DevvStream Corp DEFA14A, filed Oct 30, 2024
DevvStream Corp. (DEVSF)
DEFA14A
2024-10-30
View Original
Added on
October 21, 2026
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
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CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): October 29, 2024
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FOCUS IMPACT ACQUISITION CORP.
(Exact name of registrant as specified in its charter)
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Delaware
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001-40977
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86-2433757
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(State or other jurisdiction of incorporation)
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(Commission File Number)
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(IRS Employer Identification No.)
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345 Avenue of the Americas, 33rd Floor
New York, NY |
10105
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(Address of Principal Executive Offices)
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(Zip Code)
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Registrant’s telephone number, including area code: (212) 213-0243
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Securities registered pursuant to Section 12(b) of the Act:
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Title of each class
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Trading Symbol(s)
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Name of each exchange on which registered
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Units, each consisting of one share of Class A common stock, $0.0001 par value, and one-half of one redeemable warrant
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FIACU
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The Nasdaq Stock Market LLC
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Shares of Class A common stock included as part of the units
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FIAC
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The Nasdaq Stock Market LLC
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Redeemable warrants included as part of the units, each whole warrant exercisable for one share of Class A common stock at an exercise price of $11.50
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FIACW
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The Nasdaq Stock Market LLC
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange
Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☒
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to
Section 13(a) of the Exchange Act. ☐
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Item 1.01
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Entry into a Material Definitive Agreement.
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Amendment No. 2 to Sponsor Side Letter Agreement and Waiver of Sponsor Lock up Agreement
On October 29, 2024, Focus Impact Acquisition Corp. (“FIAC”) entered into an amendment (the “Amendment to the Sponsor Side Letter Agreement”) to the side letter agreement, dated September 12, 2023,
which was subsequently amended on May 1, 2024, by and among FIAC and Focus Impact Sponsor, LLC (“Sponsor”). Pursuant to the Amendment to the Sponsor Side Letter Agreement, FIAC is amending the transfer restrictions included therein to enable the
Sponsor to transfer on October 29, 2024 up to 5,750,000 shares of common stock of the Company (such shares of common stock that are being transfered, the “Sponsor Shares”) to (i) certain advisor parties in full or partial satisfaction of such
advisor parties’ fees and expenses incurred in connection with the the proposed business combination (the “Business Combination”) with DevvStream Holdings Inc. (“DevvStream”) (approximately $15.1 million of fees and expenses are being satisfied
through the transfer of Sponsor Shares to advisor parties), (ii) certain investors subscribing to PIPE Agreements (as defined below), and (iii) the Investor (as defined below) as consideration for the execution of the ELOC Agreement (as defined
below). On October 29, 2024, FIAC has also determined that it is advisable and in the best interest of FIAC and its stockholders to waive the transfer restrictions to which the Sponsor Shares were subject and that were included in the certain
letter agreement, dated November 1, 2021, by and between FIAC and the Sponsor. In connection with the closing of the Business Combination, the Sponsor will be issued New PubCo Common Shares (as defined below) in an amount that is equal to the
number of Sponsor Shares that the Sponsor is agreeing to transfer prior to the closing of the Business Combination, as described in the foregoing items (i) to (iii).
A copy of the Amendment to the Sponsor Side Letter Agreement is filed with this Current Report on Form 8-K (this “Current Report”) as Exhibit 10.1 and is incorporated herein by reference, and the
foregoing description of the Amendment to the Sponsor Side Letter Agreement is qualified in its entirety by reference thereto.
Monroe Agreement
On October 29, 2024, FIAC entered into a contribution and exchange agreement (the “Monroe Agreement”), pursuant to which, among other things, Crestmont Investments LLC, a Delaware limited liability
company, will, immediately following the closing of the Business Combination, contribute 2,000,000 units representing 50% of the limited liability company interests in Monroe Sequestration Partners LLC, a Delaware limited liability company, in
exchange for 2,000,000 common shares (“New PubCo Common Shares”) of the post-Business Combination company (“New PubCo”), subject to the terms and conditions described in the Monroe Agreement.
A copy of the Monroe Agreement is filed with this Current Report as Exhibit 10.2 and is incorporated herein by reference, and the foregoing description of the Monroe Agreement is qualified in its
entirety by reference thereto.
PIPE Agreements
On October 29, 2024, FIAC also entered into (i) certain subscription agreements with certain investors, including Helena Global Investment Opportunities I Ltd. (the “PIPE Agreements”), pursuant to
which the Sponsor transferred 1,547,668 Sponsor Shares to such investors on October 29, 2024 (which will convert into 1,500,000 New PubCo Common Shares in connection with the closing of the Business Combination) and, immediately prior to the
closing of the Business Combination, the investors will subscribe for 201,000 shares of Class A common stock of FIAC for $2,250,000 in aggregate, in each case, in accordance with the terms and conditions of the PIPE Agreements (such shares of Class
A common stock of FIAC will automatically convert into 194,809 New PubCo Common Shares upon consummation of the Business Combination), and (ii) certain carbon credit subscription agreements with investors, including Karbon-X Corp (the “Carbon
Subscription Agreements”), pursuant to which, immediately following the closing of the Business Combination, New PubCo will issue 3,249,877 New PubCo Common Shares in aggregate to such investors, in each case, in accordance with the terms and
conditions of the applicable Carbon Subscription Agreement. Pursuant to a Registration Rights Agreement, dated October 29, 2024, by and between Karbon-X Corp and FIAC, Karbon-X Corp will also be granted customary registration rights with respect
to the New PubCo Common Shares that it will purchase pursuant to a Carbon Subscription Agreement. The Carbon Subscription Agreements are being executed in connection with certain Carbon Credit Purchase Agreements with DevvStream (the “Carbon Credit
Purchase Agreements”), pursuant to which DevvStream is purchasing carbon credits from certain sellers (“Carbon Credit Sellers”). The New PubCo Common Shares that are being issued to such Carbon Credit Sellers pursuant to the Carbon Subscription
Agreements are being issued to the Carbon Credit Sellers in satisfaction of the purchase price owed to them under the Carbon Credit Purchase Agreements.
A form of PIPE Agreement and Carbon Subscription Agreement are filed with this Current Report as Exhibits 10.3 and 10.4, respectively, and a copy of the Registration Rights Agreement is filed with
this Current Report as Exhibit 10.5. Each of Exhibit 10.3, Exhibit 10.4 and Exhibit 10.5 is incorporated herein by reference and the foregoing description of the PIPE Agreements and Carbon Subscription Agreements is qualified in its entirety by
reference thereto.
ELOC Agreement
On October 29, 2024, FIAC entered into that certain equity line of credit purchase agreement with Helena Global Investment Opportunities I Ltd. (the “Investor”) and the Sponsor (the “ELOC
Agreement”). Pursuant to the ELOC Agreement, New PubCo will have the right to issue and to sell to the Investor from time to time, as provided in the ELOC Agreement, up to $40,000,000 of New PubCo Common Shares following the closing of the Business
Combination and the effectiveness of the registration statement registering the New PubCo Common Shares being sold under the ELOC Agreement (the “Registration Statement”), and subject to the conditions set forth therein. As a commitment fee in
connection with the execution of the ELOC Agreement, the Sponsor will transfer a certain number of Sponsor Shares to the Investor. Further, following the closing of the Business Combination and promptly following the effectiveness of the
Registration Statement, New PubCo will issue to the Investor an amount of New PubCo Common Shares equal to $125,000 divided by the greater of (i) the lowest one day VWAP during the five trading days immediately preceding the effectiveness date of
such Registration Statement and (ii) $0.75.
A copy of the ELOC Agreement is filed with this Current Report as Exhibit 10.6 and is incorporated herein by reference, and the foregoing description of the ELOC Agreement is qualified in its
entirety by reference thereto.
Waiver to Certain Business Combination Conditions Precedent
On October 29, 2024, FIAC, DevvStream and Focus Impact Amalco Sub Ltd. entered into a waiver (the “Waiver”) to the Business Combination Agreement, dated September 12, 2023, by and between FIAC,
DevvStream and Focus Impact Amalco Sub Ltd. (as amended by Amendment No. 1 to the Business Combination Agreement dated May 1, 2024 and as further amended by Amendment No. 2 to the Business Combination Agreement dated August 10, 2024, the “Business
Combination Agreement”), pursuant to which the parties to the Business Combination Agreement mutually agreed, among other things, that the following will not cause a failure of any condition set forth in the Business Combination Agreement to be met
or be considered a Company Material Adverse Effect (as defined in the Business Combination Agreement): (i) election by DevvStream to halt trading of its stock on Cboe Canada, (ii) termination by David Oliver of any agreements by and between him and
DevvStream, (iii) termination by David Oliver of his status as an individual independent contractor of DevvStream, (iv) failure by David Oliver to deliver an employment agreement with New PubCo, (v) any Action (as defined in the Business
Combination Agreement) or Proceeding (as defined in the Business Combination Agreement) threatened or brought against DevvStream by David Oliver or his Affiliates (as defined in the Business Combination Agreement), or (vi) any changes or effects
directly or indirectly attributable to, resulting from, relating to or arising out of the foregoing clauses (i)-(v).
A copy of the Waiver is filed with this Current Report as Exhibit 10.7 and is incorporated herein by reference, and the foregoing description of the Waiver is qualified in its entirety by reference thereto.
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Item 3.02
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Unregistered Sales of Equity Securities.
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The information described in Item 1.01 of this Current Report regarding the issuance of New Pubco Common Shares or shares of Class A common stock of FIAC is incorporated herein. The issuance of New
Pubco Common Shares or shares of Class A common stock of FIAC pursuant to the Monroe Agreement, certain of the PIPE Agreements and Carbon Subscription Agreements and to the sponsor under the amended side letter, as applicable, have not been
registered under the Securities Act of 1933, as amended (the “Securities Act”) and have been issued in reliance upon the exemption provided in Section 4(a)(2) of the Securities Act.
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Item 8.01
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Other Events
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Pro forma condensed combined balance sheet of DevvStream
In order to reflect the pro forma impact of the transactions described in Item 1.01 of this Current Report on DevvStream, DevvStream prepared an unaudited pro forma condensed combined balance
sheet as of June 30, 2024 and an unaudited pro forma combined income statement for the first six fiscal months of 2024 of DevvStream and FIAC. FIAC is furnishing a copy of such pro formas as Exhibit 99.1 of this Current Report. The unaudited pro
forma condensed combined financial balance sheet and income statement are presented for illustrative purposes only and are based on certain assumptions and DevvStream's management's current best estimates. Therefore, the unaudited pro forma
condensed combined financial information included in this Current Report is not necessarily indicative of the financial position or results that will be achieved upon closing of the Business Combination. The financial position and results of
DevvStream after closing of the Business Combination may differ significantly from those indicated in the unaudited pro forma condensed combined financial information included in this Current Report. You should not rely on the unaudited pro forma
condensed combined financial information as being indicative of the historical financial position or results that would have been achieved had the Business Combination closed as of June 30, 2024 or the future financial position or results that
the post-Business Combination company will achieve. FIAC's or DevvStream's auditors have not audited, reviewed, compiled or performed any procedures with respect to any of the data included in the pro formas included in this Current Report and
FIAC's or DevvStream's auditors do not express an opinion or any form of assurance with respect to the pro forma financial information included in this Current Report.
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Item 9.01
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Financial Statements and Exhibits.
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(d) Exhibits.
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Exhibit No.
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Description
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Amendment No.2 to Sponsor Letter Agreement, dated October 29, 2024, by and between FIAC and the Sponsor
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Contribution and Exchange Agreement, dated October 29, 2024, by and among FIAC, DevvStream and Crestmont
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Form of PIPE Agreement
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Form of Carbon Subscription Agreement
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Registration Rights Agreement, dated October 29, 2024, by and between FIAC and Karbon-X Corp
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Purchase Agreement, dated October 29, 2024, by and between FIAC, Helena Global Investment Opportunities I Ltd. and the Sponsor
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Waiver to Certain Business Combination Conditions Precedent, dated October 29, 2024, by and between FIAC, DevvStream and Focus Impact Amalco Sub Ltd. |
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Unaudited pro forma condensed combined balance sheet and income statement of DevvStream Holdings Inc.
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104
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Cover Page Interactive Data File (embedded within the Inline XBRL document)
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Disclaimer
This Current Report includes forward-looking statements. Forward-looking statements are statements that are not historical facts and generally relate to future events or FIAC’s or DevvStream’s future financial or
other performance metrics. In some cases, you can identify forward-looking statements by terminology such as “may”, “should”, “expect”, “intend”, “will”, “estimate”, “anticipate”, “believe”, “predict”, “potential” or “continue”, or the negatives of
these terms or variations of them or similar terminology. These forward-looking statements, including, without limitation, FIAC’s, DevvStream’s and the combined company’s expectations with respect to future performance and anticipated financial
impacts of the Business Combination or certain transactions described in this Current Report (including, but not limited to, certain share issuances and transfers), the satisfaction of the closing conditions to the Business Combination, the timing
of the completion of the proposed Business Combination or the transactions described in this Current Report, are subject to risks and uncertainties, which could cause actual results to differ materially from those expressed or implied by such
forward-looking statements. These forward-looking statements are based upon estimates and assumptions that, while considered reasonable by FIAC and its management, and DevvStream and its management, as the case may be, are inherently uncertain and
subject to material change. New risks and uncertainties may emerge from time to time, and it is not possible to predict all risks and uncertainties. Factors that may cause actual results to differ materially from current expectations include, but
are not limited to: (1) the occurrence of any event, change or other circumstances that could give rise to the termination of negotiations and any subsequent definitive agreements with respect to the proposed transaction; (2) the outcome of any
legal proceedings that may be instituted against FIAC, DevvStream, the combined company or others; (3) the inability to complete the proposed transaction due to the failure to obtain approval of the stockholders of FIAC and DevvStream or to satisfy
other conditions to closing; (4) changes to the proposed structure of the proposed transaction that may be required or appropriate as a result of applicable laws or regulations; (5) the ability to meet Nasdaq’s or another stock exchange’s listing
standards following the consummation of the proposed transaction; (6) the risk that the proposed transaction disrupts current plans and operations of FIAC or DevvStream as a result of the announcement and consummation of the proposed transaction;
(7) the ability to recognize the anticipated benefits of the proposed transaction, which may be affected by, among other things, competition, the ability of the combined company to grow and manage growth profitably, maintain relationships with
customers and retain its management and key employees; (8) costs related to the proposed transaction; (9) changes in applicable laws or regulations; (10) the possibility that FIAC, DevvStream or the combined company may be adversely affected by
other economic, business, and/or competitive factors; (11) FIAC’s estimates of expenses and profitability and underlying assumptions with respect to stockholder redemptions and purchase price and other adjustments; (12) various factors beyond
management’s control, including general economic conditions and other risks, uncertainties and factors set forth in the sections entitled “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements” in the definitive proxy statement
and prospectus of FIAC related to the Business Combination, filed with the SEC on August 9, 2024, in the definitive proxy statement related to the Extension Amendment Proposal, filed with the SEC on October 24, 2024, and other filings with the SEC;
and (13) certain other risks identified and discussed in DevvStream’s Annual Information Form for the year ended July 31, 2023, and DevvStream’s other public filings with Canadian securities regulatory authorities, available on DevvStream’s profile
on SEDAR at www.sedarplus.ca.
These forward-looking statements are expressed in good faith, and FIAC, DevvStream and the combined company believe there is a reasonable basis for them. However, there can be no assurance that the events, results or
trends identified in these forward-looking statements will occur or be achieved. Forward-looking statements speak only as of the date they are made, and none of FIAC, DevvStream or the combined company is under any obligation, and expressly
disclaim any obligation, to update, alter or otherwise revise any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by law. Readers should carefully review the statements set forth in
the reports, which FIAC has filed or will file from time to time with the SEC and DevvStream’s public filings with Canadian securities regulatory authorities. This Current Report is not intended to be all-inclusive or to contain all the information
that a person may desire in considering an investment in FIAC or DevvStream and is not intended to form the basis of an investment decision in FIAC or DevvStream. All subsequent written and oral forward-looking statements concerning FIAC and
DevvStream, the proposed transaction or other matters and attributable to FIAC and DevvStream or any person acting on their behalf are expressly qualified in their entirety by the cautionary statements above.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Dated: October 29, 2024 |
FOCUS IMPACT ACQUISITION CORP. | |
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| By: |
/s/ Carl Stanton | |
| Name: |
Carl Stanton | |
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Chief Executive Officer | |
Exhibit 10.1
AMENDMENT NO. 2 TO
SPONSOR SIDE LETTER
This Amendment No. 2 (this “Amendment”), dated as of October 29, 2024 (the “Effective Date”) to the Sponsor Side
Letter (as defined below) is entered into by and among (i) Focus Impact Acquisition Corp., a Delaware corporation (the “Company”),
and (ii) Focus Impact Sponsor, LLC, a Delaware limited liability company (“Sponsor”). Capitalized terms used but not
defined in this Amendment shall have the meanings ascribed to them in the Sponsor Side Letter.
WHEREAS,
reference is made to that certain Business Combination Agreement, dated as of September 12, 2023, by and among the Company, Focus Impact Amalco Sub Ltd., a company existing under the laws of the Province of British Columbia (“Amalco Sub”) and DevvStream Holdings Inc., a company existing under the Laws of the Province of British Columbia (the “DevvStream”), as amended by that certain First Amendment thereto, dated as of May 1, 2024, and further amended by that certain
Amendment No. 2 thereto, dated as of August 10, 2024 (as the same may be amended, supplemented or modified, the “BCA”);
WHEREAS, the
Company, Sponsor and certain directors and officers of the SPAC are parties to that certain Letter Agreement, dated as of November 1, 2021 (the “IPO Letter Agreement”);
WHEREAS, the
Company and Sponsor are parties to that certain Sponsor Side Letter, dated as of September 12, 2023, as amended by that certain Amendment No. 1, dated May 1, 2024 (as amended, the “Sponsor Side Letter”);
WHEREAS, in
connection with closing of the BCA, the parties hereto desire to amend the IPO Letter Agreement and the Sponsor Side Letter as set forth herein;
WHEREAS,
reference is made to that certain (i) Subscription Agreement, dated October 29, 2024, by and among the Company, Sponsor and Helena Global Investment Opportunities I Ltd. (“Helena”), (ii) Subscription Agreement, dated October 29, 2024, by and among the Company, Sponsor and White Lion Capital, LLC, (iii) Subscription Agreement, dated October 29, 2024, by and
among the Company, Sponsor and FirstFire Global Opportunities Fund LLC, and (iv) Purchase Agreement, dated October 29, 2024, by and between Helena, the Company and Sponsor (the foregoing agreements collectively, the “Transaction Documents”);
WHEREAS,
pursuant to the Transaction Documents, among other things, the Sponsor agreed to transfer a number of shares of common stock, par value $0.0001 per share, of the Company (the “Common Stock”) to each counterparty (the “Consideration Shares”);
WHEREAS, in
connection with closing of the BCA, the Sponsor agreed to transfer a number of shares of Common Stock to certain third-party vendors and service providers of the Company and/or DevvStream in lieu of cash in order to satisfy certain obligations of
the Company and/or DevvStream (the “Vendor Shares”);
WHEREAS, in
consideration for the Sponsor transferring the Consideration Shares and the Vendor Shares, the parties desire to issue to the Sponsor an equivalent number of shares at the closing of the Business Combination (the “Replacement Shares”); and
WHEREAS,
Section 3.2 of the Sponsor Side Letter provides that the Sponsor Side Letter may be amended by a written instrument executed by all parties thereto.
NOW, THEREFORE, for good and valuable consideration, the undersigned each agree as follows:
1. Transfer Restrictions.
The Company and the Sponsor hereby agree that the transfer of the Consideration Shares and the Vendor Shares, which may be up to 5,750,000 shares of Common Stock in the aggregate, shall not violate the terms of Section 1.4 of the Sponsor Side
Letter or Section 5 of the IPO Letter Agreement; provided that the transferees of such shares agree to substantially similar transfer restrictions as set forth in such sections of such agreements for the period prior to the closing of the
transactions contemplated by the BCA.
2. Replacement Shares. On
the date of the closing of the transactions contemplated by the BCA and in connection therewith, the Company shall issue up a number of shares of Common Stock to the Sponsor, equal to the aggregate number of Consideration Shares and Vendor
Shares, taking into account the adjustment to the number of shares of Common Stock outstanding pursuant to the exchange mechanics set forth in the BCA. The Replacement Shares shall be treated as “Sponsor Shares” under the Sponsor Side Letter, and
shall be duly authorized, validly issued, fully-paid and nonassessable. The Replacement Shares shall bear appropriate restrictive legends.
3. Company Consent. The
Company, by executing and delivering a counterpart signature page to this Amendment, hereby consents in all respects to this Amendment.
4. Miscellaneous. The
provisions of Sections 3.2 (Amendment and Waiver), 3.3 (Assignment; Third-Party Beneficiaries), 3.4 (Notices) and 3.6 (Miscellaneous) shall apply to this Amendment mutatis mutandis.
5. No Further Amendment. The
SPAC and the Sponsor agree that, except as specifically amended hereby, all other provisions of the Sponsor Side Letter shall continue unmodified, in full force and effect and constitute legal and binding obligations of all parties thereto in
accordance with its terms. This Amendment is limited precisely as written and shall not be deemed to be an amendment to any other term or condition of the Sponsor Side Letter or any of the documents referred to therein. This Amendment forms an
integral and inseparable part of the Sponsor Side Letter.
6. References. All
references to the “Side Letter” (including “hereof,” “herein,” “hereunder,” “hereby” and “this Side Letter”) in the Sponsor Side Letter shall refer to the Sponsor Side Letter as amended by this Amendment. Notwithstanding the foregoing, references
to the date of the Sponsor Side Letter (as amended hereby) and references in the Sponsor Side Letter to “the date hereof” and terms of similar import shall in all instances continue to refer to September 12, 2023.
7. Effect of Amendment. This
Amendment shall form a part of the Sponsor Side Letter for all purposes, and each party hereto and thereto shall be bound hereby. From and after the execution of this Amendment by the parties hereto, any reference to the Sponsor Side Letter shall
be deemed a reference to the Sponsor Side Letter as amended hereby. This Amendment shall be deemed to be in full force and effect from and after the execution of this Amendment by the parties hereto.
[Remainder of Page Intentionally Left Blank]
IN WITNESS WHEREOF, the undersigned have executed this Amendment as of the Effective Date.
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SPAC:
FOCUS IMPACT ACQUISITION CORP.
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By:
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/s/ Carl Stanton
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| Name: | Carl Stanton | ||
| Title: |
Authorized Signatory | ||
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SPONSOR:
FOCUS IMPACT SPONSOR LLC
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By:
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/s/ Carl Stanton
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| Name: |
Carl Stanton |
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| Title: |
Authorized Signatory | ||
[Signature Page to Amendment No. 2 to Sponsor Side Letter]
Acknowledged and agreed
as of the Effective Date:
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COMPANY:
DEVVSTREAM HOLDINGS, INC.
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By:
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/s/ Sunny Trinh
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Name:
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Sunny Trinh
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Title:
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Authorized Signatory
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[Signature Page to Amendment No. 2 to Sponsor Side Letter]
Exhibit 10.2
CONTRIBUTION AND EXCHANGE AGREEMENT
This CONTRIBUTION
AND EXCHANGE AGREEMENT (this “Agreement”) is made and entered into as of October 29, 2024, by and among Focus Impact Acquisition Corp., a Delaware corporation
(the “FIAC”), DevvStream Holdings Inc., a company existing under the laws of the Province of British Columbia (“DevvStream”), Crestmont Investments LLC, a Delaware limited liability company (the “Owner”). Each of the
parties hereto are referred to as a “Party” and collectively, the “Parties”.
RECITALS
WHEREAS,
FIAC, DevvStream and Focus Impact Amalco Sub Ltd., a company existing under the Laws of the Province of British Columbia (“Amalco Sub”), have entered into that
certain Business Combination Agreement, dated as of September 12, 2023, as amended as of May 1, 2024 (the “BCA”), whereby, in connection with the closing of
the transactions contemplated by the BCA (the “BCA Closing”), (a) FIAC will be continued from the State of Delaware under the Delaware General Corporation Law
to the Province of Alberta, Canada, and thereby become a company existing under the Business Corporations Act (Alberta) and will change its name to DevvStream Corp. (“New
PubCo”) and (b) DevvStream and Amalco Sub will amalgamate to form one corporate entity (such transactions, the “BCA Transactions”);
WHEREAS, following the consummation of the BCA Transactions and prior to the transactions contemplated by this
Agreement, New PubCo will effect a 1:6.5387 stock split in respect of the New PubCo Common Stock which resulted in New PubCo having the capitalization described herein (the “PubCo
Stock Split;
WHEREAS, the Owner
collectively owns all of the outstanding common units (the “MSP Interests”) of Monroe Sequestration Partners LLC, a Delaware limited liability company (the “Company”);
and
WHEREAS, immediately following the BCA Transactions, the Owner desires to contribute 2,000,000 units of the MSP
Interests (the “Contributed Interests”) to New PubCo, in exchange for 2,000,000 newly issued shares of New PubCo Common Stock (such shares of New PubCo, the “New PubCo Shares”) as set forth herein.
AGREEMENT
NOW, THEREFORE,
in consideration of the mutual covenants and agreements hereinafter set forth and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows:
1. Defined Terms. As used herein, the following terms shall have the following meanings:
“Affiliate” means, with
respect to any Person, any other Person directly or indirectly controlling, controlled by or under common control with such Person as of the date on which, or at any time during the period for which, the determination of affiliation is being made
(for purposes of this definition, the term “control” and the correlative meanings of the terms “controlled by” and “under common control with,” as used with respect to any Person, means the possession, direct or indirect, of the power to direct or
cause the direction of the management and policies of such Person, whether through the ownership of voting securities, by contract or otherwise).
1
“Applicable Laws” means
all applicable provisions of (a) constitutions, treaties, statutes, laws (including the common law), rules, regulations, decrees, ordinances, codes, proclamations, declarations, or Orders of any Governmental Authority, (b) any consents or approvals
of any Governmental Authority and (c) any orders, decisions, advisory or interpretative opinions, injunctions, judgments, awards, decrees of, or agreements with, any Governmental Authority.
“Business Day” means any
day other than a Saturday, Sunday or other day that banks are not authorized to be open for business in New York State and the Provinces of Ontario and Alberta, Canada.
“Exchange Act” means the
Securities Exchange Act of 1934, as amended.
“FIAC Class A Shares”
means the shares of Class A common stock, par value $0.0001 per share, of FIAC.
“FIAC Class B Shares”
means the shares of Class B common stock, par value $0.0001 per share, of FIAC.
“FIAC Private Warrants”
means non-redeemable whole warrants, issued in a private placement to the Sponsor (as defined in the BCA) at the time of the consummation of the IPO (as defined in the BCA), entitling the holders thereof to purchase one (1) FIAC Class A Share at a
purchase price of $11.50 per share.
“FIAC Public Warrants”
means redeemable whole warrants, one-half (1/2) of each such warrant which was included as part of each SPAC Unit (as defined in the BCA) issued in the IPO (as defined in the BCA), entitling the holders thereof to purchase one (1) FIAC Class A Share
at a purchase price of $11.50 per share.
“FIAC Shares” mean the
FIAC Class A Shares and the FIAC Class B Shares.
“Governmental Authority”
means any federal, state, provincial, local, municipal, or foreign government or political subdivision thereof, or any agency or instrumentality of such government or political subdivision, or any self-regulated organization or other non-governmental
regulatory authority or quasi-governmental authority (to the extent that the rules, regulations, or orders of such organization or authority have the force of law), or any arbitrator, court, or tribunal of competent jurisdiction.
“Governing Documents”
means (a) with respect to any Person that is a corporation, its certificate of incorporation and bylaws, or comparable documents, (b) with respect to any Person that is a partnership, its certificate of partnership and partnership agreement, or
comparable documents, (c) with respect to any Person that is a limited liability company, its certificate of formation and limited liability company agreement, or comparable documents, (d) with respect to any Person that is a trust, its declaration
of trust, or comparable documents and (e) with respect to any other Person that is not an individual, its comparable organizational documents.
“Liens” means any
pledge, lien, charge, option, hypothecation, mortgage, deed of trust, security interest, community property interest, adverse right, license, sublicense or any other encumbrance.
“Nasdaq” means the
NASDAQ Global Select Market, the NASDAQ Global Market or the NASDAQ Capital Market on which the New PubCo Common Stock is listed or quoted for trading on the date in question.
“New PubCo Common Stock”
means the shares of common shares of New PubCo.
“Order” means any order,
directive, decree, ruling, judgment, injunction, writ, determination, binding decision, verdict, award or other action that is or has been made, entered, rendered, or otherwise put into effect by or under the authority of any Governmental Authority.
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“Outside Date” has the
meaning set forth in Section 11(b).
“Permitted Transferee”
means a transferee receiving shares pursuant to a Permitted Transfer (as defined in Section 8).
“Person” means any
individual, corporation (including not-for-profit), general or limited partnership, limited liability company, joint venture, estate, trust, association, organization, Governmental Authority or other entity of any kind or nature.
“Proceeding” means any
notice of noncompliance or violation, or any claim, demand, action, suit, proceeding, complaint (including a qui tam complaint), charge, hearing, litigation, audit, settlement, labor dispute, inquiry, civil investigative demand, subpoena,
stipulation, assessment, arbitration, demand for recoupment or revocation, or any request (including any request for information) or investigation before or by a Governmental Authority or an arbitrator.
“Registration Rights Agreement”
means that certain Registration Rights Agreement, dated as of the BCA Closing, in substantially the form attached as Exhibit 10.3 to FIAC’s current report on form 8-K filed by FIAC on September 13, 2023.
“Registration Statement”
has the meaning set forth in the Registration Rights Agreement.
“SEC” means the United
States Securities and Exchange Commission.
“Securities Act” means
the Securities Act of 1933, as amended.
2. Contribution and Exchange. At the Closing (as defined below), (i) all of the Owner’s right, title and interest in and to the Contributed Interests set forth on Schedule A will be contributed, assigned, transferred and delivered to New PubCo free and clear of any Liens, other than any restrictions imposed by applicable
securities laws and (ii) as consideration for the contribution, assignment, transfer and delivery of the Contributed Interests, New PubCo will issue in the name of the
Owner the number of New PubCo Shares set forth on Schedule A, which the Parties agree have a value at the Closing, in the aggregate, equal to the aggregate value of the Contributed Interests (such transactions set forth in clause (i) and
(ii) collectively, the “MSP Exchange”). The New PubCo Shares shall be
delivered via a book-entry record through New PubCo’s transfer agent.
3. Closing. The closing of the MSP Exchange (the “Closing”) shall take place remotely via
exchange of documents and signatures immediately following the consummation of the BCA Transactions and the PubCo Stock Split, upon the terms and subject to the satisfaction or waiver of the conditions set forth in Section 10 (such date, the “Closing Date”).
a. At the Closing, as a
condition precedent to the obligation of New PubCo to issue to the Owner the New PubCo Shares pursuant to Section 2, the Owner shall deliver to New PubCo:
(i) a duly executed assignment of the Contributed Interests from the Owner to New PubCo, reflecting the assignment of all the Contributed Interests to New PubCo; and
(ii) a fully completed
IRS Form W-9, duly executed by the Owner or the Owner’s regarded owner for tax purposes dated as of the date of the Closing.
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b. At the Closing, as
condition precedent to the obligations of the Owner to contribute to New PubCo the Contributed Interests pursuant to Section 2, New PubCo shall deliver to the Company:
(i) a duly executed joinder to the Limited Liability Company Agreement, dated as of September 6, 2023, as amended or supplemented from time to time, of the Company, in form and
substance reasonable satisfactory to the Company.
4. Representations and Warranties of the Owner. To induce FIAC (and, after the BCA Transactions, New PubCo as successor to FIAC) to receive the Contributed Interests and issue the
New PubCo Shares as herein provided, the Owner represents and warrants to FIAC (or New PubCo) and DevvStream as of the date hereof and as of the Closing, except to the
extent such representations and warranties expressly relate to another date (in which case as of such other date):
a. The Owner is a limited
liability company organized under the laws of Delaware.
b. Other than the MSP
Interests, the Company does not have any issued and outstanding equity interests except as set forth on Section 4(b) of the disclosure letter to this Agreement (the “Disclosure
Letter”). All of the MSP Interests have been duly authorized and validly issued.
c. The MSP Interests (i)
were not issued in violation of the Governing Documents of the Company or any contract to which the Company is party or bound, in each case, in any material respect, (ii) were not issued in violation of any preemptive rights, call option, right of
first refusal or first offer, subscription rights, or similar rights of any person, and (iii) have been offered, sold and issued in compliance with applicable securities laws, in each case under clauses (ii) and (iii), in all material respects.
d. The MSP Interests are
not subject to any preemptive rights, call option, right of first refusal or first offer, subscription rights, or similar rights of any person, and the MSP Exchange is not in violation of the Governing Documents of the Company.
e. The Owner has the
requisite power and authority to execute, deliver and perform his or its obligations under this Agreement and to consummate the MSP Exchange, without the need for the consent of any other Person (other than such consents as have heretofore been
obtained). This Agreement has been duly authorized, executed and delivered by the Owner and constitutes the valid and binding obligation of the Owner, enforceable against the Owner in accordance with the terms hereof, except as such enforceability
may be limited by principles of public policy and subject to the laws of general application relating to bankruptcy, insolvency, moratorium or other similar laws affecting or relating to creditors’ rights generally and rules of law and equity
governing specific performance, injunctive relief and other equitable remedies.
f. No Proceeding is
pending or to the actual knowledge of the Owner, threatened, against the Owner with respect to the Owner’s execution and delivery of this Agreement or the consummation by the Owner of the MSP Exchange.
g. No consent, approval or
authorization of or registration, qualification or filing with any Person, is required for the execution and delivery of this Agreement and the documents contemplated hereby by the Owner or for the consummation by the Owner of the MSP Exchange.
h. The Owner has good and
valid title to the Contributed Interests, free and clear of all Liens, other than any restrictions imposed by applicable securities laws. Upon delivery of and issuance of the Contributed Interests to New PubCo as contemplated hereunder, good and valid title to such Contributed Interests will pass to New PubCo, free and clear of any Liens, other than Liens imposed by or on behalf of New PubCo or by
applicable securities laws. Other than this Agreement and the Governing Documents of the Company, there is no voting trust agreement or other contract restricting or otherwise relating to the voting, dividend rights or disposition of such
Contributed Interests.
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i. The Contributed
Interests represent fifty (50%) percent of the MSP Interests.
j. The New PubCo Shares
to be acquired by the Owner pursuant to this Agreement are being acquired for his or its own account, not as a nominee or agent for any other person and without a view to the distribution of such New PubCo Shares or any interest therein in
violation of the Securities Act or any state securities laws. The Owner is financially able to hold the New PubCo Shares for long-term investment, believe that the nature and amount of the New PubCo Shares being acquired are consistent with their
overall investment program and financial position, and recognize that there are substantial risks involved in the acquisition of the New PubCo Shares. The Owner understands
that its investment in New PubCo involves a high degree of risk and are able to bear the economic risk of such investment for an indefinite period of time, including the risk of a complete loss of the Owner’s investment in such securities.
k. The Owner’s address is
as set forth below its name on Schedule A.
l. Assuming the accuracy
of the representations and warranties of FIAC (and, after the BCA Transactions, New PubCo as successor to FIAC) set forth in Section 6, the MSP Exchange is
exempt from the registration requirements of the Securities Act.
m. The Owner (i) is a
“qualified institutional buyer” (as defined in Rule 144A under the Securities Act) or an “accredited investor” (within the meaning of Rule 501(a)(1), (2), (3), (7), (8), (9), (12) or (13) of Regulation D under the Securities Act), in each case,
satisfying the applicable requirements set forth on Schedule B hereto, (ii) is acquiring the New PubCo Shares only for its own account and not for the account of others, or if the Owner is acquiring the New PubCo Shares as a fiduciary or agent for
one or more investor accounts, the owner of such account is a “qualified institutional buyer” (as defined in Rule 144A under the Securities Act) or an “accredited investor” (within the meaning of Rule 501(a)(1), (2), (3) or (7) under the Securities
Act), and the Owner has full investment discretion with respect to each such account, and the full power and authority to make the acknowledgements, representations and agreements herein on behalf of the owner of each such account, and (iii) is not
acquiring the New PubCo Shares with a view to, or for offer or sale in connection with, any distribution thereof in violation of the Securities Act or any securities laws of the United States or any other jurisdiction. The Owner shall provide the
requested information set forth on Schedule B following the signature page hereto and the information contained therein is accurate and complete. The Owner is not an entity formed for the specific purpose of acquiring the New PubCo Shares. The term
“affiliate” or “affiliated” as used in this Agreement shall mean, with respect to any individual, partnership, corporation, limited liability company, joint stock company, unincorporated organization or association, trust, joint venture or other
similar entity, whether or not a legal entity, or governmental entity (a “person”), any other person who directly or indirectly, through one or more
intermediaries, controls, is controlled by, or is under common control with, such person. The term “control” as used in this Agreement shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the
management and policies of a person, whether through the ownership of voting securities, by contract or otherwise, and the terms “controlled” and “controlling” have meanings correlative thereto.
n. The Owner acknowledges
and agrees that the New PubCo Shares are being offered in a transaction not involving any public offering within the meaning of the Securities Act and that the issuance of the New PubCo Shares has not been registered under the Securities Act or any
other applicable securities laws. The Owner acknowledges and agrees that the New PubCo Shares may not be offered, resold, transferred, pledged or otherwise disposed of by the Owner absent an effective registration statement under the Securities Act
except (i) to New PubCo or a subsidiary thereof, (ii) to non-U.S. persons pursuant to offers and sales that occur outside the United States within the meaning of Regulation S under the Securities Act or (iii) pursuant to another applicable
exemption from the registration requirements of the Securities Act, and in each of clauses (i) and (iii) in accordance with any applicable securities laws of the states and other jurisdictions of the United States, and that any book entries
representing the New PubCo Shares, shall contain a restrictive legend to such effect. The Owner acknowledges and agrees that the New PubCo Shares will be subject to transfer restrictions and, as a result of these transfer restrictions, the Owner
may not be able to readily offer, resell, transfer, pledge or otherwise dispose of the New PubCo Shares and may be required to bear the financial risk of an investment in the New PubCo Shares for an indefinite period of time. The Owner acknowledges
and agrees that the New PubCo Shares will not immediately be eligible for offer, resale, transfer or disposition pursuant to Rule 144 promulgated under the Securities Act (“Rule 144”). The Owner acknowledges and agrees that it has been advised to consult legal counsel and tax and accounting advisors prior to making any offer, resale, transfer, pledge, transfer or disposition of any of the New
PubCo Shares.
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o. The Owner acknowledges
and agrees that the Owner has received such information as the Owner deems necessary in order to make an investment decision with respect to the New PubCo Shares, including, the Business Combination and the business of FIAC and DevvStream. Without
limiting the generality of the foregoing, the Owner acknowledges that it has reviewed the SEC Filings. The Owner acknowledges and agrees that the Owner has not relied on anything other than the representations and warranties contained in Section 6
of this Agreement in making its investment decision.
p. The Owner is not (i) a person or entity named on the List of Specially Designated Nationals and Blocked Persons, the Executive Order 13599 List, the Foreign Sanctions Evaders List, or the Sectoral Sanctions Identification List,
each of which is administered by the U.S. Treasury Department’s Office of Foreign Assets Control (“OFAC”) or in any Executive Order issued by the President
of the United States and administered by OFAC (“OFAC List”), or a person or entity prohibited by any OFAC sanctions program, (ii) owned, directly or
indirectly, or controlled by, or acting on behalf of, one or more persons that are named on the OFAC Lists; (iii) organized, incorporated, established, located, resident or born in, or a citizen, national or the government, including any political
subdivision, agency or instrumentality thereof, of Cuba, Iran, North Korea, Russia, Syria, the Crimea, Donetsk or Luhansk regions of Ukraine or any other country or territory embargoed or subject to substantial trade restrictions by the United
States, (iv) a Designated National as defined in the Cuban Assets Control Regulations, 31 C.F.R. Part 515, or (v) a non-U.S. shell bank or providing banking services indirectly to a non-U.S. shell bank (each, a “Prohibited Investor”). The Owner agrees to provide law enforcement agencies, if requested thereby, such records as required by applicable law, provided that the Owner is permitted to do
so under applicable law. If the Owner is a financial institution subject to the Bank Secrecy Act (31 U.S.C. Section 5311 et seq.) (the “BSA”), as amended by
the USA PATRIOT Act of 2001 (the “PATRIOT Act”), and its implementing regulations (collectively, the “BSA/PATRIOT Act”), the Owner maintains policies and procedures reasonably designed to comply with applicable obligations under the BSA/PATRIOT Act. To the extent required, it maintains policies and procedures
reasonably designed for the screening of its investors against the OFAC sanctions programs, including, without limitation, the OFAC List.
5. Representations and Warranties of DevvStream. To induce the Owner to contribute and exchange the Contributed Interests and receive the New PubCo Shares as herein provided,
DevvStream represents and warrants to the Owner as of the date hereof and as of the Closing Date:
a. Organization. DevvStream is a corporation duly organized, validly existing and in good standing under the laws of the Province of British Columbia, Canada and is qualified to do
business in every jurisdiction in which the failure to so qualify would reasonably be expected to be material to the financial condition, operating results or assets of DevvStream.
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b. Authority. DevvStream has the requisite corporate power and authority to execute, deliver and perform its obligations under this Agreement and to consummate the MSP Exchange,
without the need for the consent of any other Person (other than such consents as have heretofore been obtained). This Agreement has been duly authorized, executed and delivered by DevvStream and constitutes the valid and binding obligation of
DevvStream, enforceable against DevvStream in accordance with the terms hereof, except as such enforceability may be limited by the laws of general application relating to bankruptcy, insolvency, moratorium or other similar laws affecting or
relating to creditors’ rights generally and rules of law and equity governing specific performance, injunctive relief and other equitable remedies.
c. Filings, Consents and Approvals. The execution and delivery by DevvStream of this Agreement, the consummation of the MSP Exchange and the fulfillment of and compliance with the
respective terms hereof and thereof by DevvStream, do not and will not as of the Closing Date (a) conflict with or result in a breach of the terms, conditions or provisions of, (b) constitute a default under, (c) result in the creation of any Lien,
security interest, charge or encumbrance upon DevvStream’s capital stock or assets under, (d) result in a violation of, or (e) require any authorization, consent, approval, exemption or other action by or notice or declaration to, or filing with,
any court or administrative or governmental body or agency pursuant to the Governing Documents of DevvStream, any material law, statute, rule or regulation to which DevvStream is subject, any agreement to which DevvStrem or its subsidiaries is a
party, or any Order, judgment or decree to which DevvStream is subject, except for any filings required after the date hereof under federal or state securities laws and except as would not reasonably be expected to be material to the financial
condition, operating results or assets of DevvStream.
d. Financial Statements; Internal Controls.
(i) The Company Financial Statements and the Required Financial Statements (each as defined in the BCA) (i) were prepared from the books and records of DevvStream and its subsidiaries or their
respective predecessors; (ii) were prepared in accordance with IFRS methodologies in the case of the Company Financial Statements and U.S. GAAP in the case of the Required Financial Statements, in each case applied on a consistent basis
throughout the periods involved, except as may be indicated in the notes thereto and subject; and (iii) fairly present, in all material respects, the consolidated financial position of DevvStream and its subsidiaries as of the dates thereof and
their consolidated results of operations and cash flows for the periods then ended.
(ii) The books of account and other financial records of DevvStream and its subsidiaries have been kept accurately in all material respects in the ordinary course of business, the transactions entered
therein represent bona fide transactions, and the revenues, expenses, assets and liabilities of DevvStream and its subsidiaries have been properly recorded therein in all material respects.
(iii) DevvStream and its subsidiaries have devised and maintained a system of internal accounting policies and controls sufficient to provide reasonable assurances that (i) transactions are executed
in all material respects in accordance with management’s authorization; (ii) the transactions are recorded as necessary to permit the preparation of financial statements in conformity with IFRS, with respect to Company Financial Statements, and
with U.S. GAAP, with respect to the Required Financial Statements, and to maintain accountability for assets; and (iii) the amount recorded for assets on the books and records of DevvStream and each of its subsidiaries is compared with the
existing assets at reasonable intervals and appropriate action is taken with respect to any difference (collectively, “Internal Controls”).
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(iv) DevvStream has not identified and has not received written notice from an independent auditor of (i) any significant deficiency or material weakness in the system of Internal Controls utilized by
DevvStream or any of its subsidiaries; (ii) any fraud that involves DevvStream’s or any of its subsidiaries’ management or other employees who have a role in the preparation of financial statements or the Internal Controls utilized by DevvStream
or any of its subsidiaries; or (iii) any claim or allegation regarding any of the foregoing. There are no significant deficiencies or material weaknesses in the design or operation of the Internal Controls over financial reporting that would
reasonably be expected to materially and adversely affect DevvStream’s, or any of its subsidiaries’, ability to record, process, summarize and report financial information.
(v) Neither DevvStream nor any of its subsidiaries has incurred any liabilities or obligations of the type required to be reflected on a balance sheet in accordance with IFRS, with respect to Company
Financial Statements, and with U.S. GAAP, with respect to the Required Financial Statements, that are not adequately reflected or reserved on or provided for in the Company Financial Statements or Required Financial Statements, as applicable,
other than (i) liabilities of the type required to be reflected on a balance sheet in accordance with IFRS or U.S. GAAP, as applicable, that have been incurred since the Balance Sheet Date (as defined in the BCA) in the ordinary course of
business or (ii) liabilities that are not, individually or in the aggregate, material in amount. All debts and liabilities, fixed or contingent, (1) which should be included under IFRS on a balance sheet are included in all material respects in
the Company Financial Statements as of the date of such Company Financial Statements and (2) which should be included under U.S. GAAP on a balance sheet are included in all material respects in the Required Financial Statements as of the date of
such Required Financial Statements. DevvStream has no off-balance sheet arrangements.
e. Absence of Certain Changes. Since the execution of the BCA, (a) DevvStream and each of its subsidiaries have conducted their respective business in the ordinary course and
consistent with past practice in all material respects.
f. Material Adverse Effect. No Company Material Adverse Effect (as defined in the BCA) shall have occurred since the date of the BCA.
g. Compliance with Laws. Neither DevvStream nor any of its subsidiaries is, and since its incorporation has ever been, in material conflict or material non-compliance with, or in
material default or violation of any Applicable Laws. Since their respective formation, neither DevvStream nor any of its subsidiaries, (i) has received any written or, to the knowledge of DevvStream or any of its subsidiaries, oral notice of any
material conflict or non-compliance with, or material default or violation of, any Applicable Laws by which it or any of its respective properties, assets, employees or other individual service providers (solely in such individuals’ capacity as
service providers to DevvStream), business, products or operations are or were bound or affected, (ii) has been subjected to any investigation by a Governmental Authority regarding any actual or alleged violation of or failure on the part of
DevvStream or any of its subsidiaries to comply with any Applicable Law, (iii) has had claims filed against it or any of its subsidiaries with any Governmental Authority alleging any failure by DevvStream or any of its subsidiaries to comply with
Applicable Law, (iv) has not made a voluntary, directed, or involuntary disclosure to any Governmental Authority regarding any alleged act or omission arising under or relating to any noncompliance with any Applicable Law.
8
h. Proceedings. Since DevvStream’s incorporation, there have been, and there are, no Proceedings or Orders of any nature currently pending or, to the knowledge of DevvStream,
threatened against DevvStream or any of its subsidiaries, and no such Proceeding or Order has been brought against DevvStream or any of its subsidiaries, or any of their respective current or former directors, officers or securityholders, business,
equity securities, or assets, or employees or other individual service providers in their capacities as such that would, individually or in the aggregate, be material to DevvStream or any of its subsidiaries, taken as a whole. No Proceeding or
Order is pending or, to the knowledge of DevvStream, threatened against DevvStream with respect to DevvStream’s execution and delivery of this Agreement or the consummation of the MSP Exchange.
6. Representations and Warranties of FIAC and New PubCo. To induce the Owner to contribute and exchange the Contributed Interests and receive the New PubCo Shares as herein
provided, FIAC (and, after the BCA Transactions, New PubCo as successor to FIAC) represent and warrant to the Owner as of the date hereof and as of the Closing Date:
a. Organization. As of the date hereof, FIAC is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware and is qualified to do
business in every jurisdiction in which the failure to so qualify would reasonably be expected to be material to the financial condition, operating results or assets of FIAC. After the consummation of the BCA Transactions, New PubCo will be a
corporation duly organized, validly existing and in good standing under the laws of the Province of Alberta, Canada and qualified to do business in every jurisdiction in which the failure to so qualify would reasonably be expected to be material to
the financial condition, operating results or assets of New PubCo.
b. Authority. FIAC (or New PubCo) has the requisite corporate power and authority to execute, deliver and perform its obligations under this Agreement and to consummate the MSP
Exchange, without the need for the consent of any other Person (other than such consents as have heretofore been obtained). This Agreement has been duly authorized, executed and delivered by FIAC and constitutes the valid and binding obligation of
FIAC, enforceable against FIAC (or New PubCo) in accordance with the terms hereof, except as such enforceability may be limited by the laws of general application relating to bankruptcy, insolvency, moratorium or other similar laws affecting or
relating to creditors’ rights generally and rules of law and equity governing specific performance, injunctive relief and other equitable remedies.
c. Filings, Consents and Approvals. The execution and delivery by FIAC of this Agreement, the consummation of the MSP Exchange and the issuance of the New PubCo Shares, and the
fulfillment of and compliance with the respective terms hereof and thereof by FIAC (or New PubCo), do not and will not as of the Closing Date (a) conflict with or result in a breach of the terms, conditions or provisions of, (b) constitute a
default under, (c) result in the creation of any Lien, security interest, charge or encumbrance upon the FIAC (or New PubCo)’s capital stock or assets under, (d) result in a violation of, or (e) require any authorization, consent, approval,
exemption or other action by or notice or declaration to, or filing with, any court or administrative or governmental body or agency pursuant to the Governing Documents of FIAC (or New PubCo), any material law, statute, rule or regulation to which
FIAC (or New PubCo) is subject, any agreement to which FIAC (or New PubCo) is a party, or any Order, judgment or decree to which FIAC (or New PubCo) is subject, except for any filings required after the date hereof under federal or state securities
laws and except as would not reasonably be expected to be material to the financial condition, operating results or assets of FIAC (or New PubCo).
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d. Capitalization.
(i) As of the date hereof, the authorized capital stock of FIAC consists of: 551,000,000 shares of capital stock, consisting of 550,000,000 FIAC Shares, including (i) 500,000,000 FIAC Class A Shares
and 50,000,000 FIAC Class B Shares and (ii) 1,000,000 undesignated shares of preferred stock (the “FIAC Preferred Shares”). As of the date of this Agreement, there are 7,467,578 FIAC Shares issued and outstanding, including 6,717,578 FIAC Class A Shares and 750,000 FIAC Class B Shares, and no
FIAC Preferred Shares issued or outstanding. There are 11,500,000 FIAC Public Warrants with a strike price of $11.50 and 11,200,000 FIAC Private Warrants outstanding with a strike price of $11.50. All outstanding FIAC Shares are duly authorized,
validly issued, fully paid and non-assessable and are not subject to or issued in violation of any purchase option, right of first refusal, preemptive right, subscription right or any similar right under any provision of the DGCL, FIAC’s
Governing Documents or any contract to which FIAC is a party. None of the FIAC Shares, FIAC Public Warrants or FIAC Private Warrants have been issued in violation of any applicable securities laws.
(ii) At the Closing, after the BCA Transactions and the New PubCo Stock Split, the authorized capital stock of New PubCo will consist of an unlimited number of New PubCo Common Stock and an unlimited
number of New PubCo preferred shares. At the Closing, after the BCA Transactions and the New PubCo Stock Split, the issued and outstanding capital stock of New PubCo will consist of no more than 30,000,000 shares of New PubCo Common Stock. All
outstanding New PubCo Shares following the consummation of the BCA Transactions will be duly authorized, validly issued, fully paid and non-assessable and are not subject to or issued in violation of any purchase option, right of first refusal,
preemptive right, subscription right or any similar right under any provision of the DGCL, New PubCo’s Governing Documents or any contract to which New PubCo is a party. None of the shares of New PubCo Common Stock have been issued in violation
of any applicable securities laws.
(iii) Other than the FIAC Public Warrants, the FIAC Private Warrants, and anything disclosed in a SEC Filing, there are no (i) outstanding options, warrants, puts, calls, convertible securities,
preemptive or similar rights, (ii) bonds, debentures, notes or other indebtedness having general voting rights or that are convertible or exchangeable into securities having such rights or (iii) subscriptions or other rights, agreements,
arrangements, contracts or commitments of any character (other than this Agreement and the BCA), in each case (A) relating to the issued or unissued shares of FIAC (or New PubCo), (B) obligating FIAC (or New PubCo) to issue, transfer, deliver or
sell or cause to be issued, transferred, delivered, sold or repurchased any options or shares or securities convertible into or exchangeable for such shares, or (C) obligating FIAC (or New PubCo) to grant, extend or enter into any such option,
warrant, call, subscription or other right, agreement, arrangement or commitment for such capital shares. There are no outstanding obligations of FIAC (or New PubCo) to repurchase, redeem or otherwise acquire any shares of FIAC (or New PubCo) or
to provide funds to make any investment (in the form of a loan, capital contribution or otherwise) in any Person. Except as set forth on Section 6(d)(iii)
to the Disclosure Letter, there are no agreements or arrangements under which FIAC (or New PubCo) is obligated to register the sale of any of its securities under the Securities Act.
(iv) FIAC (or New PubCo) does not have any outstanding stockholder purchase rights or “poison pill” or any similar arrangement in effect giving any Person the right to purchase any equity interest in
FIAC (or New PubCo) upon the occurrence of certain events.
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e. Issuance of New PubCo Shares. Upon issuance, the Owner will have good title to the New PubCo Shares, and all of the New PubCo Shares will be (i) duly authorized, validly issued,
fully paid and nonassessable, (ii) free and clear of all Liens, (iii) assuming the accuracy of the representations and warranties of the Owner, issued in compliance with applicable securities laws or exemptions therefrom, and (iv) will not be
subject to or issued in violation of any purchase option, call option, right of first refusal, preemptive right or any similar right under any provision of the Governing Documents of FIAC (or New PubCo) or any contract by which FIAC (or New PubCo)
is otherwise bound.
f. Reports, Registrations and Statements.
(i) Since April 23, 2021, FIAC (or New PubCo) has filed all material reports, registrations, documents, filings, submissions and statements, together with any required amendments thereto, that it was
required to file with any applicable foreign, federal or state securities authorities. All such reports and statements filed with any such regulatory body or authority are collectively referred to herein as the “SEC Filings.” As of their respective dates, or as of the date of any amendment (if applicable), the SEC Filings complied in all material respects with all the rules and regulations
promulgated by any other applicable foreign, federal, or state securities authorities, as the case may be.
(ii) The financial statements and notes of FIAC (or New PubCo) contained or incorporated by reference in the SEC Filings (the “FIAC Financials”) fairly present in all material respects the financial position and the results of operations, changes in shareholders’ equity and cash flows of FIAC (or New PubCo) at the respective dates of and
for the respective periods referred to in such financial statements, all in accordance with (i) GAAP applied on a consistent basis throughout the periods involved and (ii) Regulation S-X or Regulation S-K, as applicable (except as may be
indicated in the notes thereto and for the omission of notes and audit adjustments in the case of unaudited quarterly financial statements to the extent permitted by Regulation S-X or Regulation S-K, as applicable). For the avoidance of doubt,
with respect to FIAC Financials reflecting only the financial statements of FIAC (and not those of New PubCo or DevvStream), (i) any restatement of the financial statements of FIAC (or New PubCo) and any amendments to previously filed SEC Filings
or delays in filing SEC Filings, in connection with any guidance from the SEC following the date of this Agreement and (ii) any amendment or modification of any SEC Filing (or any agreement filed as an exhibit to any SEC Filing) from its initial
filing date in a subsequent filing, in each case, shall not be deemed to constitute a breach of this Section 6(f)(ii).
(iii) Except as and to the extent reflected or reserved against in the FIAC Financials or as incurred in connection with this Agreement, FIAC (or New PubCo) has not incurred any liabilities or
obligations of the type required to be reflected on a balance sheet in accordance with GAAP that are not adequately reflected or reserved on or provided for in the FIAC Financials, other than (i) liabilities of the type required to be reflected
on a balance sheet in accordance with GAAP that have been incurred since June 30, 2024 in the ordinary course of business, (ii) liabilities that are not, individually or in the aggregate, material in amount or (iii) liabilities incurred in
connection with the entry into this Agreement. FIAC (or New PubCo) has no material off-balance sheet arrangements that are not disclosed in the SEC Filings. No financial statements other than those included or incorporated by reference in the SEC
Filings is or was required to be included in the SEC Reports.
g. Compliance with Laws. FIAC (or New PubCo) is not, and since its incorporation has never been, in material conflict or material non-compliance with, or in material default or
violation of any Applicable Laws.
11
h. Proceedings. No Proceeding is pending or, to the actual knowledge of FIAC (or New PubCo) or DevvStream, threatened against FIAC (or New PubCo) or DevvStream with respect to FIAC
(or New PubCo)’s or DevvStream’s execution and delivery of this Agreement or the consummation of the MSP Exchange.
i. Regulation D Qualification. Neither FIAC (or New PubCo) nor, to its actual knowledge, any of its affiliates, members, officers, directors or beneficial
stockholders of 20% or more of its outstanding securities, has experienced a disqualifying event as enumerated pursuant to Rule 506(d) of Regulation D under the Securities Act.
j. No Directed Selling Efforts or General Solicitation. Neither FIAC (or New PubCo) nor any Person acting on its behalf has conducted any general solicitation or
general advertising (as those terms are used in Regulation D) in connection with the offer or sale of any of the New PubCo Shares.
k. No Integrated Offering. Neither FIAC (or New PubCo) nor its subsidiaries nor any Person acting on their behalf has, directly or indirectly, made any offers or sales of any FIAC
(or New PubCo) security or solicited any offers to buy any FIAC (or New PubCo) security, under circumstances that would adversely affect reliance by FIAC (or New PubCo) on Section 4(a)(2) and Regulation D for the exemption from registration for the
transactions contemplated hereby or would require registration of the Securities Act, nor will FIAC (or New PubCo) take any action or steps that would adversely affect reliance by FIAC (or New PubCo) on Section 4(a)(2) and Regulation D for the
exemption from registration for the transactions contemplated hereby or require registration of the New PubCo Common Stock under the Securities Act.
l. Private Placement. Assuming the accuracy of the representations and warranties of the Owner set forth in Section 4, the MSP Exchange is exempt from the registration requirements of the Securities Act. The issuance of the New PubCo Shares does not contravene the rules and regulations of Nasdaq.
7. Registration Rights.
a. Except with respect to
certain definitions set forth below, capitalized terms in this Section 7 shall have the meanings given to them in the Registration Rights Agreement.
(i) “Holder” shall mean the Owner and each transferee holder of Registrable Securities pursuant to
a Permitted Transfer (as defined in Section 8).
(ii) “Registrable Securities” shall mean (a) the New PubCo Shares, (b) any shares of New PubCo Common
Stock or warrants with respect to New PubCo Common Stock otherwise acquired or owned by a Holder following the date hereof to the extent that such securities are “restricted securities” (as defined in Rule 144) or are otherwise held by an
“affiliate” (as defined in Rule 144) of FIAC (or New PubCo), and (c) any other equity security of the FIAC (or New PubCo) or any of its subsidiaries issued or issuable with respect to any securities referenced in clauses (a) and (b) above by way
of a stock dividend or stock split or in connection with a recapitalization, merger, consolidation, spin-off, reorganization or similar transaction; provided, however, that such Registrable Securities shall cease to be Registrable Securities with
respect to any Holder upon the earliest to occur of (x) when such Registrable Securities shall have been sold, transferred, disposed of or exchanged by such Holder in a transaction effected in accordance with, or exempt from, the registration
requirements of the Securities Act, and (y) the date on which such securities shall have ceased to be outstanding.
12
b. Section 2(a)(i) and
(ii), Section 2(d), Section 3, Section 4, Section 5, Section 6(a), and Section 6(l) of the Registration Rights Agreement is incorporated herein by reference.
c. Prior to filing the
Registration Statement, FIAC (or New PubCo) shall provide the Owner with a reasonable opportunity to review such Registration Statement, and shall consider in good faith any comments with respect to the Owner’s information.
d. After the date hereof,
no Registration Statement shall be filed by New PubCo prior to the filing of the Registration Statement which includes the Registrable Securities.
8. Prohibition on Transfers.
a. For purposes of this Section 8, the following capitalized terms shall have the following meanings:
(i) “Beneficial Ownership” has the meaning ascribed to such term in Rule 13d-3 under the Exchange
Act. The terms “Beneficially Own,” “Beneficially Owned” and “Beneficial Owner” shall each have a correlative meaning.
(ii) “Free
Trading Shares” shall mean, with respect to the Owner, any New PubCo Shares that are no longer subject to the transfer
restrictions contemplated by this Section 8 due to the expiration of an applicable Lock-up Period (as defined below) and become freely tradable
without restriction pursuant to the effective Registration Statement or pursuant to Rule 144 promulgated under the Securities Act, in the event the Registration Statement is unavailable for any reason for the re-sale of such New PubCo Shares.
(iii) “Lock-Up
Periods” and, each, a “Lock-Up Period” shall mean the following (i) the period
commencing on the Closing Date and ending on the date prior to the effective date of the Registration Statement during which 100% of the Owner’s New PubCo Shares shall be subject to the transfer restrictions contemplated by this Section 8; (ii) the period commencing on the effective date of the Registration Statement, where upon such date 20% of the Owner’s originally issued
New PubCo Shares shall become Free Trading Shares; (iii) the period commencing on the effective date of the effectiveness of the Registration Statement and ending on the 90th day following the effectiveness of the Registration Statement, where
upon such date an additional 30% of each Holder’s originally issued New PubCo Shares shall become Free Trading Shares; (iv) the period commencing on the effective date of the Registration Statement and ending on the 365th day following the
effectiveness of the Registration Statement, where upon the remaining New PubCo Shares of the Owner shall become Free Trading Shares.
13
(iv) “Permitted Transfer” means a Transfer (as defined below) of New PubCo Shares (i) as a bona fide gift or gifts or charitable contribution provided that the donee or successor agrees to be bound in writing by the restrictions set
forth in this Section 8 for the balance of the applicable Lock-Up Period, (ii) sales or other dispositions of New PubCo Shares, in each case that
are made exclusively between and among the Owner and Affiliates of the Owner, including its partners (if a partnership) or members (if a limited liability company); provided that the transferee agrees to be bound in writing by the restrictions
set forth in this Section 8 for the balance of the applicable Lock-Up Period, (iii) to any trust or family limited partnership for the direct or
indirect benefit of the Owner, provided that the trustee of the trust or general partner of the family limited partnership, as the case may be, agrees to be bound in writing by the restrictions set forth in this Section 8 for the balance of the applicable Lock-Up Period, (iv) transfers to the Owner’s limited partners, beneficial interest owners, members or shareholders as part of a
distribution, or to any corporation, partnership or other business that is an Affiliate of the Owner, provided that each transferee agrees to be bound in writing by the restrictions set forth in this Section 8 for the balance of the applicable Lock-Up Period, (v) transfers covered above to any corporation, partnership or other business entity with which such Owner shares in common an
investment manager or advisor that has investment discretionary authority with respect to the Owner’s and the entity’s investments pursuant to an investment advisory or similar agreement, provided that the transferee agrees to be bound in writing
by the restrictions set forth in this Section 8 for the balance of the applicable Lock-Up Period; (vi) the transfer of New PubCo Shares pursuant
to a bona fide third party tender offer, merger, consolidation or other similar transaction involving a Change of Control (as defined below) that is approved by the board of directors of New PubCo; or (vii) with the prior written consent of New
PubCo, such consent not to be unreasonably withheld. For purposes of this Section
8, “Change of Control” shall mean the transfer (whether by tender offer, merger, consolidation or other similar transaction), in one transaction or a series of related transactions, to a person or group of affiliated persons,
of New PubCo’s voting securities if, after such transfer, such person or group of affiliated persons would hold more than 50% of the outstanding voting securities of New PubCo (or the surviving entity).
(v) “Transfer” means, directly or indirectly, to sell, transfer, gift, assign, pledge, hedge or
similarly dispose of (including by merger (including by conversion into securities or other consideration), by tendering into any tender or exchange offer, by testamentary disposition, by operation of law or otherwise), either voluntarily or
involuntarily, or to enter into any contract, option or other arrangement or understanding with respect to the voting of or sale, transfer, gift, assignment, pledge, hedge or similar disposition of (including by merger, by tendering into any
tender or exchange offer, by testamentary disposition, by operation of law or otherwise).
b. The Owner agrees that,
from the Closing Date and until the conclusion of such applicable Lock-up Period (and without limitation of the provisions set forth in Section 8(c), the
Owner shall not (i) Transfer or permit the Transfer of the Owner’s New PubCo Shares, Beneficial Ownership thereof or any other interest therein unless such Transfer is a Permitted Transfer effected in accordance with the terms of this Section 8; or (ii) take any action that would restrict or otherwise adversely affect the Holder’s legal power, authority and right to comply with and
perform its covenants and obligations pursuant to this Section 8. Any Transfer in violation of this provision shall be void ab initio. For purposes of clarity, any New PubCo Shares that become Free Trading Shares, pursuant to the termination of the applicable Lock-up
Period, are not subject to the transfer restrictions contemplated by this Section 8(b).
c. Notwithstanding the
foregoing, if, following the Closing Date, the closing price of the New PubCo Common Stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like, including but not limited
to, the reverse split factor contemplated by the Business Combination Agreement) for any 20 trading days within a 30-trading day period commencing at least 150 days after the Closing Date, the Owner’s New PubCo Shares shall be released from the
transfer restrictions contemplated by this Section 8.
14
9. Other Covenants and Agreements.
a. Nasdaq Listing. FIAC (or New PubCo) will use commercially reasonable efforts to continue the listing and trading of the New PubCo Common Stock on Nasdaq and, in accordance
therewith, will use commercially reasonable efforts to comply in all material respects with FIAC (or New PubCo)’s reporting, filing and other obligations under the rules of such exchange.
b. Board Observer. Following the Closing, the Owner or its Permitted Transferee(s) shall collectively designate one observer to the board of directors of New PubCo for so long as any
Owner or any Permitted Transferee of the Owner owns at least 50% of the New PubCo Shares.
c. Tax Election. The Company (and any subsidiary of the Company that is a partnership for US federal income tax purposes) shall make an election pursuant to Section 754 of the
Internal Revenue Code of 1986, as amended, effective as of the taxable year that includes the Closing Date to the extent such election is not already in effect.
10. Conditions to Closing.
a. Conditions to all Parties Obligations. The obligations of the Parties to consummate the MSP Exchange are subject to the fulfillment, on or before the Closing Date, of each of the
following conditions:
(i) BCA Closing. The BCA Closing shall have occurred.
(ii) Nasdaq Listing. The New PubCo Shares shall have been approved for listing on the
Nasdaq Stock Market.
No Injunction. No litigation,
statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed by or in any court or Governmental Authority of competent jurisdiction or any self-regulatory organization having
authority over the matters contemplated hereby, which prohibits the consummation of the BCA Transactions, the New PubCo Stock Split or the transactions contemplated by this Agreement.
b. Conditions of the Owner’s Obligations. The obligations of the Owner to consummate the MSP Exchange are subject to the fulfillment, on or before the Closing Date, of each of the
following conditions:
(i) Representations and Warranties. The representations and warranties of DevvStream and
FIAC (or New PubCo) contained in Section 5 and Section 6,
respectively, shall be true and correct at and as of the date hereof and at and as of the Closing Date as though then made.
(ii) Performance. FIAC (or New PubCo) and DevvStream shall have performed and complied
with all agreements, obligations and conditions contained in this Agreement that are required to be performed or complied with by them on or before such Closing Date.
(iii) Stop Orders. No stop order or suspension of trading shall have been imposed by
Nasdaq, the SEC or any other Governmental Authority with respect to public trading in the New PubCo Common Stock.
(iv) New PubCo Stock Split Completion. The New PubCo Stock Split shall have been
completed and New PubCo shall have provided evidence thereof to the Owner.
15
c. Conditions of FIAC’s and DevvStream’s Obligations. The obligations of FIAC and DevvStream to consummate the MSP Exchange are subject to the fulfillment, on or before the Closing
Date, of each of the following conditions:
(i) Representations and Warranties. The representations and warranties of the Owner
contained in Section 4 shall be true and correct at and as of the date hereof and at and as of the Closing Date as though then made.
(ii) Performance. The Owner shall have performed and complied with all agreements,
obligations and conditions contained in this Agreement that are required to be performed or complied with by them on or before such Closing Date.
11. Termination.
a. This Agreement may be
terminated at any time prior to the MSP Exchange, by:
(i) Mutual written consent of the Parties hereto.
(ii) Any Party hereto, if any Governmental Authority shall have enacted, issued, promulgated, enforced or entered any Applicable Law or Order after the date of this Agreement that is in effect
and prevents the consummation of the MSP Exchange or the BCA Transactions and such Applicable Law or Order shall have become final and non-appealable.
(iii) Any Party hereto, if the MSP Exchange shall not have been consummated by 5:00 p.m. (Eastern Standard time) on the date that is thirty (30) days from the date hereof (the “Outside Date”).
(iv) FIAC (or New PubCo) or DevvStream, if there has been a breach of any representation, warranty, covenant or agreement made by the Owner set forth in this Agreement, such that the conditions
set forth in Section 10.c) would not be satisfied (and such breach is not curable prior to the Outside Date); provided, that neither FIAC (or New PubCo) nor DevvStream may terminate the Agreement under this Section 11.d if such failure to satisfy
a condition was caused by FIAC (or New PubCo)’s or DevvStream’s, as applicable, material breach of this Agreement or if FIAC (or New PubCo) or DevvStream is otherwise in material breach of this Agreement.
(v) The Owner, if there has been a breach of any representation, warranty, covenant or agreement made by either of FIAC (or New PubCo) or DevvStream set forth in this Agreement, such that the
conditions set forth in Section 10.b) would not be satisfied (and such breach is not curable prior to the Outside Date); provided, that the Owner may not terminate the Agreement under this Section 11.e if such failure to satisfy a condition was
caused by the Owner’s material breach of this Agreement or if the Owner is otherwise in material breach of this Agreement.
b. In the event that any
Party hereto terminates this Agreement pursuant to Section 11(a)(iii), FIAC shall pay to the Owner its reasonable and documented out-of-pocket expenses
incurred in connection with the negotiation and execution of this Agreement.
16
12. Miscellaneous.
a. Amendments and Waivers. The provisions of this Agreement may be amended modified or waived at any time, in whole or in part, upon the written agreement of the Parties hereto. The
failure of any party to enforce any provision of this Agreement shall not be construed as a waiver of such provision and shall not affect the right of such party thereafter to enforce each provision of this Agreement in accordance with its terms.
b. Entire Agreement. This Agreement contains the entire understanding of the parties hereto with regard to the subject matter contained in this Agreement and supersedes all prior
agreements or understandings of the parties in any way to the contribution and exchange, as applicable, of the equity interests of MSP.
c. Further Assurances. Each Party hereto shall cooperate and take such action as may be reasonably requested by another party hereto in order to carry out the provisions and
purposes of this Agreement and to consummate the MSP Exchange.
d. Notices. All notices, demands and other communications to be given or delivered under or by reason of the provisions of this Agreement shall be in writing and shall be deemed to
have been given only (a) when delivered personally to the recipient, (b) one (1) Business Day after being sent to the recipient by reputable overnight courier service (charges prepaid), (c) when sent by electronic mail if sent prior to 5:00 p.m.
(Eastern Time) on a Business Day and on the next Business Day if sent after 5:00 p.m. (Eastern Time) on a Business Day or on any day that is not a Business Day or (d) five (5) Business Days after being mailed to the recipient by certified or
registered mail (return receipt requested and postage prepaid). Such notices, demands and other communications shall be sent to the address for such recipient set forth herein, or to such other address or to the attention of such other person as
the recipient party has specified by prior written notice to the sending party. A party may change its address, contact person or email address by providing written notice, in accordance with the foregoing provisions of this Section 12.d), to the other parties of such change. Any notice to the
Owner shall be sent pursuant to the methods set forth herein to the contact information set forth on Schedule A.
Any notice to FIAC, DevvStream or New PubCo shall be sent pursuant to the methods set forth herein to:
DevvStream Corp.
c/o DevvStream Holdings Inc.
2133-1177 West Hastings Street
Vancouver, BC V6E 2K3
Attention: Sunny Trinh
E-mail: sunny@devvstream.com
with a copy (which shall not constitute notice) to:
Morrison & Foerster LLP
12531 High Bluff Drive
San Diego, CA 92130
Attention: Shai Kalansky; Omar Pringle; Justin Salon
Email: skalansky@mofo.com; opringle@mofo.com; justinsalon@mofo.com
and
Kirkland & Ellis LLP
601 Lexington Avenue
New York, NY 10022
Attn: Lauren M. Colasacco, P.C.; Peter Seligson, P.C.
Email: lauren.colasacco@kirkland.com; peter.seligson@kirkland.com
17
e. Governing Law; Forum. This Agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware, without giving effect to any choice of law or
conflict of law rules or provisions (whether of the State of Delaware or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Delaware. Subject to Section 12.f), any Proceedings arising out of or based upon this Agreement, or the
transactions contemplated hereby shall be instituted exclusively in the Delaware Chancery Court or the United States District court for the District of Delaware and each party irrevocably submits to the exclusive jurisdiction of such courts in any
such Proceedings.
f. Waiver of Jury Trial. BECAUSE DISPUTES ARISING IN CONNECTION WITH COMPLEX TRANSACTIONS ARE MOST QUICKLY AND ECONOMICALLY RESOLVED BY AN EXPERIENCED AND EXPERT PERSON AND THE
PARTIES WISH APPLICABLE STATE AND FEDERAL LAWS TO APPLY (RATHER THAN ARBITRATION RULES), THE PARTIES DESIRE THAT THEIR DISPUTES BE RESOLVED BY A JUDGE APPLYING SUCH APPLICABLE LAWS. THEREFORE, TO ACHIEVE THE BEST COMBINATION OF THE BENEFITS OF THE
JUDICIAL SYSTEM AND OF ARBITRATION, EACH PARTY TO THIS AGREEMENT HEREBY WAIVES ALL RIGHTS TO TRIAL BY JURY IN ANY PROCEEDINGS BROUGHT TO RESOLVE ANY DISPUTE BETWEEN OR AMONG ANY OF THE PARTIES HERETO, WHETHER ARISING IN CONTRACT, TORT, OR
OTHERWISE, ARISING OUT OF, CONNECTED WITH, RELATED OR INCIDENTAL TO THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED HEREBY AND/OR THE RELATIONSHIP ESTABLISHED AMONG THE PARTIES HEREUNDER. EACH OF THE PARTIES TO THIS AGREEMENT HEREBY AGREES AND
CONSENTS THAT ANY SUCH PROCEEDINGS SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY AND THAT THE PARTIES TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OF A COPY OF THIS AGREEMENT WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE PARTIES
HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
g. Service of Process. Each party hereto hereby (a) consents to service of process in any Proceedings between
any of the parties hereto arising in whole or in part under or in connection with this Agreement or the negotiation, terms or performance hereof in any manner permitted by Delaware law, (b) agrees that service of process made in accordance with clause (a) or made by overnight delivery by a nationally recognized courier service at his, her or its address specified pursuant to Section 12(d) will constitute good and valid service of process in any such Proceedings, and (c) waives and agrees not to assert (by way of motion, as a defense or otherwise) in
any such action any claim that service of process made in accordance with clause (a) or (b) does not constitute good and valid service of process.
h. Headings. The headings of the Sections of this Agreement are for the convenience of reference only, and are not to be considered in construing the terms and provisions of this
Agreement.
i. Successors and Assigns. This Agreement shall bind and inure to the benefit of and be enforceable by the parties hereto and their respective successors and
permitted assigns. The Parties agree that New PubCo, as successor to FIAC, shall be a party to this Agreement.
j. Execution in Counterparts; Facsimile and E-Mail Signatures. This Agreement may be executed in two or more counterparts and by the parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original, and all of which taken together shall constitute one and the same instrument. Delivery of an executed counterpart to this Agreement in facsimile or other electronic format (including
documents in PDF format) shall be effective as delivery of a manually executed counterpart to this Agreement.
18
k. Severability. Whenever possible, each provision of this Agreement will be interpreted in such manner as to be effective and valid under Applicable Law, but if any provision of
this Agreement is held to be invalid, illegal or unenforceable in any respect under any Applicable Law in any jurisdiction, such invalidity, illegality or unenforceability will not affect any other provision or the effectiveness or validity of any
provision in any other jurisdiction, and this Agreement will be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision had never been contained herein.
l. Remedies Cumulative. No remedy herein conferred upon any party is intended to be exclusive of any other remedy, and each and every such remedy shall be
cumulative and shall be in addition to every other remedy given hereunder or now or hereafter existing at law or in equity or by statute or otherwise. No single or partial exercise by any party of any right, power or remedy hereunder shall preclude
any other or further exercise thereof.
m. No Third-Party Beneficiaries. This Agreement is for the sole benefit of the parties hereto and their successors and permitted assigns and nothing herein expressed or implied
shall give or be construed to give to any Person, other than the parties hereto and such assigns, any legal or equitable rights hereunder.
n. Construction and Interpretation. This Agreement shall be construed without regard to any presumption or rule requiring construction or interpretation against the party drafting
or causing any agreement, instrument or document to be drafted.
[The Remainder of This Page Is Intentionally Left Blank.]
19
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.
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FOCUS IMPACT ACQUISITION CORP. |
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|
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|
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| By: |
/s/ Carl Stanton |
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| Name: |
Carl Stanton |
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|
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Title: |
Chief Executive Officer
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|
|
DEVVSTREAM HOLDINGS INC.
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|
|
|
|
|
| By: |
/s/ Sunny Trinh |
|
| Name: |
Sunny Trinh |
|
|
|
Title: |
Chief Executive Officer
|
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| OWNER: | ||
|
|
CRESTMONT INVESTMENTS LLC
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|
|
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|
|
| By: |
||
| Name: |
||
|
|
Title: |
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Schedule A
|
Owner and Notice Address
|
MSP Interests Owned
|
Contributed Interests
|
New PubCo Shares
|
|
Crestmont Investments LLC
Address:
745 Fifth Avenue, Suite 500
New York, NY 10151
E-mail: dbeach@crestmontinvestments.com
cc:
Holland & Knight LLP,
1120 S. Tryon Street, Suite 900, Charlotte, North Carolina 28203
Attention: Mike Miller; Kimberly Thibault
E-Mail: mike.miller@hklaw.com; Kimberly.thibault@hklaw.com
|
2,400,000
|
2,000,000
|
2,000,000
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Schedule B
ELIGIBILITY REPRESENTATIONS OF THE OWNER
This Schedule must be completed by the Owner and forms a part of the Agreement to which it is attached. Capitalized terms used and not
otherwise defined in this Schedule have the meanings given to them in the Agreement. The Owner must check the applicable box in either Section A, Section B or Section C below. For purposes of this Schedule B, DevvStream Corp. is referred to as the “Company.”
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A.
|
QUALIFIED INSTITUTIONAL BUYER STATUS
|
|
|
(Please check the applicable subparagraphs):
|
|
☐
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We are a “qualified institutional buyer” (as defined in Rule 144A under the Securities Act).
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** OR **
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B.
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ACCREDITED INVESTOR STATUS
|
|
|
(Please check the applicable subparagraphs):
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|
1.
|
☒ We are an “accredited investor” (within the meaning of Rule
501(a) under the Securities Act or an entity in which all of the equity holders are accredited investors within the meaning of Rule 501(a) under the Securities Act), and have marked and initialed the appropriate box below indicating the provision under which we qualify as an “accredited investor.”
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|
2.
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☒ We are not a natural person.
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C.
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AFFILIATE STATUS
|
|
(Please check the applicable box) OWNER:
|
|
☐
|
is:
|
|
☒
|
is not:
|
an “affiliate” (as defined in Rule 144 under the Securities Act) of the Company or acting on behalf of an
affiliate of the Company.
Rule 501(a) under the Securities Act, in relevant part, states that an “accredited investor” shall mean any person who comes within any
of the below listed categories, or who the issuer reasonably believes comes within any of the below listed categories, at the time of the sale of the securities to that person. The Owner has indicated, by marking and initialing the appropriate box
below, the provision(s) below which apply to the Owner and under which the Owner accordingly qualifies as an “accredited investor.”
☐ Any bank, registered
broker or dealer, insurance company, registered investment company, business development company, or small business investment company;
☐ Any plan established and
maintained by a state, its political subdivisions, or any agency or instrumentality of a state or its political subdivisions for the benefit of its employees, if such plan has total assets in excess of $5,000,000;
☐ Any employee benefit plan,
within the meaning of the Employee Retirement Income Security Act of 1974, if a bank, insurance company, or registered investment adviser makes the investment decisions, or if the plan has total assets in excess of $5,000,000;
☐ Any organization described
in Section 501(c)(3) of the Internal Revenue Code, corporation, similar business trust, or partnership, not formed for the specific purpose of acquiring the securities offered, with total assets in excess of $5,000,000;
☐ Any director, executive
officer, or general partner of the issuer of the securities being offered or sold, or any director, executive officer, or general partner of a general partner of that issuer;
☐ Any natural person whose
individual net worth, or joint net worth with that person’s spouse, exceeds $1,000,000. For purposes of calculating a natural person’s net worth: (a) the person’s primary residence shall not be included as an asset; (b) indebtedness that is secured
by the person’s primary residence, up to the estimated fair market value of the primary residence at the time of the sale of securities, shall not be included as a liability (except that if the amount of such indebtedness outstanding at the time of
sale of securities exceeds the amount outstanding sixty (60) days before such time, other than as a result of the acquisition of the primary residence, the amount of such excess shall be included as a liability); and (c) indebtedness that is
secured by the person’s primary residence in excess of the estimated fair market value of the primary residence at the time of the sale of securities shall be included as a liability;
☐ Any natural person who had
an individual income in excess of $200,000 in each of the two most recent years or joint income with that person’s spouse in excess of $300,000 in each of those years and has a reasonable expectation of reaching the same income level in the current
year;
☐ Any natural person holding
in good standing one or more professional certifications or designations or credentials from an accredited educational institution that the SEC has designated as qualifying an individual for accredited investor status, such as a General Securities
Representative license (Series 7), a Private Securities Offerings Representative license (Series 82) and an Investment Adviser Representative license (Series 65);
☐ Any trust with assets in
excess of $5,000,000, not formed to acquire the securities offered, whose purchase is directed by a sophisticated person; or
☒ Any entity in which all of
the equity owners are accredited investors meeting one or more of the above tests.
This page should be
completed by the Owner
and constitutes a part of the Agreement.
and constitutes a part of the Agreement.
Exhibit 10.3
Execution Version
SUBSCRIPTION AGREEMENT
Focus Impact Acquisition Corp.
250 Park Avenue Ste 911
New York, NY 10177
Focus Impact Sponsor, LLC
250 Park Avenue Ste 911
New York, NY 10177
Ladies and Gentlemen:
This Subscription Agreement (this “Agreement”) is being entered into as of the date set forth on the signature page hereto, by and among Focus Impact Acquisition Corp., a Delaware
corporation (the “Company” or “FIAC”), Focus Impact Sponsor, LLC, a Delaware limited liability company (the “Sponsor”), and the undersigned investor (the “Investor”), in connection with the Business Combination
Agreement, dated September 12, 2023, as amended by the first amendment thereto, dated as of May 1, 2024, and as further amended by the second amendment thereto, dated as of August 10, 2024 (as the same maybe further amended, the “Business
Combination Agreement,” and the transactions contemplated thereby, the “Business Combination”), by and among the Company, Focus Impact Amalco Sub Ltd. (“Amalco Sub”), a company existing under the laws of the Province of British
Columbia, and DevvStream Holdings Inc. (“DevvStream”), a company existing under the Laws of the Province of British Columbia, pursuant to which, among other things, the Company is expected to continue from the State of Delaware under the
Delaware General Corporation Law to the Province of Alberta under the Business Corporations Act.
In connection with the Business Combination, the Company is seeking commitments from interested investors to purchase in a private placement, contingent upon, and substantially concurrently with
the closing of the Business Combination, a number of shares of the Company’s Class A common stock, par value $0.0001 per share (the “Class A Common Stock”), as set forth on the signature page hereto (the “PIPE Shares”) for the
purchase price set forth on the signature page hereto (the “Subscription Amount”). In exchange for the Investor’s agreement to purchase the PIPE Shares, the Sponsor has agreed to transfer a number of shares of Class A Common Stock as set
forth on the signature page hereto (the “Sponsor Shares”) substantially concurrently with the execution of this Agreement. For purposes of this Agreement, “business day” shall mean any day other than a Saturday, Sunday or a day on which
commercial banking institutions in New York, New York are authorized or required to close for business. Upon the closing of the Business Combination, the Class A Common Stock, including the PIPE Shares and Sponsor Shares, will automatically convert
into common shares of the Company (as continued as an Alberta, Canada corporation) pursuant to the terms of the Business Combination Agreement and the formula described on the signature page hereto (with the converted PIPE Shares of the continued
Company sometimes referred to herein as the “New PIPE Shares” and the converted Sponsor Shares of the continued Company sometimes referred to herein as the “New Sponsor Shares”).
In connection therewith, and in consideration of the foregoing and the mutual representations, warranties and covenants, and subject to the conditions, set forth herein, and intending to be legally
bound hereby, each of the Investor and the Company acknowledges and agrees as follows:
1. Subscription.
(a) As soon as practicable after the date of this Agreement (the “Sponsor Shares Transfer Date”), the Sponsor shall transfer the Sponsor Shares to the Investor and cause such shares
to be registered in book entry form, free and clear of all liens (other than those arising under applicable securities laws), in the name of the Investor on the Company’s share register. If at any time prior to the closing of the Business
Combination, and other than in connection with the Business Combination, the number of outstanding shares of Class A Common Stock is increased or decreased by a consolidation, combination, subdivision or reclassification of the shares of Class A
Common Stock or other similar event, then, as of the effective date of such consolidation, combination, subdivision, reclassification or similar event, the Sponsor Shares shall be adjusted in proportion to such increase or decrease in the shares of
Class A Common Stock. Furthermore, the Investor shall not be subject to forfeiture, surrender, claw-back, transfers, disposals, exchanges or earn-outs for any reason on the Sponsor Shares or New Sponsor Shares.
(b) The closing of the sale, purchase and issuance of the PIPE Shares contemplated hereby (the “Closing”) is contingent upon the substantially concurrent consummation of the
Business Combination. The Closing shall occur contingent upon, and substantially concurrent with the closing of the Business Combination (the date the Closing so occurs, the “Closing Date”). Upon delivery of written notice from (or on behalf
of) the Company to the Investor (the “Closing Notice”), that the Company reasonably expects all conditions to the closing of the Business Combination under the Business Combination Agreement to be satisfied or waived on a date that is not
less than five (5) business days from the date on which the Closing Notice is delivered to the Investor, the Investor shall deliver to the Company on the anticipated closing date specified in the Closing Notice, (i) the Subscription Amount by wire
transfer of United States dollars in immediately available funds to the account(s) specified by the Company in the Closing Notice (which account shall not be an escrow account) and (ii) any other information that is reasonably requested in the
Closing Notice in order for the PIPE Shares to be issued to the Investor, including, without limitation, the legal name of the person in whose name such securities are to be issued and a duly executed Internal Revenue Service Form W-9 or W-8, as
applicable. On the Closing Date, the Company shall issue the PIPE Shares to the Investor, and subsequently cause the PIPE Shares to be registered in book entry form, free and clear of all liens (other than those arising under applicable securities
laws), in the name of the Investor on the Company’s share register; provided, however, that the Company’s obligation to issue the PIPE Shares to the Investor is contingent upon the Company having received the Subscription Amount in
full accordance with this Section 1. In the event the Closing does not occur within one (1) business day of the anticipated Closing Date specified in the Closing Notice, the Company shall promptly (but not later than the next business day
thereafter) return the Subscription Amount to the Investor; provided that, unless this Agreement has been terminated pursuant to Section 6 hereof, such return of funds shall not terminate this Agreement or relieve the Investor of its
obligation to purchase the PIPE Shares at the Closing upon the delivery by the Company of a subsequent Closing Notice in accordance with this Section 1.
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2. Conditions.
(a) The obligation of the parties hereto is subject to the following conditions:
(i) no applicable governmental authority shall have enacted, issued, promulgated, enforced or entered any judgment, order, law, rule or regulation (whether temporary,
preliminary or permanent) which is then in effect and has the effect of making the consummation of the transactions contemplated hereby illegal or otherwise enjoining, restraining or prohibiting consummation of the transactions contemplated by this
Agreement; and
(ii) all conditions precedent to the closing set forth in the Business Combination Agreement shall have been satisfied (which shall be deemed satisfied if mutually
determined by the applicable parties to the Business Combination Agreement and other than those conditions under the Business Combination Agreement that, by their nature are to be satisfied in connection with the closing of the Business
Combination, including to the extent that any such condition is dependent upon the consummation of this Agreement or waived by the applicable parties to the Business Combination Agreement as provided therein).
(b) The obligation of the Investor to consummate the transactions contemplated by this Agreement shall be subject to the conditions (which may be waived in writing (email being sufficient)
by the Investor) that (i) all representations and warranties of the Company and the Sponsor contained in this Agreement shall be true and correct in all material respects at and as of the Sponsor Shares Transfer Date and the Closing (other than (A)
representations and warranties that are qualified as to materiality (as defined below), which representations and warranties shall be true and correct in all respects and (B) those representations and warranties that speak as of a specified earlier
date, which shall be so true and correct in all material respects (or, if qualified by materiality, in all respects) as of such specified earlier date); (ii) the Company and the Sponsor shall have performed, satisfied and complied in all material
respects with all obligations, covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by it at or prior to the Closing; (iii) the New PIPE Shares and New Sponsor Shares have been approved for
listing on Nasdaq at the closing of the Business Combination; and (iv) the Investor shall have received satisfactory evidence, in its own determination, from the Company, that the New Sponsor Shares shall be free of any restrictive legends upon the
closing of the Business Combination.
(c) The obligation of the Company and the Sponsor to consummate the transactions contemplated by this Agreement shall be subject to the conditions (which may be waived in writing (email
being sufficient) by the Company) that (i) all representations and warranties of the Investor contained in this Agreement shall be true and correct in all material respects at and as of the Closing (other than (A) representations and warranties
that are qualified as to materiality, which representations and warranties shall be true and correct in all respects and (B) those representations and warranties that speak as of a specified earlier date, which shall be so true and correct in all
material respects (or, if qualified by materiality, in all respects) as of such specified earlier date); and (ii) the Investor shall have performed, satisfied and complied in all material respects with all obligations, covenants, agreements and
conditions required by this Agreement to be performed, satisfied or complied with by it at or prior to the Closing.
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3. Further Assurances. At or prior to the Closing, the parties hereto shall execute and deliver, or cause to be executed and delivered, such additional documents and take such
additional actions as the parties reasonably may deem to be practical and necessary in order to consummate the transactions as contemplated by this Agreement.
4. Representations and Warranties of the Company. The Company represents and warrants to the Investor that:
(a) The Company is a corporation duly incorporated, validly existing and in good standing under the laws of the State of Delaware. The Company has all power (corporate or otherwise) and
authority to own, lease and operate its properties and conduct its business as presently conducted and to enter into, deliver and perform its obligations under this Agreement.
(b) The PIPE Shares have been duly authorized and, when issued, delivered and paid for pursuant to this Agreement, will be validly issued, fully paid and non-assessable. The Sponsor Shares
were duly authorized, validly issued, fully paid and non-assessable. The New PIPE Shares and the New Sponsor Shares shall have been duly authorized and, when issued, delivered and paid for pursuant to the terms of the Business Combination
Agreement, will be validly issued, fully paid and non-assessable.
(c) This Agreement has been duly authorized, validly executed and delivered by the Company and the Sponsor and is enforceable against the Company and the Sponsor in accordance with its
terms, except as may be limited or otherwise affected by (i) bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or other laws relating to or affecting the rights of creditors generally, or (ii) principles of equity, whether
considered at law or equity.
(d) A copy of each form, report, statement, schedule, proxy and other document filed by the Company with the U.S. Securities and Exchange Commission (the “SEC”) on or prior to the
Closing (the “SEC Reports”) is available to the Investor (including via the SEC’s EDGAR system). As of their respective filing dates all SEC Reports complied in all material respects with the requirements of the Exchange Act and the rules
and regulations of the SEC promulgated thereunder applicable to the SEC Reports. None of the SEC Reports filed under the Exchange Act (except to the extent that information contained in any SEC Report has been superseded by a later timely filed SEC
Report) contained, when filed or, if amended, as of the date of such amendment with respect to those disclosures that are amended, any untrue statement of a material fact or omitted to state a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. The financial statements of FIAC included in the SEC Reports, as applicable, comply in all material respects with applicable
accounting requirements and the rules and regulations of the SEC with respect thereto as in effect at the time of filing, or, if amended, as of the date of such amendment, and fairly present in all material respects the financial position of FIAC
as of and for the dates thereof and the results of operations and cash flows for the periods presented, subject to (i) in the case of unaudited statements, to normal, year-end audit adjustments, and such consolidated financial statements have been
prepared in conformity with United States generally accepted accounting principles applied on a consistent basis during the periods involved (“GAAP”) (except as may be disclosed therein or in the notes thereto, and except that the unaudited
financial statements may not contain all footnotes required by GAAP), and (ii) changes to historical accounting policies of FIAC in connection with any order, directive, guideline, comment or recommendation from the SEC that is applicable to FIAC.
There are no outstanding or unresolved comments in comment letters from the staff of the SEC with respect to any of the SEC Reports. For the avoidance of doubt, any restatement of the financial statements of the Company and any amendments to
previously filed SEC Reports or delays in filing SEC Reports, in connection with any guidance from the SEC following the date of this Agreement, shall not be deemed to constitute a breach of this Section 4(d). Additionally, for avoidance of
doubt, any amendment or modification of any SEC Report (or any agreement filed as an exhibit to any SEC Report) from its initial filing date in a subsequent filing shall not be deemed to constitute a breach of this Section 4(d).
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(e) The Company is authorized to issue up to 551,000,000 shares of capital stock, consisting of 550,000,000 shares of common stock, including (i) 500,000,000 shares of Class A Common Stock
and 50,000,000 shares of Class B common stock, par value $0.0001 per share (“Class B Common Stock”), and (ii) 1,000,000 undesignated shares of preferred stock (“Preferred Stock”). As of the date of this Agreement, the Company has
2,452,731 shares of common stock issued and outstanding, including 1,702,731 shares of Class A Common Stock and 750,000 shares of Class B Common Stock, and no shares of Preferred Stock issued or outstanding. There are no shareholder agreements,
voting trusts or other agreements or understandings to which the Company is a party or by which it is bound relating to the voting of any securities of the Company, other than (1) as set forth in the SEC Reports and (2) as contemplated by the
Business Combination Agreement. Except as set forth in the SEC Reports or as contemplated by the Business Combination Agreement and the other agreements and arrangements referred to therein, as of the date hereof, there are no outstanding options,
warrants or other rights to subscribe for, purchase or acquire from the Company any equity interests in the Company, or securities convertible into or exchangeable or exercisable for such equity interests.
(f) As of the date hereof, there is no suit, action, proceeding or investigation pending or, to the knowledge of the Company, threatened against the Company by Nasdaq or the SEC,
respectively, to prohibit the listing of the PIPE Shares, or the registration of the PIPE Shares under the Exchange Act of 1934, as amended (the “Exchange Act”).
(g) Assuming the accuracy of the Investor’s representations and warranties set forth in Section 6, no registration under the Securities Act of 1933, as amended (the “Securities
Act”) is required for the issuance of the PIPE Shares or the transfer of the Sponsor Shares to the Investor hereunder. The PIPE Shares and the Sponsor Shares (i) were not offered to the Investor by any form of general solicitation or general
advertising and (ii) are not being offered to the Investor in a manner involving a public offering under, or in a distribution in violation of, the Securities Act, or any state securities laws.
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(h) At the closing of the Business Combination, the Sponsor Shares will be exchanged for the New Sponsor Shares pursuant to the terms of the Business Combination Agreement in an offering
registered under the Securities Act. Following the closing of the Business Combination, the New Sponsor Shares will be unrestricted and will not be required to bear a legend. For the avoidance of doubt, following the closing of the Business
Combination, the New Sponsor Shares shall no longer be subject to the transfer restrictions contained in Section 5 of the Letter Agreement or Sections 1.4(a) and (b) of the Sponsor Side Letter. The Company shall cause its counsel to issue a legal
opinion to the Transfer Agent (as defined below) on the Closing Date to effect the removal of all legends from the New Sponsor Shares.
5. Representations and Warranties of the Sponsor. The Sponsor represents and warrants to the Investor that:
(a) The Sponsor is the record and beneficial owner of, and has good and marketable title to, the Sponsor Shares and will, immediately prior to the transfer of the Sponsor Shares to the
Investor, be the record and beneficial owner of the Sponsor Shares, in each case, free and clear of all liens, pledges, security interests, charges, claims, encumbrances, agreements, options, voting trusts, proxies and other arrangements or
restrictions of any kind (other than transfer restrictions and other terms and conditions that apply to the Sponsor Shares generally and applicable securities laws) and when transferred to the Investor as provided herein, will be free and clear of
all liens, pledges, security interests, charges, claims, encumbrances, agreements, options, voting trusts, proxies and other arrangements or restrictions of any kind (other than transfer restrictions and other terms and conditions that apply to the
Sponsor Shares generally, under the Letter Agreement, the Sponsor Side Letter and applicable securities laws).
(b) The execution, delivery and performance of this Agreement and the consummation by the Sponsor of the transactions contemplated hereby do not violate, conflict with or constitute a default
under (i) the certificate of formation or the operating agreement of the Sponsor, (ii) any agreement or instrument to which the Sponsor is a party or by which it is bound, including the Letter Agreement and the Sponsor Side Letter, or (iii) any
law, statute, rule or regulation to which the Sponsor is subject or any order, judgment or decree to which the Sponsor is subject. The Sponsor is not required under federal, state or local law, rule or regulation to obtain any consent,
authorization or order of, or make any filing or registration with, any court or governmental agency or self-regulatory entity in order for it to perform any of its obligations under this Agreement, including the transfer of the Sponsor Shares in
accordance with the terms hereof, other than beneficial ownership filings with the SEC.
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6. Investor Representations and Warranties. The Investor represents and warrants to the Company and the Sponsor that:
(a) The Investor, or each of the funds managed by or affiliated with the Investor for which the Investor is acting as nominee, as applicable, (i) is a “qualified institutional buyer” (as
defined in Rule 144A under the Securities Act) or an “accredited investor” (within the meaning of Rule 501(a)(1), (2), (3), (7), (8), (9), (12) or (13) of Regulation D under the Securities Act), in each case, satisfying the applicable requirements
set forth on Schedule A hereto, (ii) is acquiring the PIPE Shares and the Sponsor Shares only for its own account and not for the account of others, or if the Investor is acquiring the PIPE Shares or the Sponsor Shares as a fiduciary or
agent for one or more investor accounts, each owner of such account is a “qualified institutional buyer” (as defined in Rule 144A under the Securities Act) or an “accredited investor” (within the meaning of Rule 501(a)(1), (2), (3) or (7) under the
Securities Act), and the Investor has full investment discretion with respect to each such account, and the full power and authority to make the acknowledgements, representations and agreements herein on behalf of each owner of each such account,
and (iii) is not acquiring the PIPE Shares or the Sponsor Shares with a view to, or for offer or sale in connection with, any distribution thereof in violation of the Securities Act or any securities laws of the United States or any other
jurisdiction. The Investor shall provide the requested information set forth on Schedule A following the signature page hereto and the information contained therein is accurate and complete. The Investor is not an entity formed for the
specific purpose of acquiring the PIPE Shares or the Sponsor Shares. The term “affiliate” or “affiliated” as used in this Agreement shall mean, with respect to any individual, partnership, corporation, limited liability company, joint
stock company, unincorporated organization or association, trust, joint venture or other similar entity, whether or not a legal entity, or governmental entity (a “person”), any other person who directly or indirectly, through one or more
intermediaries, controls, is controlled by, or is under common control with, such person. The term “control” as used in this Agreement shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the
management and policies of a person, whether through the ownership of voting securities, by contract or otherwise, and the terms “controlled” and “controlling” have meanings correlative thereto.
(b) The Investor acknowledges and agrees that the PIPE Shares (as issued by the Company) and the Sponsor Shares (as transferred by the Sponsor) are being offered in a transaction not
involving any public offering within the meaning of the Securities Act and that the issuance of the PIPE Shares and the transfer of the Sponsor Shares by the Sponsor has not been registered under the Securities Act or any other applicable
securities laws. The Investor acknowledges and agrees that the PIPE Shares and, prior to the closing of the Business Combination, the Sponsor Shares, may not be offered, resold, transferred, pledged or otherwise disposed of by the Investor absent
an effective registration statement under the Securities Act except (i) to the Company or a subsidiary thereof, (ii) to non-U.S. persons pursuant to offers and sales that occur outside the United States within the meaning of Regulation S under the
Securities Act or (iii) pursuant to another applicable exemption from the registration requirements of the Securities Act, and in each of clauses (i) and (iii) in accordance with any applicable securities laws of the states and other jurisdictions
of the United States, and that any book entries representing the PIPE Shares, and prior to the closing of the Business Combination, the Sponsor Shares, shall contain a restrictive legend to such effect. The Investor acknowledges and agrees that the
PIPE Shares and, prior to the closing of the Business Combination, the Sponsor Shares will be subject to transfer restrictions and, as a result of these transfer restrictions, the Investor may not be able to readily offer, resell, transfer, pledge
or otherwise dispose of the PIPE Shares and the Sponsor Shares and may be required to bear the financial risk of an investment in the PIPE Shares and the Sponsor Shares for an indefinite period of time. The Investor acknowledges and agrees that the
PIPE Shares and the Sponsor Shares will not immediately be eligible for offer, resale, transfer or disposition pursuant to Rule 144 promulgated under the Securities Act (“Rule 144”). The Investor acknowledges and agrees that it has been
advised to consult legal counsel and tax and accounting advisors prior to making any offer, resale, transfer, pledge, transfer or disposition of any of the PIPE Shares or the Sponsor Shares. The Investor acknowledges that, prior to the closing of
the Business Combination, the Sponsor Shares are subject to the restrictions on transfer and redemption set forth in that certain Sponsor Side Letter, dated September 12, 2023, by and between the Company and the Sponsor, as such agreement may be
amended from time to time; the Investor explicitly agrees to comply with the terms of such agreement with respect to the Sponsor Shares prior to the closing of the Business Combination; provided, that, for the avoidance of doubt, following the
closing Business Combination the Investor shall not be subject to such transfer and redemption restrictions and no further approval or consent of the Company shall be to in respect of any offer, resale, transfer, pledge, transfer or disposition of
any of the Investor’s Sponsor Shares.
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(c) The Investor’s acquisition and holding of the PIPE Shares and the Sponsor Shares will not constitute or result in a non-exempt prohibited transaction under Section 406 of the Employee
Retirement Income Security Act of 1974, as amended, Section 4975 of the Internal Revenue Code of 1986, as amended, or any applicable similar law.
(d) The Investor acknowledges and agrees that the Investor has received such information as the Investor deems necessary in order to make an investment decision with respect to the PIPE
Shares and the Sponsor Shares, including, the Business Combination and the business of the Company and DevvStream. Without limiting the generality of the foregoing, the Investor acknowledges that it has reviewed the SEC Reports. The Investor
acknowledges and agrees that the Investor and the Investor’s professional advisor(s), if any, have had the full opportunity to ask such questions, receive such answers and obtain such information as the Investor and the Investor’s professional
advisor(s), if any, deemed necessary to make an investment decision with respect to the PIPE Shares and the Sponsor Shares.
(e) The Investor became aware of the transactions contemplated by this Agreement solely by means of direct contact between the Investor and the Company or a representative of the Company.
The Investor did not become aware of the transactions contemplated by this Agreement, nor were the PIPE Shares or the Sponsor Shares offered to the Investor, by any other means and none of the Company or its representatives or any person acting on
behalf of any of them acted as investment advisor, broker or dealer to the Investor. The Investor acknowledges that the PIPE Shares and the Sponsor Shares (i) were not offered by any form of general solicitation or general advertising and (ii) are
not being offered in a manner involving a public offering under, or in a distribution in violation of, the Securities Act, or any state securities laws. The Investor acknowledges and agrees that the Investor is receiving the Sponsor Shares directly
from the Sponsor. The Investor further acknowledges that there have not been, and the Investor hereby agrees that it is not relying on, representations, warranties, covenants and agreements made to the Investor by or on behalf of the Company or the
Sponsor or any of their respective affiliates or any control persons, officers, directors, employees, partners, agents or representatives or any other person or entity, expressly or by implication, other than those representations, warranties,
covenants and agreements of the Company expressly set forth in Section 4 of this Agreement and of the Sponsor set forth in Section 5 of this Agreement.
(f) The Investor acknowledges that it is aware that there are substantial risks incident to the purchase and ownership of the PIPE Shares and the Sponsor Shares, including, without
limitation, those set forth in the SEC Reports. The Investor has such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of an investment in the PIPE Shares and the Sponsor Shares, and the
Investor has had an opportunity to seek, and has sought such accounting, legal, business and tax advice as the Investor has considered necessary to make an informed investment decision and the Investor has made its own assessment and satisfied
itself concerning relevant tax and other economic considerations relative to its purchase of the PIPE Shares and the Sponsor Shares. The Investor (i) is an institutional account as defined in FINRA Rule 4512(c), (ii) is a sophisticated investor,
experienced in investing in private equity transactions and capable of evaluating investment risks independently, both in general and with regard to all transactions and investment strategies involving a security or securities, and (iii) has
exercised independent judgment in evaluating its participation in the purchase of the PIPE Shares and the Sponsor Shares. The Investor is able to sustain a complete loss on its investment in the PIPE Shares and the Sponsor Shares, has no need for
liquidity with respect to its investment in the PIPE Shares and the Sponsor Shares and has no reason to anticipate any change in circumstances, financial or otherwise, which may cause or require any sale or distribution of all or any part of the
PIPE Shares and the Sponsor Shares.
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(g) Alone, or together with any professional advisor(s), the Investor has adequately analyzed and fully considered the risks of an investment in the PIPE Shares and the Sponsor Shares and
determined that the PIPE Shares and the Sponsor Shares are a suitable investment for the Investor and that the Investor is able at this time and in the foreseeable future to bear the economic risk of a total loss of the Investor’s investment in the
Company. The Investor acknowledges specifically that a possibility of total loss exists.
(h) In making its decision to acquire the PIPE Shares and the Sponsor Shares, the Investor has relied solely upon independent investigation made by the Investor. Without limiting the
generality of the foregoing, the Investor has not relied on any statements or other information provided by or on behalf of any placement agent or any of its respective affiliates or any control persons, officers, directors, employees, partners,
agents or representatives of any of the foregoing concerning the Company, DevvStream, the Business Combination, the Business Combination Agreement, this Agreement, or the transactions contemplated hereby or thereby, or the PIPE Shares or Sponsor
Shares.
(i) The Investor acknowledges and agrees that no federal or state agency has passed upon or endorsed the merits of the offering of the PIPE Shares or the Sponsor Shares or made any
findings or determination as to the fairness of this investment.
(j) The Investor, if not an individual, has been duly formed or incorporated and is validly existing and is in good standing under the laws of its jurisdiction of formation or
incorporation, with power and authority to enter into, deliver and perform its obligations under this Agreement. The Investor has sufficient funds to pay the Subscription Amount.
(k) The execution, delivery and performance by the Investor of this Agreement and the transactions contemplated herein are within the powers of the Investor, have been duly authorized and
will not constitute or result in a breach or default under or conflict with any order, ruling or regulation of any court or other tribunal or of any governmental commission or agency, or any agreement or other undertaking, to which the Investor is
a party or by which the Investor is bound, and, if the Investor is not an individual, will not conflict with or violate any provisions of the Investor’s organizational documents, including, without limitation, its incorporation or formation papers,
bylaws, indenture of trust or partnership or operating agreement, as may be applicable. (A) The signature on this Agreement is genuine, (B) the signatory of this Agreement, if the Investor is an individual, has legal competence and capacity to
execute the same or, if the Investor is not an individual, the signatory has been duly authorized to execute the same, (C) this Agreement has been duly executed and delivered by the Investor or the investment advisor to which the Investor has
delegated decision making authority over investments and (D) this Agreement constitutes a legal, valid and binding obligation of the Investor, enforceable against the Investor in accordance with its terms except as may be limited or otherwise
affected by (i) bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or other laws relating to or affecting the rights of creditors generally, and (ii) principles of equity, whether considered at law or equity.
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(l) The Investor is not (i) a person or entity named on the List of Specially Designated Nationals and Blocked Persons, the Executive Order 13599 List, the Foreign Sanctions Evaders List,
or the Sectoral Sanctions Identification List, each of which is administered by the U.S. Treasury Department’s Office of Foreign Assets Control (“OFAC”) or in any Executive Order issued by the President of the United States and administered
by OFAC (“OFAC List”), or a person or entity prohibited by any OFAC sanctions program, (ii) owned, directly or indirectly, or controlled by, or acting on behalf of, one or more persons that are named on the OFAC Lists; (iii) organized,
incorporated, established, located, resident or born in, or a citizen, national or the government, including any political subdivision, agency or instrumentality thereof, of Cuba, Iran, North Korea, Russia, Syria, the Crimea, Donetsk or Luhansk
regions of Ukraine or any other country or territory embargoed or subject to substantial trade restrictions by the United States, (iv) a Designated National as defined in the Cuban Assets Control Regulations, 31 C.F.R. Part 515, or (v) a non-U.S.
shell bank or providing banking services indirectly to a non-U.S. shell bank (each, a “Prohibited Investor”). The Investor agrees to provide law enforcement agencies, if requested thereby, such records as required by applicable law, provided
that the Investor is permitted to do so under applicable law. If the Investor is a financial institution subject to the Bank Secrecy Act (31 U.S.C. Section 5311 et seq.) (the “BSA”), as amended by the USA PATRIOT Act of 2001 (the “PATRIOT
Act”), and its implementing regulations (collectively, the “BSA/PATRIOT Act”), the Investor maintains policies and procedures reasonably designed to comply with applicable obligations under the BSA/PATRIOT Act. To the extent required,
it maintains policies and procedures reasonably designed for the screening of its investors against the OFAC sanctions programs, including, without limitation, the OFAC List. To the extent required by applicable law, the Investor maintains policies
and procedures reasonably designed to ensure that the funds held by the Investor and used to pay the Subscription Amount were legally derived and were not obtained, directly or indirectly, from a Prohibited Investor.
(m) The Investor does not have, as of the date hereof, and during the thirty (30) day period immediately prior to the date hereof such Investor has not entered into, any “put equivalent
position” as such term is defined in Rule 16a-1 under the Exchange Act or short sale positions with respect to the securities of the Company or DevvStream. The Investor is not currently (and at all times through Closing will refrain from being or
becoming) a member of a “group” (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act or any successor provision) acting for the purpose of acquiring, holding, voting or disposing of equity securities of the Company
(within the meaning of Rule 13d-5(b)(1) under the Exchange Act), other than a group consisting solely of the Investor and its affiliates.
10
7. Termination. This Agreement shall terminate and be void and of no further force and effect, and all rights and obligations of the parties hereunder shall terminate without any
further liability on the part of any party in respect thereof, upon the earliest of (a) the mutual written agreement of each of the parties hereto to terminate this Agreement, (b) the delivery of a notice of termination of this Agreement by the
Investor to the Company and the Sponsor, if the Closing has not occurred within 60 days from the date of this Agreement, and (c) the termination of the Business Combination Agreement; provided that nothing herein will relieve any party from
liability for any willful and material breach of any covenant, agreement, obligation, representation or warranty hereunder prior to the time of termination, and each party will be entitled to any remedies at law or in equity to recover losses,
liabilities or damages arising from any such willful and material breach. The Company shall notify the Investor of the termination of the Business Combination Agreement as promptly as practicable after the termination of the Business Combination
Agreement.
8. Trust Account Waiver. The Investor acknowledges that FIAC is a blank check company with the powers and privileges to effect a merger, asset acquisition, reorganization or
similar business combination involving FIAC and one or more businesses or assets. The Investor further acknowledges that, as described in FIAC’s final prospectus relating to its initial public offering dated October 27, 2021 (the “Final
Prospectus”) available at www.sec.gov, substantially all of FIAC’s assets consist of the cash proceeds of FIAC’s initial public offering and private placement of its securities, and substantially all of those proceeds have been deposited in a
trust account (the “Trust Account”) for the benefit of FIAC, its public shareholders and the underwriters of FIAC’s initial public offering. Except with respect to interest earned on the funds held in the Trust Account that may be released to FIAC
to pay its tax obligations, if any, the cash in the Trust Account may be disbursed only for the purposes set forth in the Final Prospectus. For and in consideration of FIAC entering into this Agreement, the receipt and sufficiency of which are
hereby acknowledged, the Investor, on behalf of itself and its representatives, hereby irrevocably waives any and all right, title and interest, or any claim of any kind it has or may have in the future, in or to any monies held in the Trust
Account (or distributions therefrom to FIAC’s public shareholders or to the underwriters of FIAC’s initial public offering in respect of their deferred underwriting commissions held in the Trust Account), and agrees not to seek recourse against the
Trust Account as a result of, or arising out of, this Agreement or the transactions contemplated hereby regardless of whether such claim arises based on contract, tort, equity or any other theory of legal liability; provided, however, that nothing
in this Section 8 shall be deemed to limit the Investor’s right, title, interest or claim to any monies held in the Trust Account by virtue of its record or beneficial ownership of publicly traded Class A Shares acquired in an open market
transaction, pursuant to a validly exercised redemption right with respect to any such Class A Shares, in accordance with FIAC’s Amended and Restated Certificate of Incorporation, as may be subsequently amended from time to time, and the Investment
Management Trust Agreement between Continental Stock Transfer & Trust Company and FIAC, dated November 1, 2021, except to the extent that the Investor has otherwise agreed in writing with FIAC or any of their respective affiliates to not
exercise such redemption right.
9. Miscellaneous.
(a) Neither this Agreement nor any rights that may accrue to the Investor hereunder may be transferred or assigned. Notwithstanding the foregoing, after notifying the Company, Investor may
assign its rights and obligations under this Agreement to one or more of its affiliates or, with the Company’s prior written consent, to another person, provided that no such assignment shall relieve Investor of its obligations hereunder if any
such assignee fails to perform such obligations.
11
(b) The Investor acknowledges that the Company and the Sponsor will rely on the acknowledgments, understandings, agreements, representations and warranties contained in this Agreement,
including Schedule A hereto. Prior to the Closing, the Investor agrees to promptly notify the Company in writing (email being sufficient) if any of the acknowledgments, understandings, agreements, representations or warranties set forth in
Section 6 above are no longer accurate in any material respect (other than those acknowledgments, understandings, agreements, representations and warranties qualified by materiality, in which case the Investor shall notify the Company if
they are no longer accurate in any respect).
(c) The Investor agrees that, from the date hereof until the Closing or the earlier termination of this Agreement, none of the Investor or any person or entity acting on behalf of the
Investor or pursuant to any understanding with the Investor will engage in any hedging or other transactions or arrangements (including, without limitation, any short sale or the purchase or sale of, or entry into, any put or call option, or
combination thereof, forward, swap or any other derivative transaction or similar instrument, including without limitation equity repurchase agreements and securities lending arrangements, however described or defined) designed or intended, or
which could reasonably be expected to lead to or result in, a sale, loan, pledge or other disposition or transfer (whether by the Investor or any other person), in each case, solely to the extent it has the same economic effect as a “short sale”
(as defined in Rule 200 promulgated under Regulation SHO under the Exchange Act), of any economic consequences of ownership (excluding, for the avoidance of doubt, any consequences resulting solely from foreign exchange fluctuations), in whole or
in part, directly or indirectly, physically or synthetically, of any securities of the Company or DevvStream prior to the Closing, whether any such transaction or arrangement (or instrument provided for thereunder) would be settled by delivery of
securities of the Company or DevvStream, in cash or otherwise, or to publicly disclose the intention to undertake any of the foregoing.
(d) The Investor acknowledges that any Sponsor Shares held by it, her or him, as applicable, are not redeemable prior to the closing of the Business Combination.
(e) The Investor agrees that he, she or it, as the case may be, shall not be entitled to make any voluntary or involuntary, direct or indirect (whether through a change of control of the
transferor or any person that controls such transferor, the issuance or transfer of equity securities of the transferor, by operation of law or otherwise), transfer, sale, pledge or hypothecation or other disposition (each, a “Transfer”), or
to permit any Transfer, of any Sponsor Shares; provided, that the Investor shall be permitted to distribute the Sponsor Shares to its members or otherwise to an Affiliate of the Investor, so long as any member or Affiliate of the
Investor in receipt of Sponsor Shares prior to or simultaneously with the Transfer enters into a written agreement reasonably acceptable to the parties hereto agreeing to be bound by the terms of this Agreement as if a party hereto; and provided,
further, that if such written agreement is not executed and delivered to the parties hereto, such distribution of the Sponsor Shares shall not be permitted hereunder.
(f) The Company, the Sponsor and DevvStream are entitled to rely upon this Agreement and each is irrevocably authorized to produce this Agreement or a copy hereof to any interested party
in any administrative or legal proceeding or official inquiry with respect to the matters covered hereby.
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(g) All of the agreements, representations and warranties made by each party hereto in this Agreement shall survive the Closing.
(h) This Agreement may not be terminated other than pursuant to the terms of Section 7 above. The provisions of this Agreement may not be modified, amended or waived except by an
instrument in writing, signed by each of the parties hereto. No failure or delay of either party hereto in exercising any right or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or
power, or any abandonment or discontinuance of steps to enforce such right or power, or any course of conduct, preclude any other or further exercise thereof or the exercise of any other right or power. The rights and remedies of the parties
hereunder are cumulative and are not exclusive of any rights or remedies that they would otherwise have hereunder.
(i) This Agreement including the schedule hereto constitutes the entire agreement, and supersedes all other prior agreements, understandings, representations and warranties, both written and
oral, among the parties, with respect to the subject matter hereof. This Agreement shall not confer any rights or remedies upon any person other than the parties hereto, and their respective successors and assigns, except that DevvStream shall be a
third-party beneficiary of this Agreement.
(j) Except as otherwise provided herein, this Agreement shall be binding upon, and inure to the benefit of the parties hereto and their heirs, executors, administrators, successors, legal
representatives, and permitted assigns, and the agreements, representations, warranties, covenants and acknowledgments contained herein shall be deemed to be made by, and be binding upon, such heirs, executors, administrators, successors, legal
representatives and permitted assigns.
(k) If any provision of this Agreement shall be adjudicated by a court of competent jurisdiction to be invalid, illegal or unenforceable, the validity, legality or enforceability of the
remaining provisions of this Agreement shall not in any way be affected or impaired thereby and shall continue in full force and effect.
(l) This Agreement may be executed and delivered in one or more counterparts (including, without limitation, by facsimile or electronic mail or in .pdf) and by different parties in separate
counterparts, with the same effect as if all parties hereto had signed the same document. All counterparts so executed and delivered shall be construed together and shall constitute one and the same agreement.
(m) The parties hereto acknowledge and agree that irreparable damage may occur if any of the provisions of this Agreement were not performed in accordance with their specific terms or were
otherwise breached. It is accordingly agreed that the parties hereto shall be entitled to an injunction or injunctions to prevent breaches of this Agreement, without posting a bond or undertaking and without proof of damages, to enforce
specifically the terms and provisions of this Agreement, this being in addition to any other remedy to which such party is entitled at law, in equity, in contract, in tort or otherwise. The parties hereto acknowledge and agree that parties shall be
entitled to seek to specifically enforce the other parties’ obligations hereunder on the terms and subject to the conditions set forth herein.
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(n) Any notice or communication required or permitted hereunder to be given to the Investor shall be in writing and either delivered personally, emailed or sent by overnight mail via a
reputable overnight carrier, or sent by certified or registered mail, postage prepaid, to such address(es) or email address(es) set forth on the signature page hereto, and shall be deemed to be given and received (i) when so delivered personally,
(ii) when sent, with no mail undeliverable or other rejection notice, if sent by email, or (iii) three (3) business days after the date of mailing to the address below or to such other address or addresses as the Investor may hereafter designate by
notice given hereunder:
(i) if to the Investor, to such address or addresses set forth on the signature page hereto;
(ii) if to the
Company:
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Focus Impact Acquisition Corp.
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250 Park Avenue Ste 911
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New York, NY 10177
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Attn: Carl Stanton
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E-mail: cstanton@focus-impact.com
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With a copy (which will not constitute notice) to:
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Kirkland & Ellis LLP
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601 Lexington Avenue
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New York, NY 10022
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Attn: Peter Seligson, P.C.
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E-mail: peter.seligson@kirkland.com
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(iii) if to
Sponsor:
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Focus Impact Sponsor, LLC
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250 Park Avenue Ste 911
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New York, NY 10177
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Attn: Carl Stanton
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E-mail: cstanton@focus-impact.com
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With a copy (which will not constitute notice) to:
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Kirkland & Ellis LLP
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601 Lexington Avenue
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New York, NY 10022
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Attn: Peter Seligson, P.C.
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E-mail: peter.seligson@kirkland.com
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(o) THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE (REGARDLESS OF THE LAWS THAT MIGHT OTHERWISE GOVERN UNDER APPLICABLE PRINCIPLES OF CONFLICTS OF LAWS THEREOF) AS TO ALL MATTERS (INCLUDING ANY ACTION, SUIT, LITIGATION, ARBITRATION, MEDIATION,
CLAIM, CHARGE, COMPLAINT, INQUIRY, PROCEEDING, HEARING, AUDIT, INVESTIGATION OR REVIEWS BY OR BEFORE ANY GOVERNMENTAL ENTITY RELATED HERETO), INCLUDING MATTERS OF VALIDITY, CONSTRUCTION, EFFECT, PERFORMANCE AND REMEDIES. THE PARTIES HERETO
IRREVOCABLY SUBMIT TO THE EXCLUSIVE JURISDICTION OF THE CHANCERY COURT OF THE STATE OF DELAWARE (OR, IF THE CHANCERY COURT OF THE STATE OF DELAWARE DECLINES TO ACCEPT JURISDICTION, THE SUPERIOR COURT OF THE STATE OF DELAWARE, OR THE UNITED STATES
DISTRICT COURT FOR THE DISTRICT OF DELAWARE) SOLELY IN RESPECT OF THE INTERPRETATION AND ENFORCEMENT OF THE PROVISIONS OF THIS AGREEMENT AND THE DOCUMENTS REFERRED TO IN THIS AGREEMENT AND IN RESPECT OF THE TRANSACTIONS CONTEMPLATED HEREBY, AND
HEREBY WAIVE, AND AGREE NOT TO ASSERT, AS A DEFENSE IN ANY ACTION, SUIT OR PROCEEDING FOR INTERPRETATION OR ENFORCEMENT HEREOF OR ANY SUCH DOCUMENT THAT IS NOT SUBJECT THERETO OR THAT SUCH ACTION, SUIT OR PROCEEDING MAY NOT BE BROUGHT OR IS NOT
MAINTAINABLE IN SAID COURTS OR THAT VENUE THEREOF MAY NOT BE APPROPRIATE OR THAT THIS AGREEMENT OR ANY SUCH DOCUMENT MAY NOT BE ENFORCED IN OR BY SUCH COURTS, AND THE PARTIES HERETO IRREVOCABLY AGREE THAT ALL CLAIMS WITH RESPECT TO SUCH ACTION,
SUIT OR PROCEEDING SHALL BE HEARD AND DETERMINED BY SUCH COURT. THE PARTIES HEREBY CONSENT TO AND GRANT ANY SUCH COURT JURISDICTION OVER THE PERSON OF SUCH PARTIES AND OVER THE SUBJECT MATTER OF SUCH DISPUTE AND AGREE THAT MAILING OF PROCESS OR
OTHER PAPERS IN CONNECTION WITH SUCH ACTION, SUIT OR PROCEEDING IN THE MANNER PROVIDED IN THIS SECTION 9(M) OF THIS AGREEMENT OR IN SUCH OTHER MANNER AS MAY BE PERMITTED BY LAW SHALL BE VALID AND SUFFICIENT SERVICE THEREOF.
EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY IS LIKELY TO INVOLVE COMPLICATED AND
DIFFICULT ISSUES, AND THEREFORE EACH SUCH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT AND FOR ANY COUNTERCLAIM RELATING THERETO. IF THE SUBJECT MATTER OF ANY SUCH LEGAL DISPUTE IS ONE IN WHICH THE WAIVER OF JURY TRIAL IS PROHIBITED, NO PARTY HERETO NOR ANY PERSON ASSERTING RIGHTS AS A
THIRD PARTY BENEFICIARY SHALL ASSERT IN SUCH LEGAL DISPUTE A NONCOMPULSORY COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. FURTHERMORE, NO PARTY HERETO NOR ANY PERSON ASSERTING RIGHTS AS A THIRD
PARTY BENEFICIARY SHALL SEEK TO CONSOLIDATE ANY SUCH LEGAL DISPUTE WITH A SEPARATE ACTION OR OTHER LEGAL PROCEEDING IN WHICH A JURY TRIAL CANNOT BE WAIVED. EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (I) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY
OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER; (II) SUCH PARTY UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THE FOREGOING WAIVER; (III)
SUCH PARTY MAKES THE FOREGOING WAIVER VOLUNTARILY AND (IV) SUCH PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVER AND CERTIFICATIONS IN THIS SECTION 9(M).
15
10. Non-Reliance and Exculpation. The Investor acknowledges
that it is not relying upon, and has not relied upon, any statement, representation or warranty made by any person, firm or corporation other than the statements, representations and warranties of the Company expressly contained in Section 4
of this Agreement and of the Sponsor expressly contained in Section 5 of this Agreement, in making its investment or decision to invest in the Company. The Investor acknowledges and agrees that none of any party to the Business Combination
Agreement or any Non-Party Affiliate except for the Company and Sponsor, shall have any liability to the Investor, or to any other investor, pursuant to, arising out of or relating to this Agreement, the negotiation hereof or thereof or its
subject matter, or the transactions contemplated hereby or thereby, including, without limitation, with respect to any action heretofore or hereafter taken or omitted to be taken by any of them in connection with the acquisition of the PIPE
Shares or the Sponsor Shares or with respect to any claim (whether in tort, contract or otherwise) for breach of this Agreement or in respect of any written or oral representations made or alleged to be made in connection herewith, as expressly
provided herein, or for any actual or alleged inaccuracies, misstatements or omissions with respect to any information or materials of any kind furnished by the Company or the Sponsor or any Non-Party Affiliate concerning the Company, the Sponsor
or any of their respective affiliates, this Agreement or the transactions contemplated hereby. For purposes of this Agreement, “Non-Party Affiliates” means each former, current or future officer, director, employee, partner, member, manager,
direct or indirect equityholder or affiliate of the Company, the Sponsor or any of their respective affiliates or any family member of the foregoing.
11. Registration Rights. Within forty-five (45) business
days of the closing of the Business Combination, the Company shall use its reasonable best efforts to file (at the Company’s sole cost and expense) with the SEC a registration statement registering the resale of the PIPE Shares (the “Registration
Statement”), and have the Registration Statement declared effective as soon as practicable after the filing thereof, but no later than the earliest of (i) the 60th business day (or 105th business day if the SEC notifies the Company that it
will “review” the Registration Statement) following the closing of the Business Combination and (ii) the 5th business day after the date the Company is notified (orally or in writing, whichever is earlier) by the SEC that such Registration
Statement will not be “reviewed” or will not be subject to further review. Upon notification by the SEC that the Registration Statement has been declared effective by the SEC, within two (2) business days thereafter, the Company shall file a
final prospectus under Rule 424 of the Securities Act. The Company shall not identify the Investor as a statutory underwriter in the Registration Statement unless requested by the SEC. The Company will use its reasonable best efforts to keep the
Registration Statement covering the resale of the PIPE Shares as described above continuously effective (except for customary blackout periods, up to twice per year and for a total of up to 60 business days (and not more than 45 business days in
an occurrence), if and when the Company is in possession of material non-public information the disclosure of which, in the good faith judgment of the Company’s board of directors, would be prejudicial, and the Company agrees to promptly notify
the Investor of any such blackout determination) until all such shares have been sold or may be transferred without any restrictions including the requirement for the Company to be in compliance with the current public information required under
Rule 144(c)(1) or Rule 144(i)(2) or the volume and manner of sale limitations under Rule 144 under the Securities Act; provided that Company covenants and agrees to make all necessary filings, amendments, supplements and submissions in
furtherance of the foregoing, including to register all of the Investor’s PIPE Shares for resale. The Investor will promptly deliver customary representations and other documentation reasonably acceptable to the Company, its counsel and/or its
transfer agent in connection with the Registration Statement, including those related to selling shareholders and to respond to SEC comments.
16
12. Indemnification. The Company agrees to indemnify, to
the extent permitted by law, the Investor, its directors and officers and agents and each person who controls the Investor (within the meaning of the Securities Act) against all losses, claims, damages, liabilities and expenses (including
attorneys’ fees) caused by any untrue or alleged untrue statement of material fact contained in any Registration Statement, prospectus included in any Registration Statement or preliminary Prospectus or any amendment thereof or supplement thereto
or any omission or alleged omission of a material fact required to be stated therein or necessary to make the statements therein not misleading, except insofar as the same are caused by or contained in any information furnished in writing to the
Company by the Investor expressly for use therein.
13. Disclosure. The Company shall within four business
days following the date of this Agreement, issue one or more press releases or file with the SEC a Current Report on Form 8-K disclosing all material terms of the transactions contemplated hereby.
[SIGNATURE PAGES FOLLOW]
17
IN WITNESS WHEREOF, the Investor has executed or caused this Agreement to be executed by its duly authorized representative as of the date set forth below.
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Name of Investor:
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State/Country of Formation or Domicile:
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By:
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Name:
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Title:
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Name in which PIPE Shares and Sponsor Shares are to be registered (if different):
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Date: October __, 2024
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Investor’s EIN/SSN (as applicable):
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||||
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Business Address-Street:
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Mailing Address-Street (if different):
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City, State, Zip:
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City, State, Zip:
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Attn:
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Attn:
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Telephone No.:
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Telephone No.:
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Facsimile No.:
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Facsimile No.:
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Email:
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Email:
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PIPE Shares:
Sponsor Shares: The
number of New Sponsor Shares shall equal the quotient of the Subscription Amount divided by $1.50, as further divided by the Reverse Split Factor (as defined in the Business Combination Agreement).
For illustrative purposes only, assuming a $1,500,000 Subscription Amount, the New Sponsor Shares shall equal: ($1,500,000/$1.50)/($0.29/$0.6316) =
2,177,931
Subscription Amount:
[Signature
Page to Subscription Agreement]
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IN WITNESS WHEREOF, the Company and the Sponsor has accepted this Agreement as of the date set forth below.
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Focus Impact Acquisition Corp.
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By:
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Name:
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Carl Stanton
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Title:
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Chief Executive Officer
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Focus Impact Sponsor, LLC
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By:
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Name:
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Carl Stanton
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Title:
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Authorized Signatory
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Date: October __, 2024
[Signature
Page to Subscription Agreement]
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SCHEDULE A
ELIGIBILITY REPRESENTATIONS OF THE INVESTOR
This Schedule must be completed by Investor and forms a part of the Agreement to which it is attached. Capitalized terms used and not otherwise defined in this Schedule have the meanings given
to them in the Agreement. The Investor must check the applicable box in either Section A, Section B or Section C below.
A. QUALIFIED INSTITUTIONAL BUYER STATUS
(Please check the applicable subparagraphs):
☐ We are a “qualified institutional buyer” (as defined in Rule 144A under the Securities Act).
** OR **
B. ACCREDITED INVESTOR STATUS
(Please check the applicable subparagraphs):
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1.
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☐ We are an “accredited investor” (within the meaning of Rule 501(a) under the Securities Act or an entity in which all of the equity holders are accredited investors within
the meaning of Rule 501(a) under the Securities Act), and have marked and initialed the appropriate box below indicating the provision under which we qualify as an “accredited
investor.”
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2.
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☐ We are not a natural person.
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C. AFFILIATE STATUS
(Please check the applicable box) INVESTOR:
☐ is:
☐ is not:
an “affiliate” (as defined in Rule 144 under the Securities Act) of the Company or acting on behalf of an affiliate of the Company.
Rule 501(a) under the Securities Act, in relevant part, states that an “accredited investor” shall mean any person who comes within any of the below listed categories, or who the issuer
reasonably believes comes within any of the below listed categories, at the time of the sale of the securities to that person. The Investor has indicated, by marking and initialing the appropriate box below, the provision(s) below which apply to
the Investor and under which the Investor accordingly qualifies as an “accredited investor.”
☐ Any bank, registered broker or dealer, insurance company, registered investment company,
business development company, or small business investment company;
☐ Any plan established and maintained by a state, its political subdivisions, or any agency or
instrumentality of a state or its political subdivisions for the benefit of its employees, if such plan has total assets in excess of $5,000,000;
☐ Any employee benefit plan, within the meaning of the Employee Retirement Income Security Act of
1974, if a bank, insurance company, or registered investment adviser makes the investment decisions, or if the plan has total assets in excess of $5,000,000;
☐ Any organization described in Section 501(c)(3) of the Internal Revenue Code, corporation,
similar business trust, or partnership, not formed for the specific purpose of acquiring the securities offered, with total assets in excess of $5,000,000;
☐ Any director, executive officer, or general partner of the issuer of the securities being
offered or sold, or any director, executive officer, or general partner of a general partner of that issuer;
☐ Any natural person whose individual net worth, or joint net worth with that person’s spouse,
exceeds $1,000,000. For purposes of calculating a natural person’s net worth: (a) the person’s primary residence shall not be included as an asset; (b) indebtedness that is secured by the person’s primary residence, up to the estimated fair
market value of the primary residence at the time of the sale of securities, shall not be included as a liability (except that if the amount of such indebtedness outstanding at the time of sale of securities exceeds the amount outstanding sixty
(60) days before such time, other than as a result of the acquisition of the primary residence, the amount of such excess shall be included as a liability); and (c) indebtedness that is secured by the person’s primary residence in excess of the
estimated fair market value of the primary residence at the time of the sale of securities shall be included as a liability;
☐ Any natural person who had an individual income in excess of $200,000 in each of the two most
recent years or joint income with that person’s spouse in excess of $300,000 in each of those years and has a reasonable expectation of reaching the same income level in the current year;
☐ Any natural person holding in good standing one or more professional certifications or
designations or credentials from an accredited educational institution that the SEC has designated as qualifying an individual for accredited investor status, such as a General Securities Representative license (Series 7), a Private Securities
Offerings Representative license (Series 82) and an Investment Adviser Representative license (Series 65);
☐ Any trust with assets in excess of $5,000,000, not formed to acquire the securities offered,
whose purchase is directed by a sophisticated person; or
☐ Any entity in which all of the equity owners are accredited investors meeting one or more of the
above tests.
This page should be completed by the Investor
and constitutes a part of the Agreement.
Exhibit 10.4
Execution Version
SUBSCRIPTION AGREEMENT
Focus Impact Acquisition Corp.
250 Park Avenue Ste 911
New York, NY 10177
Ladies and Gentlemen:
This Subscription Agreement (this “Agreement”) is being entered into as of the date set forth on the signature page hereto, by and between Focus Impact Acquisition Corp., a Delaware
corporation (the “Company” or “FIAC”), and the undersigned investor (the “Investor”), in connection with the Business Combination Agreement, dated September 12, 2023, as amended by the first amendment thereto, dated as of May
1, 2024, and as further amended by the second amendment thereto, dated as of August 10, 2024 (as the same maybe further amended, the “Business Combination Agreement,” and the transactions contemplated thereby, the “Business Combination”),
by and among the Company, Focus Impact Amalco Sub Ltd. (“Amalco Sub”), a company existing under the laws of the Province of British Columbia, and DevvStream Holdings Inc. (“DevvStream”), a company existing under the Laws of the
Province of British Columbia, pursuant to which, among other things, the Company is expected to continue from the State of Delaware under the Delaware General Corporation Law to the Province of Alberta under the Business Corporations Act.
In connection with the Business Combination, DevvStream and the
Investor entered into that certain Carbon Credit Purchase Agreement, dated as the date hereof (the “Purchase Agreement” and, together with this Agreement, the “Transaction Documents”), pursuant to which, among other things, the
Investor agreed to sell Carbon Credits as set forth on Exhibit A thereto (the “Purchased Credits”) for an aggregate purchase price of USD $1,137,197.25 (the “Purchase Price”), which Purchase Price will be payable in common shares of
the Company (“Common Shares”) to be issued immediately following the closing of the Business Combination at a deemed price of $6.50, for a total of 174,953 shares (the “Consideration Shares”). Capitalized terms used but not defined
herein shall have the meanings ascribed to them in the Purchase Agreement. For purposes of this Agreement, “business day” shall mean any day other than a Saturday, Sunday or a day on which commercial banking institutions in New York, New York are
authorized or required to close for business.
In connection therewith, and in consideration of the foregoing and the mutual representations, warranties and covenants, and subject to the conditions, set forth herein, and intending to be legally
bound hereby, each of the Investor and the Company acknowledges and agrees as follows:
1. Subscription.
(a) At the Closing, (i) the Company shall issue the Consideration Shares to the Investor as set forth on the signature page hereto and cause such
shares to be registered in book entry form, free and clear of all liens (other than those arising under applicable securities laws), in the name of the Investor on the Company’s share register and (ii) the Investor will take all necessary steps to
transfer, convey and assign to DevvStream all existing and future rights, title to, and interest in the Purchased Credits, and to transfer the Purchased Credits to the Verra Registry account designated by DevvStream. The Investor acknowledges and
agrees that the Consideration Shares shall be securities of an Alberta corporation.
(b) At Closing, Seller shall sell, assign, transfer, convey and deliver to Buyer, and Buyer shall purchase from Seller, all of Seller’s right, title,
and interest in to the Carbon Credits, free and clear of any mortgage, pledge, lien, charge, security interest, claim or other encumbrance (“Encumbrance”).
(c) Buyer shall not assume any liabilities or obligations of Seller of any kind related to the Carbon Credits, whether known or unknown, contingent,
matured or otherwise, whether currently existing or hereinafter created.
(d) Seller will take all necessary steps to transfer, convey and assign to Buyer all existing and future rights, title to, and interest in the Carbon Credits, and to transfer the Carbon
Credits to the Verra Registry account designated by Buyer.
(e) On that date which is 18 months from the Closing Date, Seller shall complete an accounting of the sale of the Shares and advise Buyer of the
total proceeds of the sales. In the event the gross proceeds from the sale of the Shares is less than $1,101,585 then Buyer shall issue additional shares to Seller (the “Additional Shares”) equal to 100% of the 20 day weighted average price
of Buyer’s common stock on the date immediately preceding such adjustment, multiplied by the dollar amount of the adjustment required to meet $1,101,585.
2. Conditions.
(a) The obligation of the parties hereto is subject to the following conditions:
(i) no applicable governmental authority shall have enacted, issued, promulgated, enforced or entered any judgment, order, law,
rule or regulation (whether temporary, preliminary or permanent) which is then in effect and has the effect of making the consummation of the transactions contemplated hereby illegal or otherwise enjoining, restraining or prohibiting consummation
of the transactions contemplated by this Agreement;
(ii) all conditions precedent to the closing set forth in the Business Combination Agreement shall have been satisfied (which shall
be deemed satisfied if mutually determined by the applicable parties to the Business Combination Agreement and other than those conditions under the Business Combination Agreement that, by their nature are to be satisfied in connection with the
closing, including to the extent that any such condition is dependent upon the consummation of this Agreement or waived by the applicable parties to the Business Combination Agreement as provided therein) and the closing of the Business Combination
shall have occurred; and
2
(iii) all conditions precedent to the Closing set forth in the Purchase Agreement shall have been satisfied (which shall be deemed
satisfied if mutually determined by the applicable parties to the Purchase Agreement and other than those conditions under the Purchase Agreement that, by their nature are to be satisfied in connection with the Closing, including to the extent that
any such condition is dependent upon the consummation of this Agreement or waived by the applicable parties to the Purchase Agreement as provided therein).
(b) The obligation of the Investor to consummate the transactions contemplated by this Agreement shall be subject to the conditions (which may be
waived in writing (email being sufficient) by the Investor) that (i) all representations and warranties of the Company contained in the Transaction Documents shall be true and correct in all material respects at and as of the Closing (other than
(A) representations and warranties that are qualified as to materiality or Material Adverse Effect (as defined below), which representations and warranties shall be true and correct in all respects and (B) those representations and warranties that
speak as of a specified earlier date, which shall be so true and correct in all material respects (or, if qualified by materiality, in all respects) as of such specified earlier date); and (ii) the Company and the DevvStream shall have performed,
satisfied and complied in all material respects with all obligations, covenants, agreements and conditions required by the Transaction Documents to be performed, satisfied or complied with by it at or prior to the Closing.
(c) The obligation of the Company to consummate the transactions contemplated by this Agreement shall be subject to the conditions (which may be
waived in writing (email being sufficient) by the Company) that (i) all representations and warranties of the Investor contained in the Transaction Documents shall be true and correct in all material respects at and as of the Closing (other than
(A) representations and warranties that are qualified as to materiality or Material Adverse Effect (as defined below), which representations and warranties shall be true and correct in all respects and (B) those representations and warranties that
speak as of a specified earlier date, which shall be so true and correct in all material respects (or, if qualified by materiality, in all respects) as of such specified earlier date); and (ii) the Investor shall have performed, satisfied and
complied in all material respects with all obligations, covenants, agreements and conditions required by the Transaction Documents to be performed, satisfied or complied with by it at or prior to the Closing.
3. Further Assurances. At or prior to the Closing, the parties hereto shall execute and deliver, or cause to be executed and delivered, such additional documents and take such
additional actions as the parties reasonably may deem to be practical and necessary in order to consummate the transactions as contemplated by this Agreement.
4. Representations and Warranties of the Company. The Company represents and warrants to the Investor that:
(a) The Company is a corporation duly incorporated, validly existing and in good standing under the laws of the State of Delaware. The Company has
all power (corporate or otherwise) and authority to own, lease and operate its properties and conduct its business as presently conducted and to enter into, deliver and perform its obligations under this Agreement.
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(b) The execution, delivery and performance by the Company of this Agreement and the documents to be delivered hereunder, and the consummation of the
transactions contemplated hereby, do not and will not: (a) violate or conflict with the Articles of Incorporation or other organizational documents of the Company; (b) violate or conflict with any judgment, order, decree, statute, law, ordinance,
rule or regulation applicable to the Company; (c) conflict with, or result in (with or without notice or lapse of time or both) any violation of, or default under, or give rise to a right of termination, acceleration or modification of any
obligation or loss of any benefit under any contract or other instrument to which the Company is a party. No consent, approval, waiver or authorization is required to be obtained by the Company from any person or entity (including any Governmental
Authority, as defined below) in connection with the execution, delivery and performance by the Company of this Agreement and the consummation of the transactions contemplated hereby.
(c) The Consideration Shares have been duly authorized and, when issued, delivered and paid for pursuant to this Agreement, will be validly issued,
fully paid and non-assessable.
(d) This Agreement has been duly authorized, validly executed and delivered by the Company and is enforceable against the Company in accordance with
its terms, except as may be limited or otherwise affected by (i) bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or other laws relating to or affecting the rights of creditors generally, or (ii) principles of equity,
whether considered at law or equity.
(e) A copy of each form, report, statement, schedule, proxy and other document filed by the Company with the U.S. Securities and Exchange Commission
(“SEC”) on or prior to the Closing (the “SEC Reports”) is available to the Investor (including via the SEC’s EDGAR system). As of their respective filing dates all SEC Reports complied in all material respects with the requirements of
the Exchange Act and the rules and regulations of the SEC promulgated thereunder applicable to the SEC Reports. None of the SEC Reports filed under the Exchange Act (except to the extent that information contained in any SEC Report has been
superseded by a later timely filed SEC Report) contained, when filed or, if amended, as of the date of such amendment with respect to those disclosures that are amended, any untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. The financial statements of the Company included in the SEC Reports, as applicable, comply in all
material respects with applicable accounting requirements and the rules and regulations of the SEC with respect thereto as in effect at the time of filing, or, if amended, as of the date of such amendment, and fairly present in all material
respects the financial position of the Company as of and for the dates thereof and the results of operations and cash flows for the periods presented, subject to (i) in the case of unaudited statements, to normal, year-end audit adjustments, and
such consolidated financial statements have been prepared in conformity with United States generally accepted accounting principles applied on a consistent basis during the periods involved (“GAAP”) (except as may be disclosed therein or in the
notes thereto, and except that the unaudited financial statements may not contain all footnotes required by GAAP), and (ii) changes to historical accounting policies of the Company in connection with any order, directive, guideline, comment or
recommendation from the SEC that is applicable to the Company. There are no outstanding or unresolved comments in comment letters from the staff of the SEC with respect to any of the SEC Reports. For the avoidance of doubt, any restatement of the
financial statements of the Company and any amendments to previously filed SEC Reports or delays in filing SEC Reports, in connection with any guidance from the SEC following the date of this Agreement, shall not be deemed to constitute a breach of
this Section 4(d). Additionally, for avoidance of doubt, any amendment or modification of any SEC Report (or any agreement filed as an exhibit to any SEC Report) from its initial filing date in a subsequent filing shall not be deemed to
constitute a breach of this Section 4(d).
4
(f) The Company is authorized to issue up to 551,000,000 shares of capital stock, consisting of 550,000,000 shares of common stock, including (i)
500,000,000 shares of Class A common stock, par value $0.0001 per share (“Class A Common Stock”), and 50,000,000 shares of Class B common stock, par value $0.0001 per share “Class B Common Stock”), and (ii) 1,000,000 undesignated
shares of preferred stock (“Preferred Stock”). As of the date of this Agreement, the Company has 2,452,731 shares of common stock issued and outstanding, including 1,702,731 shares of Class A Common Stock and 750,000 shares of Class B Common
Stock, and no shares of Preferred Stock issued or outstanding. There are no shareholder agreements, voting trusts or other agreements or understandings to which the Company is a party or by which it is bound relating to the voting of any securities
of the Company, other than (1) as set forth in the SEC Reports and (2) as contemplated by the Business Combination Agreement. Except as set forth in the SEC Reports or as contemplated by the Business Combination Agreement and the other agreements
and arrangements referred to therein, as of the date hereof, there are no outstanding options, warrants or other rights to subscribe for, purchase or acquire from the Company any equity interests in the Company, or securities convertible into or
exchangeable or exercisable for such equity interests.
(g) As of the date hereof, there is no suit, action, proceeding or investigation pending or, to the knowledge of the Company, threatened against
the Company by Nasdaq or the SEC, respectively, to prohibit the listing of the Class A Common Stock, or the registration of the Class A Common Stock under the Exchange Act of 1934, as amended (the “Exchange Act”).
(h) Assuming the accuracy of the Investor’s representations and warranties set forth in Section 5, no registration under the Securities Act
of 1933, as amended (the “Securities Act”) is required for the issuance of the Consideration Shares to the Investor hereunder. The Consideration Shares (i) were not offered to the Investor by any form of general solicitation or general
advertising and (ii) are not being offered to the Investor in a manner involving a public offering under, or in a distribution in violation of, the Securities Act, or any state securities laws.
5. Investor Representations and Warranties. The Investor represents and warrants to the Company that:
(a) The Investor (i) is an institutional “accredited investor” (within the meaning of Rule 501(a)(1), (2), (3), (7), (8), (9), (12) or (13) of
Regulation D under the Securities Act), in each case, satisfying the applicable requirements set forth on Schedule A hereto, (ii) is acquiring the Consideration Shares only for its own account and not for the account of others, and (iii) is
not acquiring the Consideration Shares with a view to, or for offer or sale in connection with, any distribution thereof in violation of the Securities Act or any securities laws of the United States or any other jurisdiction. The Investor shall
provide the requested information set forth on Schedule A following the signature page hereto and the information contained therein is accurate and complete. The Investor is not an entity formed for the specific purpose of acquiring the
Consideration Shares. The term “affiliate” or “affiliated” as used in this Agreement shall mean, with respect to any individual, partnership, corporation, limited liability company, joint stock company, unincorporated organization or
association, trust, joint venture or other similar entity, whether or not a legal entity, or governmental entity (a “person”), any other person who directly or indirectly, through one or more intermediaries, controls, is controlled by, or is
under common control with, such person. The term “control” as used in this Agreement shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a person, whether through
the ownership of voting securities, by contract or otherwise, and the terms “controlled” and “controlling” have meanings correlative thereto.
5
(b) The Investor acknowledges and agrees that the Consideration Shares are being offered in a transaction not involving any public offering within
the meaning of the Securities Act and that the issuance of the Consideration Shares has not been registered under the Securities Act or any other applicable securities laws. The Investor acknowledges and agrees that the Consideration Shares may not
be offered, resold, transferred, pledged or otherwise disposed of by the Investor absent an effective registration statement under the Securities Act except (i) to the Company or a subsidiary thereof, (ii) to non-U.S. persons pursuant to offers and
sales that occur outside the United States within the meaning of Regulation S under the Securities Act or (iii) pursuant to another applicable exemption from the registration requirements of the Securities Act, and in each of clauses (i) and (iii)
in accordance with any applicable securities laws of the states and other jurisdictions of the United States, and that any book entries representing the Consideration Shares shall contain a restrictive legend to such effect. The Investor
acknowledges and agrees that the Consideration Shares will be subject to transfer restrictions and, as a result of these transfer restrictions, the Investor may not be able to readily offer, resell, transfer, pledge or otherwise dispose of the
Consideration Shares and may be required to bear the financial risk of an investment in the Consideration Shares. The Investor acknowledges and agrees that the Consideration Shares will not immediately be eligible for offer, resale, transfer or
disposition pursuant to Rule 144 promulgated under the Securities Act (“Rule 144”). The Investor acknowledges and agrees that it has been advised to consult legal counsel and tax and accounting advisors prior to making any offer, resale,
transfer, pledge, transfer or disposition of any of the Consideration Shares.
(c) The Investor’s acquisition and holding of the Consideration Shares will not constitute or result in a non-exempt prohibited transaction under
Section 406 of the Employee Retirement Income Security Act of 1974, as amended, Section 4975 of the Internal Revenue Code of 1986, as amended, or any applicable similar law.
(d) The Investor acknowledges and agrees that the Investor has received such information as the Investor deems necessary in order to make an
investment decision with respect to the Consideration Shares, including, the Business Combination and the business of the Company and DevvStream. Without limiting the generality of the foregoing, the Investor acknowledges that it has reviewed the
SEC Reports. The Investor acknowledges and agrees that the Investor and the Investor’s professional advisor(s), if any, have had the full opportunity to ask such questions, receive such answers and obtain such information as the Investor and the
Investor’s professional advisor(s), if any, deemed necessary to make an investment decision with respect to the Consideration Shares.
6
(e) The Investor became aware of the transactions contemplated by this Agreement solely by means of direct contact between the Investor and the
Company or a representative of the Company. The Investor did not become aware of the transactions contemplated by this Agreement, nor were the Consideration Shares offered to the Investor, by any other means and none of the Company or its
representatives or any person acting on behalf of any of them acted as investment advisor, broker or dealer to the Investor. The Investor acknowledges that the Consideration Shares (i) were not offered by any form of general solicitation or general
advertising and (ii) are not being offered in a manner involving a public offering under, or in a distribution in violation of, the Securities Act, or any state securities laws. The Investor acknowledges that it is not relying upon, and has not
relied upon, any statement, representation or warranty made by any person, firm or corporation, other than the representations and warranties of the Company contained in Section 4 of this Agreement, in making its investment or decision to
invest in the Company.
(f) The Investor acknowledges that it is aware that there are substantial risks incident to the purchase and ownership of the Consideration Shares,
including, without limitation, those set forth in the SEC Reports. The Investor has such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of an investment in the Consideration Shares,
and the Investor has had an opportunity to seek, and has sought such accounting, legal, business and tax advice as the Investor has considered necessary to make an informed investment decision and the Investor has made its own assessment and
satisfied itself concerning relevant tax and other economic considerations relative to its purchase of the Consideration Shares. The Investor (i) is a sophisticated investor, experienced in investing in private equity transactions and capable of
evaluating investment risks independently, both in general and with regard to all transactions and investment strategies involving a security or securities and (ii) has exercised independent judgment in evaluating its participation in the purchase
of the Consideration Shares. The Investor is able to sustain a complete loss on its investment in the Consideration Shares, has no need for liquidity with respect to its investment in the Consideration Shares and has no reason to anticipate any
change in circumstances, financial or otherwise, which may cause or require any sale or distribution of all or any part of the Consideration Shares.
(g) Alone, or together with any professional advisor(s), the Investor has adequately analyzed and fully considered the risks of an investment in
the Consideration Shares and determined that the Consideration Shares are a suitable investment for the Investor and that the Investor is able at this time and in the foreseeable future to bear the economic risk of a total loss of the Investor’s
investment in the Company. The Investor acknowledges specifically that a possibility of total loss exists.
(h) In making its decision to acquire the Consideration Shares, the Investor has relied solely upon independent investigation made by the Investor.
Without limiting the generality of the foregoing, the Investor has not relied on any statements or other information provided by or on behalf of any placement agent or any of its respective affiliates or any control persons, officers, directors,
employees, partners, agents or representatives of any of the foregoing concerning the Company, DevvStream, the Business Combination, the Business Combination Agreement, this Agreement, or the transactions contemplated hereby or thereby, or the
Consideration Shares.
7
(i) The Investor acknowledges and agrees that no federal or state agency has passed upon or endorsed the merits of the offering of the
Consideration Shares or made any findings or determination as to the fairness of this investment.
(j) The Investor, if not an individual, has been duly formed or incorporated and is validly existing and is in good standing under the laws of its
jurisdiction of formation or incorporation, with power and authority to enter into, deliver and perform its obligations under this Agreement.
(k) The execution, delivery and performance by the Investor of this Agreement and the transactions contemplated herein are within the powers of the
Investor, have been duly authorized and will not constitute or result in a breach or default under or conflict with any order, ruling or regulation of any court or other tribunal or of any governmental commission or agency, or any agreement or
other undertaking, to which the Investor is a party or by which the Investor is bound, and, if the Investor is not an individual, will not conflict with or violate any provisions of the Investor’s organizational documents, including, without
limitation, its incorporation or formation papers, bylaws, indenture of trust or partnership or operating agreement, as may be applicable. (A) The signature on this Agreement is genuine, (B) the signatory of this Agreement, if the Investor is an
individual, has legal competence and capacity to execute the same or, if the Investor is not an individual, the signatory has been duly authorized to execute the same, (C) this Agreement has been duly executed and delivered by the Investor or the
investment advisor to which the Investor has delegated decision making authority over investments and (D) this Agreement constitutes a legal, valid and binding obligation of the Investor, enforceable against the Investor in accordance with its
terms except as may be limited or otherwise affected by (i) bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or other laws relating to or affecting the rights of creditors generally, and (ii) principles of equity, whether
considered at law or equity.
(l) The Investor is not (i) a person or entity named on the List of Specially Designated Nationals and Blocked Persons, the Executive Order 13599
List, the Foreign Sanctions Evaders List, or the Sectoral Sanctions Identification List, each of which is administered by the U.S. Treasury Department’s Office of Foreign Assets Control (“OFAC”) or in any Executive Order issued by the
President of the United States and administered by OFAC (“OFAC List”), or a person or entity prohibited by any OFAC sanctions program, (ii) owned, directly or indirectly, or controlled by, or acting on behalf of, one or more persons that are
named on the OFAC Lists; (iii) organized, incorporated, established, located, resident or born in, or a citizen, national or the government, including any political subdivision, agency or instrumentality thereof, of Cuba, Iran, North Korea, Russia,
Syria, the Crimea, Donetsk or Luhansk regions of Ukraine or any other country or territory embargoed or subject to substantial trade restrictions by the United States, (iv) a Designated National as defined in the Cuban Assets Control Regulations,
31 C.F.R. Part 515, or (v) a non-U.S. shell bank or providing banking services indirectly to a non-U.S. shell bank (each, a “Prohibited Investor”). The Investor agrees to provide law enforcement agencies, if requested thereby, such records
as required by applicable law, provided that the Investor is permitted to do so under applicable law. If the Investor is a financial institution subject to the Bank Secrecy Act (31 U.S.C. Section 5311 et seq.) (the “BSA”), as amended by the
USA PATRIOT Act of 2001 (the “PATRIOT Act”), and its implementing regulations (collectively, the “BSA/PATRIOT Act”), the Investor maintains policies and procedures reasonably designed to comply with applicable obligations under the
BSA/PATRIOT Act. To the extent required, it maintains policies and procedures reasonably designed for the screening of its investors against the OFAC sanctions programs, including, without limitation, the OFAC List.
8
(m) The Investor does not have, as of the date hereof, and during the thirty (30) day period immediately prior to the date hereof such Investor has
not entered into, any “put equivalent position” as such term is defined in Rule 16a-1 under the Exchange Act or short sale positions with respect to the securities of the Company.
(n) The Investor is not currently (and at all times through Closing will refrain from being or becoming) a member of a “group” (within the meaning
of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act or any successor provision) acting for the purpose of acquiring, holding, voting or disposing of equity securities of the Company (within the meaning of Rule 13d-5(b)(1) under the Exchange
Act), other than a group consisting solely of the Investor and its affiliates.
6. Termination. This Agreement shall terminate and be void and of no further force and effect, and all rights and obligations of the parties hereunder shall terminate without any
further liability on the part of any party in respect thereof, upon the earlier of (a) the mutual written agreement of each of the parties hereto to terminate this Agreement and (b) the termination of the Business Combination Agreement; provided
that nothing herein will relieve any party from liability for any willful and material breach of any covenant, agreement, obligation, representation or warranty hereunder prior to the time of termination, and each party will be entitled to any
remedies at law or in equity to recover losses, liabilities or damages arising from any such willful and material breach. Either party may terminate this Agreement at any time upon notice to the other party in the event of a material breach of this
Agreement. The Company or the Investor may terminate this Agreement at any time in the event that (i) there shall be any law that makes consummation of the transactions contemplated by this Agreement illegal or otherwise prohibited or (ii) any
Governmental Authority shall have issued any order, writ, judgment, injunction, decree, stipulation, determination or award (“Governmental Order”) restraining, enjoining, or denying the transactions contemplated by this Agreement, and such
Governmental Order shall have become final and non-appealable.
7. Miscellaneous.
(a) Neither this Agreement nor any rights that may accrue to either the Company or the Investor hereunder may be transferred or assigned.
Notwithstanding the foregoing, after notifying the Company, Investor may assign its rights and obligations under this Agreement to one or more of its affiliates or, with the Company’s prior written consent, to another person, provided that no such
assignment shall relieve Investor of its obligations hereunder if any such assignee fails to perform such obligations.
9
(b) Other than as provided in the Registration Rights Agreement, each party shall pay its own fees, costs and expenses incurred in connection with
this Agreement, including the fees, costs and expenses of such party’s financial advisors, accountants and counsel.
(c) The Investor acknowledges that the Company and DevvStream will rely on the acknowledgments, understandings, agreements, representations and
warranties contained in this Agreement, including Schedule A hereto. Prior to the Closing, each of the Company and the Investor agree to promptly notify the other in writing if any of the acknowledgments, understandings, agreements,
representations or warranties set forth herein are no longer accurate in any material respect (other than those acknowledgments, understandings, agreements, representations and warranties qualified by materiality, in which case the Company or the
Investor, as the case may be, shall notify the other if they are no longer accurate in any respect).
(d) The Investor agrees that, from the date hereof until the Closing or the earlier termination of this Agreement, none of the Investor or any
person or entity acting on behalf of the Investor or pursuant to any understanding with the Investor will engage in any hedging or other transactions or arrangements (including, without limitation, any short sale or the purchase or sale of, or
entry into, any put or call option, or combination thereof, forward, swap or any other derivative transaction or similar instrument, including without limitation equity repurchase agreements and securities lending arrangements, however described or
defined) designed or intended, or which could reasonably be expected to lead to or result in, a sale, loan, pledge or other disposition or transfer (whether by the Investor or any other person), in each case, solely to the extent it has the same
economic effect as a “short sale” (as defined in Rule 200 promulgated under Regulation SHO under the Exchange Act), of any economic consequences of ownership (excluding, for the avoidance of doubt, any consequences resulting solely from foreign
exchange fluctuations), in whole or in part, directly or indirectly, physically or synthetically, of any securities of the Company or Devvstream prior to the Closing, whether any such transaction or arrangement (or instrument provided for
thereunder) would be settled by delivery of securities of the Company or Devvstream, in cash or otherwise, or to publicly disclose the intention to undertake any of the foregoing.
(e) The Company and DevvStream are entitled to rely upon this Agreement and each is irrevocably authorized to produce this Agreement or a copy
hereof to any interested party in any administrative or legal proceeding or official inquiry with respect to the matters covered hereby.
(f) All of the agreements, representations and warranties made by each party hereto in this Agreement shall survive the Closing.
(g) This Agreement may not be terminated other than pursuant to the terms of Section 6 above. The provisions of this Agreement may not be
modified, amended or waived except by an instrument in writing, signed by each of the parties hereto. No failure or delay of either party hereto in exercising any right or remedy hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such right or power, or any course of conduct, preclude any other or further exercise thereof or the exercise of any other right or power. The
rights and remedies of the parties hereunder are cumulative and are not exclusive of any rights or remedies that they would otherwise have hereunder.
10
(h) This Agreement including the schedule hereto constitutes the entire agreement, and supersedes all other prior agreements, understandings,
representations and warranties, both written and oral, among the parties, with respect to the subject matter hereof. This Agreement shall not confer any rights or remedies upon any person other than the parties hereto, and their respective
successors and assigns, except that Devvstream shall be a third-party beneficiary of this Agreement.
(i) Except as otherwise provided herein, this Agreement shall be binding upon, and inure to the benefit of the parties hereto and their heirs,
executors, administrators, successors, legal representatives, and permitted assigns, and the agreements, representations, warranties, covenants and acknowledgments contained herein shall be deemed to be made by, and be binding upon, such heirs,
executors, administrators, successors, legal representatives and permitted assigns.
(j) If any provision of this Agreement shall be adjudicated by a court of competent jurisdiction to be invalid, illegal or unenforceable, the
validity, legality or enforceability of the remaining provisions of this Agreement shall not in any way be affected or impaired thereby and shall continue in full force and effect.
(k) This Agreement may be executed and delivered in one or more counterparts (including, without limitation, by facsimile, docusign or electronic
mail or in .pdf) and by different parties in separate counterparts, with the same effect as if all parties hereto had signed the same document. All counterparts so executed and delivered shall be construed together and shall constitute one and the
same agreement.
(l) The parties hereto acknowledge and agree that irreparable damage would occur if any of the provisions of this Agreement were not performed in
accordance with their specific terms or were otherwise breached. It is accordingly agreed that the parties hereto shall be entitled to an injunction or injunctions to prevent breaches of this Agreement, without posting a bond or undertaking and
without proof of damages, to enforce specifically the terms and provisions of this Agreement, this being in addition to any other remedy to which such party is entitled at law, in equity, in contract, in tort or otherwise. The parties hereto
acknowledge and agree that the Company shall be entitled to seek to specifically enforce the Investor’s obligations hereunder on the terms and subject to the conditions set forth herein.
(m) Any notice or communication required or permitted hereunder to be given to the Investor shall be in writing and either delivered personally,
emailed or sent by overnight mail via a reputable overnight carrier, or sent by certified or registered mail, postage prepaid, to such address(es) or email address(es) set forth on the signature page hereto, and shall be deemed to be given and
received (i) when so delivered personally, (ii) when sent, with no mail undeliverable or other rejection notice, if sent by email, or (iii) three (3) business days after the date of mailing to the address below or to such other address or addresses
as the Investor may hereafter designate by notice given hereunder:
11
|
(i)
|
if to the Investor:
|
||
|
Karbon-X Corp.
|
|||
|
510 5th St. SW, Suite 910
|
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Calgary, AB Canada T2P 3S2
|
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Attn:
|
Chad Clovis, Chief Executive Officer
|
||
|
Email:
|
cc@karbon-x.com
|
||
|
with a copy (which shall not constitute notice) to:
|
|||
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Cutler Law Group, P.C.
|
|||
|
6575 West Loop South, Suite 500
|
|||
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Bellaire, TX 77401
|
|||
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Attn:
|
M. Richard Cutler
|
||
|
Email:
|
rcutler@cutlerlaw.com
|
||
|
(ii)
|
if to the Company:
|
||
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Focus Impact Acquisition Corp.
|
|||
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250 Park Avenue Ste 911
|
|||
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New York, NY 10177
|
|||
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Attn:
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Carl Stanton
|
||
|
E-mail:
|
cstanton@focus-impact.com
|
||
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With a copy (which will not constitute notice) to:
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|||
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Kirkland & Ellis LLP
|
|||
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601 Lexington Avenue
|
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New York, NY 10022
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Attn:
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Peter Seligson, P.C.
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E-mail:
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peter.seligson@kirkland.com
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(n) THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE (REGARDLESS OF THE LAWS THAT MIGHT
OTHERWISE GOVERN UNDER APPLICABLE PRINCIPLES OF CONFLICTS OF LAWS THEREOF) AS TO ALL MATTERS (INCLUDING ANY ACTION, SUIT, LITIGATION, ARBITRATION, MEDIATION, CLAIM, CHARGE, COMPLAINT, INQUIRY, PROCEEDING, HEARING, AUDIT, INVESTIGATION OR REVIEWS BY
OR BEFORE ANY GOVERNMENTAL ENTITY RELATED HERETO), INCLUDING MATTERS OF VALIDITY, CONSTRUCTION, EFFECT, PERFORMANCE AND REMEDIES. THE PARTIES HERETO IRREVOCABLY SUBMIT TO THE EXCLUSIVE JURISDICTION OF THE CHANCERY COURT OF THE STATE OF DELAWARE
(OR, IF THE CHANCERY COURT OF THE STATE OF DELAWARE DECLINES TO ACCEPT JURISDICTION, THE SUPERIOR COURT OF THE STATE OF DELAWARE, OR THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DELAWARE) SOLELY IN RESPECT OF THE INTERPRETATION AND
ENFORCEMENT OF THE PROVISIONS OF THIS AGREEMENT AND THE DOCUMENTS REFERRED TO IN THIS AGREEMENT AND IN RESPECT OF THE TRANSACTIONS CONTEMPLATED HEREBY, AND HEREBY WAIVE, AND AGREE NOT TO ASSERT, AS A DEFENSE IN ANY ACTION, SUIT OR PROCEEDING FOR
INTERPRETATION OR ENFORCEMENT HEREOF OR ANY SUCH DOCUMENT THAT IS NOT SUBJECT THERETO OR THAT SUCH ACTION, SUIT OR PROCEEDING MAY NOT BE BROUGHT OR IS NOT MAINTAINABLE IN SAID COURTS OR THAT VENUE THEREOF MAY NOT BE APPROPRIATE OR THAT THIS
AGREEMENT OR ANY SUCH DOCUMENT MAY NOT BE ENFORCED IN OR BY SUCH COURTS, AND THE PARTIES HERETO IRREVOCABLY AGREE THAT ALL CLAIMS WITH RESPECT TO SUCH ACTION, SUIT OR PROCEEDING SHALL BE HEARD AND DETERMINED BY SUCH COURT. THE PARTIES HEREBY
CONSENT TO AND GRANT ANY SUCH COURT JURISDICTION OVER THE PERSON OF SUCH PARTIES AND OVER THE SUBJECT MATTER OF SUCH DISPUTE AND AGREE THAT MAILING OF PROCESS OR OTHER PAPERS IN CONNECTION WITH SUCH ACTION, SUIT OR PROCEEDING IN THE MANNER PROVIDED
IN THIS SECTION 7(M) OF THIS AGREEMENT OR IN SUCH OTHER MANNER AS MAY BE PERMITTED BY LAW SHALL BE VALID AND SUFFICIENT SERVICE THEREOF.
EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE EACH SUCH
PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT
AND FOR ANY COUNTERCLAIM RELATING THERETO. IF THE SUBJECT MATTER OF ANY SUCH LEGAL DISPUTE IS ONE IN WHICH THE WAIVER OF JURY TRIAL IS PROHIBITED, NO PARTY HERETO NOR ANY PERSON ASSERTING RIGHTS AS A THIRD PARTY BENEFICIARY SHALL ASSERT IN SUCH
LEGAL DISPUTE A NONCOMPULSORY COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. FURTHERMORE, NO PARTY HERETO NOR ANY PERSON ASSERTING RIGHTS AS A THIRD PARTY BENEFICIARY SHALL SEEK TO CONSOLIDATE ANY
SUCH LEGAL DISPUTE WITH A SEPARATE ACTION OR OTHER LEGAL PROCEEDING IN WHICH A JURY TRIAL CANNOT BE WAIVED. EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (I) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR
OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER; (II) SUCH PARTY UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THE FOREGOING WAIVER; (III) SUCH PARTY MAKES THE FOREGOING WAIVER
VOLUNTARILY AND (IV) SUCH PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVER AND CERTIFICATIONS IN THIS SECTION 7(M).
8. Non-Reliance. The Investor acknowledges that it is not relying upon, and has not relied upon, any statement, representation or warranty made by any person, firm or corporation other than the
statements, representations and warranties of the Company expressly contained in Section 4 of this Agreement, in making its investment or decision to invest in the Company.
13
9. Registration Rights. The Company and Investor acknowledge and agree that they have entered into a Registration Rights Agreement of even date hereof pursuant to which the Company,
within forty-five (45) business days of the closing of the Business Combination, shall use its reasonable best efforts to file (at the Company’s sole cost and expense) with the SEC a registration statement registering the resale of the
Consideration Shares (the “Registration Statement”), and have the Registration Statement declared effective as soon as practicable after the filing thereof, but no later than the 60th business day (or 105th business day if the SEC notifies the
Company that it will “review” the Registration Statement) following the closing of the Business Combination. The foregoing is qualified in its entirety by the precise terms of the Registration Rights Agreement.
10. Trust Account Waiver. The Investor acknowledges that FIAC is a blank check company with the powers and privileges to effect a merger, asset acquisition, reorganization or similar
business combination involving FIAC and one or more businesses or assets. The Investor further acknowledges that, as described in FIAC’s final prospectus relating to its initial public offering dated October 27, 2021 (the “Final Prospectus”)
available at www.sec.gov, substantially all of FIAC’s assets consist of the cash proceeds of FIAC’s initial public offering and private placement of its securities, and substantially all of those proceeds have been deposited in a trust account (the
“Trust Account”) for the benefit of FIAC, its public shareholders and the underwriters of FIAC’s initial public offering. Except with respect to interest earned on the funds held in the Trust Account that may be released to FIAC to pay its tax
obligations, if any, the cash in the Trust Account may be disbursed only for the purposes set forth in the Final Prospectus. For and in consideration of FIAC entering into this Agreement, the receipt and sufficiency of which are hereby
acknowledged, the Investor, on behalf of itself and its representatives, hereby irrevocably waives any and all right, title and interest, or any claim of any kind it has or may have in the future, in or to any monies held in the Trust Account (or
distributions therefrom to FIAC’s public shareholders or to the underwriters of FIAC’s initial public offering in respect of their deferred underwriting commissions held in the Trust Account), and agrees not to seek recourse against the Trust
Account as a result of, or arising out of, this Agreement or the transactions contemplated hereby regardless of whether such claim arises based on contract, tort, equity or any other theory of legal liability; provided, however, that nothing in
this Section 10 shall be deemed to limit the Investor’s right, title, interest or claim to any monies held in the Trust Account by virtue of its record or beneficial ownership of publicly traded Class A Shares acquired in an open market
transaction, pursuant to a validly exercised redemption right with respect to any such Class A Shares, in accordance with FIAC’s Amended and Restated Certificate of Incorporation, as may be subsequently amended from time to time, and the Investment
Management Trust Agreement between Continental Stock Transfer & Trust Company and FIAC, dated November 1, 2021, except to the extent that the Investor has otherwise agreed in writing with FIAC or any of their respective affiliates to not
exercise such redemption right.
11. Disclosure. The Company shall within four business days following the date of this Agreement, issue one or more press releases or file with the SEC a Current Report on Form 8-K
disclosing all material terms of the transactions contemplated hereby. Within two business days of this Agreement, the Company will provide both the press release and the Form 8-K for review by Investor and its counsel.
[SIGNATURE PAGES FOLLOW]
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IN WITNESS WHEREOF, the Investor has executed or caused this Agreement to be executed by its duly authorized representative as of the date set forth below.
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Name of Investor:
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State/Country of Formation or Domicile:
Nevada
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By:
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Name:
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Title:
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Date: October ___, 2024
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[Signature Page to Subscription Agreement]
IN WITNESS WHEREOF, the Company has accepted this Agreement as of the date set forth below.
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Focus Impact Acquisition Corp.
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By:
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Name:
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Carl Stanton
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Title:
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Chief Executive Officer
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Date: October ___, 2024
[Signature Page to Subscription Agreement]
SCHEDULE A
ELIGIBILITY REPRESENTATIONS OF THE INVESTOR
This Schedule must be completed by Investor and forms a part of the Agreement to which it is attached. Capitalized terms used and not otherwise defined in this Schedule have the meanings given to them in the
Agreement. The Investor must check the applicable box in either Section A, Section B or Section C below.
A.QUALIFIED INSTITUTIONAL BUYER STATUS
(Please check the applicable subparagraphs):
☐ We are a “qualified institutional buyer” (as defined in Rule 144A under the Securities Act).
** OR **
B.INSTITUTIONAL ACCREDITED INVESTOR STATUS
(Please check the applicable subparagraphs):
| 1. |
☐ We are an “accredited investor” (within the meaning of Rule 501(a) under the Securities Act or an
entity in which all of the equity holders are accredited investors within the meaning of Rule 501(a) under the Securities Act), and have marked and initialed the appropriate box below
indicating the provision under which we qualify as an “accredited investor.”
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| 2. |
☐ We are not a natural person.
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C.AFFILIATE STATUS
(Please check the applicable box) INVESTOR:
☐ is:
☐ is not:
an “affiliate” (as defined in Rule 144 under the Securities Act) of the Company or acting on behalf of an affiliate of the Company.
Rule 501(a) under the Securities Act, in relevant part, states that an “accredited investor” shall mean any person who comes within any of the below listed categories, or who the issuer reasonably believes comes
within any of the below listed categories, at the time of the sale of the securities to that person. The Investor has indicated, by marking and initialing the appropriate box below, the provision(s) below which apply to the Investor and under which
the Investor accordingly qualifies as an “accredited investor.”
☐ Any bank, registered broker or dealer,
insurance company, registered investment company, business development company, or small business investment company;
☐ Any plan established and maintained by a
state, its political subdivisions, or any agency or instrumentality of a state or its political subdivisions for the benefit of its employees, if such plan has total assets in excess of $5,000,000;
☐ Any employee benefit plan, within the meaning
of the Employee Retirement Income Security Act of 1974, if a bank, insurance company, or registered investment adviser makes the investment decisions, or if the plan has total assets in excess of $5,000,000;
☐ Any organization described in Section
501(c)(3) of the Internal Revenue Code, corporation, similar business trust, or partnership, not formed for the specific purpose of acquiring the securities offered, with total assets in excess of $5,000,000;
☐ Any director, executive officer, or general
partner of the issuer of the securities being offered or sold, or any director, executive officer, or general partner of a general partner of that issuer;
☐ Any natural person whose individual net worth,
or joint net worth with that person’s spouse, exceeds $1,000,000. For purposes of calculating a natural person’s net worth: (a) the person’s primary residence shall not be included as an asset; (b) indebtedness that is secured by the person’s
primary residence, up to the estimated fair market value of the primary residence at the time of the sale of securities, shall not be included as a liability (except that if the amount of such indebtedness outstanding at the time of sale of
securities exceeds the amount outstanding sixty (60) days before such time, other than as a result of the acquisition of the primary residence, the amount of such excess shall be included as a liability); and (c) indebtedness that is secured by
the person’s primary residence in excess of the estimated fair market value of the primary residence at the time of the sale of securities shall be included as a liability;
☐ Any natural person who had an individual
income in excess of $200,000 in each of the two most recent years or joint income with that person’s spouse in excess of $300,000 in each of those years and has a reasonable expectation of reaching the same income level in the current year;
☐ Any natural person holding in good standing
one or more professional certifications or designations or credentials from an accredited educational institution that the SEC has designated as qualifying an individual for accredited investor status, such as a General Securities
Representative license (Series 7), a Private Securities Offerings Representative license (Series 82) and an Investment Adviser Representative license (Series 65);
☐ Any trust with assets in excess of $5,000,000,
not formed to acquire the securities offered, whose purchase is directed by a sophisticated person; or
☐ Any entity in which all of the equity owners
are accredited investors meeting one or more of the above tests.
This page should be completed by the Investor
and constitutes a part of the Agreement.
Exhibit 10.5
Execution Version
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT (this "Registration Rights Agreement"), effective as of October 29, 2024, is entered into between Karbon-X Corp., a Nevada corporation (“Seller”), and Focus Impact
Acquisition Corp., a Delaware corporation (the “Company” or “FIAC”), in connection with the Business Combination Agreement, dated September 12, 2023, as amended by the first amendment thereto, dated as of May 1, 2024, and as further amended by the
second amendment thereto, dated as of August 10, 2024 (as the same maybe further amended, the “Business Combination Agreement,” and the transactions contemplated thereby, the “Business Combination”), by and among the Company, Focus Impact Amalco Sub
Ltd. (“Amalco Sub”), a company existing under the laws of the Province of British Columbia, and DevvStream Holdings Inc. (“DevvStream”), a company existing under the Laws of the Province of British Columbia, pursuant to which, among other things, the
Company is expected to continue from the State of Delaware under the Delaware General Corporation Law to the Province of Alberta under the Business Corporations Act. Capitalized terms used herein and not otherwise defined herein shall have the
respective meanings set forth in the Carbon Credit Purchase Agreement by and between the Company, the Seller and DevvStream, dated as of the date hereof (as amended, restated, supplemented or otherwise modified from time to time, the "Carbon Credit
Agreement").
WHEREAS:
In connection with the Business Combination, DevvStream and the Investor entered into that certain Carbon Credit Purchase Agreement, dated as the date hereof (the “Purchase Agreement” and, together
with this Agreement, the “Transaction Documents”), pursuant to which, among other things, the Investor agreed to sell Carbon Credits as set forth on Exhibit A thereto (the “Purchased Credits”) for an aggregate purchase price of USD $1,137,197.25 (the
“Purchase Price”), which Purchase Price will be payable in common shares of the Company (“Common Shares”) to be issued immediately following the closing of the Business Combination at a deemed price of $6.50, for a total of 174,953 shares (the
“Consideration Shares”). The Company has agreed to provide certain registration rights under the Securities Act of 1933, as amended, and the rules and regulations thereunder, or any similar successor statute (collectively, the "Securities Act"), and
applicable state securities laws. Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Purchase Agreement.
NOW, THEREFORE, in consideration of
the promises and the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and the Seller hereby agree as follows:
1. DEFINITIONS.
As used in this Agreement, the following terms shall have the following meanings:
a. "Investor" means Seller, any transferee or assignee thereof to whom Seller assigns its rights under this Agreement in accordance with Section 9 and who agrees to become bound by
the provisions of this Agreement, and any transferee or assignee thereof to whom a transferee or assignee assigns its rights under this Agreement in accordance with Section 9 and who agrees to become bound by the provisions of this Agreement.
b. "Person" means any individual or entity including but not limited to any corporation, a limited liability company, an association, a partnership, an organization, a business, an
individual, a governmental or political subdivision thereof or a governmental agency.
c. "Register," "registered," and "registration" refer to a registration effected by preparing and filing one or more registration statements of the Company in compliance
with the Securities Act and/or pursuant to Rule 415 under the Securities Act or any successor rule providing for offering securities on a continuous basis ("Rule 415"), and the declaration or ordering of effectiveness of such registration
statement(s) by the United States Securities and Exchange Commission (the "SEC").
d. "Registrable Securities" means all of the Shares which have been, or which may, from time to time be issued, including without limitation all of the shares of common stock which
have been issued or will be issued to the Investor under the Carbon Credit Purchase Agreement (without regard to any limitation or restriction on purchases), or shares of common stock issued to the Investor as a result of any stock split, stock
dividend, recapitalization, exchange or similar event or otherwise, without regard to any limitation on purchases under the Carbon Credit Purchase Agreement.
e. "Registration Statement" means one or more registration statements of the Company covering the sale of the Registrable Securities.
2. REGISTRATION.
a. Mandatory Registration. the Company shall, on or before 45 days from the date of this Agreement, file with the SEC an initial Registration Statement covering the maximum number of
Registrable Securities as shall be permitted to be included thereon in accordance with applicable SEC rules, regulations and interpretations so as to permit the resale of such Registrable Securities by the Investor, including but not limited to under
Rule 415 under the Securities Act at then prevailing market prices (and not fixed prices), as mutually determined by both the Company and the Investor in consultation with their respective legal counsel. The Investor and its counsel shall have a
reasonable opportunity to review and comment upon such Registration Statement and any amendment or supplement to such Registration Statement and any related prospectus prior to its filing with the SEC, and the Company shall give due consideration to
all reasonable comments. The Investor shall furnish all information reasonably requested by the Company for inclusion therein. The Company shall use its reasonable best efforts to have the Registration Statement and any amendment declared effective
by the SEC at the earliest possible date, but in any event within 120 days from the date hereof (the “Effective Date”). The Company shall use its reasonable best efforts to keep the Registration Statement effective, including but not limited to
pursuant to Rule 415 promulgated under the Securities Act and available for the resale by the Investor of all of the Registrable Securities covered thereby at all times until the earlier of (i) the date as of which the Investor may sell all of the
Registrable Securities without restriction pursuant to Rule 144 promulgated under the Securities and (ii) the date on which the Investor shall have sold all the Registrable Securities covered thereby and no Available Amount remains under the Carbon
Credit Purchase Agreement (the "Registration Period"). The Registration Statement (including any amendments or supplements thereto and prospectuses contained therein) shall not contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein, or necessary to make the statements therein, in light of the circumstances in which they were made, not misleading.
b. Rule 424 Prospectus. the Company shall, as required by applicable securities regulations, from time to time file with the SEC, pursuant to Rule 424 promulgated under the
Securities Act, the prospectus and prospectus supplements, if any, to be used in connection with sales of the Registrable Securities under the Registration Statement. The Investor and its counsel shall have a reasonable opportunity to review and
comment upon such prospectus prior to its filing with the SEC, and the Company shall give due consideration to all such comments. The Investor shall use its reasonable best efforts to comment upon such prospectus within one (1) Business Day from the
date the Investor receives the final pre-filing version of such prospectus.
c. Sufficient Number of Shares Registered. In the event the number of shares available under the Registration Statement is insufficient to cover all of the Registrable Securities,
the Company shall amend the Registration Statement or file a new Registration Statement (a “New Registration Statement”), so as to cover all of such Registrable Securities (subject to the limitations set forth in Section 2(a)) as soon as
practicable, but in any event not later than thirty (30) Business Days after the necessity therefor arises, subject to any limits that may be imposed by the SEC pursuant to Rule 415 under the Securities Act. the Company shall use it reasonable best
efforts to cause such amendment and/or New Registration Statement to become effective as soon as practicable following the filing thereof. The Company agrees that it shall not file any such Other Registration Statement unless all of the Registrable
Securities have been included in such Other Registration Statement or otherwise have been registered for resale as described above.
d. Offering. If the staff of the SEC (the “Staff”) or the SEC seeks to characterize any offering pursuant to a Registration Statement filed pursuant to this Agreement as
constituting an offering of securities that does not permit such Registration Statement to become effective and be used for resales by the Investor under Rule 415 at then-prevailing market prices (and not fixed prices), or if after the filing of the
initial Registration Statement with the SEC pursuant to Section 2(a), the Company is otherwise required by the Staff or the SEC to reduce the number of Registrable Securities included in such initial Registration Statement, then the Company shall
reduce the number of Registrable Securities to be included in such initial Registration Statement (with the prior consent, which shall not be unreasonably withheld, of the Investor and its legal counsel as to the specific Registrable Securities to be
removed therefrom) until such time as the Staff and the SEC shall so permit such Registration Statement to become effective and be used as aforesaid. In the event of any reduction in Registrable Securities pursuant to this paragraph, the Company
shall file one or more New Registration Statements in accordance with Section 2(c) until such time as all Registrable Securities have been included in Registration Statements that have been declared effective and the prospectus contained therein is
available for use by the Investor. Notwithstanding any provision herein or in the Purchase Agreement to the contrary, the Company’s obligations to register Registrable Securities (and any related conditions to the Investor’s obligations) shall be
qualified as necessary to comport with any requirement of the SEC or the Staff as addressed in this Section 2(d).
3. RELATED OBLIGATIONS.
With respect to the Registration Statement and whenever any Registrable Securities are to be registered pursuant to Section 2 including on any New Registration Statement, the Company shall use its
reasonable best efforts to effect the registration of the Registrable Securities in accordance with the intended method of disposition thereof and, pursuant thereto, the Company shall have the following obligations:
a. the Company shall prepare and file with the SEC such amendments (including post-effective amendments) and supplements to any registration statement and the prospectus used in connection
with such registration statement, which prospectus is to be filed pursuant to Rule 424 promulgated under the Securities Act, as may be necessary to keep the Registration Statement or any New Registration Statement effective at all times during the
Registration Period, and, during such period, comply with the provisions of the Securities Act with respect to the disposition of all Registrable Securities of the Company covered by the Registration Statement or any New Registration Statement until
such time as all of such Registrable Securities shall have been disposed of in accordance with the intended methods of disposition by the seller or sellers thereof as set forth in such registration statement.
b. the Company shall permit the Investor to review and comment upon the Registration Statement or any New Registration Statement and all amendments and supplements thereto at least two (2)
Business Days prior to their filing with the SEC, and not file any document in a form to which Investor reasonably objects. The Investor shall use its reasonable best efforts to comment upon the Registration Statement or any New Registration
Statement and any amendments or supplements thereto within two (2) Business Days from the date the Investor receives the final version thereof. the Company shall furnish to the Investor, without charge any correspondence from the SEC or the staff
of the SEC to the Company or its representatives relating to the Registration Statement or any New Registration Statement.
c. Upon request of the Investor, the Company shall furnish to the Investor, (i) promptly after the same is prepared and filed with the SEC, at least one copy of such registration statement
and any amendment(s) thereto, including financial statements and schedules, all documents incorporated therein by reference and all exhibits, (ii) upon the effectiveness of any registration statement, a copy of the prospectus included in such
registration statement and all amendments and supplements thereto (or such other number of copies as the Investor may reasonably request) and (iii) such other documents, including copies of any preliminary or final prospectus, as the Investor may
reasonably request from time to time in order to facilitate the disposition of the Registrable Securities owned by the Investor. For the avoidance of doubt, any filing available to the Investor via the SEC’s live EDGAR system shall be deemed
“furnished to the Investor” hereunder.
d. the Company shall use reasonable best efforts to (i) register and qualify the Registrable Securities covered by a registration statement under such other securities or "blue sky" laws of
such jurisdictions in the United States as the Investor reasonably requests (up to ten), (ii) prepare and file in those jurisdictions, such amendments (including post-effective amendments) and supplements to such registrations and qualifications as
may be necessary to maintain the effectiveness thereof during the Registration Period, (iii) take such other actions as may be necessary to maintain such registrations and qualifications in effect at all times during the Registration Period, and (iv)
take all other actions reasonably necessary or advisable to qualify the Registrable Securities for sale in such jurisdictions; provided, however, that the Company shall not be required in connection therewith or as a condition thereto to (x) qualify
to do business in any jurisdiction where it would not otherwise be required to qualify but for this Section 3(d), (y) subject itself to general taxation in any such jurisdiction, or (z) file a general consent to service of process in any such
jurisdiction. the Company shall promptly notify the Investor who holds Registrable Securities of the receipt by the Company of any notification with respect to the suspension of the registration or qualification of any of the Registrable Securities
for sale under the securities or "blue sky" laws of any jurisdiction in the United States or its receipt of actual notice of the initiation or threatening of any proceeding for such purpose.
e. As promptly as practicable after becoming aware of such event or facts, the Company shall notify the Investor in writing of the happening of any event or existence of such facts as a
result of which the prospectus included in any registration statement, as then in effect, includes an untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading, and promptly prepare a supplement or amendment to such registration statement to correct such untrue statement or omission, and deliver a copy of such supplement or amendment to
the Investor (or such other number of copies as the Investor may reasonably request). the Company shall also promptly notify the Investor in writing (i) when a prospectus or any prospectus supplement or post-effective amendment has been filed, and
when a registration statement or any post-effective amendment has become effective (notification of such effectiveness shall be delivered to the Investor by email or facsimile on the same day of such effectiveness and by overnight mail), (ii) of any
request by the SEC for amendments or supplements to any registration statement or related prospectus or related information, and (iii) of the Company’s reasonable determination that a post-effective amendment to a registration statement would be
appropriate.
f. the Company shall use its reasonable best efforts to prevent the issuance of any stop order or other suspension of effectiveness of any registration statement, or the suspension of the
qualification of any Registrable Securities for sale in any jurisdiction and, if such an order or suspension is issued, to obtain the withdrawal of such order or suspension at the earliest possible moment and to notify the Investor of the issuance of
such order and the resolution thereof or its receipt of actual notice of the initiation or threat of any proceeding for such purpose.
g. the Company shall (i) cause all the Registrable Securities to be listed on each securities exchange on which securities of the same class or series issued by the Company are then listed,
if any, if the listing of such Registrable Securities is then permitted under the rules of such exchange, or (ii) secure designation and quotation of all the Registrable Securities on the Principal Market. the Company shall pay all fees and expenses
in connection with satisfying its obligation under this Section.
h. the Company shall cooperate with the Investor to facilitate the timely preparation and delivery of certificates or book entry statements (not bearing any restrictive legend) representing
the Registrable Securities to be offered pursuant to any registration statement and enable such certificates or book entry statements to be in such denominations or amounts as the Investor may reasonably request and registered in such names as the
Investor may request.
i. the Company shall at all times provide a transfer agent and registrar with respect to its Common Stock.
j. If reasonably requested by the Investor, the Company shall (i) immediately incorporate in a prospectus supplement or post-effective amendment such information as the Investor believes
should be included therein relating to the sale and distribution of Registrable Securities, including, without limitation, information with respect to the number of Registrable Securities being sold, the purchase price being paid therefor and any
other terms of the offering of the Registrable Securities; (ii) make all required filings of such prospectus supplement or post-effective amendment as soon as practicable upon notification of the matters to be incorporated in such prospectus
supplement or post-effective amendment; and (iii) supplement or make amendments to any registration statement.
k. the Company shall use its reasonable best efforts to cause the Registrable Securities covered by any registration statement to be registered with or approved by such other governmental
agencies or authorities as may be necessary to consummate the disposition of such Registrable Securities.
l. Within one (1) Business Day after any registration statement which includes the Registrable Securities is ordered effective by the SEC, the Company shall notify the transfer agent for
such Registrable Securities (with copies to the Investor) that such registration statement has been declared effective by the SEC. Thereafter, if requested by the the Company at any time, the Company shall require its counsel to deliver to the the
Company a written confirmation whether or not the effectiveness of such registration statement has lapsed at any time for any reason (including, without limitation, the issuance of a stop order) and whether or not the registration statement is
current and available to the the Company for sale of all of the Registrable Securities.
m. the Company shall take all other reasonable actions necessary to expedite and facilitate disposition by the Investor of Registrable Securities pursuant to any registration statement.
4. OBLIGATIONS OF THE INVESTOR.
a. the Company shall notify the Investor in writing of the information the Company reasonably requires from the Investor in connection with any registration statement hereunder. The
Investor shall furnish to the Company such information regarding itself, the Registrable Securities held by it and the intended method of disposition of the Registrable Securities held by it as shall be reasonably required to effect the registration
of such Registrable Securities and shall execute such documents in connection with such registration as the Company may reasonably request.
b. The Investor agrees to cooperate with the Company as reasonably requested by the Company in connection with the preparation and filing of any registration statement hereunder.
c. The Investor agrees that, upon receipt of any notice from the Company of the happening of any event or existence of facts of the kind described in Section 3(f) or the first sentence of
3(e), the Investor will immediately discontinue disposition of Registrable Securities pursuant to any registration statement(s) covering such Registrable Securities until the Investor's receipt of the copies of the supplemented or amended prospectus
contemplated by Section 3(f) or the first sentence of 3(e). Notwithstanding anything to the contrary, the Company shall cause its transfer agent to promptly deliver shares of Common Stock without any restrictive legend in accordance with the terms
of the Carbon Credit Purchase Agreement in connection with any sale of Registrable Securities with respect to which an Investor has entered into a contract for sale prior to the Investor's receipt of a notice from the Company of the happening of any
event of the kind described in Section 3(f) or the first sentence of Section 3(e) and for which the Investor has not yet settled.
5. EXPENSES OF REGISTRATION.
All reasonable expenses, other than sales or brokerage commissions, incurred in connection with registrations, filings or qualifications pursuant to Sections 2 and 3, including, without limitation,
all registration, listing and qualifications fees, printers and accounting fees, and fees and disbursements of counsel for the Company, shall be paid by the Company.
6. INDEMNIFICATION.
a. To the fullest extent permitted by law, the Company will, and hereby does, indemnify, hold harmless and defend the Investor, each Person, if any, who controls the Investor, the members,
the directors, officers, partners, employees, agents, representatives of the Investor and each Person, if any, who controls the Investor within the meaning of the Securities Act or the Securities Exchange Act of 1934, as amended (the "Exchange Act")
(each, an "Indemnified Person"), against any losses, claims, damages, liabilities, judgments, fines, penalties, charges, costs, attorneys' fees, amounts paid in settlement or expenses, joint or several, (collectively, "Claims") incurred
in investigating, preparing or defending any action, claim, suit, inquiry, proceeding, investigation or appeal taken from the foregoing by or before any court or governmental, administrative or other regulatory agency, body or the SEC, whether
pending or threatened, whether or not an indemnified party is or may be a party thereto ("Indemnified Damages"), to which any of them may become subject insofar as such Claims (or actions or proceedings, whether commenced or threatened, in
respect thereof) arise out of or are based upon: (i) any untrue statement or alleged untrue statement of a material fact in the Registration Statement, any New Registration Statement or any post-effective amendment thereto or in any filing made in
connection with the qualification of the offering under the securities or other "blue sky" laws of any jurisdiction in which Registrable Securities are offered ("Blue Sky Filing"), or the omission or alleged omission to state a material fact
required to be stated therein or necessary to make the statements therein not misleading, (ii) any untrue statement or alleged untrue statement of a material fact contained in the final prospectus (as amended or supplemented, if the Company files any
amendment thereof or supplement thereto with the SEC) or the omission or alleged omission to state therein any material fact necessary to make the statements made therein, in light of the circumstances under which the statements therein were made,
not misleading or (iii) any violation or alleged violation by the Company of the Securities Act, the Exchange Act, any other law, including, without limitation, any state securities law, or any rule or regulation thereunder relating to the offer or
sale of the Registrable Securities pursuant to the Registration Statement or any New Registration Statement (the matters in the foregoing clauses (i) through (iii) being, collectively, "Violations"). Subject to Section 6(c) hereof, the Company
shall reimburse each Indemnified Person promptly as such expenses are incurred and are due and payable, for any reasonable legal fees or other reasonable expenses incurred by them in connection with investigating or defending any such Claim.
Notwithstanding anything to the contrary contained herein, the indemnification agreement contained in this Section 6(a): (i) shall not apply to a Claim by an Indemnified Person arising out of or based upon a Violation which occurs in reliance upon
and in conformity with information about the Investor furnished in writing to the Company by such Indemnified Person expressly for use in connection with the preparation of the Registration Statement, any New Registration Statement or any such
amendment thereof or supplement thereto, if such prospectus was timely made available by the Company pursuant to Section 3(c) or Section 3(e); (ii) with respect to any superseded prospectus, shall not inure to the benefit of any such person from whom
the person asserting any such Claim purchased the Registrable Securities that are the subject thereof (or to the benefit of any person controlling such person) if the untrue statement or omission of material fact contained in the superseded
prospectus was corrected in the revised prospectus, as then amended or supplemented, if such revised prospectus was timely made available by the Company pursuant to Section 3(c) or Section 3(e), and the Indemnified Person was promptly advised in
writing not to use the incorrect prospectus prior to the use giving rise to a violation and such Indemnified Person, notwithstanding such advice, used it; (iii) shall not be available to the extent such Claim is based on a failure of the Investor to
deliver or to cause to be delivered the prospectus made available by the Company, if such prospectus was timely made available by the Company pursuant to Section 3(c) or Section 3(e); and (iv) shall not apply to amounts paid in settlement of any
Claim if such settlement is effected without the prior written consent of the Company, which consent shall not be unreasonably withheld. Such indemnity shall remain in full force and effect regardless of any investigation made by or on behalf of the
Indemnified Person and shall survive the transfer of the Registrable Securities by the Investor pursuant to Section 9.
b. In connection with any Registration Statement in which the Investor is participating, the Investor agrees to indemnify, hold harmless and defend, to the same extent and in the same
manner as is set forth in Section 6(a), the Company, each of its directors, each of its officers who signs the Registration Statement and each Person, if any, who controls the Company within the meaning of the Securities Act or the Exchange Act
(each, a “Company Party” and, collectively, the “Company Parties”), against any Claim or Indemnified Damages to which any of them may become subject, under the Securities Act, the Exchange Act or otherwise, insofar as such Claim or
Indemnified Damages arise out of or are based upon any Violation, in each case, to the extent, and only to the extent, that such Violation occurs in reliance upon and in conformity with the Investor Information; and, subject to Section 6(c) and the
below provisos in this Section 6(b), the Investor shall reimburse a Company Party any legal or other expenses reasonably incurred by such Company Party in connection with investigating or defending any such Claim; provided, however, the indemnity
agreement contained in this Section 6(b) and the agreement with respect to contribution contained in Section 7 shall not apply to amounts paid in settlement of any Claim if such settlement is effected without the prior written consent of the
Investor, which consent shall not be unreasonably withheld or delayed; and provided, further that the Investor shall be liable under this Section 6(b) for only that amount of a Claim or Indemnified Damages as does not exceed the net proceeds to the
Investor as a result of the applicable sale of Registrable Securities pursuant to such Registration Statement, Prospectus or Prospectus Supplement. Such indemnity shall remain in full force and effect regardless of any investigation made by or on
behalf of such Company Party and shall survive the transfer of any of the Registrable Securities by the Investor pursuant to Section 9.
c. Promptly after receipt by an Indemnified Person or Indemnified Party under this Section 6 of notice of the commencement of any action or proceeding (including any governmental action or
proceeding) involving a Claim, such Indemnified Person or Indemnified Party shall, if a Claim in respect thereof is to be made against any indemnifying party under this Section 6, deliver to the indemnifying party a written notice of the commencement
thereof, and the indemnifying party shall have the right to participate in, and, to the extent the indemnifying party so desires, jointly with any other indemnifying party similarly noticed, to assume control of the defense thereof with counsel
mutually satisfactory to the indemnifying party and the Indemnified Person or the Indemnified Party, as the case may be; provided, however, that an Indemnified Person or Indemnified Party shall have the right to retain its own counsel with the fees
and expenses to be paid by the indemnifying party, if, in the reasonable opinion of counsel retained by the indemnifying party, the representation by such counsel of the Indemnified Person or Indemnified Party and the indemnifying party would be
inappropriate due to actual or potential differing interests between such Indemnified Person or Indemnified Party and any other party represented by such counsel in such proceeding. The Indemnified Party or Indemnified Person shall cooperate fully
with the indemnifying party in connection with any negotiation or defense of any such action or claim by the indemnifying party and shall furnish to the indemnifying party all information reasonably available to the Indemnified Party or Indemnified
Person which relates to such action or claim. The indemnifying party shall keep the Indemnified Party or Indemnified Person fully apprised at all times as to the status of the defense or any settlement negotiations with respect thereto. No
indemnifying party shall be liable for any settlement of any action, claim or proceeding effectuated without its written consent, provided, however, that the indemnifying party shall not unreasonably withhold, delay or condition its consent. No
indemnifying party shall, without the consent of the Indemnified Party or Indemnified Person, consent to entry of any judgment or enter into any settlement or other compromise which does not include as an unconditional term thereof the giving by the
claimant or plaintiff to such Indemnified Party or Indemnified Person of a release from all liability in respect to such claim or litigation. Following indemnification as provided for hereunder, the indemnifying party shall be subrogated to all
rights of the Indemnified Party or Indemnified Person with respect to all third parties, firms or corporations relating to the matter for which indemnification has been made. The failure to deliver written notice to the indemnifying party within a
reasonable time of the commencement of any such action shall not relieve such indemnifying party of any liability to the Indemnified Person or Indemnified Party under this Section 6, except to the extent that the indemnifying party is prejudiced in
its ability to defend such action.
c. The indemnification required by this Section 6 shall be made by periodic payments of the amount thereof during the course of the investigation or defense, as and when bills are received or
Indemnified Damages are incurred; provided that any Person receiving any payment pursuant to this Section 6 shall promptly reimburse the Person making such payment for the amount of such payment to the extent a court of competent jurisdiction
determines that such Person receiving such payment was not entitled to such payment.
d. The indemnity agreements contained herein shall be in addition to (i) any cause of action or similar right of the Indemnified Party or Indemnified Person against the indemnifying party or
others, and (ii) any liabilities the indemnifying party may be subject to pursuant to the law.
7. CONTRIBUTION.
To the extent any indemnification by an indemnifying party is prohibited or limited by law, the indemnifying party agrees to make the maximum contribution with respect to any amounts for which it
would otherwise be liable under Section 6 to the fullest extent permitted by law; provided, however, that: (i) no seller of Registrable Securities guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any seller of Registrable Securities who was not guilty of fraudulent misrepresentation; and (ii) contribution by any seller of Registrable Securities shall be limited in amount to the net amount of proceeds
received by such seller from the sale of such Registrable Securities.
8. REPORTS AND DISCLOSURE UNDER THE SECURITIES ACTS.
With a view to making available to the Investor the benefits of Rule 144 promulgated under the Securities Act or any other similar rule or regulation of the SEC that may at any time permit the
Investor to sell securities of the Company to the public without registration ("Rule 144"), the Company agrees, at the Company’s sole expense, to:
a. make and keep public information available, as those terms are understood and defined in Rule 144;
b. file with the SEC in a timely manner all reports and other documents required of the Company under the Securities Act and the Exchange Act so long as the Company remains subject to such
requirements and the filing of such reports and other documents is required for the applicable provisions of Rule 144;
c. furnish to the Investor so long as the Investor owns Registrable Securities, promptly upon request, (i) a written statement by the Company that it has complied with the reporting and or
disclosure provisions of Rule 144, the Securities Act and the Exchange Act, (ii) a copy of the most recent annual or quarterly report of the Company and such other reports and documents so filed by the Company, and (iii) such other information as may
be reasonably requested to permit the Investor to sell such securities pursuant to Rule 144 without registration, unless to the extent such information is publicly available; and
d. take such additional action as is requested by the Investor to enable the Investor to sell the Registrable Securities pursuant to Rule 144, including, without limitation, delivering all
such legal opinions, consents, certificates, resolutions and instructions to the Company’s Transfer Agent as may be requested from time to time by the Investor and otherwise fully cooperate with Investor and Investor’s broker to effect such sale of
securities pursuant to Rule 144.
9. ASSIGNMENT OF REGISTRATION RIGHTS.
the Company shall not assign this Agreement or any rights or obligations hereunder without the prior written consent of the Investor. The Investor may not assign its rights under this Agreement
without the written consent of the Company.
10. AMENDMENT OF REGISTRATION RIGHTS.
No provision of this Agreement may be (i) amended other than by a written instrument signed by both parties hereto or (ii) waived other than in a written instrument signed by the party against whom
enforcement of such waiver is sought. Failure of any party to exercise any right or remedy under this Agreement or otherwise, or delay by a party in exercising such right or remedy, shall not operate as a waiver thereof.
11. MISCELLANEOUS.
a. A Person is deemed to be a holder of Registrable Securities whenever such Person owns or is deemed to own of record such Registrable Securities. If the Company receives conflicting
instructions, notices or elections from two or more Persons with respect to the same Registrable Securities, the Company shall act upon the basis of instructions, notice or election received from the registered owner of such Registrable Securities.
b. Any notices, consents, waivers or other communications required or permitted to be given under the terms of this Agreement must be in writing and will be deemed to have been delivered:
(i) upon receipt, when delivered personally; (ii) upon receipt, when sent by facsimile or email (provided confirmation of transmission is mechanically or electronically generated and kept on file by the sending party); or (iii) one (1) Business Day
after deposit with a nationally recognized overnight delivery service, in each case properly addressed to the party to receive the same. The addresses for such communications shall be:
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If to Investor:
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Karbon-X Corp.
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||
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510 5th St. SW, Suite 910
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|||
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Calgary, AB Canada T2P 3S2
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Attn:
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Chad Clovis, Chief Executive Officer
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Email:
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cc@karbon-x.com
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with a copy (which shall not constitute notice) to:
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Cutler Law Group, P.C.
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6575 West Loop South, Suite 500
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Bellaire, TX 77401
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Attn:
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M. Richard Cutler
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Email:
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rcutler@cutlerlaw.com
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If to the Company:
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Focus Impact Acquisition Corp.
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250 Park Avenue Ste 911
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New York, NY 10177
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Attn:
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Carl Stanton
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E-mail:
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cstanton@focus-impact.com
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With a copy (which will not constitute notice) to:
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Kirkland & Ellis LLP
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601 Lexington Avenue
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New York, NY 10022
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Attn:
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Peter Seligson, P.C.
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||
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E-mail:
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peter.seligson@kirkland.com
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||
or at such other address and/or facsimile number and/or to the attention of such other person as the recipient party has specified by written notice given to each other party three (3) Business Days prior to the
effectiveness of such change. Written confirmation of receipt (A) given by the recipient of such notice, consent, waiver or other communication, (B) mechanically or electronically generated by the sender's facsimile machine or email account
containing the time, date, recipient facsimile number or email address, as applicable, and an image of the first page of such transmission or (C) provided by a nationally recognized overnight delivery service, shall be rebuttable evidence of personal
service, receipt by facsimile or receipt from a nationally recognized overnight delivery service in accordance with clause (i), (ii) or (iii) above, respectively.
c. All questions concerning the construction, validity, enforcement and interpretation of this Agreement shall be governed by the internal laws of the State of New York, without giving
effect to any choice of law or conflict of law provision or rule (whether of the State of New York or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of New York. Each party hereby
irrevocably submits to the exclusive jurisdiction of the federal courts sitting in The City of New York, Borough of Manhattan, for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or
discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is brought in an
inconvenient forum or that the venue of such suit, action or proceeding is improper. Each party hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy
thereof to such party at the address for such notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any
right to serve process in any manner permitted by law. If any provision of this Agreement shall be invalid or unenforceable in any jurisdiction, such invalidity or unenforceability shall not affect the validity or enforceability of the remainder of
this Agreement in that jurisdiction or the validity or enforceability of any provision of this Agreement in any other jurisdiction. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO
REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION HEREWITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.
d. This Registration Rights Agreement, the Subscription Agreement and the Carbon Credit Purchase Agreement constitute the entire agreement among the parties hereto with respect to the subject
matter hereof and thereof. There are no restrictions, promises, warranties or undertakings, other than those set forth or referred to herein and therein. This Registration Rights Agreement and the Carbon Credit Purchase Agreement supersede all
prior agreements and understandings among the parties hereto with respect to the subject matter hereof and thereof.
e. Subject to the requirements of Section 9, this Agreement shall inure to the benefit of and be binding upon the successors and permitted assigns of each of the parties hereto.
f. The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof.
g. This Agreement may be executed in identical counterparts, each of which shall be deemed an original but all of which shall constitute one and the same agreement. This Agreement, once
executed by a party, may be delivered to the other party hereto by facsimile transmission, docusign or by e-mail in a “.pdf” format data file of a copy of this Agreement bearing the signature of the party so delivering this Agreement.
h. Each party shall do and perform, or cause to be done and performed, all such further acts and things, and shall execute and deliver all such other agreements, certificates, instruments
and documents, as the other party may reasonably request in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby.
i. The language used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent and no rules of strict construction will be applied against any
party.
j. This Agreement is intended for the benefit of the parties hereto and their respective successors and permitted assigns, and is not for the benefit of, nor may any provision hereof be
enforced by, any other Person.
* * * * * *
IN WITNESS WHEREOF, the parties
have caused this Agreement to be duly executed as of day and year first above written.
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SELLER:
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||
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KARBON-X CORP.
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||
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a Nevada corporation
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||
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By:
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/s/ Chad Clovis |
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|
Name:
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Chad Clovis
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|
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Title:
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Chief Executive Officer
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|
COMPANY:
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||
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FOCUS IMPACT ACQUISITION CORP.
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||
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By:
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/s/ Carl Stanton
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Name:
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Carl Stanton
|
|
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Title:
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Chief Executive Officer
|
Exhibit 10.6
Execution Version
PURCHASE AGREEMENT
THIS PURCHASE AGREEMENT (this
“Agreement”), dated as of October 29, 2024, is made by and between HELENA GLOBAL INVESTMENT OPPORTUNITIES I LTD. (the “Investor”), FOCUS IMPACT ACQUISITION CORP., a Delaware corporation (the “Company”), and Focus Impact Sponsor, LLC, a Delaware limited
liability company (the “Sponsor”).
WHEREAS, the parties desire
that, upon the terms and subject to the conditions contained herein, the Company shall have the right to issue and sell to the Investor, from time to time as provided herein, and the Investor shall purchase from the Company, up to Forty Million
United States Dollars ($40,000,000) of the Company’s shares of common stock, par value $0.0001 per share (the “Common Stock”);
WHEREAS, pursuant to that
certain Business Combination Agreement, dated September 12, 2023, as amended by the first amendment thereto, dated as of May 1, 2024, and as further amended by the second amendment thereto, dated as of August 10, 2024 (as the same maybe further
amended, the “Business Combination Agreement,” and the transactions contemplated thereby, the “Business Combination”), by and among the Company, Focus Impact Amalco Sub Ltd., a company existing under the laws of the Province of British Columbia, and DevvStream Holdings Inc., a company existing under the Laws of
the Province of British Columbia, among other things, (i) the Company is expected to continue from the State of Delaware under the Delaware General Corporation Law to the Province of Alberta under the Business Corporations Act, (ii) the Company
will change its name from Focus Impact Acquisition Corp. to DevvStream Corp. (“New PubCo”), and (iii) each share of Common Stock will be converted into a
number of shares of common shares of New PubCo (“New PubCo Common Shares”);
WHEREAS, the Common Stock will
be approved for listing on the Nasdaq Stock Market (“Nasdaq”) under the symbol “FIAC”; and
WHEREAS, the offer and sale of
the Common Stock issuable hereunder will be made in reliance upon Section 4(a)(2) under the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder (the “Securities Act”), or upon such other exemption from the registration requirements of the Securities Act as may be available with respect to any or all of the transactions to be made hereunder.
NOW, THEREFORE, the parties hereto
agree as follows:
ARTICLE I
CERTAIN DEFINITIONS
“Advance” shall mean the portion of the Commitment Amount
requested by the Company in an Advance Notice.
“Advance Date” shall mean the 3rd Trading Day after expiration
of the applicable Pricing Period for each Advance.
“Advance Halt” shall have the meaning set forth in Section
2.06(d).
“Advance Notice” shall mean a written notice in the form of Exhibit A attached hereto to the Investor executed by an officer of the Company or other authorized representative of the Company identified on Schedule 1 hereto
and setting forth the amount of an Advance that the Company desires to issue and sell to the Investor.
“Advance Notice Confirmation” shall have the meaning set forth
in Section 2.03(a).
“Advance Notice Date” shall mean each date the Company
delivers (in accordance with Section 2.02 of this Agreement) to the Investor an Advance Notice, subject to the terms of this Agreement.
“Affiliate” shall have the meaning set forth in Section 3.07.
“Agreement” shall have the meaning set forth in the preamble
of this Agreement.
“Applicable Laws” shall mean all applicable laws, statutes,
rules, regulations, orders, executive orders, directives, policies, guidelines and codes having the force of law, whether local, national, or international, as amended from time to time the non-compliance with which will reasonably be expected to
have a material impact on the Company’s ability to perform under this Agreement, including without limitation (i) all applicable laws that relate to money laundering, terrorist financing, financial record keeping and reporting, (ii) all applicable
laws that relate to anti-bribery, anti-corruption, books and records and internal controls, including the United States Foreign Corrupt Practices Act of 1977, and (iii) any Sanctions laws.
“Bankruptcy Law” means Title 11, U.S. Code, or any similar
federal, state or similar laws for the relief of debtors.
“Black Out Period” shall have the meaning set forth in Section
6.02.
“Business Combination” shall mean the business combination
contemplated by that certain Business Combination Agreement, dated as of September 12, 2023 (as amended on May 1, 2024 and as may be amended, supplemented or otherwise modified from time to time), by and among the Company, Focus Impact Amalco Sub
Ltd., a company existing under the laws of the Province of British Columbia, and DevvStream Holdings Inc., a company existing under the Laws of the Province of British Columbia.
“Business Day” means any day on which the Principal Market or
Trading Market is open for trading, including any day on which the Principal Market or Trading Market is open for trading for a period of time less than the customary time.
“Buy-In” shall have the meaning set forth in Section 2.07.
“Buy-In Price” shall have the meaning set forth in Section
2.07.
“Closing” shall have the meaning set forth in Section 2.06.
“Commitment Amount” shall mean Forty Million United States
Dollars ($40,000,000), provided that, the Company shall not effect any sales under this Agreement and the Investor shall not have the
obligation to purchase Common Stock under this Agreement to the extent (but only to the extent) that after giving effect to such purchase and sale the aggregate number of shares Common Stock issued under this Agreement would exceed 19.99% of the
outstanding shares of Common Stock following the closing of the Business Combination Agreement (the “Exchange Cap”); provided further that, the Exchange Cap will not apply if the Company’s stockholders have approved issuances in excess of the Exchange Cap in accordance with the rules of
the Trading Market.
“Commitment Fee Shares” shall have the meaning set forth in
Section 13.04.
“Commitment Period” shall mean the period commencing on the
date hereof and expiring upon the date of termination of this Agreement in accordance with Section 11.02.
“Common Stock” shall have the meaning set forth in the
recitals of this Agreement.
“Company” shall have the meaning set forth in the preamble of
this Agreement.
“Condition Satisfaction Date” shall have the meaning set forth
in Section 7.01.
“Custodian” means any receiver, trustee, assignee, liquidator
or similar official under any Bankruptcy Law.
“DTC” means the Depository Trust Company.
“DWAC Shares” means the Commitment Fee Shares or the shares of
Common Stock acquired or purchased by the Investor pursuant to this Agreement (a) that the Investor has resold in a manner described under the caption “Plan of Distribution” in the Registration Statement, when such Registration Statement is
effective and available for resales of such shares and otherwise in compliance with this Agreement before the delivery of the Transfer Agent Confirmation regarding the resale of such Commitment Fee Shares or shares of Common Stock (as applicable)
in accordance with this Agreement, and (b) about which the Investor has (i) delivered to the Company and the transfer agent to the Company (A) the Transfer Agent Confirmation relating to such Commitment Fee Shares or shares of Common Stock (as
applicable) and (B) a customary representation letter from the Investor, and, if requested by the transfer agent, its broker, confirming, among other things, the resale of such Commitment Fee Shares or shares of Common Stock (as applicable) in the
manner described in clause (a) of this definition of DWAC Shares (including confirmation of compliance with any relevant prospectus delivery requirements), and (ii) delivered to the transfer agent instructions for the delivery of such Commitment
Fee Shares or shares of Common Stock (as applicable) to the account with DTC of the Investor’s designated broker-dealer as specified in the Transfer Agent Deliverables, which Commitment Fee Shares or shares of Common Stock (as applicable) will be
in the hands of the persons who purchase such Commitment Fee Shares or shares of Common Stock (as applicable) from the Investor in the manner described in clause (a) of this definition of DWAC Shares, freely tradable and transferable without
restriction on resale and without stop transfer instructions maintained against the transfer thereof.
“Environmental Laws” shall have the meaning set forth in
Section 4.08.
“Exchange Act” shall mean the Securities Exchange Act of 1934,
as amended, and the rules and regulations promulgated thereunder.
“Hazardous Materials” shall have the meaning set forth in
Section 4.08.
“Indemnified Liabilities” shall have the meaning set forth in
Section 5.01.
“Investor” shall have the meaning set forth in the preamble of
this Agreement.
“Investor Indemnitees” shall have the meaning set forth in
Section 5.01.
“Material Adverse Effect” shall mean any event, occurrence or
condition that has had or would reasonably be expected to have (i) a material adverse effect on the legality, validity or enforceability of this Agreement or the transactions contemplated herein, (ii) a material adverse effect on the results of
operations, assets, business or condition (financial or otherwise) of the Company and its Subsidiaries, taken as a whole, or (iii) a material adverse effect on the Company’s ability to perform in any material respect on a timely basis its
obligations under this Agreement.
“Material Outside Event” shall have the meaning set forth in
Section 6.08.
“Maximum Advance Amount” shall be an amount equal to lesser of
(i) one hundred percent (100%) of the average of the Daily Value Traded of the Common Stock over the ten (10) Trading Days immediately preceding an Advance Notice, and (ii) eight million United States Dollars ($8,000,000); provided, however, that
the parties hereto may modify the aforementioned conditions by mutual prior written consent. For purposes hereof, “Daily Value Traded” is the product
obtained by multiplying the daily trading volume of the Common Stock on the Principal Market or Trading Market during regular trading hours as reported by Bloomberg L.P., by the VWAP for such Trading Day. For the avoidance of doubt, the daily
trading volume shall include all trades on the Principal Market or Trading Market during regular trading hours.
“OFAC” shall mean the U.S. Department of Treasury’s Office of
Foreign Asset Control.
“Ownership Limitation” shall have the meaning set forth in
Section 2.04(a).
“Person” shall mean an individual, a corporation, a
partnership, a limited liability company, a trust or other entity or organization, including a government or political subdivision or an agency or instrumentality thereof.
“Plan of Distribution” shall mean the section of a
Registration Statement disclosing the plan of distribution of the Common Stock.
“Pricing Period” shall mean, in respect of any Advance, the
three (3) Trading Days commencing on the date of the Investor’s receipt of the shares of Common Stock relating to such Advance.
“Principal Market” shall mean the Nasdaq Stock Market.
“Purchase Price” shall mean the lowest intraday sale price for
the Common Stock during the Pricing Period.
“Registrable Securities” shall mean (i) the Shares, and (ii)
any securities issued or issuable with respect to any of the foregoing by way of exchange, stock dividend or stock split or in connection with a combination of shares, recapitalization, merger, consolidation or other reorganization or otherwise,
solely to the extent that such securities are restricted under the Securities Act.
“Registration Limitation” shall have the meaning set forth in
Section 2.04(b).
“Registration Statement” shall mean a registration statement
on Form S-1 or Form S-3 or on such other form promulgated by the SEC for which the Company then qualifies and which counsel for the Company shall deem appropriate, and which form shall be available for the registration of the resale by the Investor
of the Registrable Securities under the Securities Act.
“Regulation D” shall mean the provisions of Regulation D
promulgated under the Securities Act.
“Required Delivery Date” means any date on which the Company
or its transfer agent is required to deliver Common Stock to Investor hereunder.
“Sanctions” means any sanctions administered or enforced by
OFAC, the U.S. State Department, the United Nations Security Council, the European Union, Her Majesty’s Treasury, or other relevant sanctions authority.
“Sanctions Programs” means any OFAC economic sanction program
(including, without limitation, programs related to Crimea, Cuba, Iran, North Korea, Sudan and Syria).
“SEC” shall mean the U.S. Securities and Exchange Commission.
“SEC Documents” shall have the meaning set forth in Section
4.04.
“Securities Act” shall have the meaning set forth in the
recitals of this Agreement.
“Settlement Date” shall mean the 3rd Trading Day after
expiration of the applicable Pricing Period for each Advance.
“Settlement Document” shall have the meaning set forth in
Section 2.06(a).
“Shares” shall mean the Commitment Fee Shares, and the Common
Stock to be issued from time to time hereunder pursuant to an Advance.
“Subsidiaries” shall have the meaning set forth in Section
4.01.
“Trading Day” shall mean any day during which the Principal
Market or Trading Market shall be open for business.
“Trading Market” shall mean the New York Stock Exchange, the
NYSE American, the Nasdaq Global Select Market, the Nasdaq Global Market, the Nasdaq Capital Market, or the NYSE Euronext, whichever is at the time the principal trading exchange or market for the Common Stock.
“Transaction Documents” shall have the meaning set forth in
Section 4.02.
“Transfer Agent Deliverables” shall have the meaning set forth
in Section 2.03(b).
“VWAP” means, for any Trading Day, the daily volume weighted
average price of the Common Stock for such Trading Day on the Principal Market or Trading Market from 9:30 a.m. Eastern Time through 4:00 p.m. Eastern Time, excluding the opening price and the closing price; provided, however upon an Advance Halt
the VWAP calculation shall terminate as of the effective time of the Material Outside Event.
ARTICLE II
ADVANCES
Section 2.01 Advances; Mechanics. Subject to the
terms and conditions of this Agreement (including, without limitation, the provisions of Article VII hereof), the Company at its sole and exclusive option, may issue and sell to the Investor, and the Investor shall purchase from the Company, Common
Stock on the following terms.
Section 2.02 Advance Notice. At any time during
the Commitment Period, the Company may require the Investor to purchase Common Stock by delivering an Advance Notice to the Investor, subject to the conditions set forth in Section 7.01, and in accordance with the following provisions:
| a. |
The Company shall, in its sole discretion, select the amount of the Advance, not to exceed the Maximum Advance Amount, it desires to issue and sell to
the Investor in each Advance Notice and the time it desires to deliver each Advance Notice.
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| b. |
There shall be no mandatory minimum Advances and no non-usages fee for not utilizing the Commitment Amount or any part thereof.
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| c. |
The Advance Notice shall be valid upon delivery to Investor in accordance
with Exhibit C.
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Section 2.03 Date of Delivery of Advance Notice; Issuance of Shares.
| a. |
An Advance Notice shall be deemed delivered on the day it is received by the Investor if such notice is received by email prior to 8:30 a.m. Eastern Time (or later if
waived by the Investor in its sole discretion) in accordance with the instructions set forth on Exhibit C. Following the receipt of such Advance
Notice the Investor shall provide the Company with a confirmation of its receipt of such Advance Notice, which receipt may be in the form of any email or orally (each, an “Advance Notice Confirmation”).
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| b. |
Promptly after receipt of the Advance Notice with respect to each Advance (and, in any event, not later than one (1) Trading Days after such receipt), the Company
will, or will cause its transfer agent to, issue in the Investor’s name in a DRS account or accounts at the transfer agent all the shares of Common Stock purchased by Investor pursuant to such Advance. Such Common Stock shall constitute
“restricted securities” as such term is defined in Rule 144(a)(3) under the Securities Act and the certificate or book-entry statement representing such Shares shall bear the restrictive legend under the Securities Act. Notwithstanding the
foregoing, if the Investor is to resell the Common Stock in a manner described under the caption “Plan of Distribution” in the Registration Statement and otherwise in compliance with this Agreement, the Investor shall concurrently with the
delivery by the Investor to the Company of such Advance Notice Confirmation deliver to the transfer agent and Company the items set forth in clause (b) of the definition of DWAC Shares with respect to such resold shares of Common Stock and
such other items as the transfer agent or counsel to the Company may reasonably request (collectively, the “Transfer Agent Deliverables”). With
respect to shares of Common Stock or Commitment Fee Shares to be resold by the Investor as described in the preceding sentence and as to which the Investor has timely delivered the Transfer Agent Deliverables with respect to such shares of
Common Stock or Commitment Fee Shares, such securities shall be delivered and credited by the transfer agent using the Fast Automated Securities Transfer (FAST) Program maintained by DTC (or any similar program hereafter adopted by DTC
performing substantially the same function) to the account with DTC of the Investor’s designated Broker-Dealer as specified in the Transfer Agent Deliverables with respect to such securities at the time such securities would otherwise have
been required to be delivered to the Investor in accordance with this Agreement, which securities (x) shall only be used by the Investor’s Broker-Dealer to deliver such securities to DTC for the purpose of settling the Investor’s share
delivery obligations with respect to the sale of such Common Stock or Commitment Fee Shares (as applicable), which may include delivery to other accounts of such Broker-Dealer and inclusion in the number of shares of Common Stock or
Commitment Fee Shares delivered by that Broker-Dealer in “net settling” that Broker-Dealer’s trading of shares of Common Stock, including its positions with the Broker-Dealers of the respective persons who purchase such securities from the
Investor, and (y) shall remain “restricted securities” as such term is defined in Rule 144(a)(3) under the Securities Act until so delivered. The Company and the Investor acknowledge that such Commitment Fee Shares or shares of Common Stock
(as applicable) credited to the account with DTC of the Investor’s designated Broker-Dealer shall be eligible for transfer to the third-party purchasers of such Commitment Fee Shares or shares of Common Stock or their respective
Broker-Dealers as DWAC Shares. No fractional shares shall be issued, and any fractional amounts shall be rounded to the next higher whole number of shares.
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Section 2.04 Advance Limitations. Regardless of
the amount of an Advance requested by the Company in the Advance Notice, the final amount of an Advance pursuant to an Advance Notice shall be reduced in accordance with each of the following limitations:
| a. |
Ownership Limitation; Commitment Amount. In no event shall the
number of shares of Common Stock issuable to the Investor pursuant to an Advance cause the aggregate number of Shares beneficially owned (as calculated pursuant to Section 13(d) of the Exchange Act) by the Investor and its Affiliates as a
result of previous issuances and sales of Common Stock to Investor under this Agreement to exceed 9.99% of the then outstanding Common Stock (the “Ownership Limitation”). In connection with each Advance Notice delivered by the
Company, any portion of an Advance that would (i) cause the Investor to exceed the Ownership Limitation or (ii) cause the aggregate number of shares of Common Stock issued and sold to the Investor hereunder to exceed the Commitment Amount
shall automatically be withdrawn with no further action required by the Company, and such Advance Notice shall be deemed automatically modified to reduce the amount of the Advance requested by an amount equal to such withdrawn portion;
provided that in the event of any such automatic withdrawal and automatic modification, Investor will promptly notify the Company of such event.
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| b. |
Registration Limitation. In no event shall an Advance
exceed the amount registered under the Registration Statement then in effect (the “Registration Limitation”) or the Exchange Cap to the extent
applicable. In connection with each Advance Notice, any portion of an Advance that would exceed the Registration Limitation or Exchange Cap shall automatically be withdrawn with no further action required by the Company and such Advance
Notice shall be deemed automatically modified to reduce the aggregate amount of the requested Advance by an amount equal to such withdrawn portion in respect of each Advance Notice; provided that in the event of any such automatic
withdrawal and automatic modification, Investor will promptly notify the Company of such event.
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| c. |
Notwithstanding any other provision in this Agreement, the Company and the Investor acknowledge and agree that upon the Investor’s receipt of a valid
Advance Notice the parties shall be deemed to have entered into an unconditional contract binding on both parties for the purchase and sale of Common Stock pursuant to such Advance Notice in accordance with the terms of this Agreement and
subject to Applicable Law and Section 3.08 (Trading Activities), the Investor may sell Common Stock during the Pricing Period.
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Section 2.06 Closings. The closing of each
Advance and each sale and purchase of Common Stock related to each Advance (each, a “Closing”) shall take place on the applicable Settlement Date in
accordance with the procedures set forth below. The parties acknowledge that the Purchase Price is not known at the time the Advance Notice is delivered (at which time the Investor is irrevocably bound) but shall be determined on each Closing based
on the daily prices of the Common Stock that are the inputs to the determination of the Purchase Price as set forth further below. In connection with each Closing, the Company and the Investor shall fulfill each of its obligations as set forth
below:
| a. |
On the Settlement Date in respect of an Advance, the Investor shall
deliver to the Company a written document, in the form attached hereto as Exhibit B (each a “Settlement Document”), setting forth the final number of shares of Common Stock to be purchased by the Investor (taking into
account any adjustments pursuant to Section 2.04), the Purchase Price, the aggregate proceeds to be paid by the Investor to the Company, and a report by Bloomberg, L.P. indicating the lowest intraday sale price for the Common
Stock for each of the Trading Days during the Pricing Period (or, if not reported on Bloomberg, L.P., another reporting service reasonably agreed to by the parties), in each case in accordance with the terms and conditions of this
Agreement. The Investor shall pay to the Company the aggregate purchase price of the Common Stock (as set forth in the Settlement Document) in cash in immediately available funds to an account designated by the Company in writing
and transmit notification to the Company that such funds transfer has been requested.
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| b. |
Notwithstanding anything to the contrary in this Agreement, if on any day during the Pricing Period (i) the Company notifies Investor that a Material Outside Event
set forth in Section 6.08(i) through (v) has occurred or if the Material Outside Event set forth in Sections 6.08(vi) or (vii) shall have occurred, or (ii) the Company notifies the Investor of a Black Out Period, the parties agree that the
pending Advance shall end (the “Advance Halt”) and the final number of shares of Common Stock to be purchased by the Investor at the Closing for such
Advance shall be equal to the number of shares of Common Stock sold by the Investor during the applicable Pricing Period prior to the notification from the Company of a Material Outside Event or Black Out Period.
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| c. |
On or prior to the Settlement Date, each of the Company and the Investor shall deliver to the other all documents, instruments and writings expressly required to be
delivered by either of them pursuant to this Agreement or as otherwise reasonably required in order to implement and effect the transactions contemplated herein.
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Section 2.07 Failure to Timely Deliver.
| a. |
If on or prior to the Required Delivery Date either (I) if the transfer agent is not participating in the DTC Fast Automated Securities Transfer Program, the Company
shall fail to issue and deliver a certificate to Investor and register such shares of Common Stock on the Company’s share register or, if the transfer agent is participating in the DTC Fast Automated Securities Transfer Program, credit the
balance account of Investor or Investor’s designee with DTC for the number of shares of Common Stock to which Investor submitted for legend removal by Investor pursuant to clause (ii) below or otherwise or (II) if the Company’s transfer
agent is participating in the DTC Fast Automated Securities Transfer Program, the transfer agent fails to credit the balance account of Investor or Investor’s designee with DTC for any shares of Common Stock submitted for legend removal by
Investor, in each case, if and only if the Investor has delivered the Transfer Agent Deliverables in accordance with the requirements of Section 2.03(b) above, and the Company fails to promptly, but in no event later than one (1) Business
Day (x) so notify Investor and (y) deliver the Common Stock electronically without any restrictive legend in accordance with the requirements of Section 2.03(b) above, and if on or after such Trading Day Investor purchases (in an open
market transaction or otherwise) shares of Common Stock to deliver in satisfaction of a sale by Investor of shares of Common Stock submitted for legend removal by Investor that Investor is entitled to receive from the Company (a “Buy-In”), then the Company shall, within one (1) Business Day after Investor’s request and in Investor’s discretion, either (i) pay cash to Investor in
an amount equal to Investor’s total purchase price (including brokerage commissions, borrow fees and other out-of-pocket expenses, if any, for the Common Stock so purchased) (the “Buy-In Price”), at which point the Company’s obligation to so deliver such certificate or credit Investor’s balance account shall terminate and such shares shall be cancelled, or (ii) promptly honor
its obligation to so deliver to Investor a certificate or certificates or credit the balance account of Investor or Investor’s designee with DTC representing such number of shares of Common Stock that would have been so delivered if the
Company timely complied with its obligations hereunder and pay cash to Investor in an amount equal to the excess (if any) of the Buy-In Price over the product of (A) such number of shares of Common Stock that the Company was required to
deliver to Investor by the Required Delivery Date multiplied by (B) the price at which Investor sold such shares of Common Stock in anticipation of the Company’s timely compliance with its delivery obligations hereunder. Nothing shall limit
Investor’s right to pursue any other remedies available to it hereunder, at law or in equity, including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company’s failure to timely deliver
certificates representing shares of Common Stock (or to electronically deliver such shares of Common Stock) as required pursuant to the terms hereof.
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| b. |
In the event the Investor sells shares of Common Stock after receipt of an Advance Notice and the Company fails to perform its obligations as mandated in Section
2.03, the Company agrees that in addition to and in no way limiting the rights and obligations set forth in Article V hereto and in addition to any other remedy to which the Investor is entitled at law or in equity, including, without
limitation, specific performance, it will hold the Investor harmless against any loss, claim, damage, or expense (including, without limitation, all brokerage commissions, borrow fees, legal fees and expenses and all other related
out-of-pocket expenses), as incurred, arising out of or in connection with such default by the Company and acknowledges that irreparable damage may occur in the event of any such default, other than any such loss, claim, damage or expenses
directly arising from the fraud, gross negligence or intentional misconduct of the Investor (as determined by a final non-appealable judgment of court having jurisdiction over such matter). It is accordingly agreed that the Investor shall
be entitled to an injunction or injunctions to prevent such breaches of this Agreement and to specifically enforce (subject to the Securities Act and other rules of the Principal Market or Trading Market), without the posting of a bond or
other security, the terms and provisions of this Agreement.
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Section 2.08 RETURN OF SURPLUS. If the value of the Shares delivered to the Investor causes the Company to exceed the Commitment Amount, then the Investor shall
return to the Company the surplus amount of Shares associated with such Advance.
Section 2.09 Completion of Resale Pursuant to the
Registration Statement. After the Investor has purchased the full Commitment Amount and has completed the subsequent resale of the full Commitment Amount pursuant to the Registration Statement, Investor will notify the Company that all
subsequent resales are completed and the Company will be under no further obligation to maintain the effectiveness of the Registration Statement.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF INVESTOR
Investor hereby represents and warrants to, and agrees with, the Company that the following are true and correct as of the date hereof and as of each
Advance Notice Date and each Advance Date:
Section 3.01 Organization and Authorization. The
Investor is duly organized, validly existing and in good standing under the laws of the Delaware and has all requisite power and authority to execute, deliver and perform this Agreement, including all transactions contemplated hereby. The decision
to invest and the execution and delivery of this Agreement by the Investor, the performance by the Investor of its obligations hereunder and the consummation by the Investor of the transactions contemplated hereby have been duly authorized and
require no other proceedings on the part of the Investor. The undersigned has the right, power and authority to execute and deliver this Agreement and all other instruments on behalf of the Investor or its shareholders. This Agreement has been duly
executed and delivered by the Investor and, assuming the execution and delivery hereof and acceptance thereof by the Company, will constitute the legal, valid and binding obligations of the Investor, enforceable against the Investor in accordance
with its terms.
Section 3.02 Evaluation of Risks. The Investor
has such knowledge and experience in financial, tax and business matters as to be capable of evaluating the merits and risks of, and bearing the economic risks entailed by, an investment in the Common Stock of the Company and of protecting its
interests in connection with the transactions contemplated hereby. The Investor acknowledges and agrees that its investment in the Company involves a high degree of risk, and that the Investor may lose all or a part of its investment.
Section 3.03 No Legal, Investment or Tax Advice from the
Company. The Investor acknowledges that it had the opportunity to review this Agreement and the transactions contemplated by this Agreement with its own legal counsel and investment and tax advisors. The Investor is relying solely on such
counsel and advisors and not on any statements or representations of the Company or any of the Company’s representatives or agents for legal, tax, investment or other advice with respect to the Investor’s acquisition of Common Stock hereunder, the
transactions contemplated by this Agreement or the laws of any jurisdiction, and the Investor acknowledges that the Investor may lose all or a part of its investment.
Section 3.04 Investment Purpose. The Investor is
acquiring the Common Stock for its own account, for investment purposes and not with a view towards, or for resale in connection with, the public sale or distribution thereof, except pursuant to sales registered under or exempt from the
registration requirements of the Securities Act; provided, however, that by making the representations herein, the Investor does not agree, or make any representation or warranty, to hold any of the Securities for any minimum or other specific term
and reserves the right to dispose of the Securities at any time in accordance with, or pursuant to, a registration statement filed pursuant to this Agreement or an applicable exemption under the Securities Act. The Investor does not presently have
any agreement or understanding, directly or indirectly, with any Person to sell or distribute any of the Common Stock. The Investor acknowledges that it will be disclosed as an “underwriter” and a “selling stockholder” in each Registration
Statement and in any prospectus contained therein.
Section 3.05 Accredited Investor. The Investor is
an “Accredited Investor” as that term is defined in Rule 501(a)(3) of Regulation D.
Section 3.06 Information. The Investor and its
advisors (and its counsel), if any, have been furnished with all materials relating to the business, finances and operations of the Company and information the Investor deemed material to making an informed investment decision. The Investor and its
advisors (and its counsel), if any, have been afforded the opportunity to ask questions of the Company and its management and have received answers to such questions. Neither such inquiries nor any other due diligence investigations conducted by
such Investor or its advisors (and its counsel), if any, or its representatives shall modify, amend or affect the Investor’s right to rely on the Company’s representations and warranties contained in this Agreement. The Investor acknowledges and
agrees that the Company has not made to the Investor, and the Investor acknowledges and agrees it has not relied upon, any representations and warranties of the Company, its employees or any third party other than the representations and warranties
of the Company contained in this Agreement. The Investor understands that its investment involves a high degree of risk. The Investor has sought such accounting, legal and tax advice, as it has considered necessary to make an informed investment
decision with respect to the transactions contemplated hereby.
Section 3.07 Not an Affiliate. The Investor is
not an officer, director or a person that directly, or indirectly through one or more intermediaries, controls or is controlled by, or is under common control with the Company or any “affiliate” of the Company (as that term is defined in Rule 405
promulgated under the Securities Act).
Section 3.08 Trading Activities. The Investor’s
trading activities with respect to the Common Stock shall be in compliance with all applicable federal and state securities laws, rules and regulations and the rules and regulations of the Principal Market or Trading Market. Neither the Investor
nor its affiliates has any open short position in the Common Stock, nor has the Investor entered into any hedging transaction that establishes a net short position with respect to the Common Stock, and the Investor agrees that it shall not, and
that it will cause its affiliates not to, engage in any short sales or hedging transactions with respect to the Common Stock; provided that the Company acknowledges and agrees that upon receipt of an Advance Notice the Investor has the right to
sell (a) the Common Stock to be issued to the Investor pursuant to the Advance Notice prior to receiving such shares of Common Stock, or (b) other shares of Common Stock issued or sold by the Company to Investor pursuant to this Agreement and which
the Company has continuously held as a long position.
Section 3.09 General Solicitation. Neither the
Investor, nor any of its affiliates, nor any person acting on its or their behalf, has engaged or will engage in any form of general solicitation or general advertising (within the meaning of Regulation D) in connection with any offer or sale of
the Common Stock by the Investor.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
Except as set forth in the SEC Documents, or in the Disclosure Schedules, which Disclosure Schedules shall be deemed a part hereof and shall qualify any
representation or warranty otherwise made herein to the extent of the disclosure contained in the corresponding section of the Disclosure Schedules or in another Section of the Disclosure Schedules, to the extent that it is reasonably apparent on
the face of such disclosure that such disclosure is applicable to such Section, the Company represents and warrants to the Investor that, as of the date hereof and each Advance Notice Date (other than representations and warranties which address
matters only as of a certain date, which shall be true and correct as written as of such certain date), that:
Section 4.01 Organization and Qualification. Each
of the Company and its Subsidiaries (as defined below) is an entity duly organized and validly existing under the laws of its state of organization or incorporation, and has the requisite power and authority to own its properties and to carry on
its business as now being conducted. Each of the Company and its Subsidiaries is duly qualified to do business and is in good standing (to the extent applicable) in every jurisdiction in which the nature of the business conducted by it makes such
qualification necessary, except to the extent that the failure to be so qualified or be in good standing would not have a Material Adverse Effect. The Company’s Subsidiaries means any Person (as defined below) in which the Company, directly or
indirectly, (x) owns a majority of the outstanding capital stock or equity or similar interests of such Person or (y) controls or operates all or any part of the business, operations or administration of such Person provided that such Subsidiary is
set forth on Schedule 4.01.
Section 4.02 Authorization, Enforcement, Compliance with
Other Instruments. The Company has the requisite corporate power and authority to enter into and perform its obligations under this Agreement and the other Transaction Documents and to issue the Shares in accordance with the terms hereof
and thereof. The execution and delivery by the Company of this Agreement and the other Transaction Documents, and the consummation by the Company of the transactions contemplated hereby and thereby (including, without limitation, the issuance of
the Common Stock) have been or (with respect to consummation) will be duly authorized by the Company’s board of directors and no further consent or authorization will be required by the Company, its board of directors or its shareholders (except as
otherwise contemplated by this Agreement). This Agreement and the other Transaction Documents to which it is a party have been (or, when executed and delivered, will be) duly executed and delivered by the Company and, assuming the execution and
delivery thereof and acceptance by the Investor, constitute (or, when duly executed and delivered, will be) the legal, valid and binding obligations of the Company, enforceable against the Company in accordance with their respective terms, except
as such enforceability may be limited by general principles of equity or applicable bankruptcy, insolvency, reorganization, moratorium, liquidation or other laws relating to, or affecting generally, the enforcement of applicable creditors’ rights
and remedies and except as rights to indemnification and to contribution may be limited by federal or state securities law. “Transaction Documents” means,
collectively, this Agreement and each of the other agreements and instruments entered into or delivered by any of the parties hereto in connection with the transactions contemplated hereby and thereby, as may be amended from time to time.
Section 4.03 No Conflict. The execution, delivery
and performance of the Transaction Documents by the Company and the consummation by the Company of the transactions contemplated hereby and thereby (including, without limitation, the issuance of the Common Stock) will not (i) result in a violation
of the articles of incorporation or other organizational documents of the Company or its Subsidiaries (with respect to consummation, as the same may be amended prior to the date on which any of the transactions contemplated hereby are consummated),
(ii) conflict with, or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture or
instrument to which the Company or its Subsidiaries is a party, or (iii) result in a violation of any law, rule, regulation, order, judgment or decree (including federal and state securities laws and regulations) applicable to the Company or its
Subsidiaries or by which any property or asset of the Company or its Subsidiaries is bound or affected except, in the case of clause (ii) or (iii) above, to the extent such violations or conflicts would not reasonably be expected to have a Material
Adverse Effect.
Section 4.04 SEC Documents; Financial Statements.
The Company has filed all reports, schedules, forms, statements and other documents required to be filed by it with the SEC pursuant to the Exchange Act for the two years preceding the date hereof (or such shorter period as the Company was required
by law or regulation to file such material) (all of the foregoing filed within the past two years preceding the date hereof or amended after the date hereof, or filed after the date hereof, and all exhibits included therein and financial statements
and schedules thereto and documents incorporated by reference therein, and all registration statements filed by the Company under the Securities Act, being hereinafter referred to as the “SEC Documents”). The Company has made available to the Investor through the SEC’s website at http://www.sec.gov, true and complete copies of the SEC Documents, and none of the SEC Documents, when viewed as a
whole as of the date hereof, contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they
were made, not misleading. As of their respective dates (or, with respect to any filing that has been amended or superseded, the date of such amendment or superseding filing), the SEC Documents complied in all material respects with the
requirements of the Exchange Act or the Securities Act, as applicable, and the rules and regulations of the SEC promulgated thereunder applicable to the SEC Documents. As of their respective dates (or, with respect to any financial statements that
have been amended or superseded, the date of such amended or superseding financial statements), the financial statements of the Company included in the SEC Documents complied as to form in all material respects with applicable accounting
requirements and the published rules and regulations of the SEC with respect thereto. Such financial statements have been prepared in accordance with generally accepted accounting principles, consistently applied, during the periods involved
(except (i) as may be otherwise indicated in such financial statements or the notes thereto, or (ii) in the case of unaudited interim statements, to the extent they may exclude footnotes or may be condensed or summary statements) and fairly present
in all material respects the financial position of the Company as of the respective dates thereof and the results of its operations and cash flows for the periods then ended (subject, in the case of unaudited statements, to normal year-end audit
adjustments).
Section 4.05 Equity Capitalization. As of the
date hereof, the authorized capital of the Company consists of 551,000,000 shares of capital stock, including (A) 550,000,000 shares of Common Stock, of which, 6,717,578 are issued and outstanding and 22,700,000 shares are reserved for issuance
pursuant to Convertible Securities (as defined below) exercisable or exchangeable for, or convertible into, shares of Common Stock (B) 50,000,000 shares of Class B common stock, par value $0.0001 per share, of the Company, of which 750,000 are
issued and outstanding and (C) 1,000,000 undesignated shares of preferred stock, of which none are issued and outstanding. No Common Stock is held in the treasury of the Company. “Convertible Securities” means any capital stock or other security of the Company or any of its Subsidiaries that is at any time and under any circumstances directly or indirectly convertible into, exercisable or exchangeable
for, or which otherwise entitles the holder thereof to acquire, any capital stock or other security of the Company (including, without limitation, shares of Common Stock) or any of its Subsidiaries.
Section 4.06 Intellectual Property Rights. The
Company and its Subsidiaries own or possess adequate rights or licenses to use all trademarks, trade names, service marks, service mark registrations, service names, patents, patent rights, copyrights, inventions, licenses, approvals, governmental
authorizations, trade secrets and rights, if any, necessary to conduct their respective businesses as now conducted, except as would not cause a Material Adverse Effect. The Company and its Subsidiaries have not received written notice of any
infringement by the Company or its Subsidiaries of trademark, trade name rights, patents, patent rights, copyrights, inventions, licenses, service names, service marks, service mark registrations, or trade secrets. To the knowledge of the Company,
there is no claim, action or proceeding being made or brought against, or to the Company’s knowledge, being threatened against the Company or its Subsidiaries regarding any material trademark, trade name, patents, patent rights, invention,
copyright, license, service names, service marks, service mark registrations, trade secret or other infringement; and the Company is not aware of any facts or circumstances which might give rise to any of the foregoing.
Section 4.07 Employee Relations. Neither the
Company nor any of its Subsidiaries is involved in any labor dispute nor, to the knowledge of the Company or any of its Subsidiaries, is any such dispute threatened, in each case which is reasonably likely to cause a Material Adverse Effect.
Section 4.08 Environmental Laws. The Company and
its Subsidiaries (i) have not received written notice alleging any failure to comply in all material respects with all Environmental Laws (as defined below), (ii) have received all permits, licenses or other approvals required of them under
applicable Environmental Laws to conduct their respective businesses and (iii) have not received written notice alleging any failure to comply with all terms and conditions of any such permit, license or approval where, in each of the foregoing
clauses (i), (ii) and (iii), the failure to so comply would be reasonably expected to have, individually or in the aggregate, a Material Adverse Effect. The term “Environmental
Laws” means all applicable federal, state and local laws relating to pollution or protection of human health or the environment (including, without limitation, ambient air, surface water, groundwater, land surface or subsurface
strata), including, without limitation, laws relating to emissions, discharges, releases or threatened releases of chemicals, pollutants, contaminants, or toxic or hazardous substances or wastes (collectively, “Hazardous Materials”) into the environment, or otherwise relating to the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of Hazardous
Materials, as well as all authorizations, codes, decrees, demands or demand letters, injunctions, judgments, licenses, notices or notice letters, orders, permits, plans or regulations issued, entered, promulgated or approved thereunder.
Section 4.09 Title. Except as would not cause a
Material Adverse Effect, the Company (or its Subsidiaries) have indefeasible fee simple or leasehold title to its properties and assets owned by it, free and clear of any pledge, lien, security interest, encumbrance, claim or equitable interest.
Any real property and facilities held under lease by the Company and its Subsidiaries are held by them under valid, subsisting and enforceable leases with such exceptions as are not material and do not interfere with the use made and proposed to be
made of such property and buildings by the Company and its Subsidiaries.
Section 4.10 Insurance. The Company and each of
its Subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks and in such amounts as management of the Company believes to be prudent and customary in the businesses in which the Company and its
Subsidiaries are engaged. The Company has no reason to believe that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue
its business at a cost that would not have a Material Adverse Effect.
Section 4.11 Regulatory Permits. Except as would
not cause a Material Adverse Effect or as set forth on Schedule 4.11, the Company and its Subsidiaries possess all certificates, authorizations and permits
issued by the appropriate federal, state or foreign regulatory authorities necessary to own their respective businesses, and neither the Company nor any such Subsidiary has received any written notice of proceedings relating to the revocation or
modification of any such certificate, authorization or permits.
Section 4.12 Internal Accounting Controls. The
Company maintains a system of internal accounting controls sufficient to provide reasonable assurance that (i) transactions are executed in accordance with management’s general or specific authorizations, (ii) transactions are recorded as necessary
to permit preparation of financial statements in conformity with generally accepted accounting principles and to maintain asset accountability, (iii) access to assets is permitted only in accordance with management’s general or specific
authorization and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences, and management is not aware of any material weaknesses that
are not disclosed in the SEC Documents as and when required.
Section 4.13 Absence of Litigation. Except with
respect to receipt of deficiency notices relating to Nasdaq delisting, which have been disclosed in the SEC Documents, there is no action, suit, proceeding, inquiry or investigation before or by any court, public board, government agency,
self-regulatory organization or body pending against or affecting the Company, the Common Stock or any of the Company’s Subsidiaries, wherein an unfavorable decision, ruling or finding would have a Material Adverse Effect.
Section 4.14 Subsidiaries. As of the date hereof,
except as set forth on Schedule 4.14, the Company does not own or control, directly or indirectly, any interest in any other corporation, partnership,
association or other business entity, except for the Subsidiaries and Excluded Subsidiaries.
Section 4.15 Tax Status. Except as would not have
a Material Adverse Effect, each of the Company and its Subsidiaries (i) has timely made or filed all foreign, federal and state income and all other tax returns, reports and declarations required by any jurisdiction to which it is subject, (ii) has
timely paid all taxes and other governmental assessments and charges that are material in amount, shown or determined to be due on such returns, reports and declarations, except those being contested in good faith and (iii) has set aside on its
books provision reasonably adequate for the payment of all taxes for periods subsequent to the periods to which such returns, reports or declarations apply. The Company has not received written notification any unpaid taxes in any material amount
claimed to be due by the taxing authority of any jurisdiction, and the officers of the Company and its Subsidiaries know of no basis for any such claim where failure to pay would cause a Material Adverse Effect.
Section 4.16 Certain Transactions. Except as (i)
set forth in the SEC Documents or (ii) not required to be disclosed pursuant to Applicable Law (including, for the avoidance of doubt, not yet required to be disclosed at the relevant time), none of the officers or directors of the Company is
presently a party to any transaction with the Company (other than for services as employees, officers and directors), including any contract, agreement or other arrangement providing for the furnishing of services to or by, providing for rental of
real or personal property to or from, or otherwise requiring payments to or from any officer or director, or to the knowledge of the Company, any corporation, partnership, trust or other entity in which any officer or director has a substantial
interest or is an officer, director, trustee or partner.
Section 4.17 Rights of First Refusal. Except as
set forth on Schedule 4.17, the Company is not obligated to offer the Common Stock offered hereunder on a right of first refusal basis or otherwise to any
third parties including, but not limited to, current or former shareholders of the Company, underwriters, brokers, agents or other third parties.
Section 4.18 Dilution. The Company is aware and
acknowledges that the issuance of shares hereunder could cause dilution to existing shareholders and could significantly increase the outstanding number of common shares of New PubCo.
Section 4.19 Acknowledgment Regarding Investor’s
Purchase of Shares. The Company acknowledges and agrees that the Investor is acting solely in the capacity of an arm’s length investor with respect to this Agreement and the transactions contemplated hereunder. The Company further
acknowledges that the Investor is not acting as a financial advisor or fiduciary of the Company (or in any similar capacity) with respect to this Agreement and the transactions contemplated hereunder and any advice given by the Investor or any of
its representatives or agents in connection with this Agreement and the transactions contemplated hereunder is merely incidental to the Investor’s purchase of the Shares hereunder. The Company is aware and acknowledges that it shall not be able to
request Advances under this Agreement if the Registration Statement is not effective or if any issuances of shares of Common Stock pursuant to any Advances would violate any rules of the Principal Market or Trading Market.
Section 4.20 Sanctions Matters. Neither the
Company, nor any Subsidiary of the Company, nor, to the Company’s knowledge, any director, officer, agent, employee or affiliate of the Company or any Subsidiary of the Company, is a Person that is, or is owned or controlled by a Person that is on
the list of Specially Designated Nationals and Blocked Persons maintained by OFAC from time to time:
| a. |
the subject of any Sanctions; or
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| b. |
has a place of business in, or is operating, organized, resident or doing business in a country or territory that is, or whose government is, the
subject of Sanctions Programs (including without limitation Crimea, Cuba, Iran, North Korea, Sudan and Syria).
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Section 4.21 DTC Eligibility. The Company, through
the transfer agent, currently participates in the DTC Fast Automated Securities Transfer (FAST) Program and the Common Stock can be transferred electronically to third parties via the DTC Fast Automated Securities Transfer (FAST) Program.
ARTICLE V
INDEMNIFICATION
The Investor and the Company represent to the other the following with respect to itself:
Section 5.01 Indemnification by the Company. In
consideration of the Investor’s execution and delivery of this Agreement, and in addition to all of the Company’s other obligations under this Agreement, the Company shall defend, protect, indemnify and hold harmless the Investor, its investment
manager, and each of their respective officers, directors, managers, members, partners, employees and agents (including, without limitation, those retained in connection with the transactions contemplated by this Agreement) and each person who
controls the Investor within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act (collectively, the “Investor Indemnitees”)
from and against any and all actions, causes of action, suits, claims, losses, costs, penalties, fees, liabilities and damages, and reasonable and documented expenses in connection therewith (irrespective of whether any such Investor Indemnitee is
a party to the action for which indemnification hereunder is sought), and including reasonable attorneys’ fees and disbursements (the “Indemnified Liabilities”),
incurred by the Investor Indemnitees or any of them as a result of, or arising out of, or relating to (a) any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement for the registration of the Shares
as originally filed or in any amendment thereof, or in any related prospectus, or in any amendment thereof or supplement thereto, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading; provided, however, that the Company will not be liable in any such case to the extent that any such loss, claim, damage or liability arises out of or is based upon any such untrue statement or alleged untrue statement or omission or
alleged omission made therein in reliance upon and in conformity with written information furnished to the Company by or on behalf of the Investor specifically for inclusion therein; (b) any material misrepresentation or breach of any material
representation or material warranty made by the Company in this Agreement or any other certificate, instrument or document contemplated hereby or thereby; or (c) any material breach of any material covenant, material agreement or material
obligation of the Company contained in this Agreement or any other certificate, instrument or document contemplated hereby or thereby; provided, however, that the Company will not be liable in any such case to the extent that any such loss, claim, damage or liability is the direct result of the fraud,
gross negligence or intentional misconduct of the Investor (as determined by a final non-appealable judgment of court having jurisdiction over such matter). To the extent that the foregoing undertaking by the Company may be unenforceable under
Applicable Law, the Company shall make the maximum contribution to the payment and satisfaction of each of the Indemnified Liabilities, which is permissible under Applicable Law.
Section 5.02 Notice of Claim. Promptly after
receipt by an Investor Indemnitee of notice of the commencement of any action or proceeding (including any governmental action or proceeding) involving an Indemnified Liability, such Investor Indemnitee, shall, if a claim for an Indemnified
Liability in respect thereof is to be made against any indemnifying party under this Article V, deliver to the indemnifying party a written notice of the commencement thereof; but the failure to so notify the indemnifying party will not relieve it
of liability under this Article V except to the extent the indemnifying party is prejudiced by such failure. The indemnifying party shall have the right to participate in, and, to the extent the indemnifying party so desires, jointly with any other
indemnifying party similarly noticed, to assume control of the defense thereof with counsel mutually reasonably satisfactory to the indemnifying party and the Investor Indemnitee; provided, however, that an Investor Indemnitee shall have the right
to retain its own counsel with the actual and reasonable third party fees and expenses of not more than one counsel for such Investor Indemnitee to be paid by the indemnifying party, if, in the reasonable opinion of counsel retained by the
indemnifying party, the representation by such counsel of the Investor Indemnitee and the indemnifying party would be inappropriate due to actual or potential differing interests between such Investor Indemnitee and any other party represented by
such counsel in such proceeding. The Investor Indemnitee shall cooperate fully with the indemnifying party in connection with any negotiation or defense of any such action or claim by the indemnifying party and shall furnish to the indemnifying
party all information reasonably available to the Investor Indemnitee which relates to such action or claim. The indemnifying party shall keep the Investor Indemnitee reasonably apprised as to the status of the defense or any settlement
negotiations with respect thereto. No indemnifying party shall be liable for any settlement of any action, claim or proceeding effected without its prior written consent, provided, however, that the indemnifying party shall not unreasonably
withhold, delay or condition its consent. No indemnifying party shall, without the prior written consent of the Investor Indemnitee, consent to entry of any judgment or enter into any settlement or other compromise which does not include as an
unconditional term thereof the giving by the claimant or plaintiff to such Investor Indemnitee of a release from all liability in respect to such claim or litigation. Following indemnification as provided for hereunder, the indemnifying party shall
be subrogated to all rights of the Investor Indemnitee with respect to all third parties, firms or corporations relating to the matter for which indemnification has been made. The indemnification required by this Article V shall be made by periodic
payments of the amount thereof during the course of the investigation or defense, as and when bills are received and payment therefor is due, subject to receipt by the indemnifying party of an undertaking to repay any amounts that such party is
ultimately not entitled to receive as indemnification pursuant to this Agreement.
Section 5.03 Remedies. The remedies provided for
in this Article V are not exclusive and shall not limit any right or remedy which may be available to any indemnified person at law or equity. The obligations of the parties to indemnify or make contribution under this Article V shall survive
expiration or termination of this Agreement.
ARTICLE VI
COVENANTS
Section 6.01 Registration Statement.
| a. |
Filing of a Registration Statement. No later than thirty (30) calendar days
following the date of the Business Combination, the Company shall use its reasonable best efforts to prepare and file with the SEC a Registration Statement for the resale by the Investor of Registrable Securities and to file one or more
additional Registration Statements for the resale by Investor of Registrable Securities if necessary. The Company acknowledges and agrees that it shall not have the ability to request any Advances until the effectiveness of a Registration
Statement registering the applicable Registrable Securities for resale by the Investor. The Company and the Investor shall mutually agree on a good faith estimate of the number of Commitment Fee Shares which may be issuable pursuant to
Section 13.04 for purposes of registration; provided, however, that in the event such estimated number of shares have been (i) underestimated, the Company shall use reasonable best efforts to register additional Commitment Fee Shares
promptly after such underestimation is made known to the Company and (ii) overestimated, the Company shall treat (and disclose in the registration statement the same) such excess shares as Common Stock issuable and saleable to the Investor
pursuant to Advances hereunder.
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| b. |
Maintaining a Registration Statement. The Company shall use commercially
reasonable efforts to maintain the effectiveness of any Registration Statement that has been declared effective at all times during the Commitment Period, provided, however, that if the Company has received notification pursuant to Section
2.07 that the Investor has completed resales pursuant to the Registration Statement for the full Commitment Amount, then the Company shall be under no further obligation to maintain the effectiveness of the Registration Statement.
Notwithstanding anything to the contrary contained in this Agreement, the Company shall use commercially reasonable efforts to ensure that, when filed, each Registration Statement (including, without limitation, all amendments and
supplements thereto) and the prospectus (including, without limitation, all amendments and supplements thereto) used in connection with such Registration Statement shall not contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein, or necessary to make the statements therein (in the case of prospectuses, in the light of the circumstances in which they were made) not misleading. During the Commitment Period, the Company
shall notify the Investor promptly if (i) the Registration Statement shall cease to be effective under the Securities Act, (ii) the Common Stock shall cease to be authorized for listing on the Principal Market or Trading Market, (iii) the
Common Stock cease to be registered under Section 12(b) or Section 12(g) of the Exchange Act or (iv) the Company fails to file in a timely manner all reports and other documents required of it as a reporting company under the Exchange Act
(subject to applicable grace periods).
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| c. |
Filing Procedures. Not less than one business day prior to the filing of a
Registration Statement and not less than one business day prior to the filing of any related amendments and supplements to any Registration Statements (except for any amendments or supplements caused by the filing of any annual reports on
Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and any similar or successor reports), the Company shall furnish to the Investor copies of all such documents proposed to be filed, which documents (other than those
filed pursuant to Rule 424 promulgated under the Securities Act) will be subject to the reasonable and prompt review of the Investor (in each of which cases, if such document contains material non-public information as consented to by the
Investor pursuant to Section 6.13, the information provided to Investor will be kept strictly confidential until filed and treated as subject to Section 6.08). The Investor shall furnish comments on a Registration Statement and any related
amendment and supplement to a Registration Statement to the Company within 24 hours of the receipt thereof. If the Investor fails to provide comments to the Company within such 24-hour period, then the Registration Statement, related
amendment or related supplement, as applicable, shall be deemed accepted by the Investor in the form originally delivered by the Company to the Investor.
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| d. |
Amendments and Other Filings. The Company shall use commercially reasonable
efforts to (i) prepare and file with the SEC such amendments (including post-effective amendments) and supplements to a Registration Statement and the related prospectus used in connection with such Registration Statement, which prospectus
is to be filed pursuant to Rule 424 promulgated under the Securities Act, as may be necessary to keep such Registration Statement effective at all times during the Commitment Period, and prepare and file with the SEC such additional
Registration Statements in order to register for resale under the Securities Act all of the Registrable Securities; (ii) cause the related prospectus to be amended or supplemented by any required prospectus supplement (subject to the terms
of this Agreement), and as so supplemented or amended to be filed pursuant to Rule 424 promulgated under the Securities Act; (iii) provide the Investor copies of all correspondence from and to the SEC relating to a Registration Statement
(provided that the Company may excise any information contained therein which would constitute material non-public information), and (iv) comply with the provisions of the Securities Act with respect to the disposition of all the shares of
Common Stock covered by such Registration Statement until such time as all of such shares of Common Stock shall have been disposed of in accordance with the intended methods of disposition by the seller or sellers thereof as set forth in
such Registration Statement. In the case of amendments and supplements to a Registration Statement which are required to be filed pursuant to this Agreement (including pursuant to this Section 6.01(e)) by reason of the Company’s filing a
report on Form 10-K, Form 10-Q, or Form 8-K or any analogous report under the Exchange Act, the Company shall use commercially reasonable efforts to file such report in a prospectus supplement filed pursuant to Rule 424 promulgated under
the Securities Act to incorporate such filing into the Registration Statement, if applicable, or shall file such amendments or supplements with the SEC either on the day on which the Exchange Act report is filed which created the
requirement for the Company to amend or supplement the Registration Statement, if feasible, or otherwise promptly thereafter.
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| e. |
Blue-Sky. The Company shall use its commercially reasonable efforts to, if
required by Applicable Law, (i) register and qualify the Common Stock covered by a Registration Statement under such other securities or “blue sky” laws of such jurisdictions in the United States as the Investor reasonably requests, (ii)
prepare and file in those jurisdictions, such amendments (including post-effective amendments) and supplements to such registrations and qualifications as may be necessary to maintain the effectiveness thereof during the Commitment Period,
(iii) take such other actions as may be necessary to maintain such registrations and qualifications in effect at all times during the Commitment Period, and (iv) take all other actions reasonably necessary or advisable to qualify the Common
Stock for sale in such jurisdictions; provided, however, that the Company shall not be required in connection therewith or as a condition thereto to (w) make any change to its articles of incorporation or bylaws, (x) qualify to do business
in any jurisdiction where it would not otherwise be required to qualify but for this Section 6.01(f), (y) subject itself to general taxation in any such jurisdiction, or (z) file a general consent to service of process in any such
jurisdiction. The Company shall promptly notify the Investor of the receipt by the Company of any notification with respect to the suspension of the registration or qualification of any of the Common Stock for sale under the securities or
“blue sky” laws of any jurisdiction in the United States or its receipt of actual notice of the initiation or threat of any proceeding for such purpose.
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Section 6.02 Suspension of Registration Statement.
| a. |
Establishment of a Black Out Period. During the Commitment Period, the
Company from time to time may suspend the use of the Registration Statement by written notice to the Investor in the event that the Company determines in its sole discretion in good faith that such suspension is necessary to (A) delay the
disclosure of material nonpublic information concerning the Company, the disclosure of which at the time is not, in the good faith opinion of the Company, in the best interests of the Company or (B) amend or supplement the Registration
Statement or prospectus so that such Registration Statement or prospectus shall not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading (a “Black Out Period”).
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| b. |
No Sales by Investor During the Black Out Period. During such Black Out
Period, the Investor agrees not to sell any shares of Common Stock of the Company.
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| c. |
Limitations on the Black Out Period. The Company shall not impose any Black
Out Period that is longer than 120 days in any 360 day period, or 90 consecutive days, or in a manner that is more restrictive (including, without limitation, as to duration) than the comparable restrictions that the Company may impose on
transfers of the Company’s equity securities by its directors and senior executive officers. In addition, the Company shall not deliver any Advance Notice during any Black Out Period. If the public announcement of such material, nonpublic
information is made during a Black Out Period, the Black Out Period shall terminate immediately after such announcement, and the Company shall immediately notify the Investor of the termination of the Black Out Period.
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Section 6.03 Listing of the Common Stock. As of
each Advance Date, the Shares to be sold by the Company from time to time hereunder will have been registered under Section 12(b) of the Exchange Act and approved for listing on the Principal Market or Trading Market, subject to official notice of
issuance.
Section 6.04 Opinion of Counsel. Prior to the
date of the delivery by the Company of the first Advance Notice, the Investor shall have received an opinion and negative assurances letter from counsel to the Company in form and substance reasonably satisfactory to the Investor, covering matters
customary for the transactions contemplated by this Agreement.
Section 6.05 Exchange Act Registration. The
Company will use commercially reasonable efforts to file in a timely manner all reports and other documents required of it as a reporting company under the Exchange Act and will not take any action or file any document (whether or not permitted by
Exchange Act or the rules thereunder) to terminate or suspend its reporting and filing obligations under the Exchange Act.
Section 6.06 Transfer Agent Instructions. For any
time while there is a Registration Statement in effect for this transaction, the Company shall (if required by the transfer agent for the Common Stock) cause legal counsel for the Company to deliver to the transfer agent for the Common Stock (with
a copy to the Investor) instructions to issue shares of Common Stock to the Investor free of restrictive legends upon each Advance if the delivery of such instructions are consistent with Applicable Law and the Investor has provided the Transfer
Agent Deliverables with respect to such shares of Common Stock required by this Agreement.
Section 6.07 Corporate Existence. The Company
will use commercially reasonable efforts to preserve and continue the corporate existence of the Company during the Commitment Period.
Section 6.08 Notice of Certain Events Affecting
Registration; Suspension of Right to Make an Advance. The Company will promptly notify the Investor, and confirm in writing, upon its becoming aware of the occurrence of any of the following events in respect of a Registration Statement or
related prospectus relating to an offering of Common Stock (in each of which cases the information provided to Investor will be kept strictly confidential): (i) except for requests made in connection with SEC or other Federal or state governmental
authority investigations disclosed in the SEC Documents, receipt of any request for additional information by the SEC or any other Federal or state governmental authority during the period of effectiveness of the Registration Statement or any
request for amendments or supplements to the Registration Statement or related prospectus; (ii) the issuance by the SEC or any other Federal governmental authority of any stop order suspending the effectiveness of the Registration Statement or the
initiation of any proceedings for that purpose; (iii) receipt of any notification with respect to the suspension of the qualification or exemption from qualification of any of the Common Stock for sale in any jurisdiction or the initiation or
written threat of any proceeding for such purpose; (iv) the happening of any event that makes any statement made in the Registration Statement or related prospectus or any document incorporated or deemed to be incorporated therein by reference
untrue in any material respect or that requires the making of any changes in the Registration Statement, related prospectus or documents so that, in the case of the Registration Statement, it will not contain any untrue statement of a material fact
or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading, and that in the case of the related prospectus, it will not contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, or of the necessity to amend the Registration Statement or supplement a
related prospectus to comply with the Securities Act or any other law; and (v) the Company’s reasonable determination that a post-effective amendment to the Registration Statement would be appropriate; and the Company will promptly make available
to the Investor any such supplement or amendment to the related prospectus. The Company shall not deliver to the Investor any Advance Notice, and the Company shall not sell any Shares pursuant any Advance Notice (other than as required pursuant to
Section 2.05(c), during the continuation of any of the foregoing events in clauses (i) through (v) above, or in the event that (vi) there shall be no bid for the Common Stock on the Principal Market or Trading Market for a period of 15 consecutive
minutes at any time during the applicable Pricing Period or (vii) there shall be a “trading halt” or circuit breaker“ event with respect to the Common Stock on the Principal Market or Trading Market during the applicable Pricing Period (each of the
events described in the immediately preceding clauses (i) through (vii), inclusive, a ”Material Outside Event”).
Section 6.09 Consolidation. If an Advance Notice
has been delivered to the Investor, then the Company shall not effect any consolidation of the Company with or into, or a transfer of all or substantially all the assets of the Company to another entity before the transaction contemplated in such
Advance Notice has been closed in accordance with Section 2.06 hereof, and all Shares in connection with such Advance have been received by the Investor.
Section 6.10 Issuance of Common Stock. The
issuance and sale of Common Stock hereunder shall be made in accordance with the provisions and requirements of Section 4(a)(2) of the Securities Act or Regulation D under the Securities Act and any applicable state securities law.
Section 6.11 Market Activities. The Company will
not, directly or indirectly, take any action designed to cause or result in, or that constitutes or might reasonably be expected to constitute, the stabilization or manipulation of the price of any security of the Company under Regulation M of the
Exchange Act.
Section 6.12 Expenses. The Company, whether or
not the transactions contemplated hereunder are consummated or this Agreement is terminated, will pay all expenses incident to the performance of its obligations hereunder, including but not limited to (i) the preparation, printing and filing of
the Registration Statement and each amendment and supplement thereto, of each prospectus and of each amendment and supplement thereto; (ii) the preparation, issuance and delivery of any Shares issued pursuant to this Agreement, (iii) all fees and
disbursements of the Company’s counsel, accountants and other advisors, (iv) the qualification of the Shares under securities laws in accordance with the provisions of this Agreement, including filing fees in connection therewith, (v) the printing
and delivery of copies of any prospectus and any amendments or supplements thereto, (vi) the fees and expenses incurred in connection with the listing or qualification of the Shares for trading on the Principal Market or Trading Market, or (vii)
filing fees of the SEC and the Principal Market or Trading Market.
Section 6.13 Reserved.
Section 6.14 Advance Notice Limitation. The
Company shall not deliver an Advance Notice if a shareholder meeting or corporate action date, or the record date for any shareholder meeting or any corporate action, would fall during the period beginning two Trading Days prior to the date of
delivery of such Advance Notice and ending two Trading Days following the Closing of such Advance.
Section 6.15 Use of Proceeds. The Company will
use the proceeds from the sale of the Common Stock hereunder for working capital and other general corporate purposes. Neither the Company nor any Subsidiary will, directly or indirectly, use the proceeds of the transactions contemplated herein, or
lend, contribute, facilitate or otherwise make available such proceeds to any Person (i) to fund, either directly or indirectly, any activities or business of or with any Person that is identified on the list of Specially Designated Nationals and
Blocker Persons maintained by OFAC, or in any country or territory, that, at the time of such funding, is, or whose government is, the subject of Sanctions or Sanctions Programs, or (ii) in any other manner that will result in a violation of
Sanctions.
Section 6.16 Compliance with Laws. The Company
shall comply in all material respects with all Applicable Laws.
Section 6.17 Aggregation. From and after the date
of this Agreement, neither the Company, nor or any of its affiliates will, and the Company shall use its commercially reasonable efforts to ensure that no Person acting on their behalf will, directly or indirectly, make any offers or sales of any
security or solicit any offers to buy any security, under circumstances that would cause this offering of the Securities by the Company to the Investor to be aggregated with other offerings by the Company in a manner that would require shareholder
approval pursuant to the rules of the Principal Market or Trading Market on which any of the securities of the Company are listed or designated, unless shareholder approval is obtained before the closing of such subsequent transaction in accordance
with the rules of such Principal Market or Trading Market.
Section 6.18 Other Transactions. The Company
shall not enter into, announce or recommend to its shareholders any agreement, plan, arrangement or transaction in or of which the terms thereof would restrict, materially delay, conflict with or impair the ability or right of the Company to
perform its obligations under the Transaction Documents, including, without limitation, the obligation of the Company to deliver the Shares to the Investor in accordance with the terms of the Transaction Documents.
Section 6.19 Integration. From and after the date
of this Agreement, neither the Company, nor or any of its affiliates will, and the Company shall use its commercially reasonable efforts to ensure that no Person acting on their behalf will, directly or indirectly, make any offers or sales of any
security or solicit any offers to buy any security, under circumstances that would require registration of the offer and sale of any of the Securities under the Securities Act.
Section 6.20 Limitation on Variable Rate Transactions.
From the date that is one (1) day after closing the Business Combination Agreement until such date as the Investor shall have sold all of its Commitment Shares (the “Limitation
Date”), the Company shall be prohibited from effecting or entering into an agreement to effect any issuance by the Company of Common Stock or Common Stock Equivalents (or a combination of units thereof) involving a Variable Rate
Transaction, other than in connection with an Exempt Issuance or with the prior written consent of the Investor. The Investor shall be entitled to seek injunctive relief against the Company to preclude any such issuance, which remedy shall be in
addition to any right to collect damages, without the necessity of showing economic loss and without any bond or other security being required.
“Common Stock Equivalents” means any securities of the Company
which entitle the holder thereof to acquire at any time Common Stock, including, without limitation, Common Stock, any debt, preferred shares, rights, options, warrants or other instrument that is at any time convertible into or exercisable or
exchangeable for, or otherwise entitles the holder thereof to receive, Common Stock.
“Variable Rate Transaction” means a transaction in which the
Company (i) issues or sells any future equity or debt securities that are convertible into, exchangeable or exercisable for, or include the right to receive additional Common Stock or Common Stock Equivalents either (A) at a conversion price,
exercise price, exchange rate or other price that is based upon and/or varies with the trading prices of or quotations for the Common Stock at any time after the initial issuance of such equity or debt securities (including, without limitation,
pursuant to any “cashless exercise” provision), or (B) with a conversion, exercise or exchange price that is subject to being reset at some future date after the initial issuance of such equity or debt security or upon the occurrence of specified
or contingent events directly or indirectly related to the business of the Company or the market for the Common Stock (including, without limitation, any “full ratchet” or “weighted average” anti-dilution provisions, but not including any standard
anti-dilution protection for any reorganization, recapitalization, non-cash dividend, share split, reverse share split or other similar transaction), (ii) issues or sells any equity or debt securities, including without limitation, Common Stock or
Common Stock Equivalents, either (A) at a price that is subject to being reset at some future date after the initial issuance of such debt or equity security or upon the occurrence of specified or contingent events directly or indirectly related to
the business of the Company or the market for the Common Stock (other than standard anti-dilution protection for any reorganization, recapitalization, non-cash dividend, share split, reverse share split or other similar transaction), or (B) that is
subject to or contains any put, call, redemption, buy-back, price-reset or other similar provision or mechanism (including, without limitation, a “Black-Scholes” put or call right) that provides for the issuance of additional equity securities of
the Company or the payment of cash by the Company, or (iii) enters into any agreement, including, but not limited to, an at-the-market offering or “equity line” (that is not an Exempt Issuance) or other continuous offering or similar offering of
Common Stock or Common Stock Equivalents, whereby the Company may sell Common Stock or Common Stock Equivalents at a future determined price.
“Exempt Issuance” means the issuance of (a) Common Stock,
options, restricted stock units or other equity incentive awards to employees, officers, consultants, directors or vendors of the Company pursuant to any equity incentive plan duly adopted for such purpose, by the Board of Directors of the Company
or a majority of the members of a committee of directors established for such purpose, (b) any Shares issued to the Investor pursuant to this Agreement, (c) Common Stock, Common Stock Equivalents or other securities issued to the Investor pursuant
to any other existing or future contract, agreement or arrangement between the Company and the Investor, (d) Common Stock, Common Stock Equivalents or other securities upon the exercise, exchange or conversion of any Common Stock, Common Stock
Equivalents or other securities held by the Investor at any time, (e) any securities issued upon the exercise or exchange of or conversion of any Common Stock Equivalents issued and outstanding on the date hereof, provided that such securities or
Common Stock Equivalents referred to in this clause (e) have not been amended since the date hereof to increase the number of such securities or Common Stock underlying such securities or to decrease the exercise price, exchange price or conversion
price of such securities, (f) Common Stock Equivalents that are convertible into, exchangeable or exercisable for, or include the right to receive Common Stock at a conversion price, exercise price, exchange rate or other price (which may be below
the then current market price of the Common Stock) that is fixed at the time of initial issuance of such Common Stock Equivalents (subject only to standard anti-dilution protection for any reorganization, recapitalization, non-cash dividend, share
split, reverse share split or other similar transaction), which fixed conversion price, exercise price, exchange rate or other price shall not at any time after the initial issuance of such Common Stock Equivalent be based upon or varying with the
trading prices of or quotations for the Common Stock or subject to being reset at some future date and (g) securities issued pursuant to acquisitions, divestitures, licenses, partnerships, collaborations or strategic transactions approved by the
Board of Directors of the Company or a majority of the members of a committee of directors established for such purpose, which acquisitions, divestitures, licenses, partnerships, collaborations or strategic transactions can have a Variable Rate
Transaction component, provided that any such issuance shall only be to a Person (or to the equity holders of a Person) which is, itself or through its subsidiaries, an operating company or an asset in a business synergistic with the business of
the Company and shall provide to the Company additional benefits in addition to the investment of funds, but shall not include a transaction in which the Company is issuing securities primarily for the purpose of raising capital or to an entity
whose primary business is investing in securities. At any time that the Company enters into a Variable Rate Transaction in breach of this section, the Company shall promptly pay to Investor $200,000 in cash, as liquidated damages for such breach.
Section 6.21 DTC. The Company shall take all
action reasonably required to ensure that its Common Stock can be transferred electronically as DWAC Shares if the Transfer Agent Deliverables with respect to such Common Stock have been provided by the Investor.
Section 6.22 Reserved.
Section 6.23 Prohibition of Short Sales and Hedging
Transactions. The Investor agrees that beginning on the date of this Agreement and ending on the date of termination of this Agreement as provided in Section 11, the Investor and its agents, representatives and affiliates shall not in any
manner whatsoever enter into or effect, directly or indirectly, any (i) “short sale” (as such term is defined in Rule 200 of Regulation SHO of the Exchange Act) of the Common Stock (excluding transactions properly marked “short exempt”) or (ii)
hedging transaction, which establishes a net short position with respect to the Common Stock.
Section 6.24 Use of Name. The Company shall not,
directly or indirectly, use the names “Helena Partners”, “Helena Global Investments”, or “Helena”, or any derivations thereof, or logos associated with these names, as the case may be, in any manner or take any action that may imply any
relationship with the Investor or any of its Affiliates without the prior written consent of the Investor, provided, however, the Investor hereby consents to all lawful uses of these names in the prospectus, statement and other materials that are
required by applicable laws or pursuant to the disclosure requirements of the SEC or any state securities authority.
ARTICLE VII
CONDITIONS FOR DELIVERY OF ADVANCE NOTICE
Section 7.01 Conditions Precedent to the Right of the
Company to Deliver an Advance Notice. The right of the Company to deliver an Advance Notice and the obligations of the Investor hereunder with respect to an Advance is subject to:
| a. |
the satisfaction by the Company, on each Advance Notice Date (a “Condition
Satisfaction Date”), of each of the following conditions:
|
| b. |
Accuracy of the Company’s Representations and Warranties. The
representations and warranties of the Company in this Agreement shall be true and correct in all material respects.
|
| c. |
Registration of the Common Stock with the SEC. There is an
effective Registration Statement pursuant to which the Investor is permitted to utilize the prospectus thereunder to resell all of the Registrable Securities. The Company shall have filed with the SEC all reports, notices and other
documents required under the Exchange Act and applicable SEC regulations during the twelve-month period immediately preceding the applicable Condition Satisfaction Date.
|
| d. |
Authority. The Company shall have obtained all permits and
qualifications required by any applicable state for the offer and sale of all the Common Stock issuable pursuant to such Advance Notice, or shall have the availability of exemptions therefrom. The sale and issuance of such Common Stock
shall be legally permitted by all laws and regulations to which the Company is subject.
|
| e. |
No Material Outside Event or Material Adverse Effect. No Material
Outside Event or Material Adverse Effect shall have occurred and be continuing.
|
| f. |
Performance by the Company. The Company shall have performed,
satisfied and complied in all material respects with all covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by the Company at or prior the applicable Condition Satisfaction Date
including, without limitation, the delivery of all Common Stock issuable pursuant to all previously delivered Advance Notices and the issuance of all Commitment Fee Shares previously required to be issued to Investor (for the avoidance of
doubt, if the Company shall have performed, satisfied and complied in all material respects with all covenants, agreements and conditions required by this Agreement at the time of the applicable Condition Satisfaction Date, but did not
comply with any timing requirement set forth herein, then this condition shall be deemed satisfied unless the Investor is materially prejudiced by the failure of the Company to comply with any such timing requirement) and the issuance of
the Commitment Fee Shares free of any restrictive legends in accordance with Section 13.04 herein.
|
| g. |
No Injunction. No statute, rule, regulation, executive order,
decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed by any court or governmental authority of competent jurisdiction that prohibits or directly, materially and adversely affects any of the transactions
contemplated by this Agreement.
|
| h. |
No Suspension of Trading in or Delisting of the Common Stock. The
Common Stock is quoted for trading on the Principal Market or Trading Market and all of the Shares issuable pursuant to such Advance Notice will be listed or quoted for trading on the Principal Market or Trading Market. The Company shall
not have received any written notice that is then still pending threatening the continued quotation of the Common Stock on the Principal Market or Trading Market.
|
| i. |
Authorized. There shall be a sufficient number of authorized but
unissued and otherwise unreserved shares of Common Stock for the issuance of all of the Shares issuable pursuant to such Advance Notice.
|
| j. |
Executed Advance Notice. The representations contained in the applicable
Advance Notice shall be true and correct in all material respects as of the applicable Condition Satisfaction Date.
|
| k. |
Consecutive Advance Notices. Except with respect to the first Advance
Notice, the Pricing Period for all prior Advances has been completed.
|
| l. |
Business Combination. The Business Combination shall have occurred.
|
| m. |
No Variable Rate Transactions. Unless waived by the Investor, the Company
shall not then be party to any Variable Rate Transaction.
|
Furthermore, the Company shall not have the right to deliver an Advance Notice to the Investor if any of the following shall occur:
| n. |
the Company breaches any representation or warranty in any material respect, or breaches any covenant or other term or condition under any Transaction Document in any
material respect, and except in the case of a breach of a covenant which is reasonably curable, only if such breach continues for a period of at least three (3) consecutive Business Days;
|
| o. |
if any Person commences a proceeding against the Company pursuant to or within the meaning of any Bankruptcy Law for so long as such proceeding is not dismissed;
|
| p. |
if the Company is at any time insolvent, or, pursuant to or within the meaning of any Bankruptcy Law, (i) commences a voluntary case, (ii) consents to the entry of an
order for relief against it in an involuntary case, (iii) consents to the appointment of a Custodian of it or for all or substantially all of its property, or (iv) makes a general assignment for the benefit of its creditors or (v) the
Company is generally unable to pay its debts as the same become due;
|
| q. |
a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that (i) is for relief against the Company in an involuntary case, (ii) appoints
a Custodian of the Company or for all or substantially all of its property, or (iii) orders the liquidation of the Company or any Subsidiary for so long as such order, decree or similar action remains in effect; or
|
| r. |
if at any time the Company is not eligible or is unable to transfer its Shares to Investor, including, without limitation, electronically through DTC’s
Deposit/Withdrawal At Custodian system.
|
ARTICLE VIII
NON-DISCLOSURE OF NON-PUBLIC INFORMATION
The Company covenants and agrees that, other than as expressly required by Section 6.08 hereof, it shall refrain from disclosing, and shall cause its
officers, directors, employees and agents to refrain from disclosing, any material non-public information (as determined under the Securities Act, the Exchange Act, or the rules and regulations of the SEC) directly or indirectly to the Investor or
its affiliates, without also disseminating such information to the public, unless prior to disclosure of such information the Company identifies such information as being material non-public information and provides the Investor with the
opportunity to accept or refuse to accept such material non-public information for review. Unless specifically agreed to in writing, in no event shall the Investor have a duty of confidentiality, or be deemed to have agreed to maintain information
in confidence, with respect to the delivery of any Advance Notices. In the event of a breach of the foregoing covenant by the Company or any Person acting on its behalf (as determined in the reasonable good faith judgment of the Investor), in
addition to any other remedy provided herein or in the other Transaction Documents, the Investor shall have the right to make a public disclosure, in the form of a press release, public advertisement or otherwise, of such material, non-public
information without the prior approval by the Company; provided the Investor shall have first provided notice to the Company that it believes it has received information that constitutes material, non-public information, the Company shall have at
least twenty-four (24) hours to publicly disclose such material, non-public information prior to any such disclosure by the Investor, and the Company shall have failed to publicly disclose such material, non-public information within such time
period. The Investor shall not have any liability to the Company, any of its Subsidiaries, or any of their respective directors, officers, employees, shareholders or agents, for any such disclosure. The Company understands and confirms that the
Investor shall be relying on the foregoing covenants in effecting transactions in securities of the Company.
ARTICLE IX
NON EXCLUSIVE AGREEMENT
This Agreement and the rights awarded to the Investor hereunder are non-exclusive, and the Company may, at any time throughout the term of this Agreement
and thereafter, if permitted by the terms of the Agreement, issue and allot, or undertake to issue and allot, any shares and/or securities and/or convertible notes, bonds, debentures, options to acquire shares or other securities and/or other
facilities which may be converted into or replaced by Common Stock or other securities of the Company, and to extend, renew and/or recycle any bonds and/or debentures, and/or grant any rights with respect to its existing and/or future share
capital.
ARTICLE X
CHOICE OF LAW/JURISDICTION
This Agreement shall be governed by and interpreted in accordance with the laws of the State of New York without regard to the principles of conflict of
laws. The parties further agree that any action between them shall be heard in New York County, New York, and expressly consent to the jurisdiction and venue of the Supreme Court of New York, sitting in New York County, New York and the United
States District Court of the Southern District of New York, sitting in New York, New York, for the adjudication of any civil action asserted pursuant to this Agreement.
ARTICLE XI
ASSIGNMENT; TERMINATION
Section 11.01 Assignment. Neither this Agreement
nor any rights or obligations of the parties hereto may be assigned to any other Person.
Section 11.02 Termination.
| a. |
Unless earlier terminated as provided hereunder, this Agreement shall terminate automatically on the earliest of (i) the first day of the month next
following the 36-month anniversary of the date hereof or (ii) the date on which the Investor shall have made payment of Advances pursuant to this Agreement for Common Stock equal to the Commitment Amount.
|
| b. |
The Company may terminate this Agreement effective upon five Trading Days’ prior written notice to the Investor; provided that (i) there are no
outstanding Advance Notices, the Common Stock in respect of which has yet to be issued, and (ii) the Company has paid all amounts owed to the Investor pursuant to this Agreement including, without limitation, all Commitment Fee Shares. This
Agreement may be terminated at any time by the mutual written consent of the parties, effective as of the date of such mutual written consent unless otherwise provided in such written consent.
|
| c. |
Nothing in this Section 11.02 shall be deemed to release the Company or the Investor from any liability for any breach under this Agreement, or to
impair the rights of the Company and the Investor to compel specific performance by the other party of its obligations under this Agreement. The indemnification provisions contained in Article V shall survive termination hereunder.
|
ARTICLE XII
NOTICES
Other than with respect to Advance Notices, which must be in writing and will be deemed delivered on the day set forth in Section 2.02 in accordance with
Exhibit C, any notices, consents, waivers, or other communications required or permitted to be given under the terms of this Agreement must be in writing and
will be deemed to have been delivered (i) upon receipt, when delivered personally; (ii) upon receipt, when sent by facsimile or e-mail if sent on a Trading Day, or, if not sent on a Trading Day, on the immediately following Trading Day; (iii) 5
days after being sent by U.S. certified mail, return receipt requested, (iv) 1 day after deposit with a nationally recognized overnight delivery service, in each case properly addressed to the party to receive the same. The addresses and facsimile
numbers for such communications (except for Advance Notices which shall be delivered in accordance with Exhibit A hereof) shall be:
|
If to the Company, to:
|
Focus Impact Acquisition Corp.
250 Park Avenue Ste 911
New York, New York 10177
Attn: Carl Stanton
E-mail: cstanton@focus-impact.com
|
|
|
With a Copy (which shall not constitute notice or delivery of process) to:
|
Kirkland & Ellis LLP
601 Lexington Avenue
New York, New York 10022
Attn: Peter Seligson, P.C.
Email: Peter.seligson@kirkland.com
|
|
|
If to the Investor(s):
|
Helena Global Investment Opportunities 1 Ltd.
71 Fort Street
Third Floor
Grand Cayman
Cayman Islands
CY1-111
Attention: Jeremy Weech
Telephone: 242-819-5440
Email: jeremy@helenapartners.com
|
|
|
With a Copy (which shall not constitute notice or delivery of process) to:
|
Lucosky Brookman LLP
101 Wood Avenue South
Fifth Floor
Woodbridge, New Jersey 08830
Attention: Rodrigo Sanchez, Esq.
Telephone: (732) 395-4417
Email: rsanchez@lucbro.com
|
|
Either may change its information contained in this Article XII by delivering notice to the other party as set forth herein.
ARTICLE XIII
MISCELLANEOUS
Section 13.01 Counterparts. This Agreement may be
executed in identical counterparts, both which shall be considered one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other party. Facsimile or other electronically scanned
and delivered signatures, including by e-mail attachment, shall be deemed originals for all purposes of this Agreement.
Section 13.02 Entire Agreement; Amendments. This
Agreement supersedes all other prior oral or written agreements between the Investor, the Company, their respective affiliates and persons acting on their behalf with respect to the matters discussed herein, and this Agreement contains the entire
understanding of the parties with respect to the matters covered herein and, except as specifically set forth herein, neither the Company nor the Investor makes any representation, warranty, covenant or undertaking with respect to such matters. No
provision of this Agreement may be waived or amended other than by an instrument in writing signed by the parties to this Agreement. The provisions of the existing confidentiality agreement between the Investor and the Company shall remain in
force, except that all provisions therein dealing with the treatment of material non-public information are superseded by this Agreement.
Section 13.03 Reporting Entity for the Common Stock.
The reporting entity relied upon for the determination of the trading price or trading volume of the Common Stock on any given Trading Day for the purposes of this Agreement shall be Bloomberg, L.P. or any successor thereto. The written mutual
consent of the Investor and the Company shall be required to employ any other reporting entity.
Section 13.04 Due Diligence Fee; Commitment Fee Shares.
| a. |
Each of the parties shall pay its own fees and expenses (including the fees of any attorneys, accountants, appraisers or others engaged by such party)
in connection with this Agreement and the transactions contemplated hereby, except that the Company shall be responsible for Investor’s customary due diligence and legal fees (and will provide proof of any retainer payments and engagement
letters), subject to an aggregate maximum amount of $40,000.
|
| b. |
In consideration for the Investor’s execution and delivery of this Agreement, the Company shall issue, cause to be issued or cause to be transferred to the Investor,
as a commitment fee, shares of Common Stock (the “Commitment Fee Shares”). In respect of the foregoing, (i) on the date hereof the Company shall
cause to be issued or cause to be transferred to the Investor 515,889 shares of Common Stock, which as of the date of the Business Combination may be sold by the Investor without restriction in compliance with Applicable Laws, and (ii)
promptly (but in no event later than one (1) Trading Day) after the effectiveness of the Registration Statement on which the Commitment Fee Shares are registered, the Company shall issue an amount of shares of Common Stock equal to
$125,000.00 divided by higher (i) the lowest one day VWAP during the five (5) Trading Days immediately preceding the effectiveness date of such Registration Statement, and (ii) $0.75.
|
Section 13.05 Brokerage. Except as set forth on Schedule 13.05, each of the parties hereto represents that it has had no dealings in connection with this transaction with any finder or broker who will demand
payment of any fee or commission from the other party. The Company on the one hand, and the Investor, on the other hand, agree to indemnify the other against and hold the other harmless from any and all liabilities to any person claiming brokerage
commissions or finder’s fees on account of services purported to have been rendered on behalf of the indemnifying party in connection with this Agreement or the transactions contemplated hereby.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the parties hereto have caused this Purchase Agreement to be executed by the undersigned,
thereunto duly authorized, as of the date first set forth above.
|
COMPANY:
|
|||
|
FOCUS IMPACT ACQUISITION CORP.
|
|||
|
By:
|
/s/ Carl Stanton
|
||
|
Name:
|
Carl Stanton
|
||
|
Title:
|
Chief Executive Officer
|
||
|
SPONSOR:
|
|||
|
FOCUS IMPACT SPONSOR, LLC
|
|||
|
By:
|
/s/ Carl Stanton
|
||
|
Name:
|
Carl Stanton
|
||
|
Title:
|
Chief Executive Officer
|
||
|
INVESTOR:
|
|||
|
HELENA GLOBAL INVESTMENT OPPORTUNITIES I LTD.
|
|||
|
By:
|
/s/ Jeremy Weech |
||
|
Name:
|
Jeremy Weech |
||
|
Title:
|
CEO |
||
EXHIBIT A
ADVANCE NOTICE
FOCUS IMPACT ACQUISITION CORP.
Dated: ______________ Advance Notice Number: ____
The undersigned, _______________________, hereby certifies, with respect to the sale of the Common Stock of FOCUS IMPACT ACQUISITION CORP. (the “Company”) issuable in connection with this Advance Notice, delivered pursuant to that certain Purchase Agreement, dated as of September __, 2024 (the “Agreement”), as follows:
| 1 |
The undersigned is the duly elected ______________ of the Company.
|
| 2 |
There are no fundamental changes to the information set forth in the Registration Statement which would require the Company to file a post-effective
amendment to the Registration Statement.
|
| 3 |
All conditions to the delivery of this Advance Notice are satisfied as of the date hereof.
|
| 4 |
The amount of shares of Common Stock issued in respect of such Advance is:
|
| 5 |
The number of shares of Common Stock of the Company issued and outstanding as of the date hereof is ___________.
|
| 6 |
The Pricing Period shall be three (3) Trading Days.
|
The undersigned has executed this Advance Notice as of the date first set forth above.
|
FOCUS IMPACT ACQUISITION CORP.
|
||
|
By:
|
||
|
Name:
|
||
|
Title:
|
||
EXHIBIT B
FORM OF SETTLEMENT DOCUMENT
VIA EMAIL
FOCUS IMPACT ACQUISITION CORP.
Attn:
Email:
Subject:
Below please find the settlement information with respect to the Advance Notice Date of:
| 1. |
Amount of Advance requested in the Advance Notice
|
| 2. |
Adjusted Advance (after taking into account any adjustments pursuant to Section 2.04):
|
| 3. |
Lowest Intraday Sale Price during Pricing Period:
|
| 3. |
Purchase Price:
|
| 8. |
Number of Shares issued to Investor:
|
|
Sincerely,
|
|||
|
Helena Global Investment Opportunities 1 Ltd.
|
|||
|
By:
|
|||
|
Name:
|
|||
|
Title:
|
|||
|
Agreed and Approved:
|
||
|
FOCUS IMPACT ACQUISITION CORP.
|
||
|
By:
|
||
|
Name:
|
||
|
Title:
|
||
SCHEDULE 1
Authorized Representatives
The following individuals may execute Advance Notices:
| 1. |
|
| 2. |
|
EXHIBIT C
VIA EMAIL
Email: jeremy@helenapartners.com
Subject: ELOC: Focus Impact Acquisition Corp.
Advance Notice
Below please find the Advance Notice Date of:
| 1. |
Amount of Advance Shares:
|
| 2. |
Time of Advance:
|
Exhibit 10.7
Execution Version
WAIVER OF CLOSING CONDITIONS
October 29, 2024
Reference is hereby made to that certain Business Combination Agreement, dated as of September 12, 2023, as amended by Amendment No. 1 to Business Combination Agreement, dated as of May 1, 2024, and Amendment No. 2 to Business Combination Agreement, dated as of August 10, 2024 (collectively,
the “Agreement”), by and between Focus Impact Acquisition Corp., a Delaware corporation (“SPAC”), Focus
Impact Amalco Sub Ltd., a company existing under the Laws of the Province of British Columbia (“Amalco Sub”), and DevvStream Holdings Inc., a company existing under the Laws of
the Province of British Columbia (the “Company”). Capitalized terms used in this Waiver of Closing Conditions (this “Waiver”)
that are not otherwise defined herein shall have the respective meanings set forth in the Agreement.
The obligations of SPAC, Amalco Sub and the Company to consummate the transactions contemplated by the Agreement
are subject to the satisfaction (or waiver by the applicable party) of certain conditions set forth in Article VIII of the Agreement, including, among other things, that (i) the representations and warranties of the Company and the SPAC shall be true
and correct in certain respects as of certain dates, (ii) the Company and the SPAC shall have performed in all material respects all of its obligations and complied in all material respects with all of its agreements and covenants under the
Agreement, (iii) no Company Material Adverse Effect shall have occurred since the date of the Agreement which is continuing and uncured, (iv) that each of the Key Employees shall be actively employed (or, solely in the case of David Oliver, actively
engaged as an individual independent contractor and anticipated to be converted to employee status) with the Company as of the Closing Date and (v) SPAC shall have received from the Company duly executed counterparts of all Key Employment Agreements.
For valuable consideration, the receipt of which is hereby acknowledged, and pursuant to Section 11.8 of the
Agreement, the parties to the Agreement hereby agree that the following shall not cause a failure of any condition set forth in Article VIII, shall not be considered a Company Material Adverse Effect: (i) election by the Company to halt trading of
its stock on Cboe Canada, (ii) termination by David Oliver of any agreements by and between him and the Company, (iii) termination by David Oliver of his status as an individual independent contractor of the Company, (iv) failure by David Oliver to
deliver an employment agreement with New PubCo, (v) any Action or Proceeding threatened or brought against the Company by David Oliver or his Affiliates, and (vi) any changes or effects directly or indirectly attributable to, resulting from, relating
to or arising out of the foregoing clauses (i) – (v).
Except to the extent set forth herein, the Agreement is in all respects ratified and confirmed and remains in full
force and effect. This Waiver shall not constitute a waiver of (i) Article VIII except to the extent expressly referenced herein or (ii) any other provision of the Agreement or Ancillary Agreement. This Waiver may be executed in two or more
counterparts, each of which when executed and delivered shall be deemed an original and all of which, taken together, shall constitute one and the same agreement. This letter may be executed and delivered by facsimile or electronic mail of a “.pdf”
data file, which shall be considered legally binding for all purposes.
[Signature Page Follows]
IN WITNESS WHEREOF, the undersigned have executed this Waiver as of the date first written above.
|
|
FOCUS IMPACT ACQUISITION CORP.
|
|
|
|
|
|
| By: |
/s/ Carl Stanton |
|
| Name: |
Carl Stanton |
|
| Title: |
Chief Executive Officer |
|
| FOCUS IMPACT AMALCO SUB LTD. | ||
| By: |
/s/ Carl Stanton |
|
| Name: |
Carl Stanton |
|
|
Title:
|
Chief Executive Officer |
|
|
DEVVSTREAM HOLDINGS INC.
|
||
| By: |
/s/ Sunny Trinh |
|
| Name: |
Sunny Trinh |
|
|
|
Title: |
Chief Executive Officer |
[Signature Page to Waiver of Closing Condition]
Exhibit 99.1
DevvStream Holdings Inc.
Unaudited Pro Forma Condensed Combined Balance Sheet
As of June 30, 2024
(in thousands)
|
1
|
2
|
3
|
4
|
5
|
6
|
7
|
8
|
9
|
||||||||||||||||||||||||||||||||||||
|
Formula
|
Based on DevvStream Shares * DESG Price
|
Based on DevvStream Shares * DESG Price
|
Accrual Relieved from vendor equitization agreements
|
Formula
|
||||||||||||||||||||||||||||||||||||||||
|
|
Focus Impact Acquisition Corp. (Historical)
|
DevvStream Holdings Inc. (Historical)
|
Transaction Accounting Adjustments
|
Pro Forma Combined
|
Carbon Credit Investments
|
Project Monroe Investment
|
Equitized Transaction Expenses
|
Non-Redeemed SPAC Shares
|
PIPE Equity Investment
|
Additional Expenses not yet accrued
|
Pro Forma Shareholder's Equity upon Listing
|
|||||||||||||||||||||||||||||||||
|
Assets
|
||||||||||||||||||||||||||||||||||||||||||||
|
Current assets:
|
||||||||||||||||||||||||||||||||||||||||||||
|
Cash
|
$
|
7
|
$
|
21
|
$
|
(28
|
)
|
$
|
-
|
$
|
741
|
$
|
2,250
|
$
|
2,991
|
|||||||||||||||||||||||||||||
|
Restricted Cash
|
26
|
-
|
-
|
26
|
26
|
|||||||||||||||||||||||||||||||||||||||
|
Income tax receivable
|
212
|
-
|
-
|
212
|
212
|
|||||||||||||||||||||||||||||||||||||||
|
GST receivable
|
-
|
90
|
-
|
90
|
90
|
|||||||||||||||||||||||||||||||||||||||
|
Prepaid expenses
|
33
|
33
|
-
|
66
|
66
|
|||||||||||||||||||||||||||||||||||||||
|
Total current assets
|
278
|
144
|
(28
|
)
|
394
|
-
|
-
|
-
|
741
|
2,250
|
-
|
3,385
|
||||||||||||||||||||||||||||||||
|
Equipment
|
-
|
1
|
-
|
1
|
1
|
|||||||||||||||||||||||||||||||||||||||
|
Carbon credit assets and projects
|
-
|
13,000
|
8,000
|
21,000
|
||||||||||||||||||||||||||||||||||||||||
|
Prepaid expenses, non-current
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||||||||||||||||||||
|
Investment held in Trust Account
|
19,069
|
-
|
(19,069
|
)
|
-
|
-
|
||||||||||||||||||||||||||||||||||||||
|
Total assets
|
$
|
19,347
|
$
|
145
|
$
|
(19,097
|
)
|
$
|
395
|
$
|
13,000
|
$
|
8,000
|
$
|
0
|
$
|
741
|
$
|
2,250
|
$
|
0
|
$
|
24,386
|
|||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||||||||||
|
Liabilities and Shareholders' Equity
|
||||||||||||||||||||||||||||||||||||||||||||
|
Current liabilities:
|
||||||||||||||||||||||||||||||||||||||||||||
|
Accounts payable and accrued liabilities
|
$
|
6,217
|
$
|
5,785
|
$
|
3,043
|
$
|
15,045
|
$
|
(15,003
|
)
|
$
|
4,930 |
$
|
4,972
|
|||||||||||||||||||||||||||||
|
Convertible debenture
|
-
|
1,003
|
3,300
|
4,303
|
40
|
4,343
|
||||||||||||||||||||||||||||||||||||||
|
Derivative liability
|
-
|
53
|
-
|
53
|
53
|
|||||||||||||||||||||||||||||||||||||||
|
Due to related party
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||||||||||||||||||||
|
Due to Sponsor
|
300
|
-
|
(300
|
)
|
-
|
-
|
||||||||||||||||||||||||||||||||||||||
|
Franchise taxes payable
|
20
|
-
|
-
|
20
|
20
|
|||||||||||||||||||||||||||||||||||||||
|
Income taxes payable
|
|
-
|
-
|
- |
-
|
|||||||||||||||||||||||||||||||||||||||
|
Excise tax payable
|
2,235
|
-
|
192
|
2,427
|
2,427
|
|||||||||||||||||||||||||||||||||||||||
|
Redemption payable
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||||||||||||||||||||
|
Promissory note - related party
|
2,675
|
-
|
(2,675
|
)
|
-
|
-
|
||||||||||||||||||||||||||||||||||||||
|
Total current liabilities
|
11,447
|
6,841
|
3,560
|
21,848
|
-
|
-
|
(15,003
|
)
|
-
|
-
|
4,970
|
11,815
|
||||||||||||||||||||||||||||||||
|
Warrant liability
|
908
|
-
|
43
|
951
|
951
|
|||||||||||||||||||||||||||||||||||||||
|
Marketing agreement
|
150
|
-
|
(150
|
)
|
-
|
-
|
||||||||||||||||||||||||||||||||||||||
|
Deferred underwriting commissions
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||||||||||||||||||||
|
Note Payable
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||||||||||||||||||||
|
Total liabilities
|
12,505
|
6,841
|
3,453
|
22,799
|
-
|
-
|
(15,003
|
)
|
-
|
-
|
4,970
|
12,766
|
||||||||||||||||||||||||||||||||
|
Commitments and contingencies:
|
||||||||||||||||||||||||||||||||||||||||||||
|
Class A common stock subject to possible redemption
|
19,288
|
-
|
(19,288
|
)
|
-
|
-
|
||||||||||||||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||||||||||
|
Equity:
|
||||||||||||||||||||||||||||||||||||||||||||
|
Other Equity
|
(12,446
|
)
|
(6,696
|
)
|
$
|
(3,262
|
)
|
(22,404
|
)
|
13,000
|
8,000
|
15,003
|
$
|
741
|
$
|
2,250
|
(4,970
|
)
|
11,620
|
|||||||||||||||||||||||||
|
Total shareholders' equity
|
(12,446
|
)
|
(6,696
|
)
|
(3,262
|
)
|
(22,404
|
)
|
13,000
|
8,000
|
15,003
|
741
|
2,250
|
(4,970
|
)
|
11,620
|
||||||||||||||||||||||||||||
|
Total liabilities and shareholders' equity
|
$
|
19,347
|
$
|
145
|
$
|
(19,097
|
)
|
$
|
395
|
$
|
13,000
|
$
|
8,000
|
$
|
0
|
$
|
741
|
$
|
2,250
|
$
|
0
|
$
|
24,386
|
|||||||||||||||||||||
1 - Includes identical assumptions and adjustments to the maximum redemptions scenario of the effective S-4 filed in July 2024 - except for changes in balance sheet accounts (i.e., cash, sponsor amount available to be
paid, historical book equity)
2- Sum of historical results of each of FIAC as of 6/30/2024 and DevvStream's preliminary, unaudited, unreviewed trial balance as of July 31, 2024 and pro forma adjustments as previously disclosed
3 - Carbon Credit investment - based on the presumption that the fair value of DevvStream's' stock is the most reliable measure of value to measure DevvStream's cost for the asset acquisition, resulting in a value of
~$13.0M. If this were a business combination, or the fair value of the underlying assets were more reliably determinable, the results may differ materially.
4 - Monroe Sequestration Partners LLC Investment - Similar to the adjustment above, DevvStream's' stock is presumed to be the most reliable measure of value to measure DevvStream's cost for the asset acquisition,
resulting in a value of $8.0M. If this were a business combination, or the fair value of the underlying assets were more reliably determinable, the results may differ materially.
5 - Certain of FIAC and DevvStream's vendors have agreed to equitize all or a portion of their expenses in exchange for Sponsor Shares to be received prior to closing and then exchanged into New PubCo shares in
accordance with the Business Combination Agreement. The result is the removal of these liabilities, offset by charges to equity (either paid in capital or accumulated deficit/income)
6 - Certain investors have agreed to repurchase redeemed shares at a price of $11.19 upon closing, effectively reversing the impacts of those redemptions, providing cash to the Company
7 - The Company has secured emergence financing of $2.25M, which is reflected as an equity investment
8 - Certain Transaction costs have not yet been accrued. Of the total estimated costs, a large portion has agreed to be equitized. The remaining balance, reflects the total costs estimated, less any equitizations. This
also reflects additional sponsor admin payable charges, less the amounts paid with available cash at closing as part of the pro forma adjustments from 1) above. While this estimate is based on management's best view as of the date hereof, actual
transaction costs, or other liabilities of either entity that have not yet been recorded may be materially different.
9 - Other Limitations:
Equity impacts do not split any impact/separate recognition of Common Stock, Par Value, Gain or Loss or other classification considerations.
Final or draft agreements of the contemplated transactions have not been reviewed in detail for accounting implications, the resulting classification or measurement could be materially different.
Underlying share counts, financial statement footnotes, and events subsequent to the latest balance sheet have not been incorporated unless otherwise noted herein, these impacts, including the share counts, share
conversions or share prices, could have a materially different result.
An "Other Assets" account has been established to reflect the anticipated accounting for the investments in the carbon credits and the Project Monroe investment. Which are assumed to be asset acquisitions, for which
DevvStream stock is the most reliable measure of value
DEVVSTREAM HOLDINGS INC. PRO FORMA COMBINED INCOME STATEMENT
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
For the First Six Months of 2024 (Expressed in USD)
As of 10/22/24
|
Devstream
Holdings Inc.
$
|
Focus Impact
Acquisition
Corp.
$
|
Pro-forma
Adjustments
$
|
Notes
A
|
Pro-forma
Results
|
|
|
Operating expenses
|
|||||
|
Advertising and promotion
|
49,666
|
-
|
-
|
49,666
|
|
|
Depreciation
|
450
|
-
|
-
|
450
|
|
|
General and administrative
|
217,695
|
608,177
|
(368,177)
|
B
|
457,695
|
|
Professional fees
|
1,797,601
|
2,084,716
|
(3,340,634)
|
C
|
541,683
|
|
Salaries and wages
|
400,940
|
-
|
-
|
400,940
|
|
|
Share-based compensation
|
262,213
|
-
|
-
|
262,213
|
|
|
Travel expenses
|
|||||
|
(2,728,565)
|
(2,692,893)
|
3,708,811
|
(1,712,647)
|
||
|
Other income
|
|||||
|
Foreign exchange gain/loss
|
(89,311)
|
-
|
-
|
(89,311)
|
|
|
Interest expense
|
(6,503)
|
-
|
-
|
(6,503)
|
|
|
Interest income
|
-
|
471,525
|
(471,525)
|
D
|
-
|
|
Accretion expense
|
(20,474)
|
-
|
-
|
(20,474)
|
|
|
Change in fair value of warrant liability
|
-
|
(454,000)
|
(454,000)
|
||
|
Unrealized gain (loss)
|
(49,364)
|
-
|
-
|
(49,364)
|
|
|
Tax expense
|
-
|
(176,530)
|
176,530
|
D
|
-
|
|
Net loss
|
(2,894,217)
|
(2,851,898)
|
3,413,816
|
(2,332,299)
|
|
|
Foreign currency translation
|
121,221
|
-
|
121,221
|
||
|
Comprehensive loss
|
(2,772,996)
|
(2,851,898)
|
3,413,816
|
(2,211,078)
|
|
|
Weighted average number of shares outstanding
|
34,175,629
|
7,467,578
|
E
|
17,417,612
|
|
|
Loss per share
|
-0.08
|
-0.38
|
-0.13
|
Notes:
A: These fiancials are based on management's best estimates as of the date hereof and are pro forma for the combination of Devvstream and FIAC. These fiancials and related adjustments have not been audited nor
reviewed by the company's external advisers and the company makes no representations as to their accuracy or applicability. The combined results are for their first six fiscal months of 2024 for both companies beginning February 1 and ending July
31, 2024 in the case of Devvstream Holdings and beginning January 1 and ending June 30, 2024 for in the case of FIAC.
B: Adjustment reflects the elimnation of general and administrative expenses of FIAC not to be incurred following the transaciton and the addition of general and administrative expenses related to the listing,
franchise taxes and other miscellaneous items, which are exepcted to continue to be incurred post transaction closing.
C: Adjustment reflects the elimination of professional fees in conjunction with the transaction and FIAC espenses not expected to reoccur post-tranaction plus the addition of legal, audit and investor relations fees
expected to be incurred on an ongoing basis following the transaction.
D: Adjsutment reflects the elimination of interest income on the cash balances in Trust and the corresponding elimination of income taxes on such interst income.
E: Weighted average number of shares outstanding reflects pro forma number of shares estimated to be outstanding following the transaction as of most recent exchange ratio as of the date of this analysis.