A Redemption Date. Upon the payment of the applicable Class A Preferred
Share Return with respect to each Class A Preferred Share pursuant to this Article 17 in full and in cash, the Class A Preferred Shares will cease to be outstanding; provided, however, that if
there is any disagreement between the Company and a Class A Preferred Majority regarding the amount of the Class A Preferred Share Return as of the Mandatory Class A Redemption Date, such Class A
Preferred Majority and the Company shall negotiate in good faith to reach agreement regarding the amount of the Class A Preferred Share Return and, in any event, the Class A Preferred Shares shall
not be deemed to have been redeemed until the amount of the Class A Preferred Share Return (which shall continue to accrue during the pendency of such dispute) has been finally determined (either as agreed by such Class A Preferred Majority
and the Company or otherwise by submitting the dispute to a Designated Valuation Firm ) and paid in full and in cash to the Class A Preferred Members; provided, however, that if such Redemption is initially contemplated to concur at the
closing of a Change of Control Transaction then the Company may close such Change of Control Transaction and put an amount in escrow equal to the amount of the Class A Preferred Share Return proposed by a Class A Preferred Majority (taking
into account the tolling and continued accrual of the Class A Preferred Share Return during the pendency of such dispute), with such amount to be released by such Class A Preferred Majority and the Company jointly, or in accordance with the
determination of a Designated Valuation Firm, upon resolution of such dispute, to the Class A Preferred Members and/or the Company in accordance with the final resolution of such dispute.
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17.2 |
If such a dispute has been submitted to a Designated Valuation Firm, the Designated Valuation Firm shall be instructed to issue its determination within ten (10) Business Days after the submission of such dispute; provided, however, that
if the Company and a Class A Preferred Majority are unable to agree on a Designated Valuation Firm within five (5) Business Days, the Designated Valuation Firm shall be designated by the Independent Directors.
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17.3 |
The determination by such Designated Valuation Firm shall be binding on the Company and all Class A Preferred Members. All costs and expenses relating to the work performed by the Designated Valuation Firm shall be borne by the Class A
Preferred Members and the Company based on the Designated Valuation Firm Cost Allocations.
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17.4 |
On the Mandatory Class A Redemption Date (or such later date as contemplated in the immediately preceding sentence), the Company shall pay in cash to each Class A Preferred Member the applicable Class A Preferred Share Return with
respect to each such Class A Preferred Share redeemed. Upon payment in full and in cash of the Class A Preferred Share Return with respect to each redeemed Class A Preferred Share, such redeemed Class A Preferred Share will cease to be
outstanding.
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18. |
Deemed Redemption of Class A Preferred Shares Deemed Redemption. Notwithstanding anything contained herein to the contrary: (i) a Class A Preferred Share shall be deemed redeemed upon the applicable Class A Preferred Member
holding the same receiving payments pursuant to these Articles in respect of such Class A Preferred Share in cash in an aggregate amount equal to the applicable Class A Preferred Share Return with respect to such Class A Preferred Share;
and (ii) upon the redemption of any Class A Preferred Share in full in cash for the applicable Class A Preferred Share Return, such Class A Preferred Share shall cease to be issued.
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19. |
The Deferred Shares shall have the rights and privileges and be subject to the restrictions set out in this Article 19:
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|
19.1 |
the Deferred Shares are non-voting shares and do not convey upon the holder the right to be paid a dividend or to receive notice of or to attend, vote or speak at a general meeting;
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19.2 |
the Deferred Shares confer the right on a return of capital, on a winding-up or otherwise, only to the repayment of the nominal value paid up on the Deferred Shares after repayment of the nominal value of the Ordinary Shares; and
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19.3 |
any Director (the “Agent”) is appointed the attorney of the holder of a Deferred Share, with an irrevocable instruction to the Agent to execute all or any forms of transfer and/or renunciation
and/or surrender and/or other documents in the Agent’s discretion in relation to the Deferred Shares in favour of the Company or as it may direct and to deliver such forms of transfer and/or renunciation and/or surrender and/or other
documents together with any certificate(s) and/or other documents for registration and to do all such other acts and things as may in the reasonable opinion of the Agent be necessary or expedient for the
purpose of, or in connection with, the surrender of the Deferred Shares, the purchase by the Company of the Deferred Shares for nil consideration or such other consideration as the Board may determine and to vest the said Deferred Shares in
the Company.
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20. |
Without prejudice to any special rights conferred on the members of any existing shares or class of shares but subject to the provisions of the Act and these Articles, including Article 177, any share
may be issued with such rights or restrictions as the Company may by ordinary resolution determine.
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21. |
The following provisions shall apply:
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|
21.1 |
Subject to the provisions of these Articles including Article 177, the shares shall be at the disposal of the Directors, and they may (subject to the provisions of the Act) allot, grant options over
or otherwise dispose of them to such persons, on such terms and conditions and at such times as they may consider to be in the best interests of the Company and its members, but so that no share shall be issued at a discount and so that, in
the case of shares offered to the public for subscription, the amount payable on application on each share shall not be
less than one-quarter of the nominal amount of the share and the whole of any premium thereon.
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21.2 |
Without prejudice to the generality of the powers conferred on the Directors by other paragraphs of these Articles, but subject to the provisions of Article 177, and subject to any requirement to obtain the approval of the members under any laws,
regulations or the rules of any Exchange, the Directors may grant from time to time options to subscribe for the unallotted shares in the capital of the Company to Directors and other persons in the service or employment of the Company or
any subsidiary or associate company of the Company on such terms and subject to such conditions as may be approved from time to time by the Directors or by any committee thereof appointed by the Directors for the purpose of such approval
and on the terms and conditions required to obtain the approval of any statutory authority in any jurisdiction.
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21.3 |
Subject to the provisions of these Articles, including Article 177, the Directors are hereby generally and unconditionally authorised to exercise all the powers of the Company to allot relevant securities within the meaning of section 1021 of the Act. The maximum amount of relevant securities which may
be allotted under the authority hereby conferred shall be the amount of the authorised but unissued share capital of the Company at the Adoption Date. The authority hereby conferred shall expire on the date which is five (5) years after
the Adoption Date unless and to the extent that such authority is renewed, revoked or extended prior to such date. The Company may before such expiry make an offer or agreement which would or might require relevant securities to be
allotted after such expiry and the Directors may allot relevant securities in pursuance of such offer or agreement, notwithstanding that the authority hereby conferred has expired.
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21.4 |
Subject to the provisions of these Articles, including Article 177, the Directors are hereby empowered pursuant to sections 1022 and 1023 of the
Act to allot equity securities (within the meaning of the said section 1023) for cash pursuant to the authority conferred by Article 21.3 as if section 1022(1) of the Act
did not apply to any such allotment. The authority conferred by this Article 21.4 shall expire on the date which is five (5) years after the Adoption Date, unless previously renewed, varied or revoked; provided that the Company may before the expiry of such authority make an offer or agreement which would or might require equity securities to be allotted after such expiry and the Directors may allot equity securities in pursuance of such an offer or agreement as if the power conferred by this Article 21.4
had not expired.
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21.5 |
The Company may issue permissible letters of allotment (as defined by section 1019 of the Act) to the extent permitted by the Act.
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21.6 |
Unless otherwise determined by the Directors or the rights attaching to or
by the terms of issue of any particular shares, or to the extent required by the Act, any Exchange, depository or any operator of any clearance or settlement system, no person whose name
is entered as a member in the Register shall be entitled to receive a share certificate for any shares of any class held by him or her in the capital of the Company (nor on transferring part of a holding, to a certificate for the balance).
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21.7 |
Any share certificate, if issued, shall specify the number of shares in respect of which it is issued and the amount paid thereon or the fact that they are fully paid, as the case may be, and may otherwise be in such form as shall be determined by the Directors. Such certificates may be under seal. All
certificates for shares in the capital of the Company shall be consecutively numbered or otherwise identified and shall specify the shares in the capital of the Company to which they relate. The name and address of the person to whom the
shares represented thereby are issued, with the number of shares and date of issue, shall be entered in the Register. All certificates surrendered to the Company for transfer shall be cancelled and no new certificate shall be issued until
the former certificate for a like number of shares in the capital of the Company shall have been surrendered and cancelled. The Directors may authorise certificates to be issued with the seal and authorised signature(s) affixed by some
method or system of mechanical process. In respect of a share or shares in the capital of the Company held jointly by several persons, the Company shall not be bound to issue a certificate or certificates to each such person, and the issue
and delivery of a certificate or certificates to one of several joint holders shall be sufficient delivery to all such holders. If a share certificate is defaced, worn out, lost or destroyed, it may be renewed on such terms (if any) as to
evidence and indemnity and on the payment of such expenses reasonably incurred by the Company in investigating such evidence, as the Directors may prescribe, and, in the case of defacement or wearing out, upon delivery of the old
certificate.
|
22. |
The Company:
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|
22.1 |
may give financial assistance for the purpose of an acquisition of its shares or, where the Company is a subsidiary, its holding company where permitted by sections 82 and 1043 of the Act, and
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|
22.2 |
is authorised, for the purposes of section 105(4)(a) of the Act, but subject to section 1073 of the Act, to acquire its own shares.
|
23. |
Subject to the provisions of these Articles, including Article 177, the Directors (and any committee established under Article 196 and so authorised by the Directors and any person so authorised by the Directors or such committee) may:
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|
23.1 |
allot, issue, grant options over and otherwise dispose of shares in the
Company; and
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|
23.2 |
exercise the Company’s powers under Article 21,
|
24. |
Unless the Board determines otherwise, any share in the capital of the Company shall be deemed to be a Redeemable Share on, and from the time of, the existence or creation of an agreement, transaction or trade between the Company and any person (who may or may not be a member) pursuant to which the Company acquires
or will acquire a share in the capital of the Company, or an interest in shares in the capital of the Company, from the relevant person, save for an acquisition for nil consideration pursuant to section 102(1)(a) of the Act. In these circumstances, the acquisition of such shares by the Company, save where acquired for nil consideration in accordance with the Act, shall constitute the
redemption of a Redeemable Share in accordance with Chapter 6 of Part 3 of the Act. No resolution, whether special or otherwise, shall be required to be passed to deem any share in the capital of the
Company a Redeemable Share.
|
25. |
Without prejudice to the authority conferred on the Directors pursuant to Article 9 to issue Preferred Shares in the capital of the Company, where the shares in the Company are divided into different classes, the rights attaching to a
class of shares may only be varied or abrogated if (a) the holders of 75% in nominal value of the issued shares of that class consent in writing to the variation, or (b) a special resolution, passed at a separate general meeting of the
holders of that class, sanctions the variation. The quorum at any such separate general meeting, other than an Adjourned Meeting, shall be two persons holding or representing by proxy at least one-third in nominal value of the issued
shares of the class in question and the quorum at an Adjourned Meeting shall be one person holding or representing by proxy shares of the class in question or that person’s proxy. The rights conferred upon the holders of any class of
shares issued with preferred or other rights shall not, unless otherwise expressly provided by the terms of issue of the shares of that class, be deemed to be varied by a purchase or redemption by the Company of its own shares or by the
creation or issue of further shares ranking pari passu therewith or subordinate thereto.
|
26. |
The issue, redemption or purchase of the Class A Preferred Shares shall not constitute a variation of rights of the holders of Preferred Shares, any class or series of Preferred Shares or the Ordinary Shares.
|
27. |
The issue, redemption or purchase of any of the Preferred Shares or any class or series of Preferred Shares shall not constitute a variation of the rights of the holders of Ordinary Shares.
|
28. |
The issue, redemption or purchase of Preferred Shares or any class or series of Preferred Shares which rank pari passu with, or junior to, any existing Preferred Shares or class of Preferred
Shares shall not constitute a variation of the existing Preferred Shares or class of Preferred Shares.
|
29. |
The rights conferred upon the holders of the shares of any class issued with preferred or other rights shall not, unless otherwise expressly provided by the terms of issue of the shares of
that class, be deemed to be varied by the creation or issue of further shares ranking pari passu therewith.
|
30. |
Except as required by law, no person shall be recognised by the Company as holding any share upon any trust, and the Company shall not be bound by or be compelled in any way to recognise (even when having notice thereof) any equitable,
contingent, future or partial interest in any share or any interest in any fractional part of a share or (except only as by these Articles or by law otherwise provided) any other rights in respect of any share except an absolute right to
the entirety thereof in the member. This shall not preclude (i) the Company from requiring the members or a transferee of shares to furnish the Company with information as to the beneficial ownership of any share when such information is
reasonably required by the Company, or (ii) the Directors, where they consider it appropriate, providing the information given to the members of shares to the holders of depositary instruments in such shares.
|
31. |
The Directors may from time to time make calls upon the members in respect of any consideration unpaid on their shares in the Company (whether on account of the nominal value of the shares or by way of premium), provided that in the case
where the conditions of allotment or issuance of shares provide for the payment of consideration in respect of such shares at fixed times, the Directors shall only make calls in accordance with such conditions.
|
32. |
Each member shall (subject to receiving at least thirty days’ notice specifying the time or times and place of payment, or such lesser or greater period of notice provided in the conditions of allotment or issuance of the shares) pay to
the Company, at the time or times and place so specified, the amount called on the shares.
|
33. |
A call may be revoked or postponed, as the Directors may determine.
|
34. |
Subject to the conditions of allotment or issuance of the shares, a call shall be deemed to have been made at the time when the resolution of the Directors authorising the call was passed and may be required to be paid by instalments if
specified in the call.
|
35. |
The joint holders of a share shall be jointly and severally liable to pay all calls in respect of it.
|
36. |
If the consideration called in respect of a share or in respect of a particular instalment is not paid in full before or on the day appointed for payment of it, the person from whom the sum is due shall pay interest in cash on the unpaid
value from the day appointed for payment of it to the time of actual payment of such rate, not exceeding five per cent per annum or such other rate as may be specified by an order under section 2(7) of the Act,
as the Directors may determine, but the Directors may waive payment of such interest wholly or in part.
|
37. |
Any consideration which, by the terms of issue of a share, becomes payable on allotment or issuance or at any fixed date (whether on account of the nominal value of the share or by way of premium) shall, for the purposes of these
Articles, be deemed to be a call duly made and payable on the date on which, by the terms of issue, that consideration becomes payable, and in the case of non-payment of such a consideration, all the relevant provisions of these Articles as
to payment of interest and expenses, forfeiture or otherwise, shall apply as if such consideration had become payable by virtue of a call duly made and notified.
|
38. |
The Directors may, on the issue of shares, differentiate between the holders of different classes as to the amount of calls to be paid and the times of payment.
|
39. |
The Directors may, if they think fit:
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|
(a) |
receive from any member willing to advance such consideration, all or any
part of the consideration uncalled and unpaid upon any shares held by him or her; and/or
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|
(b) |
pay, upon all or any of the consideration so advanced (until the amount concerned would, but for such advance, become payable) interest at such rate (not exceeding, unless the Company in a general meeting otherwise directs, five per cent per annum or such other rate as may be specified by an
order under section 2(7) of the Act) as may be agreed upon between the Directors and the member paying such consideration in advance.
|
40. |
The Company may:
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|
(a) |
acting by its Directors, make arrangements on the issue of shares for a difference between the members in the amounts and times of payment of calls on their shares;
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|
(b) |
acting by its Directors, accept from any member the whole or a part of the amount remaining unpaid on any shares held by him or her, although no part of that amount has been called up;
|
|
(c) |
acting by its Directors and subject to the Act, pay a dividend in proportion to the amount paid up on each share where a larger amount is paid up on some shares than on others; and
|
|
(d) |
by special resolution determine that any portion of its share capital which has not been already called up shall not be capable of being called up except in the event and for the purposes of the Company being wound up; upon the Company
doing so, that portion of its share capital shall not be capable of being called up except in that event and for those purposes.
|
41. |
The Company shall have a first and paramount lien on every share (not being a fully paid share) for all consideration (whether immediately payable or not) called, or payable at a fixed time, in respect of that share.
|
42. |
The Directors may at any time declare any share in the Company to be wholly or in part exempt from Article 41.
|
43. |
The Company’s lien on a share shall extend to all dividends payable on it.
|
44. |
The Company may sell, in such manner as the
Directors think fit, any shares on which the Company has a lien, but no sale shall be made unless (i) a sum in respect of which the lien exists is immediately payable; and (ii) the following conditions are satisfied:
|
|
44.1 |
a notice in writing, stating and demanding payment of such part of the amount in respect of which the lien exists as is immediately payable, has been given to the registered holder of the share for the time being, or the person entitled
thereto by reason of his or her death or bankruptcy; and
|
|
44.2 |
a period of 14 days after the date of giving of that notice has expired.
|
45. |
The following provisions apply in relation to a sale referred to in Article 44:
|
|
45.1 |
to give effect to any such sale, the Directors may authorise some person to
transfer the shares sold to the purchaser of them;
|
|
45.2 |
the purchaser shall be registered as the holder of the shares comprised in any such transfer;
|
|
45.3 |
the purchaser shall not be bound to see to the application of the purchase consideration, nor shall his or her title to the shares be affected by any irregularity or invalidity in the proceedings in reference to the sale; and
|
|
45.4 |
the proceeds of the sale shall be received by the Company and applied in payment of such part of the amount in respect of which the lien exists as is immediately payable, and the residue, if any, shall (subject to a like lien for sums
not immediately payable as existed upon the shares before the sale) be paid to the person entitled to the shares at the date of the sale.
|
46. |
If a member of the Company fails to pay any call or instalment of a call on the day appointed for payment of it, the Directors may, at any time thereafter during such time as any part of the call or instalment remains unpaid, serve a
notice on the member requiring payment of so much of the call or instalment as is unpaid, together with any interest which may have accrued.
|
47. |
The notice referred to in Article 46 shall:
|
|
47.1 |
specify a further day (not earlier than the expiration of 14 days after the
date of service of the notice) on or before which the payment required by the notice is to be made; and
|
|
47.2 |
state that, if the amount concerned is not paid by the day so specified, the shares in respect of which the call was made will be liable to be forfeited.
|
48. |
If the requirements of the notice referred to in Article 47 are not complied with, any share in respect of which the notice has been served may at any time after the day so specified (but before, should it occur, the payment required by
the notice has been made) be forfeited by a resolution of the Directors to that effect.
|
49. |
On the trial or hearing of any action for the recovery of any money due for
any call, it shall be sufficient to prove that the name of the member sued is entered in the Register as the holder, or one of the holders, of the shares in the capital of the Company in respect of which such debt accrued, that the
resolution making the call is duly recorded in the minute book and that notice of such call was duly given to the member sued, in pursuance of these Articles, and it shall not be necessary to prove the appointment of the Directors who made
such call nor any other matters whatsoever, but the proof of the matters aforesaid shall be conclusive evidence of the debt.
|
50. |
A forfeited share may be sold or otherwise disposed of on such terms and in such manner as the Directors think fit, and at any time before a sale or disposition the forfeiture may be cancelled on such terms as the Directors think fit.
|
51. |
A person whose shares have been forfeited shall cease to be a member of the Company in respect of the forfeited shares, but shall, notwithstanding, remain liable to pay to the Company all consideration which, at the date of forfeiture, were payable by him or her to the Company in respect of the
shares, but his or her liability shall cease if and when the Company shall have received payment in full of all such consideration in respect of the shares.
|
52. |
A statement in writing that the maker of the statement is a Director or the Company Secretary, and that a share in the Company has been duly forfeited on a date stated in the statement, shall be conclusive evidence of the facts stated in
it as against all persons claiming to be entitled to the share.
|
53. |
The following provisions apply in relation to a sale or other disposition of a share referred to in Article 50:
|
|
53.1 |
the Company may receive the consideration, if any, given for the share on the sale or other disposition of it and may execute a transfer of the share in favour of the person to whom the share is sold or otherwise disposed of (the “disponee”);
|
|
53.2 |
upon such execution, the disponee shall be registered as the holder of the share; and
|
|
53.3 |
the disponee shall not be bound to see to the application of the purchase consideration, if any, nor shall his or her title to the share be affected by any irregularity or invalidity in the proceedings in reference to the forfeiture,
sale or disposal of the share.
|
54. |
The provisions of these Articles as to forfeiture shall apply in the case of non-payment of any sum which, by the terms of issue of a share in the capital of the Company, becomes payable at a fixed time, whether on account of the nominal
value of the share in the capital of the Company or by way of premium, as if the same had been payable by virtue of a call duly made and notified.
|
55. |
The Directors may accept the surrender of any share in the capital of the
Company which the Directors have resolved to have been forfeited upon such terms and conditions as may be agreed and, subject to any such terms and conditions, a surrendered share in the capital of the Company shall be treated as if it has
been forfeited.
|
56. |
Subject to the provisions of these Articles, including Article 177, the Company may, by ordinary resolution and in accordance with section 83 of the Act, do any one or more of the following, from time
to time:
|
|
56.1 |
consolidate and divide all or any of its classes of shares into shares of a
larger nominal value than its existing shares;
|
|
56.2 |
subdivide its classes of shares, or any of them, into shares of a smaller nominal value, so however, that in the subdivision the proportion between the amount paid and the amount, if any, unpaid on each reduced share shall be the same as
it was in the case of the share from which the reduced share is derived;
|
|
56.3 |
increase the nominal value of any of its shares by the addition to them of any un-denominated capital;
|
|
56.4 |
reduce the nominal value of any of its shares by the deduction from them of any part of that value, subject to the crediting of the amount of the deduction to un-denominated capital, other than the share premium account;
|
|
56.5 |
without prejudice or limitation to Articles 96 to 101 and the powers conferred on the Directors thereby, convert any un-denominated capital into shares for allotment as bonus shares to holders of existing shares;
|
|
56.6 |
increase its share capital by new shares of such amount as it thinks
expedient; or
|
|
56.7 |
cancel shares of its share capital which, at the date of the passing of the resolution, have not been taken or agreed to be taken by any person, and diminish the amount of its share capital by the amount of the shares so cancelled.
|
57. |
Subject to the provisions of these Articles, the Company may:
|
|
57.1 |
without prejudice to Article 24, by special resolution, and subject to the
provisions of the Act governing the variation of rights attached to classes of shares and the amendment of these Articles, convert any of its shares into Redeemable Shares; or
|
|
57.2 |
by special resolution, and subject to the provisions of the Act (or as otherwise required or permitted by applicable law) alter or add to the Memorandum with respect to any objects, powers or other matters specified therein or alter or add to these Articles.
|
58. |
Subject to the provisions of these Articles, including Articles 15 and 177, the Company may, in accordance with the provisions of sections 84 to 87 of the Act, reduce its company capital in any way it
thinks expedient and, without prejudice to the generality of the foregoing, may thereby:
|
|
58.1 |
extinguish or reduce the liability on any of its shares in respect of share
capital not paid up;
|
|
58.2 |
either with or without extinguishing or reducing liability on any of its shares, cancel any paid up company capital which is lost or unrepresented by available assets; or
|
|
58.3 |
either with or without extinguishing or reducing liability on any of its shares, pay off any paid up company capital which is in excess of the wants of the Company.
|
59. |
Subject to the Act and to the provisions of these Articles as may be applicable, any member may transfer all or any of his shares (of any class) by an instrument of transfer in the usual common form
or in any other form which the Board may from time to time approve. The
instrument of transfer may be endorsed on the certificate.
|
60. |
The instrument of transfer of a share shall be signed by or on behalf of
the transferor and, if the share is not fully paid, by or on behalf of the transferee. The transferor shall be deemed to remain the holder of the share until the
name of the transferee is entered in the Register in respect of it. All instruments of transfer may be retained by the Company.
|
61. |
Save in the case of a transfer of Class A Preferred Shares, the instrument of transfer of any share may be executed for and on behalf of the transferor by the Company Secretary or any other party designated by the Board for such purpose,
and the Company Secretary or any other party designated by the Board for such purpose shall be deemed to have been irrevocably appointed agent for the transferor of such share or shares with full power to execute, complete and deliver in
the name of and on behalf of the transferor of such share or shares all such transfers of shares held by the members in the share capital of the Company. Any document which records the name of the transferor, the name of the transferee,
the class and number of shares agreed to be transferred, the date of the agreement to transfer shares and the price per share, shall, once executed by the transferor or, other than in the case of a transfer of Class A Preferred Shares, the
Company Secretary or any other party designated by the Board for such purpose as agent for the transferor, be deemed to be a proper instrument of transfer for the purposes of the Act. The transferor
shall be deemed to remain the member holding the share until the name of the transferee is entered on the Register in respect thereof, and neither the title of the transferee nor the title of the transferor shall be affected by any
irregularity or invalidity in the proceedings in reference to the sale should the Directors so determine.
|
62. |
Subject to the Act, the Company, at its absolute discretion, may, or may procure that a subsidiary of the Company shall, pay Irish stamp duty arising on a transfer of shares on behalf of the transferee of such shares of the Company. If stamp duty resulting from the transfer of
shares in the Company which would otherwise be payable by the transferee is paid by the Company or any subsidiary of the Company on behalf of the transferee, then in
those circumstances, the Company shall, on its behalf or on behalf of its subsidiary (as the case may be), be entitled to (i) reimbursement of the stamp duty from the transferee, (ii) set-off the stamp duty against any dividends payable to
the transferee of those shares and (iii) to the extent permitted by section 1042 of the Act, claim a first and paramount lien on the shares on which stamp duty has been paid by the Company or its subsidiary for the amount of stamp duty paid. The Company’s lien shall extend to all
dividends paid on those shares.
|
63. |
The Directors shall have power to permit any class of shares to be held in uncertificated form and to implement any arrangements they think fit for such evidencing and transfer which accord with such regulations and in particular shall,
where appropriate, be entitled to disapply or modify all or part of the provisions in these Articles with respect to the requirement for written instruments of transfer and share certificates (if any), in order to give effect to such
regulations.
|
64. |
The Board may, in its absolute discretion and without assigning any reason for its decision, decline to register any transfer of any share which is not a fully-paid share. The Board may also decline to register any transfer if:
|
|
64.1 |
the instrument of transfer is not duly stamped, if required, and lodged at the Office or any other place as the Board may from time to time specify for the purpose, accompanied by the certificate (if any) for the shares to which it relates and such other evidence as the Board may reasonably require to show the right of the transferor to make the transfer;
|
|
64.2 |
the instrument of transfer is in respect of more than one class of share;
|
|
64.3 |
the instrument of transfer is in favour of more than four persons jointly;
|
|
64.4 |
it is not satisfied that all applicable consents, authorisations, permissions or approvals of any governmental body or agency in Ireland or any other applicable
jurisdiction required to be obtained under relevant law prior to such transfer have been obtained; or
|
|
64.5 |
it is not satisfied that the transfer would not violate the terms of any agreement to which the Company (or any of its subsidiaries) and the transferor are party or subject.
|
65. |
Subject to any directions of the Board from time to time in force, the Company Secretary or any other party designated by the Board for such purpose may exercise the powers and discretions of the Board under Article 64, Article 88,
Article 95 and Article 97.
|
66. |
If the Board declines to register a transfer it shall, within one month after the date on which the instrument of transfer was lodged, send to the transferee notice of such refusal.
|
67. |
No fee shall be charged by the Company for registering any transfer or for making any
entry in the Register concerning any other document relating to or affecting the title to any share (except that the Company may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed on it in
connection with such transfer or entry).
|
68. |
In the case of the death of a member, the survivor or survivors, where the deceased was a joint holder, and the personal representatives of the deceased where he or she was a sole holder, shall be the only persons recognised by the
Company as having any title to his or her interest in the shares.
|
69. |
Nothing in Article 68 shall release the estate of a deceased joint holder from any liability in respect of any share which had been jointly held by him or her with other persons.
|
70. |
Any person becoming entitled to a share in consequence of the death or
bankruptcy of a member may, upon such evidence being produced as may from time to time properly be required by the Directors and subject to Article 71, elect either: (a) to be registered himself or herself as holder of the share; or (b) to
have some person nominated by him or her (being a person who consents to being so registered) registered as the transferee thereof.
|
71. |
The Directors shall, in either of those cases, have the same right to decline or suspend registration as they would have had in the case of a transfer of the share by that member before his or her death or bankruptcy, as the case may be.
|
72. |
If the person becoming entitled as mentioned in Article 70: (a) elects to be registered himself or herself, the person shall furnish to the Company a notice in writing signed by him or her stating that he or she so elects; or (b) elects
to have another person registered, the person shall testify his or her election by executing to that other person a transfer of the share.
|
73. |
All the limitations, restrictions and provisions of Articles 68 to 72 shall
be applicable to a notice or transfer referred to in Article 72 as if the death or bankruptcy of the member concerned had not occurred and the notice or transfer were a transfer signed by that member.
|
74. |
Subject to Article 75 and Article 76, a person becoming entitled to a share by reason of the death or bankruptcy of
the holder shall be entitled to the same dividends and other advantages to
which he or she would be entitled if he or she were the registered holder of the share.
|
75. |
A person referred to in Article 74 shall not, before being registered as a member in respect of the share, be entitled in respect of it to
exercise any right conferred by membership in relation to meetings of the Company.
|
76. |
The Directors may at any time serve a notice on any such person requiring the person to make the election provided
for by Article 70 and, if the person does not make that election (and proceed to do, consequent on that election, whichever of the things mentioned in Article 72 is appropriate) within ninety days after the date of service of the notice,
the Directors may thereupon withhold payment of all dividends, bonuses or other moneys payable in respect of the share until the requirements of the notice have been complied with.
|
77. |
The Company may charge a fee not exceeding €10 on the registration of every probate, letters of administration, certificate of death, power of attorney, notice as to stock or other instrument or order.
|
78. |
The Directors may determine such procedures as they shall think fit
regarding the transmission of shares in the Company held by a body corporate that are transmitted by operation of law in consequence of a merger or division.
|
79. |
For the purpose of determining members entitled to notice of or to vote at any meeting of members or any adjournment thereof, or members entitled to receive payment of any dividend, or in order to make a determination of members for any
other proper purpose, the Board may provide, subject to the requirements of section 174 of the Act, that the Register shall be closed for transfers at such times and for such periods, not exceeding in
the whole thirty days in each year. If the Register shall be so closed for the purpose of determining members entitled to notice of, or to vote at, a meeting of members, such Register shall, subject to applicable law and Exchange rules, be
so closed for at least five days immediately preceding such meeting and the record date for such determination shall be the date of the closure of the Register.
|
80. |
In lieu of, or apart from, closing the Register, the Board may fix in advance a date as the record date (a) for any such determination of members entitled to notice of or to vote at a meeting of the members, which record date shall not,
subject to applicable law and Exchange rules, be more than sixty days before the date of such meeting, and (b) for the purpose of determining the members entitled
to receive payment of any dividend or other distribution, or in order to make a determination of members for any other proper purpose, which record date shall not, subject to applicable law and Exchange rules, be more than sixty days prior
to the date of payment of such dividend or other distribution or the taking of any action to which such determination of members is relevant.
|
81. |
If the Register is not so closed and no record date is fixed for the determination of members entitled to notice of or to vote at a meeting of members, the date
immediately preceding the date on which notice of the meeting is deemed given under these Articles shall be the record date for such determination of members. Where a determination of members entitled to vote at any meeting of members has
been made as provided in these Articles, such determination shall apply to any adjournment thereof; provided, however, that the Directors may fix a new record date of the Adjourned Meeting, if they think fit.
|
82. |
Subject to the provisions of these Articles, including Articles 13, 14 and 177, the Company in a general meeting may declare dividends, but no dividends shall exceed the amount recommended by the Directors. Any general meeting declaring
a dividend and any resolution of the Directors declaring an interim dividend may direct payment of such dividend or interim dividend wholly or partly by the distribution of specific assets including paid up shares, debentures or debenture stocks of any other company or in any one or more of such ways, and the Directors
shall give effect to such resolution.
|
83. |
Subject to the provisions of these Articles, including Articles 13, 14 and 177, the Directors may from time to time:
|
|
83.1 |
pay to the members such dividends (whether as either interim dividends or final dividends) as appear to the Directors to be justified by the profits of the Company, subject to section 117 and Chapter 6 of Part 17 of the Act;
|
|
83.2 |
before declaring any dividend, set aside out of the profits of the Company such sums as they think proper as a reserve or reserves which shall, at the discretion of the Directors, be applicable for any purpose to which the profits of the
Company may be properly applied, and pending such application may, at the like discretion either be employed in the business of the Company or be held as cash or cash equivalents or invested in such investments as the Directors may lawfully
determine; and
|
|
83.3 |
without placing the profits of the Company to reserve, carry forward any profits which they may think prudent not to distribute.
|
84. |
Unless otherwise specified by the Directors at the time of declaring a dividend, the dividend shall be a final dividend.
|
85. |
Where the Directors specify that a dividend is an interim dividend at the time it is declared, such interim dividend shall not constitute a debt recoverable against the Company and the declaration may be revoked by the Directors at any
time prior to its payment provided that the holders of the same class of share are treated equally on any revocation.
|
86. |
Subject to the rights of persons, if any, entitled to shares with special rights as to dividend (and to the rights of the Company under Articles 41 to 45 and Article 88) all dividends shall be declared and paid such that shares of the
same class shall rank equally irrespective of the premium credited as paid up on such shares.
|
87. |
If any share is issued on terms providing that it shall rank for a dividend as from a particular date, such share shall rank for dividend accordingly.
|
88. |
The Directors may deduct from any dividend payable to any member, all
sums of money (if any) immediately payable by him or her to the Company on account of calls or otherwise in relation to the shares of the Company.
|
89. |
The Directors when declaring a dividend or bonus may direct payment of such dividend or bonus wholly or partly by the distribution of specific assets and, in particular, paid up shares, debentures or debenture stock of any other company
or in any one or more of such ways.
|
90. |
Where any difficulty arises in regard to a distribution, the Directors may settle the matter as they think expedient and, in particular, may:
|
|
90.1 |
issue fractional certificates (subject always to the restriction on the issue of fractional shares) and fix the value for distribution of such specific assets or any part of them;
|
|
90.2 |
determine that cash payments shall be made to any members upon the footing of the value so fixed, in order to adjust the rights of all the parties; and
|
|
90.3 |
vest any such specific assets in trustees as may seem expedient to the Directors.
|
91. |
Any dividend, interest or other moneys payable in cash in respect of any shares may be paid:
|
|
91.1 |
by cheque or negotiable instrument sent by post directed to or otherwise delivered to the registered address of the holder, or where there are joint holders, to the registered address of that one of the joint holders who is first named
on the register or to such person and to such address as the holder or the joint holders may in writing direct; or
|
|
91.2 |
by transfer to a bank account nominated by the payee or where such an account has not been so nominated, to the account of a trustee nominated by the Company to hold such moneys,
|
92. |
Any such cheque or negotiable instrument referred to in Article 91 shall be made payable to the order of the person to whom it is sent.
|
93. |
Any one of two or more joint holders may give valid receipts for any
dividends, bonuses or other moneys payable in respect of the shares held by them as joint holders, whether paid by cheque or negotiable instrument or direct transfer.
|
94. |
Subject to the rights of persons, if any, entitled to shares with special rights as to dividend, no dividend shall bear interest against the Company.
|
95. |
If the Directors so resolve, any dividend or distribution which has remained unclaimed for twelve years from the date of its declaration shall be forfeited and cease to remain owing by the Company. The payment by the Directors of any
unclaimed dividend, distribution or other moneys payable in respect of a share into a separate account shall not constitute the Company a trustee in respect thereof.
|
96. |
Subject to Article 177, any capitalisation provided for in Articles 97 to 101 inclusive will not require approval or ratification by the members.
|
97. |
The Directors may resolve to capitalise any part of a relevant sum
(within the meaning of Article 98) by applying such sum in paying up in full unissued shares of a nominal value, or nominal value and share premium, equal to the sum capitalised, to be allotted and issued as fully paid bonus shares, to
those members or the members of any class of shares in the capital of the Company who would have been entitled to that sum if it were distributed by way of dividend (and in the same proportions).
|
98. |
For the purposes of Article 97, “relevant sum” means: (a) any sum for the time being standing to the credit of the Company’s un-denominated capital; (b) any of the Company’s profits available for distribution; (c) any sum representing unrealised revaluation reserves; (d) a merger reserve
or (e) any sum standing to the credit of any other capital reserve, reserve account or capital fund, by whatever name called, of the Company, and whether distributable or non-distributable.
|
99. |
The Directors may in giving effect to any resolution under Article 97
make: (a) all appropriations and applications of the relevant sum resolved to be capitalised by the resolution; and (b) all allotments and issues of fully paid shares, if any, and generally shall do all acts
and things required to give effect to the resolution.
|
100. |
Without limiting Article 99, the Directors may:
|
100.1 |
make such provision as they think fit for the case of shares becoming distributable in fractions (and, again, without limiting the
foregoing, may sell the shares represented by such fractions and distribute the net proceeds of such sale amongst the members or members of a particular class otherwise entitled to such fractions in due proportions);
|
|
100.2 |
authorise any person to enter, on behalf of all the members or members of a particular class concerned, into an agreement with the Company providing for the allotment to them, respectively credited as fully paid up, of any further shares
to which they may become entitled on the capitalisation concerned or, as the case may require, for the payment by the application thereto of their respective proportions of the profits resolved to be capitalised of the amounts remaining
unpaid on their existing shares,
|
101. |
Where the Directors have resolved to approve a bona fide revaluation of all the fixed assets of the Company, the net capital surplus in excess of the previous book value of the assets arising
from such revaluation may be: (a) credited by the Directors to un-denominated capital other than the share premium account; or (b) used in paying up unissued shares of the Company to be issued to members or members of a particular class as
fully paid bonus shares.
|
102. |
Subject to Article 103, the Company shall in each year hold a general meeting as its annual general meeting in addition to any other meeting in that year, and shall specify the meeting as such in the notices calling it; and not more than
15 months shall elapse between the date of one annual general meeting of the Company and that of the next.
|
103. |
The Company will hold its first annual general meeting within eighteen
months of its incorporation.
|
104. |
The annual general meeting shall be held in such place and at such time as the Directors shall determine.
|
105. |
All general meetings of the Company other than annual general meetings shall be called extraordinary general meetings.
|
106. |
The Directors may, whenever they think fit, convene an extraordinary general meeting. An extraordinary general meeting shall also be convened by the Directors on the requisition of members, or if the Directors fail to so convene an
extraordinary general meeting, such extraordinary general meeting may be convened by the requisitioning members, in each case in accordance with section 178(3) to (7) of the Act.
|
107. |
If at any time the number of Directors is less than two, any Director or any member that satisfies the criteria under section 178 of the Act may convene an extraordinary general meeting in the same
manner as nearly as possible as that in which meetings may be convened by the Directors.
|
108. |
An annual general meeting or extraordinary general meeting of the Company may be held outside of Ireland. The Company shall make, at its expense, all necessary arrangements to ensure that members can by technological means participate in
any such meeting without leaving Ireland.
|
109. |
A general meeting of the Company may be held in two or more venues (whether inside or outside of Ireland) at the same time using any technology that provides members, as a whole, with a reasonable opportunity to participate, and such
participation shall be deemed to constitute presence in person at the meeting.
|
110. |
The only persons entitled to notice of general meetings of the Company are:
|
110.1 |
the members;
|
|
110.2 |
the personal representatives of a deceased member, which member would but for his death be entitled to vote;
|
|
110.3 |
the assignee in bankruptcy of a bankrupt member of the Company (being a bankrupt member who is entitled to vote at the meeting);
|
|
110.4 |
the Directors and Company Secretary; and
|
|
110.5 |
unless the Company is entitled to and has availed itself of the audit exemption under the Act, the Auditors (who shall also be entitled to receive other communications relating to any general meeting
which a member is entitled to receive).
|
111. |
Subject to the provisions of the Act allowing a general meeting to be called by shorter notice, an annual general
meeting and an extraordinary general meeting called for the passing of a special resolution shall be called by at least twenty-one days’ notice. Any other extraordinary general meeting shall also be called by at least twenty-one days’
notice, except that it may be called by fourteen days’ notice where:
|
|
111.1 |
all members, who hold shares that carry rights to vote at the meeting, are permitted to vote by electronic means at the meeting; and
|
|
111.2 |
a special resolution reducing the period of notice to fourteen days has been passed at the immediately preceding annual general meeting, or at a general meeting held since that meeting.
|
112. |
Any notice convening a general meeting shall specify the time and place of the meeting and, in the case of special business, the general nature of that business and, in reasonable prominence, that a member entitled to attend, speak, ask
questions and vote is entitled to appoint a proxy to attend, speak, ask questions and vote in his place and that a proxy need not be a member of the Company. Every notice shall specify such other details as are required by applicable law or
the relevant code, rules and regulations applicable to the listing of the shares on any Exchange. Subject to any restrictions imposed on any shares, the notice shall be given to all the members and to the Directors and Auditors.
|
113. |
The accidental omission to give notice of a meeting to, or the non-receipt of notice of a meeting by, any person entitled to receive notice shall not invalidate the proceedings at the meeting.
|
114. |
In cases where instruments of proxy are sent out with notices, the accidental omission to send such instrument of proxy to, or the non-receipt of such instrument of proxy by, any person entitled to receive such notice shall not
invalidate any resolution passed or any proceeding at any such meeting. A member present, either in person or by proxy, at any general meeting of the Company or of the holders of any class of shares in the Company will be deemed, subject to
Article 117, to have received notice of that meeting and, where required, of the purpose for which it was called.
|
115. |
Where, by any provision contained in the Act, extended notice is required of a resolution, the resolution shall not be effective (except where the Directors have resolved to submit it) unless notice
of the intention to move it has been given to the Company not less than twenty-eight days (or such shorter period as the Act permits) before the meeting at which it is moved, and the Company shall give
to the members notice of any such resolution as required by and in accordance
with the provisions of the Act.
|
116. |
In determining the correct period of notice for a general meeting, only Clear Days shall be counted.
|
117. |
Whenever any notice is required to be given by law or by these Articles to any person or persons, a waiver thereof in writing, signed by the person or persons entitled to the notice whether before or after the time stated therein, shall
be deemed equivalent thereto. Attendance of a person at a meeting shall constitute a waiver of notice of such meeting, except when the person attends a meeting for the express purpose of objecting at the beginning of the meeting to the
transaction of any business because the meeting is not lawfully called or convened.
|
118. |
For so long as the Company has more than one shareholder, unanimous
consent of the holders of the Ordinary Shares shall be required before the shareholders may act by way of written resolution in lieu of holding a meeting.
|
119. | 119.1 | Except in the case of the removal of statutory auditors or Directors and subject to the Act and the provisions of Article 118, anything which may be done by resolution in general meeting of all or any class of members may be done by resolution in writing, signed by all of the holders or any class thereof or their proxies (or in the case of a holder that is a corporation (whether or not a company within the meaning of the Acts) on behalf of such holder) being all of the members of the Company or any class thereof, who at the date of the resolution in writing would be entitled to attend a meeting and vote on the resolution and shall be valid and effective for all purposes as if the resolution had been passed at a general meeting of the Company or any class thereof duly convened and held, and if described as a Special Resolution shall be deemed to be a Special Resolution within the meaning of the Acts. Any such resolution in writing may be signed in as many counterparts as may be necessary. |
119.2 |
For the purposes of any written resolution under Article 119, the date of the resolution in writing is the date when the resolution is signed by, or on behalf of, the last holder to sign and any reference in any enactment to the
date of passing of a resolution is, in relation to a resolution in writing made in accordance with this section, a reference to such date.
|
|
119.3 |
A resolution in writing made in accordance with Article 119 is valid as
if it had been passed by the Company in general meeting or, if applicable, by a meeting of the relevant class of holders of the Company, as the case may be. A resolution in writing made in accordance with this section shall constitute
minutes for the purposes of the Act and these Articles.
|
120. |
At any time that the Company is a single-member company, its sole member may pass any resolution as a written
decision in accordance with section 196 of the Act.
|
121. |
Two members present in person or by proxy and having the right to attend and vote at the meeting and together holding shares representing more than 50% of the votes that may be cast by all members at the relevant time shall be a quorum at a general meeting; provided, however,
that at any time when the Company is a single-member company, one member of the Company present in person or by proxy at a general meeting of it shall be a quorum.
|
122. |
If within 15 minutes (or such greater time determined by the chairperson) after the time appointed for a general meeting a quorum is not present, then:
|
122.1 |
the meeting shall stand adjourned to the same day in the next week, at the same time and place or to such other day and at such other time and place as the Directors may determine (the “Adjourned Meeting”);
and
|
|
122.2 |
if at the Adjourned Meeting a quorum is not present within half an hour (or such greater time determined by the chairperson) after the time appointed for the meeting, the members present
shall be a quorum.
|
123. |
Every member entitled to attend, speak, ask questions and vote at a general meeting may appoint a proxy or proxies to attend, speak, ask questions relating to items on the agenda and vote
on his behalf and may appoint more than one proxy to attend, speak, ask questions and vote at the same general meeting provided that, where a member appoints more than one proxy in relation to a general meeting, each proxy must be appointed
to exercise the rights attached to different shares held by that member.
|
124. |
The appointment of a proxy shall be in writing in any usual form or in any other form which the Directors may approve and shall be signed by or on behalf of the appointor. The signature on such appointment need not be witnessed. A body
corporate may sign a form of proxy under its common seal or under the hand of a duly authorised officer thereof or in such other manner as the Directors may approve. A proxy need not be a member of the Company. A member shall be entitled to
appoint a proxy by electronic means, to an address specified by the Company. The proxy form must make provision for three-way voting (i.e., to allow votes to be cast for or against a resolution or to be withheld) on all resolutions intended
to be proposed, other than resolutions which are merely procedural. An instrument or other form of communication appointing or evidencing the appointment of a proxy or a corporate representative (other than a standing proxy or
representative) together with such evidence as to its due execution as the Board may from time to time require, may be returned to the address or addresses stated in the notice of meeting or Adjourned Meeting or any other information or
communication by such time or times as may be specified in the notice of meeting or Adjourned Meeting or in any other such information or communication (which times may differ when more than one place is so specified) or, if no such time is
specified, at any time prior to the holding of the relevant meeting or Adjourned Meeting at which the appointee proposes to vote, and, subject to the Act, if not so delivered the appointment shall not be
treated as valid.
|
125. |
A body corporate which is a member, or a proxy for a member, of the Company may by resolution of its directors or other governing body authorise such person or persons as it thinks fit to act as its representative or representatives at
any meeting of the Company or of any class of members of the Company and, subject to evidence being furnished to the Company of such authority as the Directors may reasonably require, any person(s) so authorised shall be entitled to
exercise the same powers on behalf of the body corporate which he represents as that body corporate could exercise if it were an individual member of the Company or, where more than one such representative is so authorized, all or any of
the rights attached to the shares in respect of which he is so authorised. Where a body corporate appoints more than one representative in relation to a general meeting, each representative must be appointed to exercise the rights attached
to different shares held by that body corporate.
|
126. |
Where the appointment of a proxy and any authority under which it is signed or a copy certified notarially or in some other way approved by the Directors is to be received by the Company:
|
|
126.1 |
in physical form, it shall be deposited at the Office or (at the option of the member) at such other place or places (if any) as may be specified for that purpose in or by way of note to the notice convening the meeting;
|
|
126.2 |
in electronic form, it may be so received where an address has been specified by the Company for the purpose of receiving electronic communications:
|
|
(a) |
in the notice convening the meeting; or
|
|
(b) |
in any appointment of proxy sent out by the Company in relation to the meeting; or
|
|
(c) |
in any invitation contained in an electronic communication to appoint a proxy issued by the Company in relation to the meeting;
|
|
127.1 |
Receipt by the Company of an appointment of a proxy in respect of a meeting shall not preclude a member from attending and voting at the meeting or at any adjournment thereof. However, if
that member votes at the meeting or at any adjournment thereof, then as regards to the resolution(s) any proxy notice delivered to the Company by or on behalf of that same member shall on a
poll, be invalid to the extent that such member votes in respect of the shares to which the proxy notice relates.
|
|
127.2 |
An appointment of a proxy shall be valid, unless the contrary is stated therein, as well for any adjournment of the meeting as for the meeting to which it relates and shall be deemed to confer authority to speak at a general meeting and
to demand or join in demanding a poll.
|
128. |
A proxy shall have the right to exercise all or any of the rights of his appointor, or (where more than one proxy is appointed) all or any of the rights attached to the shares in respect
of which he is appointed as the proxy to attend, and to speak and vote, at a general meeting of the Company. Unless his appointment provides otherwise, a proxy may vote or abstain at his discretion on any resolution put to the vote.
|
129. |
A vote given or poll demanded in accordance with the terms of an appointment of a proxy or a resolution authorising a representative to act on behalf of a body corporate shall be valid notwithstanding the previous death, insanity or
winding up of the principal, or the revocation of the appointment of a proxy or of the authority under which the proxy was appointed or of the resolution authorising the representative to act or the transfer of the share in respect of which
the proxy was appointed or the authorisation of the representative to act was given, provided that no notice in writing (whether in electronic form or otherwise) of such death, insanity, winding up, revocation or transfer is received by the
Company at the Office before the commencement of the meeting.
|
130. |
The Directors may send to the members, at the expense of the Company, by post, electronic mail or otherwise, forms for the appointment of a proxy (with or without reply paid envelopes for their return) for use at any general meeting or
at any class meeting, either in blank or nominating any one or more of the Directors or any other persons in the alternative. If, for the purpose of any meeting, invitations to appoint as proxy a person or one of a number of persons
specified in the invitations are issued at the expense of the Company, such invitations shall be issued to all (and not to some only) of the members entitled to be sent a notice of the meeting and to vote thereat by proxy, but the
accidental omission to issue such invitations to, or the non-receipt of such invitations by, any member shall not invalidate the proceedings at any such meeting.
|
131. |
All business shall be deemed to be special business that is transacted at an extraordinary general meeting or that is transacted at an annual general meeting other than, in the case of an annual general meeting, the business specified in
Article 135 which shall be ordinary business.
|
132. |
At any meeting of the members, only such business shall be conducted as shall have been properly brought before such meeting. To be properly brought before an annual general meeting, business must be:
|
|
132.1 |
specified in the notice of meeting (or any supplement thereto) given by
or at the direction of the Board;
|
|
132.2 |
otherwise properly brought before the meeting by or at the direction of the Board; or
|
|
132.3 |
otherwise properly brought before the meeting by a member.
|
133. |
Without prejudice to any procedure which may be permitted under the Act, for business to be properly brought before an
annual general meeting by a member, the member must have given timely notice thereof in writing to the Company Secretary. To be timely, a member’s notice must be received not less than 60 days nor more than 90 days prior to the first
anniversary of the preceding year’s annual general meeting; provided, however, that in the event that the date of the annual general meeting is advanced by more than 30 days or delayed by more than 60 days from such anniversary, notice by
the member to be timely must be so received not earlier than the 90th day prior to such annual general meeting and not later than the close of business on the
later of (i) the 60th day prior to such annual general meeting or (ii) the tenth day following the date on which notice of the date of the annual general
meeting was mailed or public disclosure thereof was made by the Company, whichever event in this clause (ii) first occurs. For the avoidance of doubt, in no event shall the adjournment or postponement of any general meeting, or the public
announcement of such an adjournment or postponement, commence a new time period (or extend any time period) for the giving of a member’s notice to the Company Secretary pursuant to this Article 133. Each such notice shall set forth as to
each matter the member proposes to bring before the annual general meeting:
|
|
133.1 |
a brief description of the business desired to be brought before the annual general meeting and the reasons for conducting such business at the meeting;
|
|
133.2 |
the name and address, as they appear on the Register, of the member proposing such business;
|
|
133.3 |
the class, series and number of shares of the Company which are beneficially owned by the member;
|
|
133.4 |
whether and the extent to which any hedging, derivative or other transaction is in place or has been entered into within the prior six months preceding the date of delivery of the notice by or for the benefit of the member with respect
to the Company or its subsidiaries or any of their respective securities, debt instruments or credit ratings, the effect or intent of which transaction is to give rise to gain or loss as a result of changes in the trading price of such
securities or debt instruments or changes in the credit ratings for the Company, its subsidiaries or any of their respective securities or debt instruments (or, more generally, changes in the perceived creditworthiness of the Company or its
subsidiaries), or to increase or decrease the voting power of the member, and if so, a summary of the material terms thereof; and
|
|
133.5 |
any material interest of the member in such business.
|
134. |
The chairperson of the meeting shall, if the facts warrant, determine and declare to the meeting that business
was not properly brought before the meeting and in accordance with the provisions of these Articles, and if he or she should so determine, any such business not
properly brought before the meeting shall not be transacted. Nothing
herein shall be deemed to affect any rights of members to request inclusion of proposals in the Company’s proxy statement pursuant to Rule 14a-8 under the Exchange
Act.
|
135. |
The business of the annual general meeting shall include:
|
|
135.1 |
the consideration of the Company’s statutory financial statements and the report of the Directors and the report of the Auditors on those statements and that report;
|
|
135.2 |
the review by the members of the Company’s affairs;
|
|
135.3 |
the authorisation of the Directors to approve the remuneration of the Auditors (if any); and
|
|
135.4 |
the appointment or re-appointment of Auditors.
|
136. |
The Chairperson, if any, shall preside as chairperson at every general meeting of the Company, or if there is no such Chairperson, or if he or she is not
present at the time appointed for the holding of the meeting or is unwilling to act, the Directors present shall elect one of their number to be chairperson of the meeting.
|
137. |
If at any meeting no Director is willing to act as chairperson or if no Director is present at the time appointed for holding the meeting, the members present shall choose one of their number to be chairperson of the meeting.
|
138. |
At each meeting of members, the chairperson of the meeting shall fix and announce the date and time of the opening and the closing of the polls for each matter upon which the members will vote at the meeting and shall determine the order
of business and all other matters of procedure.
|
139. |
The Directors may adopt such rules, regulations and procedures for the conduct of any meeting of the members as they deem appropriate. Except to the extent inconsistent with any applicable rules, regulations and procedures adopted by the
Board, the chairperson of any meeting may adopt such rules, regulations and procedures for the meeting, which need not be in writing, and take such actions with respect to the conduct of the meeting, as the chairperson of the meeting deems
appropriate, to maintain order and safety and for the conduct of the meeting.
|
140. |
The chairperson of the meeting may, with the consent of any meeting at which a quorum is present, and shall if so directed by the meeting, adjourn the meeting from time to time and from place to place.
|
141. |
No business shall be transacted at any Adjourned Meeting other than the business left unfinished at the meeting from which the adjournment took place.
|
142. |
When a meeting is adjourned for thirty days or more, notice of the Adjourned Meeting shall be given as in the case of an original meeting but, subject to that, it shall not be necessary
to give any notice of an adjournment or of the business to be transacted at an Adjourned Meeting.
|
143. |
Each Director and the Auditors shall be entitled to attend and speak at any general meeting of the Company.
|
144. |
For business to be properly requested by a member to be brought before a general meeting, the member must comply with the requirements of the Act or:
|
|
144.1 |
be a member at the time of the giving of the notice for such general meeting;
|
|
144.2 |
be entitled to vote at such meeting; and
|
|
144.3 |
have given timely and proper notice in writing to the Company Secretary in accordance with Article 133.
|
145. |
Except where a greater majority is required by the Act or these Articles, any question proposed for a decision of the members at any general meeting of the Company or a decision of any class of members at a separate meeting of any class of shares
shall be decided by an ordinary resolution.
|
146. |
At any general meeting, a resolution put to the vote of the meeting
shall be decided on a poll.
|
147. |
Save as provided in Article 148 of these Articles, a poll shall be taken in such manner as the chairperson of the meeting directs and he or she may appoint scrutineers (who need not be members) and fix a time and place for declaring the
result of the poll. The result of the poll shall be deemed to be the resolution of the meeting at which the poll was demanded.
|
148. |
A poll demanded on the election of a chairperson of the meeting or on a question of adjournment shall be taken
forthwith. A poll demanded on any other question shall be taken either forthwith or at such time and place as the chairperson of the meeting may direct. The demand for a poll shall not prevent the continuance of a meeting for the
transaction of any business other than the question on which the poll was demanded.
|
149. |
No notice need be given of a poll not taken forthwith if the time and place at which it is to be taken are announced at the meeting at which it is demanded. In any other case at least seven Clear Days’ notice shall be given specifying
the time and place at which the poll is to be taken.
|
150. |
If authorised by the Directors, any vote taken by written ballot may be satisfied by a ballot submitted by electronic and/or telephonic transmission, provided that any such electronic or telephonic submission must either set forth or be
submitted with information from which it can be determined that the electronic or telephonic submission has been authorised by the member or proxy.
|
151. |
Subject to the provisions of these Articles and any rights or restrictions for the time being attached to any class or classes of shares in the capital of the Company, every member of record present in person or by proxy shall have one
vote for each share registered in his or her name in the Register.
|
152. |
Where there are joint holders of a share, the vote of the senior who
tenders a vote, whether in person or by proxy, shall be accepted to the exclusion of the votes of the other joint holder or holders; and for this purpose, seniority shall be determined by the order in which the names of the joint holders
stand in the Register.
|
153. |
A member who has made an enduring power of attorney, or a member in respect of whom an order has been made by any court having jurisdiction in cases of unsound mind, may vote by his or her committee, donee of an enduring power of
attorney, receiver, guardian or other person appointed by the foregoing court, and any such committee, donee of an enduring power of attorney, receiver, guardian or other persons appointed by the foregoing court may speak or vote by proxy.
|
154. |
No objection shall be raised to the qualification of any voter except at the general meeting or adjourned general meeting at which the vote objected to is given or tendered and every vote not disallowed at such general meeting shall be
valid for all purposes. Any such objection made in due time shall be referred to the chairperson of the general meeting whose decision shall be final and conclusive.
|
155. |
A person shall be entered on the Register by the record date specified in respect of a general meeting in order to exercise the right of a member to participate and vote at the general meeting and any change to an entry on the Register
after the record date shall be disregarded in determining the right of any person to attend and vote at the meeting.
|
156. |
Votes may be given either personally (including by a duly authorised representative of a corporate member) or by proxy. On a poll taken at a meeting of the members of the Company or a meeting of any class of members of the Company, a
member, whether present in person or by proxy, entitled to more than one vote need not, if he votes, use all his votes or cast all the votes he uses in the same way.
|
157. |
Subject to such requirements and restrictions as the Directors may specify, the Company may permit members to vote by correspondence in advance of a general meeting in respect of one or more of the resolutions proposed at a meeting.
Where the Company permits members to vote by correspondence, it shall only count votes cast in advance by correspondence, where such votes are received at the address and before the date and time specified by the Company, provided the date
and time is no more than 24 hours before the time at which the vote is to be concluded.
|
158. |
Subject to such requirements and restrictions as the Directors may specify, the Company may permit members who are not physically present at a meeting to vote by electronic means at the general meeting in respect of one or more of the
resolutions proposed at a meeting.
|
159. |
Where there is an equality of votes, the chairperson of the meeting shall not have a second or casting vote.
|
160. |
No member shall be entitled to vote at any general meeting of the Company unless all calls or other sums immediately payable by him or her in respect of shares in the Company have been paid.
|
161. |
The provisions of these Articles relating to general meetings shall, as far as applicable, apply in relation to any meeting of any class of member of the Company.
|
162. |
The number of Directors from time to time shall be not less than two nor more than thirteen.
|
163. |
From and after the date that is the earlier of (i) 2 January 2024 and (ii) the first occurrence of a Springing Rights Event, for so long as any Class A Preferred Shares remain outstanding, then the Class A Preferred Majority shall be
entitled from time to time to appoint two persons as Directors (the “Class A Preferred Directors”), and the Class A Preferred Majority shall be entitled, from time to time, to remove from office each
and any such person appointed as a Class A Preferred Director and, upon the death, resignation, retirement, disqualification or removal of any person appointed as a Class A Preferred Director (howsoever occasioned), to appoint another
person in his or her place. Any such appointment and/or removal shall be made by notice in writing served on the Company and shall take effect on the date specified in the notice.
|
164. |
The Board, upon recommendations of the nomination and governance committee (or equivalent committee established by the Board), shall propose nominees for election to the office of Director (other than as a Class A Preferred Director) at
each annual general meeting.
|
165. |
The Directors (other than as a Class A Preferred Director) may be appointed by the members in general meeting, provided that no person other than a Director
retiring at the meeting shall, save where recommended by the Board, be eligible for election to the office of Director at any general meeting unless the
requirements of Article 172 as to his or her eligibility for that purpose have been complied with.
|
166. |
The Directors (other than the Class A Preferred Directors) shall be divided into three classes, designated Class I, Class II and Class III. The initial division of the Board into classes shall be made by the decision of the affirmative vote of a majority of the Directors in office and each class need not be of equal size or number.
|
|
166.1 |
The term of the initial Class I Directors shall terminate at the conclusion of the Company’s 2024 annual general meeting; the term of the initial Class II
Directors shall terminate on the conclusion of the Company’s 2025 annual general meeting; and the term of the initial Class III Directors shall terminate on the conclusion of the Company’s 2026 annual general meeting.
|
|
166.2 |
At each annual general meeting of the Company beginning with the Company’s 2024 annual general meeting, all of the Directors of the class of directors whose term expires on the conclusion of that annual general meeting shall retire from
office, unless re-elected, and successors to that class of directors shall be elected for a three-year term.
|
|
166.3 |
The resolution appointing any Director (other than a Class A Preferred Director) must designate the Director as a Class I, Class II or Class III Director.
|
|
166.4 |
Every Director of the class retiring shall be eligible to stand for re-election at an annual general meeting.
|
|
166.5 |
If the number of Directors is changed, any increase or decrease (other than an increase or decrease related to the appointment or removal of a Class A Preferred Director) shall be apportioned among the classes so as to maintain the
number of Directors in each class as nearly equal as possible or as the Chairperson may otherwise direct. In no case will a decrease in the number of Directors shorten the term of any incumbent Director.
|
|
166.6 |
A Director (other than a Class A Preferred Director) shall hold office until the conclusion of the annual general meeting for the year in which his term expires and until he shall be re-elected or his successor shall be elected or
appointed and subject, however, to prior death, resignation, retirement, disqualification or removal from office.
|
|
166.7 |
Any vacancy on the Board, including a vacancy that results from an increase in the number of directors or from the death, resignation, retirement, disqualification or removal of a Director, shall be deemed a casual vacancy. Subject to
the terms of any one or more classes or series of Preferred Shares (including, in the case of the Class A Preferred Shares, Article 163), any casual vacancy shall only be filled by the decision of a majority of the Board then in office,
provided that a quorum is present and provided that the appointment does not cause the number of Directors to exceed any number fixed by or in accordance with these articles as the maximum number of Directors. A Class A Preferred Director
may only be appointed pursuant to Article 163, and no person may otherwise be appointed or elected to fill a casual vacancy resulting from the death, resignation, retirement, disqualification or removal of a Class A Preferred Director.
|
|
166.8 |
Any Director of such class elected to fill a vacancy resulting from an increase in the number of Directors of such class shall hold office for a term that shall
coincide with the remaining term of that class. Any Director (other than a Class A Preferred Director) elected to fill a vacancy not resulting from an increase in the number of Directors shall have the same remaining term as that of his
predecessor or if there is no such remaining term, the Director shall retire, and be eligible to stand for re-election, at the annual general meeting immediately
following their appointment at which time, if reelected, the Director shall hold
office for a term that shall coincide with the remaining term of that class. A Director retiring at a meeting shall retain office until the close or adjournment of the meeting.
|
167. |
Each Director (other than a Class A Preferred Director) shall be elected by an ordinary resolution at such meeting, provided that if, as of, or at any time prior to, fourteen days before the filing of the Company’s definitive proxy
statement with the SEC relating to such general meeting, the number of Director nominees exceeds the number of Directors to be elected (a “contested election”), each of those nominees shall be voted
upon as a separate resolution and the Directors shall be elected by a plurality of the votes of the shares present in person or represented by proxy at any such meeting and entitled to vote on the election of Directors.
|
168. |
Any nominee for election to the Board who is then serving as a
Director and, in an uncontested election (where the number of Director nominees does not exceed the number of Directors to be elected), receives a greater number of “against” votes than “for” votes shall promptly tender his or her
resignation following certification of the vote. The nomination and governance committee of the Board shall then consider the resignation offer and recommend to the Board whether to accept or reject the resignation, or whether other action
should be taken; provided that any Director whose resignation is under consideration shall not participate in the nomination and governance committee’s recommendation regarding whether to accept, reject or take other action with respect to
his/her resignation. The Board shall take action on the nomination and governance committee’s recommendation within 90 days following certification of the vote, and promptly thereafter publicly disclose its decision and the reasons
therefor.
|
169. |
Any Director (other than a Class A Preferred Director) may, from time to time, in accordance with the provisions of Section 165(4) of the Act, appoint any other Director to be an alternate director as respects him or her. Any Class A
Preferred Director may, in accordance with the provisions of Section 165(4) of the Act, appoint any other Director or any other person (at his or her absolute discretion) to be an alternate director as respects him or her.
|
170. |
The Company may from time to time, by ordinary resolution, increase or reduce the number of Directors provided that any resolution to appoint a Director approved by the members that would result in the maximum number of Directors being
exceeded shall be deemed to constitute an ordinary resolution increasing the maximum number of Directors to the number that would be in office following such a resolution of appointment.
|
171. |
The Company may by ordinary resolution appoint another person in place of a Director removed from office under section 146 of the Act (other than a Class A Preferred Director) and, without prejudice
to the powers of the Directors under Article 166.7, the Company in a general meeting may appoint any person to be a Director (other than a Class A Preferred
Director) either to fill a casual vacancy or as an additional Director.
|
172. |
The following are the requirements mentioned in Article 165 for the eligibility of a person (the “person concerned”) for election as a Director at a general meeting, namely, any member entitled to vote in the election of Directors
generally may nominate one or more persons for election as Directors at an annual general meeting only pursuant to the Company’s notice of such meeting or if written notice of such member’s intent to make such nomination or nominations has
been received by the Company Secretary at the Company’s Office not less than 60 nor more than 90 days prior to the first anniversary of the preceding year’s annual general meeting; provided, however, that in the event that the date of the
annual general meeting is advanced by more than 30 days or delayed by more than 60 days from such anniversary, notice by the member to be timely must be so received not earlier than the 90th day prior to such annual general meeting and not
later than the close of business on the later of (i) the 60th day prior to such annual general meeting and (ii) the 10th day following the day on which notice of the date of the annual general meeting was mailed or public disclosure thereof
was made by the Company, whichever event in this clause (ii) first occurs. Each such member’s notice shall set forth:
|
|
172.1 |
the name and address of the member who intends to make the nomination
and of the person or persons to be nominated;
|
|
172.2 |
a representation that the member is a holder of record of shares of the Company entitled to vote at such meeting and intends to appear in person or by proxy at the meeting to nominate the person or persons specified in the notice;
|
|
172.3 |
a description of all arrangements or understandings between the member and each nominee and any other person or persons (naming such person or persons) relating to the nomination or nominations;
|
|
172.4 |
the class and number of shares of the Company which are beneficially owned by such member and by any other members known by such member to be supporting such nominees as of the date of such member’s notice;
|
|
172.5 |
whether and the extent to which any hedging, derivative or other transaction is in place or has been entered into within the prior six months preceding the date of delivery of the notice by or for the benefit of the member with respect
to the Company or its subsidiaries or any of their respective securities, debt instruments or credit ratings, the effect or intent of which transaction is to give rise to gain or loss as a result of changes in the trading price of such
securities or debt instruments or changes in the credit ratings for the Company, its subsidiaries or any of their respective securities or debt instruments (or, more generally, changes in the perceived creditworthiness of the Company or its
subsidiaries), or to increase or decrease the voting power of the member, and if so, a summary of the material terms thereof;
|
|
172.6 |
such other information regarding each nominee proposed by such member as would be required to be included in a proxy statement filed pursuant to the proxy rules of the SEC;
|
|
172.7 |
the consent of each nominee to serve as a Director if so elected; and
|
|
172.8 |
for each nominee who is not an incumbent Director:
|
|
(a) |
their name, age, business address and residential address;
|
|
(b) |
their principal occupation or employment;
|
|
(c) |
the class, series and number of securities of the Company that are owned of record or beneficially by such person;
|
|
(d) |
the date or dates the securities were acquired and the investment intent of each acquisition;
|
|
(e) |
any other information relating to such person that is required to be disclosed in proxies for the election of Directors under any applicable securities legislation; and
|
|
(f) |
any information the Company may require any proposed director nominee to furnish such as it may reasonably require to comply with applicable law and to determine the eligibility of such proposed nominee to serve as a Director and whether
such proposed nominee would be considered independent as a Director or as a member of the audit or any other committee of the Board under the various rules and standards applicable to the Company.
|
173. |
Subject to the provisions of these Articles and in addition to the circumstances described in sections 146, 148(1) and 196(2) of the Act, the office of Director shall be vacated ipso facto, if that Director:
|
|
173.1 |
is restricted or disqualified to act as a Director under the Act; or
|
|
173.2 |
resigns his or her office by notice in writing to the Company or in writing offers to resign and the Directors resolve to accept such offer; or
|
|
173.3 |
save in the case of a Class A Preferred Director, is requested to resign in writing by not less than three quarters of the other Directors.
|
174. |
Subject to Article 177, the remuneration of the Directors shall be such as is determined, from time to time, by the Board and such remuneration shall be deemed to accrue from day to day. The Board may from time to time determine that,
subject to the requirements of the Act, all or part of any fees or other remuneration payable to any Director shall be provided in the form of shares or other securities of the Company or any subsidiary
of the Company, or options or rights to acquire such shares or other securities, on such terms as the Board may decide.
|
175. |
The Directors may also be paid all travelling, hotel and other expenses properly incurred by them: (a) in attending and returning from: (i) meetings of the
Directors or any committee; or (ii) general meetings of the Company, or (b) otherwise in connection with the business of the Company.
|
176. |
The business of the Company shall be managed by its Directors who may pay all expenses incurred in promoting and registering the Company and may exercise all
such powers of the Company as are not, by the Act, by the Memorandum or by these Articles, required to be exercised by the Company in a general meeting, but subject to:
|
|
176.1 |
any regulations contained in these Articles (including the provisions
of Articles 177 and 178);
|
|
176.2 |
the provisions of the Act;
|
|
176.3 |
from and after the Initial Closing Date until all the Class A Preferred Shares are redeemed in full in accordance with the provisions of these Articles, the provisions of Article 177;
|
|
176.4 |
from and after the occurrence of a Springing Rights Event, such
directions as are given by a Class A Preferred Majority in accordance with the provisions of Article 178: and
|
|
176.5 |
following the redemption of all the Class A Preferred Shares, such directions, not being inconsistent with the foregoing regulations or provisions, as the Company in a general meeting may (by special resolution) give.
|
177. |
From and after the Initial Closing Date until all the Class A Preferred Shares are redeemed in full in accordance with the provisions of these Articles, and notwithstanding anything to the contrary contained in these Articles, the Company shall not (and shall cause its subsidiaries not to), and the Board shall
cause the Company (and its subsidiaries) not to, undertake any Structured Voting Rights Matter without the prior written consent of a Class A Preferred Majority.
|
178. |
From and after the occurrence of a Springing Rights Event, and notwithstanding anything to the contrary contained in these Articles, until (a) all of the Class A Preferred Shares are redeemed in full in accordance with the provisions of
these Articles or (b) if earlier, in the case of a Springing Rights Event occurring under limbs (ii) or (iii) of the definition of “Springing Rights Event”, until the non-compliance by the Company with the relevant obligations referred to
therein giving rise to the Springing Rights Event (x) if capable of rectification, is rectified to the satisfaction of a Class A Preferred Majority or (y) is otherwise waived in writing by a Class A Preferred Majority, a Class A Preferred
Majority shall be entitled to provide directions to the Directors with respect to each Springing Rights Matter. In addition to the means of service of documents set out in section 51 of the Act, such directions may be served on the Company
by a Class A Preferred Majority by email and the Directors shall designate an email address for that purpose, which shall be notified to the Class A Preferred Members, in accordance with the provisions of Articles 223 to 232 for the express
purpose of serving directions on the Company. For the avoidance of doubt, a Springing Rights Event may occur under limbs (ii) and (iii) of the definition of “Springing Rights Event” on more than one occasion, in each case giving rise to
the rights of a Class A Preferred Majority to provide directions hereunder.
|
179. |
No direction given by the Company in a general meeting under Article 176.5 shall invalidate any prior act of the Directors which would have been valid if that direction had not been given.
|
180. |
Without prejudice to the generality of Article 176, Article 176
operates to enable, subject to a limitation (if any) arising under any of paragraphs 176.1 to 176.3 of it, the Directors exercise all powers of the Company to
borrow money and to mortgage or charge its undertaking, property and uncalled capital, or any part thereof.
|
181. |
Without prejudice to section 40 of the Act,
the Directors may delegate any of their powers (including any power
referred to in these Articles) to such person or persons as they think fit, including committees; any such person or committee shall, in the exercise of the powers so delegated, conform to any regulations that may be imposed on it by the
Directors.
|
182. |
Any reference to a power of the Company required to be exercised by the Company in a general meeting includes a reference to a power of the Company that, but for the power of the members to pass a written resolution to effect the first-mentioned power’s exercise, would be required to be
exercised by the Company in a general meeting.
|
183. |
The acts of the Board or of any committee established by the Board or any delegee of the Board or any such committee shall be valid notwithstanding any defect which may afterwards be discovered in the
appointment or qualification of any Director, committee member or delegee.
|
184. |
The Directors may appoint a sole or joint company secretary, an assistant company
secretary and a deputy company secretary for such term, at such remuneration and upon such conditions as they may think fit; and any such person so appointed may be
removed by them.
|
185. |
Subject to the provisions of these Articles, including Article 177, the Directors may from time to time appoint one or more of themselves to the office of Chief Executive Officer (by whatever name called including managing director) or
such other office or position with the Company and for such period and on such terms as to remuneration, if any (whether by way of salary, commission, participation in profits or otherwise) as the Board may determine, and, subject to the
terms of any agreement entered into in any particular case, may revoke such appointment.
|
186. |
Without prejudice to any claim the person so appointed under Article 185 may have for damages for breach of any contract of service between the person and the Company, the person’s appointment shall cease upon his or her ceasing, for any
reason, to be a Director.
|
187. |
The Board may appoint any person whether or not he or she is a
Director, to hold such executive or official position (except that of Auditor) as the Board may from time to time determine. The same person may hold more than one
office of executive or official position.
|
188. |
The Board shall determine from time to time, the powers and duties of any such office holder or official appointed under Articles 185 and/or Article 187, and subject to the provisions of the Act and these Articles, the Directors may confer upon an office holder or official any of the powers exercisable by them upon such terms and conditions and with such restrictions as they may think fit and
in conferring any such powers, the Directors may specify that the conferral is to operate either: (a) so that the powers concerned may be exercised concurrently by them and the relevant office holder; or (b) to the exclusion of their own
such powers.
|
189. |
The Directors may (a) revoke any conferral of powers under Article 188 or (b) amend any such conferral (whether as to the powers conferred or the terms, conditions or restrictions subject to which the conferral is made). The use or inclusion of the word “officer” (or similar words) in the title of any executive or other position shall not be deemed to imply
that the person holding such executive or other position is an “officer” of the Company within the meaning of the Act.
|
190. | 190.1 |
The Directors may meet together for the dispatch of business, adjourn and otherwise regulate their meetings as they think fit. |
|
190.2 |
The Directors may establish attendance and procedural guidelines from time to time about how their meetings are to be conducted consistent with good corporate governance and applicable tax requirements.
|
|
190.3 |
Such meetings shall take place at such time and place as the Directors may determine.
|
|
190.4 |
Questions arising at any such meeting shall be decided by a majority of votes and where there is an equality of votes, the chairperson of the meeting shall not have a second or casting vote, provided that, from and after the occurrence
of a Springing Rights Event until (a) all of the Class A Preferred Shares are redeemed in full in accordance with the provisions of these Articles or (b) if earlier, in the case of a Springing Rights Event occurring under limbs (ii) or
(iii) of the definition of “Springing Rights Event”, until the non-compliance by the Company with the relevant obligations referred to therein giving rise to the Springing Rights Event (x) if capable of rectification, is rectified to the
satisfaction of a Class A Preferred Majority or (y) is otherwise waived in writing by a Class A Preferred Majority, the Class A Preferred Directors (or either of them) shall, in respect of each Springing Rights Matter, be deemed to have the
power to exercise such number of votes as constitute a majority of the votes that may be cast by all the Directors from time to time. For the avoidance of doubt, a Springing Rights Event may occur under limbs (ii) and (iii) of the
definition of “Springing Rights Event” on more than one occasion, in each case giving rise to the enhanced voting rights of the Class A Preferred Directors hereunder.
|
|
190.5 |
A Director may, and the Company Secretary on the requisition of a Director shall, at any time summon a meeting of the Directors.
|
191. |
All Directors shall be entitled to reasonable notice of any meeting of the Directors.
|
192. |
Nothing in Article 191 or any other provision of the Act enables a person, other than a Director, to object to the notice given for any meeting of the Directors.
|
193. |
The quorum necessary for the transaction of the business of the
Directors may be fixed by the Directors, and unless so fixed shall be a majority of the Directors in office at the time when the meeting is convened, provided that, if any Class A Preferred Director is in office at the time when the meeting
is convened, the quorum shall include at least one (1) Class A Preferred Director.
|
194. |
The continuing Directors may act notwithstanding any vacancy in their number, provided that if the number of the Directors is reduced below the prescribed minimum the remaining Director or Directors shall appoint forthwith an additional
Director or additional Directors to make up such minimum or shall convene a general meeting of the Company for the purpose of making such appointment and apportion the Directors among the classes so as to maintain the number of Directors in
each class as equal as possible.
|
195. |
The Directors may elect a Chairperson and determine the period for which he or she is to hold office, but if no such Chairperson is elected, or, if at any meeting the Chairperson is not present after the time appointed for holding it,
the Directors present may choose one of their members to be chairperson of a Board meeting. The Chairperson shall vacate office if he or she vacates his or her office as a Director (otherwise than by the expiration of his or her term of
office at a general meeting of the Company at which he or she is re-appointed).
|
196. |
Subject to the other provisions of these Articles, including Article 177, the Directors may establish one or more committees consisting in whole or in part of members of the Board. Subject to Article 177, the composition, function,
power and obligations of any such committee will be determined by the Board from time to time, provided that, if a Class A Preferred Director so requests, at least one (1) Class A Preferred Director shall be entitled to serve on any
committee so established.
|
197. |
A committee established under Article 196 (a “committee”) may elect a chairperson of its meetings; if no such chairperson is elected, or if at any meeting the chairperson is not present after the time appointed for holding it, the members of the committee present may choose one of their number to be chairperson of the meeting.
|
198. |
A committee may meet and adjourn as it thinks proper. Committee
meetings shall take place at such time and place as the relevant committee may determine. Questions arising at any meeting of a committee shall be determined (subject to Article 196) by a majority of votes of the members of the committee
present, and where there is an equality of votes, the chairperson of the committee shall not have a second or casting vote.
|
199. |
Where any committee is established by the Directors :
|
|
199.1 |
the meetings and proceedings of such committee shall be governed by the provisions of these Articles regulating the meetings and proceedings of the Directors so far as the same are applicable and are not superseded by any regulations imposed upon such committee by the Directors; and
|
|
199.2 |
the Directors may authorise, or may authorise such committee to authorise, any person who is not a Director to attend all or any meetings of any such committee on such terms as the Directors or the committee think fit, provided that any such person shall not be entitled to vote at meetings
of the committee.
|
200. |
The following provision shall apply:
|
|
200.1 |
A resolution in writing signed by all the Directors, or by all the Directors being members of a committee referred to in Article 196, and who are for the time being entitled to receive notice of a meeting of the Directors or, as the case
may be, of such a committee, shall be as valid as if it had been passed at a meeting of the Directors or such a committee duly convened and held.
|
|
200.2 |
A resolution in writing shall be deemed to have been signed by a Director where the Chairperson, Company Secretary or other person designated by the Board has received an email from that Director’s Certified Email Address which identifies the resolution and states,
unconditionally, “I hereby sign the resolution”.
|
|
200.3 |
A Director’s Certified Email Address is such email address as the Director has, from time to time, notified to such person and in such manner as may from time
to time be prescribed by the Board.
|
|
200.4 |
The Company shall cause a copy of every email referred to in Article 200.2 to be entered in the books kept pursuant to section 166 of the Act.
|
201. |
Subject to Article 202, where one or more of the Directors (other than a majority of them) would not, by reason of:
|
|
201.1 |
the Act or any other enactment;
|
|
201.2 |
these Articles; or
|
|
201.3 |
an applicable rule of law or an Exchange,
|
202. |
In a case falling within Article 201, the resolution shall state the
name of each Director who did not sign it and the basis on which he or she did not sign it.
|
203. |
For the avoidance of doubt, nothing in Articles 200 to 202 dealing with a resolution that is signed by other than all of
the Directors shall be read as making available, in the case of an equality of votes, a second or casting vote to the one of their number who would, or might have been, if a meeting had been held to transact the business concerned,
chairperson of that meeting.
|
204. |
The resolution referred to in Article 200 may consist of several
documents in like form each signed by one or more Directors and for all purposes shall take effect from the time that it is signed by the last Director.
|
205. |
A meeting of the Directors or of a committee referred to in Article
196 may consist of a conference between some or all of the Directors or, as the case may be, members of the committee who are not all in one place, but each of whom is able (directly or by means of telephonic, video or other electronic
communication) to speak to each of the others and to be heard by each of the others and:
|
|
205.1 |
a Director or as the case may be a member of the committee taking part
in such a conference shall be deemed to be present in person at the meeting and shall be entitled to vote (subject to Article 201) and be counted in a quorum accordingly; and
|
|
205.2 |
such a meeting shall be deemed to take place:
|
|
(a) |
where the largest group of those Directors participating in the conference is assembled;
|
|
(b) |
if there is no such group, where the chairperson of the meeting then
is; or
|
|
(c) |
if neither subparagraph (a) or (b) applies, in such location as the meeting itself decides.
|
206. |
A Director may have regard to the interests of any other companies in a group of which the Company is a member to the full extent permitted by the Act.
|
207. |
A Director is expressly permitted (for the purposes of section 228(1)(d) of the Act) to use vehicles, telephones, computers, aircraft, accommodation and any other Company property where such use is approved by the Board or by a person
so authorised by the Board or where such use is in accordance with a Director’s terms of employment, letter of appointment or other contract or in the course of the discharge of the Director’s duties or responsibilities or in the course of
the discharge of a Director’s employment.
|
208. |
Nothing in section 228(1)(e) of the Act shall restrict a Director from entering into any commitment which has been approved by the Board or has been approved pursuant to such authority as may be delegated by the Board in accordance with
these Articles. It shall be the duty of each Director to obtain the prior approval of the Board before entering into any such commitment permitted by sections 228(1)(e)(ii) and 228(2) of the Act.
|
209. |
It shall be the duty of a Director who is in any way, whether directly or indirectly, interested (within the meaning of section 231 of the Act) in a contract or proposed contract with the Company, to declare the nature of his or her
interest at a meeting of the Directors.
|
210. |
Subject to any applicable law or the relevant code, rules and regulations applicable to the listing of the shares on any Exchange, a Director may attend and participate at Board meetings, be counted in the quorum and vote in respect of
any contract, appointment or arrangement in which he or she is interested (including his or her own appointment as a director of the Company or to any other office or place of profit under the Company, and the terms of it), and each
Director is hereby released from his or her duty set out in section 228(1)(f) of the Act to avoid a conflict between the Director’s duties to the Company and the Director’s other interests (including personal interests) in respect of any
such contract, appointment or arrangement.
|
211. |
For the purposes of section 228(1)(f) of the Act, the Board may release any Director from his or her duty to avoid a conflict between that Director’s duties to the Company and that Director’s other interests (including personal
interests) in connection with any matter brought to the attention of the Board which would or might otherwise constitute or give rise to a conflict between that Director’s duties to the Company and that Director’s other interests (including
personal interests). Release of any Director under this Article 211 shall be effective only if the matter is considered at a meeting of the Board at which the quorum is met without counting the Director in question and the matter is agreed
to without that Director voting or would have been agreed to if the vote of that Director had not been counted.
|
212. |
Without prejudice to the provisions of Article 211, for the purposes of section 228(1)(f) of the Act, each Class A Preferred Director is hereby generally and unconditionally released from his or her duty to avoid a conflict between that
Class A Preferred Director’s duties to the Company and that Class A Preferred Director’s other interests (including personal interests) to the extent any situation or matter constitutes a “Permitted Conflict”. A Class A Preferred Director
who is subject to a Permitted Conflict may attend and participate at Board meetings, be counted in the quorum and vote on any decision concerning such situation. A “Permitted Conflict” is a situation
or matter where, or in respect of which, a Class A Preferred Director has, or may have, a direct or indirect interest that conflicts, or possibly may conflict, with the interests of the Company arising from (i) that Class A Preferred
Director’s relationship(s) (as described in Article 213.1) with any Class A Preferred Member who appointed him or her as a director of the Company and/or (ii) the exercise by a Class A Preferred Majority of any rights under these Articles
(including the provisions of Articles 177 and 178), the Securities Purchase Agreement or otherwise, howsoever arising. For the purposes of this Article 212, any reference to a “Class A Preferred Member” shall be deemed to include a
reference to any unitholder, shareholder, general partner, limited partner, managing member, manager, investment adviser, adviser, director, officer, employee, custodian, trustee, nominee or consultant, in, of, or to, (or other person who
or which is involved or interested, whether directly or indirectly, in any capacity or role whatsoever with) a (i) Class A Preferred Member, (ii) any of that Class A Preferred Member’s Affiliates or (iii) any manager, investment adviser or
other adviser to such Class A Preferred Member or any of its Affiliates (or any Affiliate of any such person).
|
213. |
Without prejudice to the provisions of Articles 211 and 212, a Class A Preferred Director may:
|
|
213.1 |
from time to time, but without limitation, be a unitholder, shareholder, general partner, limited partner, managing member, manager, investment adviser, adviser, director, officer, employee, custodian, trustee, nominee or consultant, in,
of, or to, (or otherwise, be involved or interested, whether directly or indirectly, in any capacity or role whatsoever with) a (i) Class A Preferred Member, (ii) any of that Class A Preferred Member’s Affiliates, (iii) any manager,
investment adviser or other adviser to such Class A Preferred Member or any of its Affiliates (or any Affiliate of any such person); and
|
|
213.2 |
if he or she obtains information or opportunities (other than through his or her office as a Class A Preferred Director) that are confidential to any third party (including any of the persons listed in Article 213.1), or in respect of
which he or she owes a duty of confidentiality or a fiduciary duty to any third party (including any of the persons listed in Article 213.1), or the disclosure of which would amount to a breach of applicable law or regulation, choose, at
his or her absolute discretion, not to disclose it to the Company or to use it in relation to the Company’s affairs,
|
214. |
The Directors may exercise the voting powers conferred by the shares of any other company held or owned by the Company in such manner in all respects as they think fit and, in particular, they may exercise the voting powers in favour of
any resolution: (a) appointing the Directors or any of them as directors or officers of such other company; or (b) providing for the payment of remuneration or pensions to the directors or officers of such other company.
|
215. |
Subject to any applicable law or the relevant code, rules and regulations applicable to the listing of the shares on any Exchange, any Director may vote in favour of the exercise of such voting rights
notwithstanding that he or she may be or may be about to become a director or officer of the other company referred to in Article 214 and as such or in any other way is or may be interested in the exercise of such voting rights in the
foregoing manner.
|
216. |
A Director may hold any other office or place of profit under the Company (other than Auditor) in conjunction with his or her office of Director for such period and on such terms as to remuneration and otherwise as the Directors may
determine.
|
217. |
Without prejudice to the provisions of section 228 of the Act, a Director may be or become a director or other officer of, or otherwise interested in, any company promoted by the Company or in which the Company may be interested as a
shareholder, member or otherwise.
|
218. |
A Director may act by himself or herself, or his or her firm, in a professional capacity for the Company, and any Director, in such a case, or his or her firm, shall be entitled to remuneration for professional services as if he or she
were not a Director, but nothing in this Article authorises a Director, or his or her firm, to act as Auditor.
|
219. |
No Director shall by reason of his or her office as a director of the Company (or the fiduciary relationship established by holding that office) be:
|
|
219.1 |
disqualified from contracting with the Company with regard to any situation or matter authorised or permitted under Articles 207, 208, 210, 211, 212, 213, 216, 217 and/or 218; or
|
|
219.2 |
accountable to the Company for any remuneration, profit or other benefit resulting from any situation or matter authorised or permitted under Articles 207, 208, 210, 211, 212, 213, 216, 217 and/or 218,
|
220. |
Any seal of the Company shall be used only by the authority of the Directors, a committee authorised by the Directors to exercise such authority or by any one or more persons severally or jointly so authorised by the Directors or such a
committee, and the use of the seal shall be deemed to be authorised for these purposes where the matter or transaction pursuant to which the seal is to be used has been so authorised.
|
221. |
Any instrument to which a Company’s seal shall be affixed shall be signed by any one of the following:
|
|
221.1 |
a Director;
|
|
221.2 |
the Company Secretary; or
|
|
221.3 |
any other person authorised to sign by (i) the Directors or (ii) a committee,
|
222. |
The Company may have one or more duplicate common seals or official seals for use in different locations including for use abroad.
|
223. |
A notice required or authorised to be served on or given to a member of the Company pursuant to a provision of the Act or these Articles shall, save where the means of serving or giving it specified
in Article 223.4 is used, be in writing and may be served on or given to the member in one of the following ways:
|
|
223.1 |
by delivering it to the member;
|
|
223.2 |
by leaving it at the registered address of the member;
|
|
223.3 |
by sending it by post in a prepaid letter to the registered address of
the member; or
|
|
223.4 |
subject to Article 228, by electronic mail or other means of
electronic communication approved by the Directors to the contact details notified to the Company by any such member for such purpose (or if not so notified, then to the contact details of the member last known to the Company). A notice or
document may be sent by electronic means to the fullest extent permitted by the Act.
|
224. |
Without prejudice or limitation to the foregoing provisions of Article
223.1 to 223.4, for the purposes of these Articles and the Act, a document shall be deemed to have been sent to a member if a notice is given, served, sent or delivered to the member and the notice
specifies the website or hotlink or other electronic link at or through which the member may obtain a copy of the relevant document.
|
225. |
Any notice served or given in accordance with Article 223 shall be
deemed, in the absence of any agreement to the contrary between the
Company (or, as the case may be, the officer of it) and the member, to have been served or given:
|
|
225.1 |
in the case of its being delivered, at the time of delivery (or, if
delivery is refused, when tendered);
|
|
225.2 |
in the case of its being left, at the time that it is left;
|
|
225.3 |
in the case of its being posted on any day other than a Friday, Saturday or Sunday, 24 hours after despatch and in the case of its being posted:
|
|
(a) |
on a Friday — 72 hours after despatch; or
|
|
(b) |
on a Saturday or Sunday — 48 hours after despatch;
|
|
225.4 |
in the case of electronic means being used in relation to it, twelve hours after despatch,
|
226. |
Every legal personal representative, committee, receiver, curator bonis
or other legal curator, assignee in bankruptcy, examiner or liquidator of a member shall be bound by a notice given as aforesaid if sent to the last registered address of such member, or, in the event of notice given or delivered pursuant
to Article 223.4, if sent to the address notified to the Company by the member for such purpose notwithstanding that the Company may have notice of the death, his or her being of unsound mind, bankruptcy, liquidation or disability of such
member.
|
227. |
Notwithstanding anything contained in these Articles to the contrary, the Company shall not be obliged to take account of or make any investigations as to the existence of any suspension or curtailment of postal services within or in
relation to all or any part of any jurisdiction.
|
228. |
Any requirement in these Articles for the consent of a member in regard to the receipt by such member of electronic
mail or other means of electronic communications approved by the Directors, including the receipt of the Company’s annual report, statutory financial statements and the Directors’ and Auditor’s reports thereon, shall be deemed to have been
satisfied where the Company has written to the member informing him or her of its intention to use electronic communications for such purposes and the member has not, within four weeks of the issue of such notice, served an objection in
writing on the Company to such member. Where a member has given, or is deemed to have given, his/her consent to the receipt by such member of electronic mail or other means of electronic communications approved by the Directors, she/he may
revoke such consent at any time by requesting the Company to communicate with him or her in documented form; provided, however, that such revocation shall not take effect until five days after written notice of the revocation is received by
the Company. Notwithstanding anything to the contrary in this Article 228, no such consent shall be necessary, and to the extent it is necessary, such consent shall be deemed to have been given, if electronic communications are permitted to
be used under the rules and regulations of any Exchange on which the shares in the capital of the Company or other securities of the Company are listed or under the rules of the SEC.
|
229. |
If at any time by reason of the suspension or curtailment of postal services in any territory, the Company is
unable effectively to convene a general meeting by notices sent through the post, a general meeting may be convened by a public announcement (as defined below) and such notice shall be deemed to have been duly served on all members entitled thereto at noon (Ireland time) on the day on which the said public announcement is made. In any such case the Company shall put a full copy of the
notice of the general meeting on its website.
|
230. |
Notice shall be given by the Company to the joint holders of a share in the capital of the Company by giving the notice to both such holders whose names stand in the Register in respect of the share.
|
231. | 231.1 |
Every person who becomes entitled to a share in the capital of the Company shall, before his or her name is entered in the Register in respect of the share, be bound by any notice in respect of that share
which has been duly given to a person from whom he or she derives his or her title.
|
|
231.2 |
A notice may be given by the Company to the persons entitled to a share in
the capital of the Company in consequence of the death or bankruptcy of a member by sending or delivering it, in any manner authorised by these Articles for the giving of notice to a member, addressed to them at the address, if any,
supplied by them for that purpose. Until such an address has been supplied, a notice may be given in any manner in which it might have been given if the death or bankruptcy had not occurred.
|
232. |
The signature (whether electronic signature, an advanced electronic signature or otherwise) to any notice to be given by the Company may be written (in electronic form or otherwise) or printed.
|
233. |
In addition to the means of service of documents set out in section 51 of the Act, a notice or other document may be served on the Company by an officer of the Company by email provided, however, that
the Directors have designated an email address for that purpose and notified that email address to its officers for the express purpose of serving notices on the Company.
|
234. |
The Company may send by post, electronic mail or any other means of electronic communication:
|
|
234.1 |
the Company’s statutory financial statements;
|
|
234.2 |
the directors’ report; and
|
|
234.3 |
the statutory auditors’ report,
|
|
(a) |
the Company and that person have agreed to his or her having access to the documents on a website (instead of their being sent to him or her);
|
|
(b) |
the documents are documents to which that agreement applies; and
|
|
(c) |
that person is notified, in a manner for the time being agreed for the purpose between him or her and the Company, of:
|
|
(i) |
the publication of the documents on a website;
|
|
(ii) |
the address of that website; and
|
|
(iii) |
the place on that website where the documents may be accessed, and how they may be accessed.
|
234.4 |
Documents treated in accordance with Article 234 as sent to any person are to be treated as sent to him or her not less than 21 days before the date of a meeting if, and only if:
|
|
(a) |
the documents are published on the website throughout a period
beginning at least 21 days before the date of the meeting and ending with the conclusion of the meeting; and
|
|
(b) |
the notification given for the purposes of Article 234.3(c) is given not less than 21 days before the date of the meeting.
|
235. |
Any obligation by virtue of section 339(1) or (2) of the Act to furnish a person with a document may, unless these Articles provide otherwise, be complied with by using electronic communications for sending that document to such address as may for the time being
be notified to the Company by that person for that purpose.
|
236. |
The Directors shall, in accordance with Chapter 2 of Part 6 of the Act, cause to be kept adequate accounting records, whether in the form of documents, electronic form or otherwise, that:
|
|
236.1 |
correctly record and explain the transactions of the Company;
|
|
236.2 |
will at any time enable the assets, liabilities, financial position and profit or loss of the Company to be determined with reasonable accuracy;
|
|
236.3 |
will enable the Directors to ensure that any financial statements of the Company, required to be prepared under sections 290 or 293 of the Act, comply with the requirements of the Act; and
|
|
236.4 |
will enable those financial statements of the Company to be readily and properly audited.
|
237. |
The accounting records shall be kept on a continuous and consistent basis and entries therein shall be made in a timely manner and be consistent from year to year. Adequate accounting records shall be deemed to have been maintained if
they comply with the provisions of Chapter 2 of Part 6 of the Act and explain the Company’s transactions and facilitate the preparation of financial statements that give a true and fair view of the
assets, liabilities, financial position and profit or loss of the Company and, if relevant, the Group and include any information and returns referred to in section 283(2) of the Act.
|
238. |
The accounting records shall be kept at the Office or, subject to the provisions of the Act, at such other place as the Directors think fit and shall be open at all reasonable times to the inspection
of the Directors.
|
239. |
The Directors shall determine from time to time whether and to what extent and at what times and places and under what conditions or regulations the accounting records of the Company shall be open to the inspection of members, not being
Directors. No member (not being a Director) shall have any right of inspecting any financial statement or accounting record of the Company except (i) as conferred by the Act (ii) as authorised by the
Directors (iii) as agreed between the Company and a member in a contract or agreement or (iv) as authorised by the Company in a general meeting.
|
240. |
In accordance with the provisions of the Act, the Directors shall cause to be prepared and to be laid before the annual general meeting of the Company from time to time such statutory financial
statements of the Company and reports as are required by the Act to be prepared and laid before such meeting.
|
241. |
A copy of every statutory financial statement of the Company (including every document required by law to be annexed thereto) which is to be laid before the annual general meeting of the Company together with a copy of the Directors’
report and Auditors’ report, or summary financial statements prepared in accordance with section 1119 of the Act, shall be sent, by post, electronic mail or any other means of electronic communications,
not less than twenty-one Clear Days before the date of the annual general meeting, to every person entitled under the provisions of the Act to receive them; provided that where the Directors elect to
send summary financial statements to the members, any member may request that he be sent a copy of the statutory financial statements of the Company. The Company may, in addition to sending one or more copies of its statutory financial
statements, summary financial statements or other communications to its members, send one or more copies to any Approved Nominee. For the purposes of this Article, sending by electronic communications includes the making available or
displaying on the Company’s website (or a website designated by the Board) or the website of the SEC, and each member is deemed to have irrevocably consented to receipt of every statutory financial statement of the Company (including every
document required by law to be annexed thereto) and every copy of the Directors’ report and the Auditors’ report and every copy of any summary financial statements prepared in accordance with section 1119 of the Act, by any such document being made so available or displayed.
|
242. |
Auditors shall be appointed and their duties regulated in accordance with the Act.
|
243. |
Subject to the provisions of the Act as to preferential payments, the property of the Company on its winding up shall be distributed among the members according to their rights and interests in the Company, including, in the case of the Class A Preferred Members, in accordance with their priority liquidation preference rights set out in Article 15.
|
244. |
Unless the conditions of issue of the shares in question provide otherwise, dividends declared by the Company more than six years preceding the commencement date of a winding up of the Company, being dividends which have not been claimed
within that period of six years, shall not be a claim admissible to proof against the Company for the purposes of the winding up.
|
245. |
If the Company shall be wound up and the assets available for distribution among the members as such shall be insufficient to repay the whole of the paid up or credited as paid up share capital, such assets shall be distributed so that,
as nearly as may be, the losses shall be borne by the members in proportion to the nominal value of the share capital paid-up or credited as
paid-up at the commencement of the winding up on the shares in the
capital of the Company held by them respectively. If in a winding up the assets available for distribution among the members shall be more than sufficient to repay
the whole of the share capital paid up or credited as paid up at the commencement of the winding up, the excess shall be distributed among the members in proportion to the nominal value of the share capital paid-up or credited as paid-up at
the commencement of the winding up on the said shares held by them respectively; provided, however, that this Article shall be subject to any specific rights
attaching to any class of share capital, including, in the case of the Class A Preferred Shares, the priority liquidation preference rights of the Class A Preferred Members set out in Article 15.
|
245.1 |
In case of a sale by the liquidator under section 601 of the Act, the liquidator may by the contract of sale agree so as to bind all the members, for the allotment to the members directly, of the
proceeds of sale in proportion to their respective interests in the Company and may further, by the contract, limit a time at the expiration of which obligations or shares in the capital of the Company not accepted or required to be sold
shall be deemed to have been irrevocably refused and be at the disposal of the Company, but so that nothing herein contained shall be taken to diminish, prejudice or affect the rights of dissenting members conferred by the said section.
|
|
245.2 |
The power of sale of the liquidator shall include a power to sell wholly or partially for debentures, debenture stock, or other obligations of another company, either then already constituted or about to be constituted for the purpose of carrying out the sale.
|
246. |
If the Company is wound up, the liquidator, with the sanction of a special resolution and any other sanction required by the Act, may divide amongst the members in
specie or kind the whole or any part of the assets of the Company (whether they shall consist of property of the same kind or not), and, for such purpose, may value any assets and determine how the division shall be carried out as
between the members or different classes of members. The liquidator, with the like sanction, may vest the whole or any part of such assets in trustees upon such trusts for the benefit of the contributories as, with the like sanction, he or
she determines, but so that no member shall be compelled to accept any assets upon which there is a liability.
|
247. |
In addition to any affirmative vote or consent required by law or these Articles, and except as otherwise expressly provided in Article 248, a Business Transaction (as defined in Article 249.3) with, or proposed by or on behalf of, any
Interested Person (as defined in Article 249.6) or any Affiliate (as defined in Article 249.1) of any Interested Person or any person who thereafter would be an Affiliate of such Interested Person shall require approval by the affirmative
vote of members of the Company holding not less than two-thirds (2/3) of the paid up ordinary share capital of the Company, excluding the voting rights attached to any shares beneficially owned by such Interested Person. Such affirmative
vote shall be required notwithstanding the fact that no vote may be required, or that a lesser percentage may be specified, by law or in any agreement with any Exchange or otherwise.
|
248. |
The provisions of Article 247 shall not be applicable to any particular Business Transaction, and such Business Transaction shall require only such affirmative vote, if any, as is required by law or by any other provision of these
Articles, or any agreement with any Exchange, if (i) the Business Transaction shall have been approved by a majority of the Board prior to such Interested Person first becoming an Interested Person; (ii) prior to such Interested Person
first becoming an Interested Person, a majority of the Board shall have approved such Interested Person becoming an Interested Person and, subsequently, a majority of the Independent Directors (as hereinafter defined) shall have approved
the Business Transaction; or (iii) from and after the Initial Closing Date until all the Class A Preferred Shares are redeemed in full in accordance with the provisions of these Articles, a Class A Preferred Majority shall have approved the
Business Transaction.
|
249. |
The following definitions shall apply with respect to Articles 247 to 251:
|
|
249.1 |
The term “Affiliate”, with respect to any specified person, shall mean any other person that directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under
common control with, a specified person, and “control” includes the power to, directly or indirectly (i) to exercise, or direct the exercise of, more than one half of the shareholders’ or members’
voting rights in another person or (ii) control of that other person’s business and affairs.
|
|
249.2 |
A person shall be a “beneficial owner” of any shares of the Company (a) which such person or any of its Affiliates beneficially owns, directly or indirectly; (b) which such person or any of its
Affiliates has, directly or indirectly, (i) the right to acquire (whether such right is exercisable immediately or subject only to the passage of time or the occurrence of one or more events), pursuant to any agreement, arrangement or
understanding or upon the exercise of conversion rights, exchange rights, warrants or options, or otherwise, or (ii) the right to vote pursuant to any agreement, arrangement or understanding; provided, however, that a person shall not be
deemed the beneficial owner of any security if the agreement, arrangement or understanding to vote such security arises solely from a revocable proxy or consent solicitation made pursuant to and in accordance with the Act; or (c) which is
beneficially owned, directly or indirectly, by any other person with which such person or any of its Affiliates has any agreement, arrangement or understanding for the purpose of acquiring, holding, voting or disposing of any shares of the
Company (except to the extent permitted by the proviso of clause (b)(ii) above). For the purposes of determining whether a person is an Interested Person pursuant to Article 249.6, the number of shares of the Company deemed to be
outstanding shall include shares deemed beneficially owned by such person through application of this Article 249.2, but shall not include any other shares of the Company that may be issuable pursuant to any agreement, arrangement or
understanding, or upon exercise of conversion rights, warrants or options, or otherwise.
|
|
249.3 |
The term “Business Transaction” shall mean any of the following transactions when entered into by the Company or a subsidiary of the Company with, or upon a proposal by or on behalf of, any
Interested Person or any Affiliate of any Interested Person:
|
|
(a) |
any merger or consolidation of the Company or any subsidiary with (i) any Interested Person, or (ii) any other body corporate which is, or after such merger or consolidation would be, an Affiliate of an Interested Person;
|
|
(b) |
any sale, lease, exchange, mortgage, pledge, transfer or other disposition (in one transaction or a series of transactions), except proportionately as a member of the Company, to or with the Interested Person of assets of the Company
(other than shares of the Company or of any subsidiary of the Company which assets have an aggregate market value equal to ten percent (10%) or more of the aggregate market value of all the issued share capital of the Company);
|
|
(c) |
any transaction that results in the issuance of shares or the transfer of treasury shares by the Company or by any subsidiary of the Company of any shares of the Company or any shares of such subsidiary to the Interested Person, except
(i) pursuant to the exercise, exchange or conversion of securities exercisable for, exchangeable for or convertible into stock of the Company or any such subsidiary which securities were outstanding prior to the time that the Interested
Person became such, (ii) pursuant to a dividend or distribution paid or made, or the exercise, exchange or conversion of securities exercisable for, exchangeable for or convertible into shares of the Company or any such subsidiary which
security is distributed, pro rata to all holders of a class or series of shares of the Company subsequent to the time the Interested Person became such, (iii) pursuant to an exchange offer by the Company to purchase shares made on the same
terms to all holders of said shares, (iv) any issuance of shares or transfer of treasury shares of the Company by the Company, provided, however, that in the case of each of the clauses (ii) through (iv) above there shall be no increase of
more than one percent (1%) in the Interested Person’s proportionate share in the shares of the Company of any class or series or (v) pursuant to a public offering or private placement by the Company to an Institutional Investor;
|
|
(d) |
any reclassification of securities, recapitalization or other transaction involving the Company or any subsidiary of the Company which has the effect, directly or indirectly, of (i) increasing the proportionate amount of the shares of
any class or series, or securities convertible into the shares of any class or series, of the Company or of any such subsidiary which is owned by the Interested Person, except as a result of immaterial changes due to fractional share
adjustments or as a result of any purchase or redemption of any shares not caused, directly or indirectly, by the Interested Person or (ii) increasing the voting power, whether or not then exercisable, of an Interested Person in any class
or series of shares of the Company or any subsidiary of the Company;
|
|
(e) |
the adoption of any plan or proposal by or on behalf of an Interested Person for the liquidation, dissolution or winding-up of the Company; or
|
|
(f) |
any receipt by the Interested Person of the benefit, directly or indirectly (except proportionately as a member of the Company), of any loans, advances, guarantees, pledges, tax benefits or other financial benefits (other than those
expressly permitted in subparagraphs (a) through (e) above) provided by or through the Company or any subsidiary thereof.
|
|
249.4 |
The term “Independent Directors” shall mean the members of the Board who are not Affiliates or representatives of, or associated with, an Interested Person and who were either Directors prior to
any person becoming an Interested Person or were recommended for election or elected to succeed such directors by a vote which includes the affirmative vote of a majority of the Independent Directors.
|
|
249.5 |
The term “Institutional Investor” shall mean a person that (a) has acquired, or will acquire, all of its shares in the Company in the ordinary course of its business and not with the purpose nor
with the effect of changing or influencing the control of the Company, nor in connection with or as a participant in any transaction having such purpose or effect, including any transaction subject to rule 13d-3(b) under the Exchange Act,
and (b) is a registered broker dealer; a bank as defined in section 3(a)(6) of the Exchange Act; an insurance company as defined in, or an investment company registered under, the Investment Company Act of 1940 of the United States; an
investment advisor registered under the Investment Advisors Act of 1940 of the United States; an employee benefit plan or pension fund subject to the Employee Retirement Income Security Act of 1974 of the United States or an endowment fund;
a parent holding company, provided that the aggregate amount held directly by the parent and directly and indirectly by its subsidiaries which are not persons specified in the foregoing subclauses of this clause (b) does not exceed one
percent (1%) of the securities of the subject class; or a group, provided that all the members are persons specified in the foregoing subclauses of this clause (b).
|
|
249.6 |
The term “Interested Person” shall mean any person (other than the Company, any subsidiary, any profit-sharing, employee share ownership or other employee benefit plan of the Company or any
subsidiary or any trustee of or fiduciary with respect to any such plan when acting in such capacity) who (a) is the beneficial owner of shares of the Company representing ten percent (10%) or more of the votes entitled to be cast by the
holders of all the paid up share capital of the Company; (b) has stated in a filing with any governmental agency or press release or otherwise publicly disclosed a plan or intention to become or consider becoming the beneficial owner of
shares of the Company representing ten percent (10%) or more of the votes entitled to be cast by the holders of all paid up share capital of the Company and has not expressly abandoned such plan, intention or consideration more than two
years prior to the date in question; or (c) is an Affiliate of the Company and at any time within the two-year period immediately prior to the date in question was the beneficial owner of shares representing ten percent (10%) or more of the
votes entitled to be cast by holders of all the paid up share capital of the Company.
|
|
249.7 |
The term “person” shall mean any individual, body corporate, partnership, unincorporated association, trust or other entity.
|
|
249.8 |
The term “subsidiary” has the meaning ascribed to it in section 7 of the Act.
|
250. |
A majority of the Independent Directors shall have the power and duty to determine, on the basis of information known to them after reasonable inquiry, for the purposes of (i) Articles 247 and 248, all questions arising under Articles
247 and 248 including, without limitation (a) whether a person is an Interested Person, (b) the number of shares of the Company or other securities beneficially owned by any person; and (c) whether a person is an Affiliate of another; and
(ii) these Articles, the question of whether a person is an Interested Person. Any such determination made in good faith shall be binding and conclusive on all parties.
|
251. |
Nothing contained in Articles 247 to 250 shall be construed to relieve any Interested Person from any fiduciary obligation imposed by law.
|
252. |
Subject to applicable law and the provisions of these Articles,
including Article 177, the Directors are hereby expressly authorised to
adopt any shareholder rights plan (a “Rights Plan”), upon such terms and conditions as the Directors deem expedient and in the best interests of the Company, including, without limitation, where the
Directors are of the opinion that a Rights Plan could grant them additional time to gather relevant information or pursue strategies in response to or anticipation of, or could prevent, a potential change
of control of the Company or accumulation of shares in the Company or interests therein.
|
253. |
Subject to applicable law and the provisions of these Articles, including Article 177, the Directors may exercise any power of the Company to grant rights (including approving the execution of any documents relating to the grant of such
rights) to subscribe for Ordinary Shares or Preferred Shares (“Rights”) in accordance with the terms of a Rights Plan.
|
254. |
Subject to applicable law and the provisions of these Articles, including Article 177, for the purposes of effecting an exchange of Rights for Ordinary Shares or Preferred Shares (an “Exchange”),
the Directors may:
|
|
254.1 |
resolve to capitalise an amount standing to the credit of the reserves of the Company (including, but not limited to, the share premium account, capital redemption reserve, any un-denominated capital and profit and loss account), whether
or not available for distribution, being an amount equal to the nominal value of the ordinary shares or preferred shares which are to be exchanged for the Rights; and
|
|
254.2 |
apply that sum in paying up in full ordinary shares or preferred shares and allot such shares, credited as fully paid, to those holders of Rights who are entitled to them under an Exchange effected pursuant to the terms of a Rights Plan.
|
255. |
The duties of the Directors to the Company under applicable law, including, but not limited to, the Act and common law, are hereby deemed amended and modified such that the adoption of a Rights Plan
and any actions taken thereunder by the Directors (if so approved by the Directors) shall be deemed to constitute an action in the best interests of the Company in all circumstances, and any such action shall be deemed to be immediately
confirmed, approved and ratified.
|
256. |
The Company shall be entitled to sell at the best price reasonably obtainable any share of a member or any share to which a person is entitled by transmission if and provided that:
|
|
256.1 |
for a period of twelve years no cheque or warrant sent by the Company through the post in a pre-paid letter addressed to the member or to the person entitled by transmission to the share at his address on the Register or at the last
known address given by the member or the person entitled by transmission to which cheques and warrants are to be sent has been cashed and no communication has been received by the Company from the member or the person entitled by
transmission (provided that during such twelve year period at least three dividends shall have become payable in respect of such share);
|
|
256.2 |
at the expiration of the said period of twelve years by advertisement in a national daily newspaper published in Ireland and in a newspaper circulating in the area in which the address referred to in Article 256.1 is located the Company
has given notice of its intention to sell such share;
|
|
256.3 |
during the further period of three months after the date of the advertisement and prior to the exercise of the power of sale the Company has not received any communication from the member or person entitled by transmission; and
|
|
256.4 |
the Company has first given notice in writing to the appropriate sections of the Exchanges of its intention to sell such shares.
|
257. |
Where a share, which is to be sold as provided in Article 256, is held in uncertificated form, the Directors may authorise any person to do all that is necessary to change such share into certificated form prior to its sale.
|
258. |
To give effect to any such sale the Company may appoint any person to
execute as transferor an instrument of transfer of such share and such instrument of transfer shall be as effective as if it had been executed by the member or the person entitled by the transmission to such share. The transferee shall be
entered in the Register as the member of the shares comprised in any such transfer and he shall not be bound to see to the application of the purchase moneys nor shall his title to the shares be affected by any irregularity in or invalidity
of the proceedings in reference to the sale.
|
259. |
The Company shall account to the member or other person entitled to such share for the net proceeds of such sale by carrying all moneys in respect thereof to a separate account which shall be a permanent debt of the Company and the
Company shall be deemed to be a debtor and not a trustee in respect thereof for such member or other person. Moneys carried to such separate account may be either employed in the business of the Company or held as cash or cash equivalents,
or invested in such investments as the Directors may think fit, from time to time.
|
260. |
The Company shall be entitled to destroy all instruments of transfer which have been registered at any time after the expiration of six years from the date of registration thereof, all notifications of change of name or change of address
however received at any time after the expiration of two years from the date of recording thereof and all share certificates and dividend mandates which have been cancelled or ceased to have effect at any time after the expiration of one
year from the date of such cancellation or cessation. It shall be presumed conclusively in favour of the Company that every entry in the Register purporting to have been made on the basis of an instrument of transfer or other document so
destroyed was duly and properly made and every instrument duly and properly registered and every share certificate so destroyed was a valid and effective document duly and properly cancelled and every other document hereinbefore mentioned
so destroyed was a valid and effective document in accordance with the recorded particulars thereof in the books or records of the Company. Provided always that:
|
|
260.1 |
the provision aforesaid shall apply only to the destruction of a document in good faith and without notice of any claim (regardless of the parties thereto) to which the document might be relevant;
|
|
260.2 |
nothing herein contained shall be construed as imposing upon the Company any liability in respect of the destruction of any document earlier than as aforesaid or in any other circumstances which would not attach to the Company in the
absence of this Article; and
|
|
260.3 |
references herein to the destruction of any document include references to the disposal thereof in any manner.
|
261. | 261.1 | Subject to the provisions of and so far as may be permitted by the Act, each person who is or was a Director, officer or employee of the Company, and each person who is or was serving at the request of the Company as a director, officer or employee of another company, or of a partnership, joint venture, trust or other enterprise, including service with respect to employee benefit plans maintained or sponsored by the Company (including the heirs, executors, administrators and estate of such person) shall be entitled to be indemnified by the Company against all costs, charges, losses, expenses and liabilities incurred by him or her in the execution and discharge of his or her duties or in relation thereto, including any liability incurred by him or her in defending any proceedings, civil or criminal, which relate to anything done or omitted or alleged to have been done or omitted by him or her as a director, officer or employee of the Company or such other company, partnership, joint venture, trust or other enterprise, and in which judgment is given in his or her favour (or the proceedings are otherwise disposed of without any finding or admission of any material breach of duty on his or her part) or in which he or she is acquitted or in connection with any application under any statute for relief from liability in respect of any such act or omission in which relief is granted to him or her by the court. |
|
261.2 |
In the case of any threatened, pending or completed action, suit or proceeding by or in the right of the Company, the Company shall indemnify, to the fullest extent permitted by the Act, each person
indicated in Article 261.1 against expenses, including attorneys’ fees actually and reasonably incurred in connection with the defence or the settlement thereof, except no indemnification shall be made in respect of any claim, issue or
matter as to which such person shall have been adjudged to be liable for fraud or dishonesty in the performance of his or her duty to the Company unless and only to the extent that the courts of Ireland or the court in which such action or
suit was brought shall determine upon application that despite the adjudication of liability, but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses as the Court shall
deem proper.
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|
261.3 |
As far as permissible under the Act, expenses, including attorneys’ fees, incurred in defending any action, suit or proceeding referred to in this Article shall be paid by the Company in advance of
the final disposition of such action, suit or proceeding upon receipt of a
written affirmation by or on behalf of the Director, officer, employee or other indemnitee of a good faith belief that the criteria for indemnification have been satisfied and a written undertaking to repay such amount if it shall
ultimately be determined that such Director, officer or employee or other indemnitee is not entitled to be indemnified by the Company as authorised by these Articles.
|
|
261.4 |
It being the policy of the Company that indemnification of the persons specified in this Article shall be made to the fullest extent permitted by law, the indemnification provided by this Article shall not be deemed exclusive of: (a) any other rights to which those seeking indemnification or advancement
of expenses may be entitled under the Memorandum, these Articles, any agreement, any insurance purchased by the Company, any vote of members or disinterested Directors, or pursuant to the direction (however embodied) of any court of
competent jurisdiction, or otherwise, both as to action in his or her official capacity and as to action in another capacity while holding such office, or (b) any amendments or replacements of the Act which permit for greater indemnification
of the persons specified in this Article and any such amendment or replacement of the Act shall hereby be incorporated into these Articles. As used in this Article 261.4, references to the “Company”
include all constituent companies in a consolidation or merger in which the Company or any predecessor to the Company by consolidation or merger was involved. The indemnification provided by this Article shall continue as to a person who
has ceased to be a Director, officer or employee and shall inure to the benefit of the heirs, executors, and administrators of such Directors, officers, employees or other indemnitees.
|
|
261.5 |
The Directors shall have power to purchase and maintain for any Director, the Company Secretary or other officers or employees of the Company insurance against any such liability as referred to in section 235 of the Act.
|
|
261.6 |
The Company may additionally indemnify any agent of the Company or any director, officer, employee or agent of any of its subsidiaries to the fullest extent provided by law, and purchase and maintain insurance for any such person as appropriate.
|
262. |
Subject to the provisions of the Act and so far as may be permitted by the Act, no person shall be personally liable to the Company or its members for monetary damages for breach of fiduciary duty as a
Director, provided, however, that the foregoing shall not eliminate or limit the liability of a Director:
|
|
262.1 |
for any breach of the Director’s duty of loyalty or duty of care to the
Company or its members;
|
|
262.2 |
for acts or omissions not in good faith
or which involve intentional misconduct or a knowing violation of law; or
|
|
262.3 |
for any transaction from which the Director derived an improper personal benefit.
|
263. |
This constitution and any dispute or claim arising out of or in connection with it or its subject matter, formation, existence, negotiation, validity, termination or enforceability (including non-contractual
obligations, disputes or claims) will be governed by and construed in accordance with the laws of Ireland.
|
264. |
Subject to Article 265, the courts of Ireland
are to have exclusive jurisdiction to settle any dispute arising out of or in connection with this constitution and, for such purposes, the Company and each shareholder irrevocably submit to the
exclusive jurisdiction of such courts. Any proceeding, suit or action arising out of or in connection with this Constitution (the “Proceedings”) will
therefore be brought in the courts of Ireland. Each shareholder irrevocably waives any objection to Proceedings in the courts referred to in this Article on the grounds of venue or on the grounds of forum non conveniens.
|
265. |
Unless the Company consents in writing to the
selection of an alternative forum, the federal district courts of the United States of America shall, to the fullest extent permitted by law, be the exclusive forum for the resolution of any complaint asserting a cause of action arising
under the Exchange Act or the Securities Act of 1933 of the United States. Any person or entity purchasing or otherwise acquiring any interest in any security of the Company shall be deemed to have
notice of and consented to this provision.
|
1. |
the declaration, making or payment of any dividends, distributions or other payments to Shareholders, including repurchases, buy-backs and redemptions of shares, other than (i) dividends or distributions by wholly owned subsidiaries of
the Company to the Company or other wholly owned subsidiaries of the Company, (ii) dividends or redemption payments to Class A Preferred Members in compliance with these Articles, including pursuant to an Early Company Call Option Notice
and/or (iii) payments to Shareholders in accordance with arms’ length agreements entered into in the ordinary course of business;
|
2. |
the issue or authorisation of the issuance of (i) any new or additional Class A Preferred Shares (save as provided for in the Securities Purchase Agreement or to give effect to a Class A Preferred PIK Distribution), (ii) any other shares
in the capital of the Company having rights, preferences or privileges that are senior to or pari passu with the Class A Preferred Shares (including with respect to distributions, liquidation,
insolvency, dissolution, redemption and subordination to indebtedness) or (iii) any option, warrant or other security or instrument conferring rights to subscribe for or convert into Class A Preferred Shares or other shares as described in
(i) or (ii), as aforesaid;
|
3. |
the entry into any agreement containing any provision that would create, or permit to exist or become effective, any restriction on the ability of the Company or any other member of the Group to pay dividends or make other distributions
to their equity holders, or redeem the Class A Preferred Shares in accordance with the terms set out in these Articles;
|
4. |
the incurrence of any indebtedness by the Company or any other member of the Group other than Permitted Indebtedness, or the guarantee by the Company or any other member of the Group of the indebtedness of another person other than
Permitted Indebtedness, or the granting by the Company or any other member of the Group of any mortgage, lien, pledge, charge, security interest or encumbrance in respect of the property or assets of the Company or any other member of the
Group, other than to secure the repayment of Permitted Indebtedness;
|
5. |
the entry into, any cancellation or termination of (except for an expiration that occurs in accordance with the terms of such agreement), amendment to, modification of, variance of (including by changing orders), impairment of,
assignment of, replacement of, refinancing of, or waiver of timely compliance with, any Material Contract (or the giving of consent to any of the foregoing);
|
6. |
the sale, transfer, lease or other disposal of any of the assets of the Company or any other member of the Group having a value, individually or in the aggregate, in excess of US$5,000,000, other than and excluding for such purpose sales
of products or services in the ordinary course of business;
|
7. |
the liquidation, dissolution, winding-up or termination of the Company or any other member of the Group;
|
8. |
the undertaking, implementation or recommendation of a Change of Control Transaction, provided that the consent of the Class A Preferred Majority shall not be required where such Change of Control Transaction results in the receipt by
all Class A Preferred Members of the applicable Class A Preferred Share Return;
|
9. |
the hiring, termination or modification of any material terms of any employment agreement of any of the Company’s (i) Chief Executive Officer, (ii) Chief Financial Officer, (iii) Chief Technology Officer, (iv) Company Secretary, (v) Vice
President of Operations or (vi) Director of Sales;
|
10. |
the adoption or implementation of (i) a corporate budget (or any amendment or modification thereof) applicable to the Company and the other members of the Group for selling, general and administrative (“SG&A”)
and discretionary expenses (the “Operating Budget”) or (ii) a corporate budget (or any amendment or modification thereof) applicable to the Company and the other members of the Group for capital
expenditures, investments and acquisitions (the “Capex Budget”);
|
11. |
(i) before 1 December 2024, the incurrence or payment of any SG&A or discretionary expenses or the incurrence, payment or making of any capital expenditures, investments, and acquisitions in excess of the applicable amounts set forth
in the Approved Budget (as defined in the Securities Purchase Agreement), provided, however, if the Company has raised at least US$15,000,000 from the issue of Ordinary Shares sufficient to cover such variances, it may incur or pay
additional SG&A or discretionary expenses or it may incur, pay or make additional capital expenditures, investments and acquisitions, in aggregate, up to a total amount not exceeding 10% of the applicable amounts set forth in the
Approved Budget; (ii) on, or after 1 December 2024, provided that the Company has repaid the IP Loan in full, the incurrence or payment, in aggregate, of additional SG&A or discretionary expenses in excess of 10% of the total amount set
forth in the Operating Budget for the relevant year; and (iii) on, or after 1 December 2024, the incurrence, payment or making, in aggregate, of additional capital expenditures, investments, and acquisitions in excess of 10% of the total
amount set forth in the Capex Budget for the relevant year, and provided that, so long as the Operating Budget and Capex Budget are consistent with the Company’s business plan, the consent of the Class A Preferred Majority shall not be
unreasonably withheld, conditioned or delayed;
|
12. |
the making of capital or other expenditures, of a value, individually or in the aggregate, in excess of US$2,500,000 other than in accordance with the Operating Budget or Capex Budget;
|
13. |
materially changing the nature of the business or purpose of the Company or any member of the Group, or the entry by the Company or any member of the Group into any new line of business that materially changes the nature of the business
or purpose of the Company or any member of the Group, including with respect to tax status;
|
14. |
modifying or changing the tax elections of the Company or any other member of the Group;
|
15. |
save in connection with the appointment or removal by the Class A Preferred Majority of Class A Preferred Directors, the increase or decrease of the number of Directors on the Board (excluding any Class A Preferred Directors for the time
being appointed) above 11 or below 3, or increasing or reducing the number or changing the composition of Directors which constitute a quorum of Directors for Board action;
|
16. |
the modification of these Articles or any organisational or formation documents of any of the Company’s subsidiaries in any manner that would materially and adversely change or materially and adversely affect (directly or indirectly) the
rights, privileges or preferences of the Class A Preferred Shares;
|
17. |
the entry into or committing to enter into any joint ventures or any partnerships or establish or acquire any non-wholly-owned partnership subsidiaries;
|
18. |
the entry into, or amendment, waiver or termination of, any transactions with an Affiliate having a value, individually or in the aggregate, in excess of US$250,000;
|
19. |
the adoption of a shareholder rights’ plan in accordance with the provisions of Article 252 to 255;
|
20. |
save to the extent provided for in the Operating Budget, the approval of the remuneration of the Directors; and/or
|
21. |
the capitalisation of any “relevant sum” (as defined in Article 98), save to give effect to a Class A Preferred PIK Distribution.
|
(i) |
the Proceeds Disbursing and Security Agreement by and between Carbon Revolution Operations Pty Ltd and UMB Bank, National Association and Newlight Capital LLC dated 23 May 2023 (as amended from time to time prior to as the date of
adoption of these Articles);
|
(ii) |
Loan agreement by and between Carbon Revolution Operations Pty Ltd and Jaguar Land Rover Limited dated 13 March 2023;
|
(iii) |
Payables Services and Order and Invoice Management Services Agreement by and between Carbon Revolution Operations Pty Ltd and C.H. Robinson Trade Management Pty Ltd dated 10 May 2023;
|
(iv) |
Standby Equity Purchase Agreement between YA II PN, Ltd and Twin Ridge Capital Acquisition Corp. dated 28 November 2022;
|
(v) |
Grant Agreement by and between Carbon Revolution Ltd and the State of Victoria dated 19 July 2018 (as amended);
|
(vi) |
Commonwealth Standard Grant Agreement by and between Carbon Revolution Operations Pty Ltd and the Commonwealth of Australia dated 29 November 2022 (MMI);
|
(vii) |
Commercial Program Agreement with Ford Motor Company dated 7 June 2022 and Purchase Orders dated 26 September 2022 and 17 December 2022 (Redwood);
|
(viii) |
Sourcing Contract by and between Carbon Revolution Operations Pty Ltd and Ford Motor Company dated 4 April 2023 (Legend);
|
(ix) |
Jaguar Land Rover Limited Purchase Order Amendments dated 21 March 2023 (Duke);
|
(x) |
Purchase Contract with Ferrari S.p.A. dated 28 July 2021 and Letter of Assignment dated 1 February 2019 (Fred);
|
(xi) |
Fe Purchase Contract with Ferrari S.p.A. dated 24 Jul 2021 and Nomination Letter dated 14 July 2020 (Dakota);
|
(xii) |
Purchase Contract dated with Ferrari S.p.A. 9 September 2020 and Nomination Letter dated 14 July 2020 (Idaho);
|
(xiii) |
Nomination Letters by and between Carbon Revolution Operations Pty Ltd and Ferrari S.p.A. dated 31 August 2022 and 27 July 2023 (Sophia);
|
(xiv) |
Nomination Letter by and between Carbon Revolution Operations Pty Ltd and Ferrari S.p.A. dated 27 July 2022 (Peter);
|
(xv) |
Purchase Contracts C-3RGJ0-01B-000, C-3RGJ0-01C-000, C-3RGJ0-01D-000, C-3RGJ0-01F-000, C-3RGJ0-01G-000, C-3RGJ0-019-000 by and between Carbon Revolution Operations Pty Ltd and General Motors LLC dated 5 April 2023 (HPV1);
|
(xvi) |
Purchase Contracts C-3RGJ0-01H-000, C-3RGJ0-01J-000, C-3RGJ0-01K-000, C-3RGJ0-01L-000 by and between Carbon Revolution Operations Pty Ltd and General Motors LLC dated 17 July 2023 (HPV2);
|
(xvii) |
Purchase Contracts C-3RGJ0-014-002, C-3RGJ0-015-001 by and between Carbon Revolution Operations Pty Ltd and General Motors LLC dated 21 and 25 August 2023 (Thor);
|
(xviii) |
Purchase Contracts C-3RGJ0-017-000, C-3RGJ0-018-000 by and between Carbon Revolution Operations Pty Ltd and General Motors LLC dated 15 March 2023 (Odin);
|
(xix) |
Nomination Agreement by and between Carbon Revolution Operations Pty Ltd and Automobili Lamborghini S.p.A. dated 27 July 2023;
|
(xx) |
Supply contracts to which the Company is party as at the date of adoption of this constitution with annual payments exceeding US$1,000,000 in any given calendar year;
|
(xxi) |
Lease dated 1 May 2019 by and between Carbon Revolution Operations Pty Ltd, Carbon Revolution Limited and Deakin University (as amended);
|
(xxii) |
Agreement for the Manufacturing, Supply and Installation of Equipment by and between Carbon Revolution Operations Pty Ltd and Marand Precision Engineering Pty Ltd dated 6 August 2021 (as amended from time to time prior to as the date of
adoption of these Articles);
|
(xxiii) |
Project and Partner Agreements (SOMAC) with Deakin University and Sovereign Manufacturing Automation for Composites Ltd;
|
(xxiv) |
Innovation Contract by and between Carbon Revolution Operations Pty Ltd and the Commonwealth of Australia dated 11 April 2019 (as amended from time to time prior to as the date of adoption of these Articles);
|
(xxv) |
Deed of Guarantee and Indemnity by and between Carbon Revolution Ltd. and Macquarie Bank Limited dated 2 March 2022;
|
(xxvi) |
ISDA 2002 Master Agreement by and between Carbon Revolution Operations Pty Ltd Macquarie Bank Limited dated 2 March 2022;
|
(xxvii) |
ISDA Master Agreement Credit Support Annex by and between Carbon Revolution Operations Pty Ltd and Macquarie Bank Limited dated 2 March 2022;
|
(xxviii) |
any new swap and hedging arrangements (including any trade confirmations) and related guarantees or indemnities; and
|
(xxix) |
any new contract (or series of contracts) entered into by the Company or its subsidiaries that provides for the payments, expenditures, fees, damages or other liabilities (including contingent liabilities such as guarantees) of the
Company or any of its subsidiaries in excess of US$1,000,000 per calendar year.
|
(i) |
indebtedness of the Group with respect to that (i) certain Proceeds Disbursing and Security Agreement, dated May 23, 2023 by and among UMB Bank, N.A., as trustee and disbursing Agent, Newlight Capital LLC, as servicer, collateral agent
and security trustee and Carbon Revolution Operations PTY LTD. and (ii) certain Trust Indenture dated May 23, 2023, by and between Carbon Revolution Operations PTY LTD and UMB Bank, N.A., as trustee and disbursing Agent, in each case in an
aggregate principal amount not to exceed US$61,500,000 (the “IP Loan”);
|
(ii) |
indebtedness of the Company or any other member of the Group with respect to that certain Agreement by and between Carbon Revolution Operations Pty Ltd and Jaguar Land Rover Limited dated as of March 13, 2023 in an aggregate principal
amount not to exceed AU$4,975,740;
|
(iii) |
indebtedness of the Company with respect to the certain Payable Services and Order and Invoice Management Services Agreement, dated May 10, 2023, with C.H. Robinson Trade Management Pty Ltd, in an aggregate amount not to exceed
AU$16,000,000 outstanding at any time;
|
(iv) |
indebtedness of the Group to trade creditors incurred in the ordinary course of business;
|
(v) |
indebtedness of the Company or any other member of the Group arising from the endorsement of instruments for deposit or collection in the ordinary course of business;
|
(vi) |
indebtedness consisting of the financing of insurance premiums by the Company or any other member of the Group in the ordinary course of business, not to exceed US$250,000 of premiums in the aggregate;
|
(vii) |
indebtedness of the Company or any other member of the Group incurred in the ordinary course of business in connection with corporate credit cards issued for the benefit of the Company or other member of the Group, not to exceed
US$250,000 in the aggregate;
|
(viii) |
unsecured obligations (contingent or otherwise) existing or arising under any hedging or swap contracts entered into in by the Company or any other member of the Group in the ordinary course of business for the purpose of directly
mitigating risks associated with fluctuations in interest rates or foreign exchange rates and not for speculative purposes;
|
(ix) |
indebtedness of the Company or any other member of the Group arising from judgments with respect to any of the Company or any other member of the Group that individually or in the aggregate are less than US$250,000 or that are stayed for
more than 10 days;
|
(x) |
indebtedness of the Company or any other member of the Group with respect to and resulting from customer deposits and advance payments received by the Company or any of its subsidiaries in the ordinary course of business, provided,
however, that any such payments must be netted against original payment terms and not mandatorily prepaid prior to original payment terms;
|
(xi) |
indebtedness of the Company or any other member of the Group with respect to Australian employee corporate credit card accounts in an aggregate principal amount not to exceed AU$70,000 outstanding at any time; and/or
|
(xii) |
cash and cash equivalents of the Company and any of the other members of the Group pledged to secure leased location security deposits in an aggregate principal amount not to exceed US$300,000 with respect to the Company and the other
members of the Group outstanding at any time.
|
1. |
the entry into, any cancellation or termination of (except for an expiration that occurs in accordance with the terms of such agreement), amendment to, modification of, variance of (including by changing orders), impairment of,
assignment of, replacement of, refinancing of, or waiver of timely compliance with, any Material Contract (or the giving of consent to any of the foregoing);
|
2. |
the determination of the Operating Budget and/or the Capex Budget;
|
3. |
the declaration, payment or making of any dividends, distributions or other payments to Shareholders, whether in cash, property, stock, or other securities and whether or not a regular cash dividend;
|
4. |
the hiring, termination or modification of any material terms of any employment agreement of the Company’s (i) Chief Executive Officer, (ii) Chief Financial Officer (iii) Chief Technology Officer (iv) Company Secretary (v) Vice President
of Operations or (vi) Director of Sales;
|
5. |
the appointment and termination of any Company financial advisors or investment bankers;
|
6. |
the issuance, and terms of issuance, of any shares or debt securities;
|
7. |
the purchase, redemption or other acquisition by the Company of any shares;
|
8. |
the liquidation, dissolution, winding-up or termination of the Company or any of its subsidiaries;
|
9. |
the initiation, undertaking or implementation of a Change of Control Transaction;
|
10. |
a reduction of company capital to create distributable profits; and/or
|
11. |
any sale of any of the Company subsidiaries.
|
1. |
Assignment and Assumption; Consent; Notice; Payment of Taxes.
|
1.1 |
Assignment and Assumption. As of and with effect on and from the Closing, the Company hereby assigns to MergeCo all of the Company’s right, title and interest in and to the Existing Warrant Agreement (as amended by the Warrant
Amendment Agreement); MergeCo hereby assumes, and agrees to pay, perform, satisfy and discharge in full, as the same become due, all of the Company’s liabilities and obligations under the Existing Warrant Agreement (as amended by the Warrant
Amendment Agreement) arising on, from and after the Closing. As of and with effect on and from the Closing, all references to the “Company” in the Existing Warrant Agreement (including all Exhibits thereto) shall be references to
MergeCo. MergeCo shall provide an opinion of counsel to Computershare as successor Warrant Agent pursuant to the Warrant Amendment Agreement on or prior to the Closing stating that all Warrants or MergeCo Ordinary Shares issuable upon the
exercise of Warrants, as applicable, are: (i) registered under the Securities Act of 1933, as amended, or are exempt from such registration, and (ii) all Warrants are validly issued and the MergeCo Ordinary Shares issuable upon exercise of
such Warrants shall be validly issued and, subject to payment of the Exercise Price paid upon such exercise, fully paid and non-assessable.
|
1.2 |
Notice. Any notice, statement or demand authorized by the Existing Warrant Agreement (as amended by the Warrant Amendment Agreement) to be given or made by Computershare or by the holder of any Warrant to or on MergeCo in
accordance with Section 9.2 of the Existing Warrant Agreement, should be made to:
|
with a copy to: |
Arthur Cox LLP
|
1.3 |
Payment of Taxes. Without prejudice to Section 8.1 of the Existing Warrant Agreement, MergeCo, at its absolute discretion, may, or may procure that a subsidiary of MergeCo shall, pay any Irish stamp duty arising on a
transfer of Warrants on behalf of the transferee of such Warrants. If stamp duty resulting from the transfer of Warrants in MergeCo which would otherwise be payable by the transferee is paid by MergeCo or any subsidiary of MergeCo on behalf
of the transferee, then in those circumstances, MergeCo shall, on its behalf or on behalf of its subsidiary (as the case may be), be entitled to (i) reimbursement of the stamp duty from the transferee, (ii) set-off the stamp duty against any
dividends payable by MergeCo to the transferee of those Warrants and (iii) to the extent permitted by section 1042 of the Companies Act 2014 of Ireland and every statutory modification and re- enactment thereof for the time being, claim a
first and paramount lien on the Warrants (or Ordinary Shares issued upon the exercise of Warrants) on which stamp duty has been paid by MergeCo or its subsidiary for the amount of stamp duty paid. MergeCo’s lien shall extend to all dividends
paid on Ordinary Shares issued upon the exercise of such Warrants.
|
2. |
Miscellaneous Provisions.
|
2.1 |
Effectiveness. Each of the parties hereto acknowledges and agrees that the effectiveness of this Agreement shall be expressly subject to and substantially contemporaneous with the occurrence of Closing and shall automatically be
terminated and shall be null and void if the Business Combination Agreement shall be terminated for any reason.
|
2.2 |
Successors. All the covenants and provisions of this Agreement by or for the benefit of MergeCo, the Company, Continental or Computershare shall bind and inure to the benefit of their respective successors and assigns.
|
2.3 |
Applicable Law and Exclusive Forum. The validity, interpretation, and performance of this Agreement shall be governed in all respects by the laws of the State of New York. Each of MergeCo and the Company hereby agrees that any
action, proceeding or claim against it arising out of or relating in any way to this Agreement shall be brought and enforced in the courts of the State of New York or the United States District Court for the Southern District of New York, and
irrevocably submits to such jurisdiction, which jurisdiction shall be exclusive forum for any such action, proceeding or claim. Each of MergeCo and the Company hereby waives any objection to such exclusive jurisdiction and that such courts
represent an inconvenient forum.
|
2.4 |
Counterparts. This Agreement may be executed in any number of original or facsimile counterparts and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute
but one and the same instrument. A signed copy of this Agreement delivered by facsimile, e-mail or other means of electronic transmission shall be deemed to have the same legal effect as delivery of an original signed copy of this Agreement.
|
2.5 |
Severability. This Agreement shall be deemed severable, and the invalidity or unenforceability of any term or provision hereof shall not affect the validity or enforceability of this Agreement or of any other term or provision
hereof. Furthermore, in lieu of any such invalid or unenforceable term or provision, the parties hereto intend that there shall be added as a part of this Agreement a provision as similar in terms to such invalid or unenforceable provision as
may be possible and be valid and enforceable.
|
TWIN RIDGE CAPITAL ACQUISITION CORP.
|
||
By:
|
/s/William P. Russell, Jr.
|
|
Name: William P. Russell, Jr.
|
||
Title: Co-Chief Executive Officer and
|
||
Chief Financial Officer
|
||
CARBON REVOLUTION PUBLIC LIMITED COMPANY
|
||
By:
|
/s/Jacob Dingle
|
|
Name: Jacob Dingle
|
||
Title:
|
||
COMPUTERSHARE INC.
|
||
COMPUTERSHARE TRUST COMPANY, N.A.
|
||
By:
|
/s/ Collin Ekeogu
|
|
Name: Collin Ekeogu
|
||
Title: Manager, Corporate Actions
|
1. |
Appointment of Warrant Agent; Notice; Amendment of Existing Agreement.
|
1.1 |
Appointment of Warrant Agent. The Company hereby appoints Computershare to serve as successor warrant agent to Continental under the Existing Warrant Agreement (as amended hereby) effective upon the Closing, and Continental hereby
assigns to Computershare, and Computershare hereby agrees to accept and assume, with effect from Closing, all of Continental’s rights, interests and obligations in, and under the Existing Warrant Agreement (as amended hereby) and the
Warrants, as warrant agent; provided that, Computershare shall not assume any of Continental’s liabilities and obligations under the Existing Warrant Agreement (as amended hereby) arising prior to the Closing. Unless otherwise provided or the
context otherwise requires, from and after Closing, any references in the Existing Warrant Agreement (as amended hereby) to the “Warrant Agent” shall mean Computershare.
|
1.2 |
Amendments to Existing Warrant Agreement. The Existing Warrant Agreement is hereby deemed amended pursuant to Section 9.8 thereof to reflect the subject matter contained herein, effective as of the Closing, including the following:
|
|
a. |
The preamble is amended by deleting “Continental Stock Transfer & Trust Company, a New York corporation, as warrant agent (in such capacity, the “Warrant Agent”)” and
replacing it with “Computershare Inc., a Delaware corporation (“Computershare”) and Computershare Trust Company, N.A., a federally chartered trust company and an affiliate of
Computershare (“Trust Company” and together with Computershare, in such capacity as warrant agent, the “Warrant Agent”).”
As a result of the foregoing, all references in the Existing Warrant Agreement and the amendments to the Existing Warrant Agreement below to “Warrant Agent” shall be to Computershare and Trust Company, together.
|
|
b. |
The recitals are hereby deleted and replaced in their entirety as follows:
|
|
c. |
The penultimate sentence of Section 3.3.2 is hereby amended by deleting the reference to “Section 4.6” and replacing it with “Section 4.7”.
|
|
d. |
Section 3.3.5 is hereby amended by deleting the phrase “Continental Stock Transfer & Trust Company, as” and replacing it with the word “its”.
|
|
e. |
Section 4.6 is hereby amended by adding, immediately after the first full sentence of Section 4.6, the following sentence:
|
|
f. |
Section 5.5 is hereby amended to add the following as the final sentence thereof.
|
|
g. |
Section 6 is hereby amended by increasing each of the dollar amounts included in Section 6 by a multiple of 10.
|
|
h. |
Section 7.4 is hereby amended by adding new subsections 7.4.3, 7.4.4 and 7.4.5 to the end thereof as follows:
|
|
i. |
Section 8.3.1 is hereby amended and restated in its entirety as follows:
|
|
j. |
Section 8.4.1 is hereby amended and restated in its entirety as follows:
|
|
k. |
Section 8.4.2 is hereby amended and restated in its entirety as follows:
|
|
l. |
Section 8.5 is hereby amended and restated in its entirety as follows:
|
|
m. |
The following provisions are hereby incorporated into Section 8 in the numerical order set forth below:
|
|
n. |
The fourth sentence of Section 8.2.1 is hereby amended and restated in its entirety as follows:
|
|
o. |
Section 9.8 is hereby amended to add the following sentences to the end thereof:
|
|
p. |
Section 9.9 is hereby amended by adding the following sentence to the end thereof:
|
2. |
Miscellaneous Provisions.
|
2.1 |
Effectiveness. Each of the parties hereto acknowledges and agrees that the effectiveness of this Agreement shall be expressly subject to and substantially contemporaneous with the occurrence of Closing and shall automatically be
terminated and shall be null and void if the Business Combination Agreement shall be terminated for any reason.
|
2.2 |
Successors. All the covenants and provisions of this Agreement by or for the benefit of the Company, Continental or Computershare shall bind and inure to the benefit of their respective successors and assigns.
|
2.3 |
Applicable Law and Exclusive Forum. The validity, interpretation, and performance of this Agreement shall be governed in all respects by the laws of the State of New York. The Company hereby agrees that any action, proceeding or
claim against it arising out of or relating in any way to this Agreement shall be brought and enforced in the courts of the State of New York or the United States District Court for the Southern District of New York, and irrevocably submits
to such jurisdiction, which jurisdiction shall be exclusive forum for any such action, proceeding or claim. The Company hereby waives any objection to such exclusive jurisdiction and that such courts represent an inconvenient forum.
|
2.4 |
Counterparts. This Agreement may be executed in any number of original or facsimile counterparts and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute
but one and the same instrument. A signed copy of this Agreement delivered by facsimile, e-mail or other means of electronic transmission shall be deemed to have the same legal effect as delivery of an original signed copy of this Agreement.
|
2.5 |
Severability. This Agreement shall be deemed severable, and the invalidity or unenforceability of any term or provision hereof shall not affect the validity or enforceability of this Agreement or of any other term or provision
hereof. Furthermore, in lieu of any such invalid or unenforceable term or provision, the parties hereto intend that there shall be added as a part of this Agreement a provision as similar in terms to such invalid or unenforceable provision as
may be possible and be valid and enforceable.
|
TWIN RIDGE CAPITAL ACQUISITION CORP.
|
||
By:
|
||
Name:
|
||
Title:
|
||
COMPUTERSHARE INC. and
|
||
COMPUTERSHARE TRUST COMPANY, N.A.
|
||
By:
|
||
Name:
|
||
Title:
|
||
CONTINENTAL STOCK TRANSFER & TRUST COMPANY
|
||
By:
|
||
Name:
|
||
Title:
|
1. |
Appointment of Warrant Agent; Notice; Amendment of Existing Agreement.
|
1.1 |
Appointment of Warrant Agent. The Company hereby appoints Computershare to serve as successor warrant agent to Continental under the Existing Warrant Agreement (as amended hereby) effective upon the Closing, and Continental hereby
assigns to Computershare, and Computershare hereby agrees to accept and assume, with effect from Closing, all of Continental’s rights, interests and obligations in, and under the Existing Warrant Agreement (as amended hereby) and the
Warrants, as warrant agent; provided that, Computershare shall not assume any of Continental’s liabilities and obligations under the Existing Warrant Agreement (as amended hereby) arising prior to the Closing. Unless otherwise provided or
the context otherwise requires, from and after Closing, any references in the Existing Warrant Agreement (as amended hereby) to the “Warrant Agent” shall mean Computershare.
|
1.2 |
Amendments to Existing Warrant Agreement. The Existing Warrant Agreement is hereby deemed amended pursuant to Section 9.8 thereof to reflect the subject matter contained herein, effective as of the Closing, including the
following:
|
|
.a. |
The preamble is amended by deleting “Continental Stock Transfer & Trust Company, a New York corporation, as warrant agent (in such capacity, the “Warrant Agent”)” and
replacing it with “Computershare Inc., a Delaware corporation (“Computershare”) and Computershare Trust Company, N.A., a federally chartered trust company and an affiliate of
Computershare (“Trust Company” and together with Computershare, in such capacity as warrant agent, the “Warrant Agent”).”
As a result of the foregoing, all references in the Existing Warrant Agreement and the amendments to the Existing Warrant Agreement below to “Warrant Agent” shall be to Computershare and Trust Company, together.
|
|
b. |
The recitals are hereby deleted and replaced in their entirety as follows:
|
|
c. |
The penultimate sentence of Section 3.3.2 is hereby amended by deleting the reference to “Section 4.6” and replacing it with “Section 4.7”.
|
|
d. |
Section 3.3.5 is hereby amended by deleting the phrase “Continental Stock Transfer & Trust Company, as” and replacing it with the word “its”.
|
|
e. |
Section 4.6 is hereby amended by adding, immediately after the first full sentence of Section 4.6, the following sentence:
|
|
f. |
Section 5.5 is hereby amended to add the following as the final sentence thereof.
|
|
g. |
Section 6 is hereby amended by increasing each of the dollar amounts included in Section 6 by a multiple of 10.
|
|
h. |
Section 7.4 is hereby amended by adding new subsections 7.4.3, 7.4.4 and 7.4.5 to the end thereof as follows:
|
|
i. |
Section 8.3.1 is hereby amended and restated in its entirety as follows:
|
|
j. |
Section 8.4.1 is hereby amended and restated in its entirety as follows:
|
|
k. |
Section 8.4.2 is hereby amended and restated in its entirety as follows:
|
|
l. |
Section 8.5 is hereby amended and restated in its entirety as follows:
|
|
m. |
The following provisions are hereby incorporated into Section 8 in the numerical order set forth below:
|
|
n. |
The fourth sentence of Section 8.2.1 is hereby amended and restated in its entirety as follows:
|
|
o. |
Section 9.8 is hereby amended to add the following sentences to the end thereof:
|
|
p. |
Section 9.9 is hereby amended by adding the following sentence to the end thereof:
|
2. |
Miscellaneous Provisions.
|
2.1 |
Effectiveness. Each of the parties hereto acknowledges and agrees that the effectiveness of this Agreement shall be expressly subject to and substantially contemporaneous with the occurrence of Closing and shall automatically be
terminated and shall be null and void if the Business Combination Agreement shall be terminated for any reason.
|
2.2 |
Successors. All the covenants and provisions of this Agreement by or for the benefit of the Company, Continental or Computershare shall bind and inure to the benefit of their respective successors and assigns.
|
2.3 |
Applicable Law and Exclusive Forum. The validity, interpretation, and performance of this Agreement shall be governed in all respects by the laws of the State of New York. The Company hereby agrees that any action, proceeding or
claim against it arising out of or relating in any way to this Agreement shall be brought and enforced in the courts of the State of New York or the United States District Court for the Southern District of New York, and irrevocably submits
to such jurisdiction, which jurisdiction shall be exclusive forum for any such action,bproceeding or claim. The Company hereby waives any objection to such exclusive jurisdiction and that such courts represent an inconvenient forum.
|
2.4 |
Counterparts. This Agreement may be executed in any number of original or facsimile counterparts and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute
but one and the same instrument. A signed copy of this Agreement delivered by facsimile, e-mail or other means of electronic transmission shall be deemed to have the same legal effect as delivery of an original signed copy of this
Agreement.
|
2.5 |
Severability. This Agreement shall be deemed severable, and the invalidity or unenforceability of any term or provision hereof shall not affect the validity or enforceability of this Agreement or of any other term or provision
hereof. Furthermore, in lieu of any such invalid or unenforceable term or provision, the parties hereto intend that there shall be added as a part of this Agreement a provision as similar in terms to such invalid or unenforceable provision
as may be possible and be valid and enforceable.
|
TWIN RIDGE CAPITAL ACQUISITION CORP.
|
||
By:
|
/s/William P. Russell, Jr.
|
|
Name: William P. Russell, Jr.
|
||
Title: Co-Chief Executive Officer and
|
||
Chief Financial Officer
|
||
COMPUTERSHARE INC. and
|
||
COMPUTERSHARE TRUST COMPANY, N.A.
|
||
By:
|
/s/ Collin Ekeogu
|
|
Name: Collin Ekeogu
|
||
Title: Manager, Corporate Actions
|
||
CONTINENTAL STOCK TRANSFER & TRUST COMPANY
|
||
By:
|
/s/ Stacy Aqui
|
|
Name: Stacy Aqui
|
||
Title: Vice President
|
|
A. |
Prior to the execution and delivery of this Agreement (i) MergeCo has entered into a Business Combination Agreement dated as of November 29, 2022 (as the same may be amended, restated or amended and restated from time to time in accordance
with its terms, the “Business Combination Agreement”) and (ii) MergeCo has entered into a Scheme Implementation Deed, dated as of November 30, 2022 (as the same may be amended, restated or amended and restated from time to time in
accordance with its terms, the “Scheme Implementation Deed”).
|
|
B. |
The Holder is the record and/or beneficial owner of ordinary shares in the capital of the MergeCo (“MergeCo Shares”), or securities exchangeable or convertible into MergeCo Shares, and in connection with the Scheme and as Scheme
Consideration, such Holder is expected to be issued MergeCo Shares, or securities exchangeable or convertible into MergeCo Shares, in connection with the consummation of the transactions set forth in the Business Combination Agreement and the
Scheme Implementation Deed.
|
|
C. |
As a condition of, and as a material inducement for MergeCo to enter into and consummate the transactions contemplated by the Business Combination Agreement and the Scheme Implementation Deed, the Holder has agreed to execute and deliver
this Agreement.
|
|
1. |
Lock-Up.
|
|
a. |
During the Lock-up Period (as defined below), the Holder irrevocably agrees that it, he or she will not offer, sell, contract to sell, pledge or otherwise dispose of, directly or indirectly, any Lock-Up Shares (as defined below), enter
into a transaction that would have the same effect, or enter into any swap, hedge or other arrangement that transfers, in whole or in part, any of the economic consequences of ownership of Lock-Up Shares, whether any of these transactions are
to be settled by delivery of any Lock-Up Shares, or otherwise, publicly disclose the intention to make any offer, sale, pledge or disposition, or to enter into any transaction, swap, hedge or other arrangement, or engage in any Short Sales
(as defined below) with respect to any securities of MergeCo.
|
|
b. |
In furtherance of the foregoing, during the Lock-up Period, MergeCo will (i) place a stop order on all the Lock-Up Shares, including those which may be covered by a registration statement, and (ii) notify MergeCo’s transfer agent in
writing of the stop order and the restrictions on the Lock-Up Shares under this Agreement and direct MergeCo’s transfer agent, as applicable, not to process any attempts by the Holder to resell or transfer any Lock-Up Shares, except in
compliance with this Agreement.
|
|
c. |
For purposes hereof, “Short Sales” include, without limitation, all “short sales” as defined in Rule 200 promulgated under Regulation SHO under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and all
types of direct and indirect stock pledges, forward sale contracts, options, puts, calls, swaps and similar arrangements (including on a total return basis), and sales and other transactions through non-US broker dealers or foreign regulated
brokers.
|
|
d. |
For the avoidance of doubt, nothing in this Agreement restricts the ability of the Holder to exercise a right to vote attached to, or to dispose of, any MergeCo Shares.
|
|
e. |
The “Lock-up Period” means the period beginning at the date hereof and ending on the 180th day after the Closing Date.
|
|
a. |
Notwithstanding the foregoing, and subject to the conditions below, the undersigned may, by written notice to MergeCo, transfer Lock-Up Shares in connection with (a) transfers or distributions to the Holder’s current or former general or
limited partners, managers or members, stockholders, other equityholders or direct or indirect affiliates (within the meaning of Rule 405 under the Securities Act of 1933, as amended (the “Securities Act”)) or to the estates of any of
the foregoing; (b) transfers by bona fide gift to a member of the Holder’s immediate family or to a trust, the beneficiary of which is the Holder or a member of the Holder’s immediate family for estate planning purposes; (c) by virtue of the
laws of descent and distribution upon the death of the Holder; or (d) pursuant to a qualified domestic relations order, in each case where such transferee agrees to be bound by the terms of this Agreement; provided that in the case of
any transfer pursuant to the foregoing clauses it shall be a condition to any such transfer that the transferee/donee agrees to be bound by the terms of this Agreement to the same extent as if the transferee/donee were a party hereto.
|
|
4. |
Representations and Warranties. Each of the parties hereto hereby represents and warrants to each other party hereto that as of the date such party executes this Agreement:
|
|
a. |
Existence; Authority; Enforceability. Such party has the power and authority to enter into this Agreement and to carry out its obligations hereunder. Such party who is not an individual is duly organized and validly existing under
the laws of its respective jurisdiction of organization, and the execution of this Agreement, and the consummation of the transactions contemplated herein, have been authorized by all necessary action, and no other act or proceeding on its
part is necessary to authorize the execution of this Agreement or the consummation of any of the transactions contemplated hereby. This Agreement has been duly executed by it and constitutes its legal, valid and binding obligations,
enforceable against it in accordance with its terms.
|
|
b. |
Absence of Conflicts. The execution and delivery by such party of this Agreement and the performance of its obligations hereunder does not and will not (i) conflict with, or result in the breach of any material provision of the
constitutive documents of such party who is not an individual, (ii) result in any violation, breach, conflict, default or event of default (or an event which with notice, lapse of time, or both, would constitute a default or event of
default), or give rise to any right of acceleration or termination or any additional payment obligation, under the terms of any material contract, agreement or permit to which such party is a party or by which such party’s assets or
operations are bound or affected or (iii) violate any law applicable to such party.
|
|
c. |
Consents. Other than any consents which have already been obtained, no consent, waiver, approval, authorization, exemption, registration, license or declaration is required to be made or obtained by such party in connection with (i)
the execution, delivery or performance of this Agreement or (ii) the consummation of any of the transactions contemplated herein.
|
|
d. |
Lock-Up Shares. The Holder, upon the date that the Lock-Up Period commences beneficially owns [●] Lock-up Shares.
|
|
5. |
Exceptions. During the Lock-up Period, with the prior approval of the MergeCo board of directors, the Holder may transfer any of its Lock-Up Shares to fund the liability associated with any tax, duty, levy, fee, penalty or charge
imposed by any governmental authority on the Holder in connection with any securities issued under any executive or employee incentive plan of MergeCo.
|
Notices to MergeCo:
Carbon Revolution Limited
75 Pigdons Road,
Warn Ponds
VIC 3126 Australia
Attention: David Nock
E-mail: david.nock@carbonrev.com
|
with a copy to (which shall not constitute notice):
Goodwin Procter LLP
100 Northern Avenue
Boston, MA 02210
Attention: Jocelyn M. Arel
E-mail: jarel@goodwinlaw.com
and
Goodwin Procter LLP
620 Eighth Avenue
New York, NY 10018
Attention: Jeffrey Letalien
E-mail: jletalien@goodwinlaw.com
|
MERGECO:
|
||
CARBON REVOLUTION PUBLIC LIMITED COMPANY
|
||
By:
|
||
Name:
|
||
Title:
|
||
HOLDER:
|
||
Name:
|
||
Address for Notice:
|
||
|
||
|
1.
|
DEFINITIONS
|
2.
|
REGISTERED OFFERINGS
|
3.
|
PROCEDURES
|
4.
|
INDEMNIFICATION
|
6.
|
MISCELLANEOUS
|
|
CARBON REVOLUTION PUBLIC LIMITED COMPANY
|
|
|
||
|
By:
|
/s/ Jacob Dingle
|
|
Name:
|
Jacob Dingle
|
|
Title:
|
Director
|
|
TWIN RIDGE CAPITAL SPONSOR, LLC
|
|
|
||
|
By:
|
/s/ Sanjay Morey
|
|
Name:
|
Sanjay Morey
|
|
Title:
|
CEO and Co President
|
|
DDGN ADVISORS, LLC
|
|
|
||
|
By:
|
/s/ Daniel Zlotnitsky
|
|
Name:
|
Daniel Zlotnitsky
|
|
Title:
|
Vice President
|
|
Twin Ridge Holders
|
|
|
||
|
By:
|
/s/ Alison Burns
|
|
Name:
|
Alison Burns
|
|
||
|
By:
|
/s/ Paul Henrys
|
|
Name:
|
Paul Henrys
|
|
||
|
By:
|
/s/ Gary Pilnick
|
|
Name:
|
Gary Pilnick
|
|
Legacy Carbon Revolution Holders
|
|
|
||
|
By:
|
/s/ Jacob Dingle
|
|
Name:
|
Jacob Dingle
|
|
||
|
By:
|
/s/ James Douglas
|
|
Name:
|
James Douglas
|
|
||
|
By:
|
/s/ Gerard Buckle
|
|
Name:
|
Gerard Buckle
|
By:
|
/s/ Dale McKee
|
|
Name:
|
Dale McKee
|
|
|
||
By:
|
/s/ Mark Bernhard
|
|
Name:
|
Mark Bernhard
|
|
|
||
By:
|
/s/ Lucia Cade
|
|
Name:
|
Lucia Cade
|
|
I. |
Overview
|
|
• |
your “Family Members” (“Family Members” are (a) your spouse or domestic partner, children, stepchildren, grandchildren,
parents, stepparents, grandparents, siblings and in-laws who reside in the same household as you, (b) your children or your spouse’s children who do not reside in the same household as you but are financially dependent on you, (c) any of
your other family members who do not reside in your household but whose transactions are directed by you, and (d) any other individual over whose account you have control and to whose financial support you materially contribute. (Materially
contributing to financial support would include, for example, paying an individual’s rent but not just a phone bill.).);
|
|
• |
all trusts, family partnerships and other types of entities formed for your benefit or for the benefit of a member of your family and over which you have the ability to influence
or direct investment decisions concerning securities;
|
|
• |
all persons who execute trades on your behalf; and
|
|
• |
all investment funds, trusts, retirement plans, partnerships, corporations and other types of entities over which you have the ability to influence or direct investment decisions
concerning securities; provided, however, that the Trading Procedures do not apply to any such entity that engages in
the investment of securities in the ordinary course of its business (e.g., an investment fund or partnership) if the entity has established its own insider trading controls and procedures in compliance with applicable securities laws and it
(or an affiliated entity) has represented to the Company that its affiliated entities: (a) engage in the investment of securities in the ordinary course of their respective businesses; (b) have established insider trading controls and
procedures in compliance with securities laws; and (c) are aware the securities laws prohibit any person or entity who has material nonpublic information concerning the Company from purchasing or selling securities of the Company or from
communicating such information to any other person under circumstances in which it is reasonably foreseeable that such person is likely to purchase or sell securities.
|
|
• |
projections of future earnings or losses, or other earnings guidance;
|
|
• |
financial results that are known but have not been publicly disclosed;
|
|
• |
potential restatements of the Company’s financial statements, changes in auditors or auditor notification that the Company may no longer rely on an auditor’s audit report;
|
|
• |
pending or proposed corporate mergers, acquisitions, tender offers, joint ventures or dispositions of significant assets;
|
|
• |
changes in senior management or members of our Board of Directors;
|
|
• |
significant actual or threatened litigation or governmental investigations or major developments in such matters;
|
|
• |
cybersecurity risks and incidents, including the discovery of significant vulnerabilities or breaches;
|
|
• |
significant developments regarding products, customers, suppliers, orders, contracts or financing sources (e.g., the acquisition or loss of a contract);
|
|
• |
changes in dividend policy, declarations of stock splits, or proposed securities offerings or other financings;
|
|
• |
potential defaults under our credit agreements or indentures or potential material liquidity issues; and
|
|
• |
bankruptcies or receiverships.
|
D. |
What are the Penalties for Insider Trading and Noncompliance with this Insider Trading Policy?
|
|
• |
forfeiting any profit gained or loss avoided by the trading;
|
|
• |
payment of the loss suffered by the persons who, contemporaneously with the purchase or sale of securities that are subject of a violation, have purchased or sold securities of the
same class;
|
|
• |
payment of criminal penalties of up to US$5,000,000;
|
|
• |
payment of civil penalties of up to three times the profit made or loss avoided; and
|
|
• |
imprisonment for up to 20 years.
|
E.
|
How Do You Report a Violation of this Insider Trading Policy?
|
II. |
Trading Procedures
|
A.
|
Trading Restrictions Applicable to all Company Personnel
|
|
• |
No Short Sales. You may not at any time
sell any securities of the Company that are not owned by you at the time of the sale (a “short sale”).
|
|
• |
No Purchases or Sales of Derivative Securities or Hedging Transactions. You may not buy or sell puts, calls, other derivative securities of the Company or any derivative securities that
provide the economic equivalent of ownership of any of the Company’s securities or an opportunity, direct or indirect, to profit from any change in the value of our securities or engage in any other hedging transaction with respect to our
securities.
|
|
• |
No Company Securities Subject to Margin Calls. You may not use the Company’s securities as collateral in a margin account.
|
|
• |
No Pledges. You may not pledge Company
securities as collateral for a loan (or modify an existing pledge).
|
1. |
Procedures. No Insider may trade in our securities unless:
|
|
• |
The Insider has notified the Compliance Officer of the amount and nature of the proposed trade(s) using the Stock Transaction Request form attached to this Insider Trading Policy
or an equivalent form using an online application, if set up by the Company (“Online Request”). To provide adequate time for the preparation of any required reports under Section 16 of the Exchange Act, when and if it becomes applicable to
the Company, a Stock Transaction Request form should, if practicable, be received by the Compliance Officer at least two (2) business days before the intended trade date;
|
|
• |
The Insider has certified to the Compliance Officer in writing (including via an Online Request) before the proposed trade(s) that the Insider does not possess material nonpublic
information concerning the Company;
|
|
• |
If the Insider is an executive officer or director, the Insider has informed the Compliance Officer, using the Stock Transaction Request form or an Online Request, whether, to the
Insider’s best knowledge, (a) the Insider has (or is deemed to have) engaged in any opposite way transactions within the previous six months that were not exempt from Section 16(b) of the Exchange Act when and if the Company becomes subject
to Section 16 of the Exchange Act1 and (b) if the transaction involves a sale by an “affiliate” of the Company or of “restricted securities” (as such terms are defined under Rule 144
under the Securities Act of 1933, as amended (“Rule 144”)), whether the transaction meets all of the applicable conditions of Rule 144; and
|
|
• |
The Compliance Officer has approved the trade(s) and has certified their approval in writing (which may be by email or by way of approval using the Online Request application).
|
|
2. |
Additional Information.
|
|
3. |
Notification of Brokers of Insider Status
|
|
4. |
No Obligation to Approve Trades.
|
|
5. |
Completion of Trades.
|
|
6. |
Post-Trade Reporting.
|
|
1. |
Pre-Approved Rule 10b5-1 Plan.
|
|
• |
satisfy the requirements of Rule 10b5-1;
|
|
• |
be documented in writing;
|
|
• |
be established during a trading window when such Insider does not possess material nonpublic information; and
|
|
• |
be pre-approved by the Compliance Officer.
|
|
2. |
Employee Equity and Retirement Plans.
|
III. |
Acknowledgement
|
REQUESTER INFORMATION
Insider’s Name:
_________________________________________
|
|||||
INTENT TO PURCHASE
Number of shares: __________________________
Intended trade date: __________________________
|
|||||
Means of acquiring shares:
|
☐
|
Acquisition through employee benefit plan (please specify):
___________________________________________________________
|
|||
|
☐
|
Purchase through a broker on the open market
|
|||
☐
|
Other (please specify): ________________________________________
|
||||
INTENT TO SELL
Number of shares: __________________________
Intended trade date: __________________________
|
|||||
Means of selling shares:
|
☐
|
Sale through employee benefit plan (please specify):
___________________________________________________________
|
|||
☐
|
Sale through a broker on the open market
|
||||
☐
|
Other (please specify): ________________________________________
|
||||
SECTION 16
|
RULE 144 (Not applicable if transaction requested involves a purchase)
|
||||
☐
|
I am not subject to Section 16.
|
☐ |
I am not an “affiliate” of the Company and the transaction requested above does not involve the sale of “restricted securities” (as those terms are defined in Rule 144 under the Securities Act of 1933, as
amended).
|
||
☐
|
To the best of my knowledge, I have not (and am not deemed to have) engaged in an opposite way transaction within the previous 6 months that was not exempt from Section 16(b) of the Exchange Act.
|
☐ | To the best of my knowledge, the transaction requested above will meet all of the applicable conditions of Rule 144. | ||
☐
|
None of the above. | ☐ |
The transaction requested will be made pursuant to an effective registration statement covering such transaction.
|
||
|
|
☐ |
None of the above.
|
CERTIFICATION
I hereby certify that I am not (1) in possession of any material nonpublic information concerning the Company, as defined in the Company’s
Insider Trading Policy and (2) purchasing any securities of the Company on margin in contravention of the Company’s Trading Procedures. I understand that, if I trade while possessing such information or in violation of such trading
restrictions, I may be subject to severe civil and/or criminal penalties and may be subject to discipline by the Company including termination of my employment.
|
||||
Insider’s Signature
|
Date
|
|||
APPROVAL
|
||||
Signature of Compliance Officer (or designee)
|
Date
|
Date:
|
Signature:
|
|||
Name:
|
||||
Title:
|
• |
A condensed combined statement of financial position as of June 30, 2023 assuming the transaction was consummated on that date; and
|
• |
A condensed combined statement of comprehensive income for the year ended June 30, 2023 assuming the transaction was consummated as of July 1, 2022, at the commencement of
the earliest period presented.
|
• |
The exchange of shares between MergeCo, Carbon Revolution and Twin Ridge as a result of the Scheme Implementation Deed and the Business Combination Agreement and
associated transaction costs; and
|
• |
The issuance of shares as a commitment fee as consideration for the CEF (as defined below) upon completion of the Business Combination; and
|
• |
The issuance of preferred shares and warrants and assumption of liabilities pursuant to the OIC securities purchase agreement that is effective on completion of the
Business Combination and receipt of the proceeds and escrow deposits in reserve funds therefrom; and
|
• |
The partial deferral of Twin Ridge transaction costs on completion of the Business Combination.
|
• |
Carbon Revolution’s audited financial statements as of and for the year ended June 30, 2023 and the related notes thereto, included elsewhere in this Report;
|
• |
Twin ridge’s audited financials for December 2022 and unaudited interim financials for March 31 and June 30, 2023 and 2022 and September 30, 2022. Twin Ridge results of
operations for pro forma purposes for the 12 months ended June 30, 2023 are arithmetically derived from these financial statements; and
|
• |
the sections titled ‘‘Management’s Discussion and Analysis of Financial Condition and Results of
Operations of Carbon Revolution’’ and ‘‘Management’s Discussion and Analysis of Financial Condition and Results of Operations of Twin Ridge’’ in our
Registration Statement on Form F-4/A (333-270047) filed with the SEC on August 28, 2023 and other financial information.
|
• |
Carbon Revolution’s existing shareholders will have the greatest voting interest in the combined entity after the 99.70% Redemptions. Further, Twin Ridge shareholders
would not have a substantial majority of the voting interests, being approximately 27% and board and management representation are considered further below;
|
• |
Carbon Revolution’s directors will represent the majority of the board of directors of the combined company following the consummation of the Business Combination;
|
• |
Carbon Revolution’s senior management will be the senior management of the combined company following the consummation of the Business Combination as disclosed elsewhere
in this proxy statement/prospectus. Of the disclosed executive officers, all of them are current Carbon Revolution employees;
|
• |
Carbon Revolution is the larger entity based on historical operating activity and its employee base; and
|
• |
MergeCo will continue to operate under the Carbon Revolution trade name and the combined entity’s headquarters will be based in Australia
with its corporate head office in Geelong, consistent with the current location of Carbon Revolution’s head office.
|
|
• |
Each Twin Ridge Class B Ordinary Share, automatically converted, on a one-for-one basis, into a Twin Ridge Class A Ordinary Share;
|
|
• |
Immediately after the Pre-Merger Conversion, each Twin Ridge Class A Ordinary Share was automatically canceled in exchange for one validly issued, fully paid and
non-assessable MergeCo Ordinary Share;
|
|
• |
Each Public Warrant was automatically exchanged to become one MergeCo Public Warrant. Each such MergeCo Public Warrant is subject to substantially the same terms and
conditions set forth in the Existing Warrant Agreement, pursuant to which such Twin Ridge Public Warrant was issued immediately prior to the Twin Ridge Merger Effective Time; and
|
|
• |
Each Private Placement Warrant was automatically exchanged to become one MergeCo Public Warrant (each, a ‘‘Company Founder Warrant’’). Each such Company Founder Warrant is subject to substantially the same terms and conditions set forth in the Existing Warrant Agreement pursuant to which such Twin Ridge Private Warrant was
issued immediately prior to the Twin Ridge Merger Effective Time.
|
|
• |
For a period of three years from closing, MergeCo has the right to require Yorkville Advisors to purchase new MergeCo Ordinary Shares in a series of advances, with each
advance being in an amount up to the greater of (i) $10 million or (ii) the aggregate trading volume of MergeCo Ordinary Shares for the five trading days immediately preceding MergeCo requesting an advance. MergeCo's is not obliged to
require Yorkville Advisors to purchase a minimum volume of MergeCo Ordinary Shares. MergeCo can choose one of two Purchase Price Options:
|
|
○ |
Purchase Price Option 1: Yorkville Advisors will
purchase MergeCo Ordinary Shares at a price equal to 95.0% of the average VWAP during the day on which the advance request was made. If the volume threshold
under an advance is not reached during the pricing period, the number of shares purchased will be reduced to the greater of (i) 35.0% of the trading volume during the pricing period, or (ii) the number of shares sold by the Yorkville
Advisors during the pricing period. The volume threshold is the amount of the advance in shares divided by 35.0%.
|
|
○ |
Purchase Price Option 2: Yorkville Advisors will
purchase MergeCo Ordinary Shares at a price equal to 97.0% of the lowest VWAP of MergeCo's Ordinary Shares during the pricing period of three consecutive
trading days commencing on the trading day commencing after the advance notice is received by Yorkville Advisors.
|
|
• |
During either pricing period, Yorkville Advisors will have the ability to hedge its position by short selling in full the quantum of shares that it is required to purchase
under any advance notice. Under Purchase Price Option 2, MergeCo will have the ability to notify Yorkville Advisors of the minimum acceptable price (‘‘MAP’’) at which it can sell the new shares. If the Company does not set a MAP, this may have a material and adverse impact on MergeCo’s share price depending on the
quantum of shares being sold relative to overall liquidity of MergeCo’s shares.
|
|
• |
Yorkville Advisors cannot be issued MergeCo Ordinary Shares in an amount that would result in it holding more than the CEF
Ownership Restriction at any one time. In the circumstance where Yorkville Advisors is unable to dispose of its MergeCo Ordinary Shares on an ongoing basis, it will not be required to purchase
additional shares under the CEF beyond the CEF Ownership Restriction, which means MergeCo may not have full access to the stated $60 million CEF capital. Carbon Revolution determined that the CEF
right to issue shares represents a purchased put option which is classified as a derivative asset with a de minimus fair value at inception.
|
|
• |
MergeCo has agreed to issue 15,000 MergeCo Ordinary Shares to Yorkville Advisors as a
‘commitment fee’ to secure the facility. These must be issued upon completion of the Business Combination.
|
As of 30 June 2023
|
Carbon Revolution
|
Twin Ridge Capital Acquisition Corp.
|
|||||||||||||||||||||||||
(in thousands)
|
As of 30
June 2023
(unaudited)
|
As of 30 June 2023 (unaudited)
|
Pro Forma Combined
|
||||||||||||||||||||||||
(Historical)
|
US GAAP
(Historical)
|
IFRS Adjustments
|
IFRS
(Historical)
|
Notes
|
Transaction Accounting Adjustments
|
Notes
|
Pro
Forma
|
||||||||||||||||||||
AUD
|
USD
|
AUD
|
AUD
|
AUD
|
AUD
|
AUD
|
|||||||||||||||||||||
ASSETS
|
|||||||||||||||||||||||||||
Current assets
|
|||||||||||||||||||||||||||
Cash and cash equivalents
|
19,582
|
130
|
197
|
197
|
99,214
|
1A
|
29,757
|
||||||||||||||||||||
(98,161
|
)
|
1A.1
|
|||||||||||||||||||||||||
(8,797
|
)
|
1C
|
|||||||||||||||||||||||||
(12,248
|
)
|
1C
|
|||||||||||||||||||||||||
(18,386
|
)
|
1D
|
|||||||||||||||||||||||||
(965 |
) |
1K
|
|||||||||||||||||||||||||
49,321
|
1L
|
||||||||||||||||||||||||||
Restricted trust fund |
14,677 |
- | - | - | - | 14,677 | |||||||||||||||||||||
Receivables
|
6,430
|
-
|
-
|
-
|
-
|
6,430
|
|||||||||||||||||||||
Contract assets
|
8,239
|
- |
-
|
-
|
-
|
8,239
|
|||||||||||||||||||||
Inventories
|
22,173
|
-
|
-
|
-
|
-
|
22,173
|
Prepaid expenses
|
-
|
120
|
181
|
181
|
|
-
|
181
|
||||||||||||||||||||
Other current assets
|
378
|
-
|
-
|
-
|
|
-
|
378
|
||||||||||||||||||||
Total current assets
|
71,479
|
250
|
378
|
-
|
378
|
|
9,978
|
81,835
|
|||||||||||||||||||
|
|||||||||||||||||||||||||||
Non–current assets
|
|||||||||||||||||||||||||||
Marketable securities held in Trust Account
|
-
|
65,779
|
99,214
|
99,214
|
|
(99,214
|
)
|
1A
|
-
|
||||||||||||||||||
Restricted trust fund
|
-
|
- | - |
|
- |
52,790 |
1M |
52,790 | |||||||||||||||||||
Property, plant and equipment
|
62,638
|
-
|
-
|
-
|
|
-
|
62,638
|
||||||||||||||||||||
Right-of-use assets
|
7,446
|
-
|
-
|
|
-
|
|
-
|
7,446
|
|||||||||||||||||||
Intangible assets
|
16,774
|
-
|
-
|
-
|
|
-
|
16,774
|
||||||||||||||||||||
Total non–current assets
|
86,858
|
65,779
|
99,214
|
-
|
99,214
|
|
(46,424
|
)
|
139,648 | ||||||||||||||||||
Total assets
|
158,337
|
66,029
|
99,592
|
- |
99,592
|
|
(34,446
|
)
|
221,483
|
||||||||||||||||||
|
|||||||||||||||||||||||||||
Current liabilities
|
|||||||||||||||||||||||||||
Payables
|
15,474
|
5,832
|
8,797
|
8,797
|
|
(8,797
|
)
|
1C
|
15,474
|
||||||||||||||||||
Due to related party, net
|
-
|
1
|
2
|
2
|
|
-
|
2
|
||||||||||||||||||||
Promissory note - related party
|
-
|
640
|
965
|
965 |
|
(965
|
) |
1K | - | ||||||||||||||||||
Borrowings
|
13,829
|
-
|
-
|
-
|
|
|
|
13,829
|
|||||||||||||||||||
Warrant liabilities
|
- | - |
- |
- |
6,487
|
1L |
6,487
|
||||||||||||||||||||
Lease liability
|
645
|
-
|
-
|
-
|
|
-
|
645
|
||||||||||||||||||||
Contract liability
|
748
|
-
|
-
|
|
-
|
748
|
|||||||||||||||||||||
Deferred income
|
1,919
|
-
|
-
|
-
|
|
-
|
1,919
|
||||||||||||||||||||
Provisions
|
12,957
|
-
|
-
|
-
|
|
(9,458
|
)
|
1D
|
3,499
|
||||||||||||||||||
Total current liabilities
|
45,572
|
6,473
|
9,764
|
-
|
9,764
|
|
(12,733
|
)
|
42,603
|
||||||||||||||||||
|
Non–current liabilities
|
|||||||||||||||||||||||||||
Borrowings
|
70,833
|
-
|
-
|
99,214
|
99,214
|
(a)
|
(99,214
|
)
|
1A
|
166,457
|
|||||||||||||||||
42,834 |
1L
|
||||||||||||||||||||||||||
52,790 |
1M
|
||||||||||||||||||||||||||
Lease liability
|
7,368
|
-
|
-
|
-
|
-
|
7,368
|
|||||||||||||||||||||
Contract liability
|
1,755
|
-
|
-
|
-
|
-
|
1,755
|
|||||||||||||||||||||
Deferred income
|
15,235
|
-
|
-
|
-
|
-
|
15,235
|
|||||||||||||||||||||
Provisions
|
1,843
|
-
|
-
|
-
|
-
|
1,843
|
|||||||||||||||||||||
Warrant liabilities
|
-
|
684
|
1,032
|
1,032
|
-
|
1,032
|
|||||||||||||||||||||
Commitment fee shares liability
|
-
|
157
|
237.10
|
237
|
(237
|
)
|
1E
|
-
|
|||||||||||||||||||
Total non-current liabilities
|
97,034
|
841
|
1,269
|
99,214
|
100,483
|
(3,827
|
)
|
193,690
|
|||||||||||||||||||
Total Liabilities
|
142,606
|
7,314
|
11,033
|
99,214
|
110,247
|
(16,560
|
)
|
236,293
|
|||||||||||||||||||
Commitment
|
|||||||||||||||||||||||||||
Class A ordinary shares subject to possible redemption, 6,266,645 shares at redemption value of approximately $10.50 at June 30, 2023
|
-
|
65,779
|
99,214
|
(99,214
|
) |
-
|
(a)
|
-
|
-
|
||||||||||||||||||
Stockholders’ Equity
|
|||||||||||||||||||||||||||
Twin Ridge
|
|||||||||||||||||||||||||||
Preference shares, $0.0001 par value; 1,000,000 shares authorized; none issued and outstanding
|
-
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||
Class A ordinary shares, $0.0001 par value; 500,000,000 shares authorized; none shares issued and outstanding (excluding 6,266,645 shares subject to possible redemption at June 30, 2023)
|
-
|
-
|
-
|
-
|
-
|
-
|
Class B ordinary shares, $0.0001 par value; 50,000,000 shares authorized; 5,327,203 shares issued and outstanding
|
1
|
1
|
34,554
|
34,555
|
(b)
|
(34,555
|
)
|
1G
|
-
|
||||||||||||||||||
MergeCo Ordinary Shares
|
-
|
-
|
-
|
-
|
99,214
|
1A
|
436,835
|
||||||||||||||||||||
|
(86,947
|
)
|
1A.1
|
||||||||||||||||||||||||
|
31
|
1E
|
|||||||||||||||||||||||||
|
386,432
|
1F
|
|||||||||||||||||||||||||
|
3,105
|
1B
|
|||||||||||||||||||||||||
|
445
|
1H
|
|||||||||||||||||||||||||
|
34,555
|
1G
|
|||||||||||||||||||||||||
Additional paid-in-capital
|
-
|
2,059
|
3,105
|
-
|
3,105
|
(3,105
|
)
|
1B
|
-
|
||||||||||||||||||
Share based payment reserves
|
-
|
-
|
-
|
24,757
|
1C.1
|
24,757
|
|||||||||||||||||||||
Carbon Revolution Contributed equity
|
386,432
|
-
|
-
|
-
|
(386,432
|
)
|
1F
|
-
|
|||||||||||||||||||
Carbon Revolution Reserves
|
7,166
|
-
|
-
|
-
|
-
|
7,166
|
|||||||||||||||||||||
Accumulated losses
|
(377,867
|
)
|
(9,124
|
)
|
(13,761
|
)
|
(34,554
|
)
|
(48,315
|
)
|
(b)
|
(8,928
|
) | 1D |
(483,568
|
)
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
206
|
|
1E
|
|||||||||||||||
|
(12,248
|
) |
1C
|
||||||||||||||||||||||||
|
(24,757
|
)
|
1C.1
|
||||||||||||||||||||||||
|
(445
|
)
|
1H
|
||||||||||||||||||||||||
|
(11,214
|
)
|
1A.1
|
||||||||||||||||||||||||
Total Stockholders’ Equity
|
15,731
|
(7,064
|
) |
(10,655
|
) |
(99,214
|
)
|
(10,655
|
)
|
(19,886
|
)
|
(14,810
|
)
|
||||||||||||||
Total Liabilities and Stockholders’ Equity
|
158,337
|
66,029
|
99,592
|
0
|
|
99,592
|
(36,446
|
)
|
221,483
|
For the year ended 30 June 2023
|
|||||||||||||||||||||||||||
For the year ended 30 June 2023 (unaudited)
|
Twin Ridge Capital Acquisition Corp.
for the year ended 30 June 2023 (unaudited)
|
Pro Forma Combined
|
|||||||||||||||||||||||||
CRL
|
Twin Ridge
|
IFRS Conversion
and
Presentation
Alignment
|
Twin Ridge IFRS
|
Notes
|
Transaction Accounting Adjustments
|
Notes
|
Pro Forma Combined
|
||||||||||||||||||||
AUD
|
US$
|
AUD
|
AUD
|
AUD
|
AUD
|
AUD
|
|||||||||||||||||||||
Revenue:
|
|||||||||||||||||||||||||||
Sale of wheels
|
37,477
|
-
|
-
|
-
|
37,477
|
||||||||||||||||||||||
Engineering services
|
530
|
-
|
-
|
-
|
530
|
||||||||||||||||||||||
Sale of tooling
|
253
|
-
|
-
|
-
|
253
|
||||||||||||||||||||||
Total revenue
|
38,260
|
-
|
-
|
-
|
-
|
38,260
|
|||||||||||||||||||||
|
|||||||||||||||||||||||||||
Cost of goods sold
|
(55,094
|
)
|
-
|
-
|
-
|
(55,094
|
)
|
||||||||||||||||||||
Gross margin
|
(16,834
|
)
|
-
|
-
|
-
|
-
|
(16,834
|
)
|
|||||||||||||||||||
|
|||||||||||||||||||||||||||
Other income (expense), net:
|
|||||||||||||||||||||||||||
Other income
|
3,096
|
5,696
|
8,474
|
8,474
|
11,570
|
||||||||||||||||||||||
Operational expenses
|
(2,997
|
)
|
(5,687
|
)
|
(8,526
|
)
|
(8,526
|
)
|
(11,523
|
)
|
|||||||||||||||||
Research and development
|
(16,180
|
)
|
-
|
-
|
(16,180
|
)
|
|||||||||||||||||||||
Administrative expenses
|
(14,566
|
)
|
-
|
-
|
(445
|
)
|
1H
|
(15,316
|
)
|
||||||||||||||||||
|
(305
|
)
|
1J
|
||||||||||||||||||||||||
Marketing expenses
|
(1,494
|
)
|
-
|
-
|
(1,494
|
)
|
|||||||||||||||||||||
Capital raising transaction costs
|
(24,746
|
)
|
-
|
-
|
(24,757
|
) |
1C.1
|
(81,580
|
)
|
||||||||||||||||||
|
(8,928
|
)
|
1D
|
||||||||||||||||||||||||
|
305
|
|
1J
|
||||||||||||||||||||||||
|
(12,248
|
) |
1C
|
||||||||||||||||||||||||
|
(11,206
|
)
|
1A.1
|
||||||||||||||||||||||||
Finance costs
|
(5,502
|
)
|
-
|
827
|
827
|
(d)
|
(13,574
|
)
|
1N
|
(18,249
|
)
|
||||||||||||||||
|
|||||||||||||||||||||||||||
Fair value of Commitment fee shares
|
-
|
(157
|
)
|
(239
|
)
|
-
|
-
|
(d)
|
206
|
1E
|
(33
|
)
|
|||||||||||||||
Change in fair value of warrant liability
|
-
|
547
|
827
|
(827
|
)
|
-
|
(d)
|
-
|
-
|
||||||||||||||||||
(Loss) profit before income taxes
|
(79,223
|
)
|
399
|
536
|
-
|
775
|
(71,960
|
)
|
(149,647
|
)
|
|||||||||||||||||
|
|||||||||||||||||||||||||||
Income tax expense
|
-
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||
Net (loss) profit
|
(79,223
|
)
|
399
|
536
|
-
|
775
|
(71,960
|
)
|
(149,647
|
)
|
|
• |
(a) Reflects the generally accepted accounting principles in the United States (“U.S. GAAP”) to IFRS conversion adjustment related to the reclassification of Twin Ridge’s historical mezzanine equity (Twin Ridge Class A Shares subject to
possible redemption) into Non-current Liabilities (Borrowings).
|
|
• |
(b) Reflects the award of Twin Ridge Class B Shares measured at fair value of A$34.6 million in accumulated losses representing an IFRS 2 charge for the Twin Ridge Class B Shares awarded to the Sponsor in Q1, 2021. IFRS 2 requires that
where an issuance of shares is made for less than fair value, an IFRS 2 expense is recognized for any unidentifiable services provided at the value of the difference. The adjustment represents the value of the difference between the
aggregate consideration paid and the aggregate value of Twin Ridge Class B Shares issued with reference to the US$5.01 fair value of the Twin Ridge Class B Shares as determined by the concurrent award of Twin Ridge Class B Shares to the
directors of Twin Ridge described below. As the award did not contain any performance or forfeiture conditions, nor any variability based on the outcome of a subsequent business combination, the IFRS 2 charge is recognized at the date of
issuance of the shares being for services deemed to be provided by the Sponsor up to that date. As this took place prior to July 1, 2022 no corresponding pro forma compensation charge is recognized in the pro forma statement of operations
for the twelve months ended 30 June 2023. US GAAP does not contain a similar prescriptive requirement regarding unidentifiable services.
|
|
• | (c) As reflected in the pro forma C and D series of adjustments below, Transaction costs that are not direct and incremental to the issuance of new MergeCo Shares for consideration are expensed as a pro forma adjustment. These include consulting fees, Australian legal counsel fees in relation to the issue of MergeCo Shares to existing Carbon Revolution Shareholders and the Extension Payments. IAS32 generally requires an allocation between equity and profit and loss of direct and incremental transaction costs such as US counsel fees and other costs relating to preparation of the registration statement for lodgement with the SEC based on the proportion of existing Carbon Revolution shareholders to total shares on issue. Given the 99.70% Twin Ridge shareholder redemption rate, all such transaction costs have been recognized in profit and loss. |
|
• | (d) Reflects the U.S. GAAP to IFRS conversion adjustment related to the reclassification of Twin Ridge’s change in fair value of warrant liability and fair value of commitment fees shares into finance expenses (Borrowings). |
|
• |
(1A) Reflects the recognition and reclassification of AUD equivalent US$65.8 million of cash and marketable securities held in Twin Ridge Trust Account as of June 30, 2023 to cash and cash equivalents that becomes available for general
use by MergeCo following Implementation of the Transaction. It also reflects the issuance of MergeCo Shares in exchange for Twin Ridge Class A Shares currently
classified in borrowings.
|
|
• |
(1A.1) Represents the impact to cash of a 99.70% redemption in which 6,215,862 Twin Ridge Class A Shares are redeemed for A$100.714 million allocated to common stock, using a par value of US$0.0001 per share at a redemption price of
US$10.00 per share. Additionally, an IFRS 2 charge of A$11.2 million has been recognized for the excess of the fair value of MergeCo Ordinary Shares issued to Twin Ridge shareholders over the pro
forma net asset deficiency of Twin Ridge after transaction costs and redemptions as a pro forma transaction accounting adjustment to give effect to the acquisition of the Twin Ridge net liabilities in exchange for MergeCo Ordinary Shares.
|
|
• |
(1B) Under Australian law share capital does not have any par value or share premium. Accordingly, this pro forma adjustment represents the reclassification of Twin Ridge additional paid-in-capital to MergeCo
Shares as a result of the Business Combination.
|
|
• |
(1C) Represents the preliminary estimated direct and incremental Transaction costs incurred prior to, or concurrent with, the completion of the Business Combination by the Twin Ridge recognized in profit and loss.
|
|
• |
(1C.1) Represents a non-cash compensation incurred, concurrent with, the completion of the Business Combination by the Twin Ridge through a share-based award payment to advisors. US$16.4 million is translated at the relevant AUD/USD
exchange rates.
|
|
• |
(1D) Represents recognition of and settlement of preliminary estimated direct and incremental Transaction costs which include Transaction costs incurred by Carbon Revolution which have been recognized at June 30, 2023 of $9.5 million and
transaction costs yet to be incurred of $8.9 million.
|
|
• |
(1E) Represents the remeasurement of the commitment fee liability prior to settlement being the fair value of 1,500 MergeCo Shares to be issued to Yorkville for establishment of the CEF which takes
effect at closing of the Business Combination. The fair value of MergeCo Shares is determined by reference to the implied value based on the market price of Carbon Revolution Shares as October 19,
2023 and associated proposed merger ratio of 0.0065 MergeCo Shares per Carbon Revolution Share.
|
|
• |
(1F) Represents the pro forma adjustment for the exchange of Carbon Revolution Shares as a result of the Business Combination.
|
|
• |
(1G) Represents the pro forma adjustment for the award of Twin Ridge Class B Shares of A$34.6 million as a result of the Business Combination with no forfeiture conditions and the award of Twin Ridge Class B Shares to the Twin Ridge
directors that are contingent on successful completion of the Business Combination.
|
|
• |
(1H) Represents the pro forma adjustment for the share-based compensation in relation to MergeCo Shares offered to the directors of the Twin Ridge that is contingent on successful completion of the
Business Combination.
|
|
• |
(1J) Represents a reclassification of Transaction expenses comprising existing staff costs to administrative expenses.
|
|
• |
(1K) Represents the pro forma adjustment for balances outstanding between Twin Ridge and Carbon Revolution at June 30, 2023.
|
•
|
(1L) Reflects the A$106 million consideration under the OIC securities purchase agreement for the issuance of preferred shares and warrants effective upon consummation of the
Business Combination. The adjustment gives effect to amounts immediately available to MergeCo on issuance of an initial tranche of preferred shares, the issuance of MergeCo
warrants, transaction expenses and financing fees of A$3.5 million and an additional tranche to be issued by December 2024 subject to milestones.
|
A$’000
|
|
Restricted trust fund
|
52,790
|
Transaction costs and financing fees
|
3,469
|
Cash (Net proceeds)
|
49,321
|
Total
|
105,580
|
|
• |
Class A Ordinary Shares, par value $0.0001 per share, all of which were subject to possible redemption at approximately $10.00 per share: 500,000,000 shares
authorized, 21,308,813 shares issued and outstanding; and
|
|
• |
Class B Ordinary Shares, par value $0.0001 per share: 50,000,000 shares authorized, 5,327,203 shares issued and outstanding (0.3 million of which will be
forfeited).
|
|
• |
None of Carbon Revolution’s outstanding vested or unvested options were exercised immediately prior to the Business Combination; and
|
|
• |
None of the MergeCo OIC investor warrants were exercised immediately upon consummation of the Business Combination.
|
|
Net Earnings
(loss) per
share-basic
and diluted
For the Year
ended June 30,
2023
|
|||
Year ended June 30, 2023
|
||||
Pro forma net loss (in thousands)
|
(149,647
|
)
|
||
Net loss per share-basic and diluted
|
(79.80
|
)
|
||
Number of Shares
|
||||
Twin Ridge shareholders*
|
506,473
|
|||
Carbon Revolution Shareholders
|
1,367,211
|
|||
Yorkville Advisors Global, LP
|
1,500
|
|||
|
1,875,184
|
|
1. |
We agree with the first, second and third paragraphs included in Item 16F Change in Registrant’s Certifying Accountant. We also agree with the first and second
sentence of the last paragraph included in Item 16F Change in Registrant’s Certifying Accountant.
|
|
2. |
We have no basis on which to agree or disagree with the last sentence of the last paragraph included in Item 16F Change in Registrant’s Certifying Accountant.
|
1.
|
The Republic of Albania
|
2.
|
The Republic of Armenia
|
3.
|
Australia
|
4.
|
The Republic of Austria
|
5.
|
The Kingdom of Bahrain
|
6.
|
The Republic of Belarus
|
7.
|
Belgium
|
8.
|
Bosnia and Herzegovina
|
9.
|
The Republic of Botswana
|
10.
|
The Republic of Bulgaria
|
11.
|
Canada
|
12.
|
The Republic of Chile
|
13.
|
The People’s Republic of China
|
14.
|
The Republic of Croatia
|
15.
|
Cyprus
|
16.
|
Czech Republic
|
17.
|
The Kingdom of Denmark
|
18.
|
The Arab Republic of Egypt
|
19.
|
The Republic of Estonia
|
20.
|
The Federal Democratic Republic of Ethiopia
|
21.
|
Finland
|
22.
|
France
|
23.
|
Georgia
|
24.
|
The Federal Republic of Germany
|
25.
|
The Republic of Ghana
|
26.
|
The Hellenic Republic (Greece)
|
27.
|
Hong Kong
|
28.
|
The Republic of Hungary
|
29.
|
The Republic of Iceland
|
30.
|
The Republic of India
|
31.
|
The State of Israel
|
32.
|
Italy
|
33.
|
Japan
|
34.
|
The Republic of Kazakhstan
|
35.
|
The Republic of Kenya
|
36.
|
The Republic of Korea
|
37.
|
The Republic of Kosovo
|
38.
|
The State of Kuwait
|
39.
|
The Republic of Latvia
|
40.
|
The Republic of Lithuania
|
41.
|
The Grand Duchy of Luxembourg
|
42.
|
The Republic of Macedonia (now the Republic of North Macedonia)
|
43.
|
Malaysia
|
44.
|
Malta
|
45.
|
The United Mexican States (Mexico)
|
46.
|
The Republic of Moldova
|
47.
|
Montenegro
|
48.
|
The Kingdom of Morocco
|
49.
|
The Kingdom of the Netherlands
|
50.
|
New Zealand
|
51.
|
The Kingdom of Norway
|
52.
|
The Islamic Republic of Pakistan
|
53.
|
The Republic of Panama
|
54.
|
The Republic of Poland
|
55.
|
Portuguese Republic
|
56.
|
State of Qatar
|
57.
|
Romania
|
58.
|
Russian Federation
|
59.
|
Kingdom of Saudi Arabia
|
60.
|
The Republic of Serbia
|
61.
|
The Republic of Singapore
|
62.
|
Slovak Republic
|
63.
|
The Republic of Slovenia
|
64.
|
The Republic of South Africa
|
65.
|
Kingdom of Spain
|
66.
|
Sweden
|
67.
|
Switzerland
|
68.
|
Kingdom of Thailand
|
69.
|
The Republic of Turkey
|
70.
|
United Kingdom
|
71.
|
Ukraine
|
72.
|
United Arab Emirates
|
73.
|
The Republic of Uzbekistan
|
74.
|
United States of America
|
75.
|
The Socialist Republic of Vietnam
|
76.
|
The Republic of Zambia
|